Well done HSH Business Sales in Cheshire, United Kingdom.
LOTTERY/NEWSAGENTS: ASHTON-UNDER-LYNE: located within Ashton Market Hall, surrounded by a large number of independent traders, close to the entrance, facing a large sandwich shop, takings £7,500 per week plus £260 lottery commission per week, GP 35%, rent £166 per week pic.twitter.com/vi7t2C5yVl
— HSH Business Sales (@hshbusiness) September 6, 2023
The youth team supporting Dr Monique Ryan in Kooyong released this TikTok that comments on the plastering of the Kooyong electorate with posters, billboards and walking billboards supporting Josh Frydenberg.
@youth4mon Can’t escape it 🙄😨 #youth4mon #election2022 #auspol #fyp #kooyong #foryoupage #mon4kooyong ♬ Josh – Peach PRC
What’s this got to do with newsagency? Okay, TikTok is an interesting platform through which you can reach a demographic that is likely not shopping your shop. The team behind this and other video is reaching out to an audience important to the electron campaign. It’s also an audience we need to better connect with.
For perspective, check out this “traditional newsagents” for sale for £74,950+sav. The ad caught my attention as it really is a traditional UK newsagent business, away from the centre of town and still with a range of magazines and, by the looks of the photos, an opportunity for cards. This is the kind of newsagency business in the UK I’d buy if I was in the market as the base is flexible enough for potential growth through change. Take a moment and scroll through the photos on the ad. It is interesting to compare with similar high street newsagencies in Australia.
One of the most common questions I get privately from people who find me through this blog is what should I ask for when looking at buying a newsagency?
The question itself, when asked, indicates how green a prospective purchaser is when it comes to purchasing a business.
Here is a list of data I suggest newsagency business purchasers access from the vendor or their representative:
This is good basic information that will enable any purchaser to undertake reasonable assessment of a business.
A good business will shine through the numbers just as a business with upside achievable by new owners will shine through.
My advice to newsagents looking to sell who are concerned about this list is: think about it now and focus on your business so the data I have listed looks good.
Every day you make decisions in your business that impact many of the data points listed.
This is why I say every day is your pay day. Run a smart, lean and profit focused business and you will have a good pay day today and a good one when you come to sell.
The most appealing businesses are those that are easier to run and are making money.
The time to focus on that is now.
Sure a purchaser can turn a business around. They should get the rewards if they are expected to do that for your business.
The price you can sell your business for will be based on what it is making now.
Getting the data ready for the sale of the business could, of itself, help you improve how you run your business.
newsXpress Beers Port Lincoln in South Australia is a terrific business. Innovative, loved by customers, and respected in the local community.
The business is now for sale. Rather than hiding this as many newsagents do, they have a sign in the window – inviting expressions of interest from locals.
I mention it here today in case the idea of a sea change appeals. Port Lincoln is a wonderful place.
I have known this business for many years and remain in awe of their commitment to connecting with the community and embracing change.
I am aware of several new newsagency locations in centres. If you are looking to open a newsagency in Victoria, New South Wales or Queensland, please contact me by email or phone (0418 321 338).
Consider a sign in the window if you are selling your newsagency. A customer could be in the market for a business and yours could be a good fit. Brokers tell me buyers in rural and regional situations are more often locals.
A sign in the window can work – as long as the business – the shop itself – looks healthy and appealing. A FOR SALE sign in the window of a shop that looks like it is on its last legs will not help drive a sale.
Too often retailers selling their business go to considerable lengths to hide that the business is for sale and through this they miss opportunities – including selling to existing staff and or customers.
By putting a sign in the window you also remind yourself every day that the business is for sale and that you need to keep it looking at its best. It also reminds you to talk more about what there is to love about the business than what you don’t love.
Yes, this approach will have people asking. You could be the best sales person of the business. Be sure to have a broker as a backup for the more formal questions.
My work with newsagents sees me get involved in many changes of newsagency ownership situations. Often, the involvement is sought to help get to the bottom of a dispute. If the purchaser undertook reasonable due diligence many of the disputes I see could have been avoided.
Here is my incomplete due diligence list. I say incomplete as it is what I suggest you do which is so often forgotten – in addition to the usual:
This list is by no means complete. I have listed items which tend to be overlooked. My goal is to help purchasers purchase based on accurate business data.
There will be some newsagents who are not happy with me publishing this list. If you have nothing to hide then why worry? Transparency around a good business can only add value.
Footnote: I have published a list like this several times here. This latest version reflects learnings following recent purchases.
Rather than getting involved in commercial deals outside the remit of a traditional association, newsagent associations should spend their time and newsagent money on association services. One such service could be the development of a code of conduct for newsagency brokers.
Newsagency brokers are vital to the renewal of the channel. They assess, package and promote newsagency businesses for sale. They chase the highest price for the vendor as their key goal yet they look for support from existing newsagents to help their businesses.
Some newsagents have paid more to purchase their businesses than real net profit can justify. Even one is too many.
One newsagent I spoke with recently shared the profile provided by the broker. It was a work of fiction. The figures did not meet even basic accounting requirements. Beyond the usual (an sometimes questionable) add backs, there was no accountability on the veracity of the claimed sales. I know the business. The sales claimed were not being achieved in the business at the time it was offered for sale.
Brokers have an obligation to the future health of the channel. Incoming newsagents paying too much to purchase their businesses will kill the channel.
I know some excellent brokers. This post is not about them. It’s about those who package businesses with information which inaccurately reflects the financial performance of the business.
We need a code of conduct for brokers. Newsagent associations could develop this if they consider themselves to be relevant to the businesses. It would be money well spent. Brokers who sign up and submit to auditing could get a seal of approval. This could give buyers more confidence.
Of course, good brokers could establish this for themselves and pub list it on their blog or website.
Any newsagency broker code of conduct should be framed within the view of the incoming newsagent as they will be there in their business after the broker receives their commission and the vendor moves on.
Would you buy a car off the lot without fuel? When you buy a newsagency you can reasonably expect to be buying the business in its then existing form: shop fit, stock, customers. It is also reasonable that you expect to be buying information necessary to run the business. Information is the fuel of any good business.
This is on my mind today because of a newsagency which was sold recently where the new owner discovered that the sales history and other business data had been deleted, leaving nothing with which to compare the performance of the business or to guide business decisions.
The people buying the newsagency have been denied access to a key asset which they assumed was part of the purchase. Their job for the next year has been made more difficult. They have no sales history at all. They didn’t want confidential customer account data, just information necessary to properly manage the business.
The people selling the newsagency decided to delete crucial business data for their own reasons. They would have known the cost to the new owners of this data not being available. Their choice has hurt the business they called home for years.
My recommendation if you are buying a newsagency is that the sale contract includes a special condition along the lines of:
The seller agrees to not delete, remove or change in any sales, stock of customer history or data stored in the business computer system or manual records without the written permission of the purchaser.
While such a clause may be more onerous that some newsagency sellers would want, use it as a discussion point.
Industry associations should play a role here and ensure that the business settlement addresses this and other issues – especially since they have commercial relationships with newsagency brokers. The future of the channel depends on new people coming in. One way to ensure this is to offer some guidance around change of owner best practice.
When a newsagent sells their business they are selling the business as it operates. Data is crucial to business operation. Selling an operating newsagency without historical data is like selling a car without any fuel in the tank.
We are promoting the Australian Women’s Weekly / Good Health double pack in a dump bin near the entrance to our women’s magazine aisle. We chose the location because we had no space next to or near either of the titles in the pack – thanks to an extraordinarily heavy week of magazine supply. Disappointingly, the publisher did not provide any marketing collateral. So, we went with the dump bin idea in a high traffic area. Shoppers know that dump bins contain value based offers so the location makes sense.
Through my involvment with newsXpress I am hearing of more newsagency for sale opportunities through landlords looking to get national brand representation in their centres. Right now, I am aware of newsagency locations available in Queensland, New South Wales and Victoria. Some are greenfield locations and others are existing centres. I’d be happy to point interested parties to the landlords involved. I can be reached on 0418 321 338.
Someone I met through this blog has placed their small newsagency in southern Melbourne suburb on the market. It is in a high street situation with good potential. My knowledge of the business suggests it is a good opportunity for a first time newsagent. It has Tattersalls which generates good traffic. I’d be glad to point anyone interested to the brokers.