Author: Mark Fletcher

From my perspective, the convenience retail sector, especially when it comes to tobacco and associated products, is a competitive and challenging landscape for Australian newsagencies. This market is dominated by large, national and multinational businesses, possessing substantial financial resources, advantageous supplier relationships, and the competitive edge of streamlined, centralised decision-making.

For an independently owned, local newsagency attempting to compete in the convenience space, particularly with tobacco as a key driver, the challenge is significant. It’s not insurmountable, but it certainly presents a formidable undertaking. The regulatory environment surrounding tobacco is constantly evolving, adding further layers of complexity and cost. Add to that the risk of arson and other attacks and you have a challenging business.

The primary selling point of any convenience store is, naturally, convenience and location. The secondary proposition is value, pricing. However, with the increasing standardisation of convenience offerings, particularly regarding tobacco products, these points of differentiation are eroding.

Recent acquisitions intensify competition in this space.

A newsagency attempting to focus on convenience while situated near a nationally branded convenience store, or a fuel-based convenience offering, will invariably face difficulties. The brand recognition of these national chains carries considerable weight, as consumers have established expectations. Furthermore, the reliance on tobacco sales ties the business to a product with diminishing social acceptance and increasing regulatory risk.

While an independent retailer might attempt to compete on price with a national convenience store, they will lack the capacity to negotiate equivalent purchasing price points, nor will they possess the resources to subsidise prices. They will rarely have the ability to market as effectively as a national chain, particularly with in-store price messaging, especially regarding regulated products like tobacco.

A local shop operating as a standalone convenience business, heavily reliant on tobacco, feels like an increasingly precarious battle.

I see more value in pursuing alternative retail segments, where product differentiation is more achievable, consumer enthusiasm is higher, and repeat business is more assured. In these sectors, margin dollars per transaction are typically higher, competition is less intense, and customers are more likely to travel by choice to patronise your business. Diversification away from tobacco reduces the business’s exposure to regulatory changes and declining consumer demand.

An Australian newsagency, regardless of location, can specialise in higher-margin product categories. While this requires research and investment, the payoff can be considerable and many have already discovered. The outcome can be a more manageable business, requiring less reliance on high foot traffic and a less critical location, while also reducing the reliance on tobacco sales.

This approach, to me, appears more strategic, sustainable, and valuable in terms of overall business worth. It results in a business that is more readily marketed externally and more difficult to replicate, while also being more resilient to shifts in consumer preferences and regulatory landscapes.

Niche specialty retail is less likely to attract competition from national or multinational retailers. The primary competition is more likely to be online, and while this certainly presents challenges, online competitors are more easily analysed and understood.

If your newsagency is successful with a convenience model, congratulations. If you play in the convenience space are re not successful, get out now. There are plenty of us in the newsagency channel who can help.

Footnote: the majority of UK newsagents focussed on convenience years ago as the sales of print media products started to decline. While some have done okay, the majority have not been able to compete with the national retailers who dominate convenience retail there.

I and some colleagues from newsXpress are back from another buying trip to Bali. Thanks to a new local agent relationship we have sources an even better range oif suppliers to visit with and consider.

This trip was unlike any other in that we got to meet with local makers and manufacturers who supply specialty retail businesses in the US and Europe. We were able to benefit from the work put in by these other retailers in honing in on quality makers.

By switching to a better established and full time local agent we have significantly expanded the range of products we can consider, thereby enabling an expansion of our local Aussie businesses.

In organising this buying trip, newsXpress does not commercially insert itself into the supply relationship. Rather, I encourage the participating retailers to buy direct from makers using the local agent. This maximises the margin for retailers as well as providing more control to them as to shipping timing.

It is interesting seeing Aussie realise that what is available in Bali in terms of range and product quality is nothing like they expected. We didn’t look at all at cheap shit  you may find in a discount variety store. Rather, our focus was on high end ceramics, homewares and gifts you’d find in David Jones and similar, but without the price tag of such shops.

As we traveled to different suppliers we found the makers of some products we see in Australia from name brand furniture and homewares businesses. These name brand designers use Bali production for their products. The quality is excellent with a good attention to detail.

We also got to meet with makers who supply some local Aussie wholesalers to newsagents and similar businesses. It was fun calculating the wholesaler margin on some items.

Trips like this are also useful to take us outside of what is traditionally considered for our businesses, even those newsagencies that have transformed away from what has been traditional. We get to challenge ourselves as to what we could do rather than staying stuck in a world of what customers expect us to do.

I’ve been thinking a lot about how we consume media these days, and it’s really changing the retail landscape. Gone are the days when we’d all sit down in front of the YV at a set time, or listen to the radio at a specific hour. Okay so the TV networks thing the nightly news is still a thing when in reality in terms of accessing news it is not a thing or at least not as much of a thing it used to be. Now, we’re all about streaming, podcasts, and YouTube, grabbing our content whenever it suits us.

And it got me thinking, if we’re not tied to appointment-based media anymore, why should we be tied to appointment-based shopping? You know, those traditional brick-and-mortar stores with their fixed opening hours. Like newsagents. It just doesn’t make sense when considering the future.

Too many retailers are missing out on a huge chunk of potential customers by not having a strong online presence. People want the flexibility and convenience of shopping whenever they want, from wherever they are. If you’re not online, you’re basically telling those customers, “Sorry, we’re closed.”

Having a website isn’t just a “nice to have” anymore; it’s essential. It’s about meeting your customers where they are, which is increasingly online. If you want to stay competitive in today’s market, you’ve got to offer that flexibility. It’s all about convenience.

This has all been on my mind for a while. It’s one reason I captured some more thoughts here:

Physical retail is not dead. It is changing though. What I am writing about here is, I hope, food for thought.

There are many of is who support newsagents and own newsagency businesses who can speak to these changes and help you hitch a ride on the changes occurring.

Too many newsagents leave anything to do with online for their business to others to do. Take Facebook posts. Letting someone else do them for you is ridiculous. This results in boring fodder. It see it on many newsagency Facebook pages – posts created in an office far from your shop and with little consideration of your shop. Stop it. It’s a waste of time and money.

Please, consider your online strategy. Are you truly catering to the modern consumer, the one who expects on-demand access to everything? If not, it’s time to make some changes. Embrace the digital age, build a strong online presence, and give your customers the flexibility they crave. You’ll be glad you did, and so will they.

A big thank you to all the newsagents across diverse locations (rural, regional, and suburban) who participated in this benchmark study by providing their sales data. Your contribution, facilitated by the Tower Systems newsagency software, is invaluable.

This year’s analysis reveals a stark and growing divide between traditional and transformed newsagencies. The benchmark sales datasets paint a clear picture: traditional businesses are struggling, facing declining revenue and an increased risk of closure. Conversely, transformed and transforming businesses are demonstrating profitability and higher sale values.

The key differentiator lies in diversification. Transformed newsagencies have successfully expanded beyond the traditional “newsagency” model, often with minimal impact on customer perception. In fact, customer purchasing habits indicate strong support for these evolving businesses.

Key Performance Indicators: A Comparative Snapshot

My newsXpress newsagency marketing group has launched an exclusive product range opportunity to its members valued at more than $10 million to retailers in the group.

Bring supported by professional public relations and marketing teams with a focus on national, state and regional TV, radio and print media, this newsXpress exclusive is set to drive traffic to newsXpress stores listed in all the marketing.

To be in-store in a few months, newsXpress members have been fully briefed on the products and they are making arrangements to support the opportunity with value-add products to maximise the revenue from the program.

From what I can tell, this is the largest exclusive opportunity for newsagents in a marketing group in the history our channel. It has come about following over a year of work by the newsXpress team working the key stakeholders.

This program will attract new shoppers to the participating newsXpress businesses and the websites they operate.