Nine Media has announced to newsagents price increases for its newspapers effective from August 26. At 10% (or less) gross profit per title, we need to wonder about the value of stocking these products. They are loss making in all but the newsagencies doing the biggest sales. We have to sell 10 copies of a paper to cover the cost of one being stolen and, yes, newspaper theft in newsagencies is a problem.
Years ago we would make 25% of the cover price. Today, as this table shows, we are at 10% or less.
In today’s cashless world, the cost is more with EFTPOS fees ranging from 1% to 1.5% of purchase price.
With 80% and more newspaper purchases for a newspaper alone, the basket value of the category is not there for us. And to publisher reps who may say that’s it’s on newsagents to leverage newspaper traffic, studies have shown that getting destination newspaper shoppers to purchase something else in the visit is next to impossible.
Just as newspaper publishers are managing their businesses for the ultimate exit from the print medium, so much newsagents. Smart newsagents have been working toward this inevitable day for many years.
At what point does it no longer become viable for a newsagent to carry newspapers?
And is a newsagent that doesn’t carry newspapers still a newsagent?
Jonathan there are ‘newsagents’ today who do not sell newspapers, even more who do not sell magazines. Shoppers are drawn more to what a business sells than the shingle under which or the channel in which it identifies itself.