Hi my name is Neil Barry and my speciality is Newsagencies. Having been an owner for 20 years has given me a good insight into the workings of the industry, and a good knowledge of the “pros and cons” a new owner can expect to experience.

In my last blog I touched on the different types of newsagencies such as retail only, retail and delivery and delivery only. In this blog I would like to tell you why I think newsagencies are one of, if not the strongest franchised business model going.

Firstly the business is territorial. By virtue of a contractual agreement with the publishers a delineated territory forms part of the agreement ensuring the business is the only supplier of all publisher’s products within that territory. The only exception being the very large supermarket chains who because of volume are generally supplied direct. Having said that there are some exceptions where the supermarket is a sub agent of the newsagency and relies on them for supply. In the case of a retail only newsagency i.e. one situated in a medium to large shopping centre the territory is normally the property line of the shopping centre, and defined as such in the publishers contract. In this case the lease also defines your territory within the centre and it is vitally important when checking the “permitted use” clause in the lease that it does not have exclusions that would affect the normal operations of the business at present and into the future. Retail is a competitive field and successful business owners need to be able to adapt to new trends, fashions and unforseen circumstances.

Secondly the approval process when buying a newsagency can seem initially a bit daunting. Approvals from publishers need to be sought with proof of the buyers ability to not only afford the business, there are restriction applied to buyers concerning the debt to equity ratio, but also their business acumen and to this end a business plan is essential. All this only goes to strengthen the industry by ensuring only good business minded people with the financial strength enter the arena.Golden Casket is the franchisor for newsagents and as such has a separate approval process from all others. A prospective buyer must undergo an interview and again prove their financial ability and business acumen and also provide a fairly detailed business plan, a template for this is provided. Golden Casket is required by law to provide prospective buyers with their disclosure statement and franchise agreement as part of the approval process. Following this, once approved, a buyer will be required to complete an intense one week training period and the week preceding settlement a buyer must work in an approved newsagency for around 40 hours as a further learning experience. All this is to ensure a new buyer is a competent newsagent in every respect i.e. financially, business experience, product knowledge and customer
service.

Thirdly, this is getting back a comment I made in an earlier blog and that is that the Golden Casket products, Lotto and Instant Scratch tickets, are the life blood of the industry. The foot print of the corporate image is a very small part of the shop and process of selling is easy, fully automated, fast and completely secure, and the commission is paid weekly to the business. There are regular lotto jackpots and of course the ever possibility of lotto jackpots growing to $90 million or more is the major hook that keeps customers coming back and back and back to the shop. On some occasions customers will return to the shop several times a day to cash and collect scratch ticket prizes. The advertising budget of Golden Casket is huge and every newsagency benefits from the many advertising formats used from TV, posters on bus and bus shelters, in store and many others all designed to attract the huge volume of foot traffic only newsagents can. Everybody wants a piece of the many millions in prizes the Golden Casket give out each week.

No small business can lay claim to the number of customers who visit a newsagency each week. The very first rule of retail is customers through the door, well it’s a given with newsagencies, thanks to Golden Casket, the rest is up to you the owner.
Call me to talk about selling or buying a newsagency business.

Author Bio:

How to calculate the Value of my Business? Is this question always on your mind, Benchmark is here to help you. Neil Barry is in his 8th year with Benchmark.Neil Barry is the right person to discuss your needs with, as he has great insight, knowledge, skill and understanding of retail, small businesses and franchises for sale. Neil has 20 years of experience as the owner of a newsagency business, and ten years as the principal of a large real estate agency – running two busy offices. In addition to the sale of post offices and newsagencies, Neil sells all types of businesses, including Self Storage facilities – and wineries.