Newsagencies..abyobe own one??? tops please??

[csc]

Newsagencies..anyone own one??? info please??

im contemplating buying a newsagency,,not a big one but big enough..turning over around a mill yr, net before wages is around $200K...

last five years financials are at the accountants currently being disected.

Just looking for feedback from anyone who has been in the industry pos/negs etc...

looking at a 5-7 year plan if we proceed with it.

oldest daughter currently works at a newsagency so ill prob only have a minor roll of 20 hrs a week or so if time permits and let her run the show.

there is no paper run to worry about...just a tidy retail shop in a complex.

if you have experience is owing one currently or previously by all means please add to this thread about anything general.

cheers

 

[Ausprop]

everytime I go into a newsagency i think how awesome it must be to be the owners and read all those magazines and then chuck them back on the shelf and sell them - i could easily spend a couple of hundred on mags

 

[HiEquity]

Sorry can't help...

But I always did wonder what happened to unsold mags at newsagencies - there must be a lot? I'll just add that question for anyone who knows the industry...

 

[csc]

everytime I go into a newsagency i think how awesome it must be to be the owners and read all those magazines and then chuck them back on the shelf and sell them - i could easily spend a couple of hundred on mags

i cant wait!! ive never purchased a playboy mag ever.....the tradition will continue Strictly for the editorial section and featured articles only.

tell you though theres some absolute garbage that gets sold at newsagents.....some people really need to get a proper life......mind you ill take their money and wish them a good afternoon!!

ill see how this pans out..........ive looked at three so far...no downturn effect with any as yet from this recession........... recession proof??? maybe to some degree..

 

[csc]

Sorry can't help...

But I always did wonder what happened to unsold mags at newsagencies - there must be a lot? I'll just add that question for anyone who knows the industry...

its a bit messy if you ask me, they are purchased on an account then unsold mags are credited..........unsure just yet the exact workings of it if its a mthly a/c or longer....daughter says its simple but i really dislike double and tripple handling anything........on the shelf, off the shelf then package up unsold mags to be sent back.....

what happend to honesty in business over the phone??? ha!

what a circus the honour system would be with magazines..

 

[silversands]

just wondering...

Does anyone think that magazine circulation may be hurting - as retailers have to be more vigilant as to how they spend their advertising dollars in the current economy.

I have noticed a number of news papers and mags are getting smaller less pages etc and I wonder if their demise is pending. At the same time, I see a bigger selection of magazines available in super markets than there used to be. This must surely hurt sales in news agencies.

Just one example, is the trading post, which I used to buy weekly from the news agency. It seems a quarter of the size it used to be as the online version has grown in value. Will others follow suit? I don't know.

I would be a little cautious of this industry (generalizing ) On line post cards and greeting cards via email are rising in popularity. How much will this impact future sales?

There seems to be more news agencies that have been tightly held for years on the market now. Colleagues in Perth, who own an agency are looking to get out also. (however their profits are hurting because of colossal hikes in their lease.)

A news agency nearby us is up for sale. Interestingly the owner first split the post office from the agency (which does have lotto keno etc) in order to retain p/o which according to my friend, who works there, because the p/o is very profitable and the agency is a cash flow drain. Make of that what you will.

At the end of the day if you do all your dd and the deal stacks up and the numbers aren't scary... then happy purchasing!

Jo

 

[steveadl]

The newagent across the carpark from me is very large. It amazes me just how many specialty magazines there are, for just about any interest you can think off - literally hundreds! Cumulative shelf space for magazine sections of about 40m length x 1.5m height - just row after row after row!

 

[Sabitor_84]

This may be a rude question to ask but, how much are you looking to pay for this news agency?

Again sorry if im being rude. Just interested.

Matt

 

[csc]

This may be a rude question to ask but, how much are you looking to pay for this news agency?

Again sorry if im being rude. Just interested.

Matt

..but ive entered into a confidentiality agreement with the other party so best i dont gob off to much cause the price may give it away...........

its between 100k and 500k...closest i can give you..sorry...

net return is ther only thing that interests me with this....and potential to increase it....the actual area is a high growth corridor so 3-5 years should see a marked increase in the community size....

 

[Ridin-High]

csc i'll talk to the lady @ my work who had done alot of leg work to purchase a news agency in the blue mountains NSW. i believe it was in the region of 400k (to be confirmed) ill come back to you with what i find out

 

[csc]

Just one example, is the trading post, which I used to buy weekly from the news agency. It seems a quarter of the size it used to be as the online version has grown in value. Will others follow suit? I don't know.

Trading post was sold a few years ago to sensis i believe and they couldnt get the phone books right so they were no chance of trading post which was an absolute cash cow until they took it over..



There seems to be more news agencies that have been tightly held for years on the market now. Colleagues in Perth, who own an agency are looking to get out also. (however their profits are hurting because of colossal hikes in their lease.)
yep this is a concern for me also...ill be looking at the fine print closely before signing. big lease left though which is a positive


A news agency nearby us is up for sale. Interestingly the owner first split the post office from the agency (which does have lotto keno etc) in order to retain p/o which according to my friend, who works there, because the p/o is very profitable and the agency is a cash flow drain. Make of that what you will.

bloody hell a post office is a nightmare also..definitely not for me......... what does annoy me with newsagencies is the amount of manipulation publishers put on agents..they tell them their opening and closing times within reason and agents must stick to it from what i gather

i will really need to sit down and spend days going through all the b/s associated with it then decide if its a headache, a nightmare or just a wet dream....

either way its a learning experience to know about the industry.

 

[csc]

csc i'll talk to the lady @ my work who had done alot of leg work to purchase a news agency in the blue mountains NSW. i believe it was in the region of 400k (to be confirmed) ill come back to you with what i find out

PM me with any info please Ridin at your convenience please...cheers

 

[Dazz]

Colleagues in Perth, who own an agency are looking to get out also. (however their profits are hurting because of colossal hikes in their lease.)

There may be a hint right there as to which side of the business you wish to partake in.

 

[silversands]

^^he-he! Was almost going to post tongue in cheek as I wrote that statement that perhaps you were their new LL but thought I might get dogged for the comment!

 

[csc]

As an update this potential newsagency candidate has just been rejected..........accountant found some issues with the figures.....

always pays to have someone experienced look at it...

the look continues to find something decent that is a good earner............

in the meantime ill just keep daytrading...

cheers

 

[Chris.R_WA]

Hi csc,

For everone else's learning, are you able to say which figures didn't add up for the deal?

Did you weight some measures more important than others?

Cheers, Chris

 

[Dazz]

this potential newsagency candidate has just been rejected.......... accountant found some issues with the figures.....

Was the accountant correct though ??

I wouldn't trust my accountant to assess an investment opportunity as far as I could kick him. He's a good accountant, but a hopeless capital allocator.

That's my job.....and it cannot be delegated

 

[csc]

i havnt seen the figures personally yet as they went straight to my accountant from their accountant..

if you have the right accountant they can be terrific..

mind you blind freddy would have seen what was missing with their figures.....i wont say what it was online as its sure to cause him some grief but here was the basic deal:

gross was $1.02 mill last financial.........a very steady 3% growth per annum last 6 yrs....not at all brilliant but at least growth....i saw definite potential to increase greatly this side of things

when the smoke cleared the business was actually only netting $100k yr.............

very poor for the t/o of around 10% nett....

for the outlay they required it was downright ridiculous...

thing is there are three punters behind me waiting to check the books!

ill keep looking for now...the area was terrific and exactly what the family was looking for but in the light of day its not such a viable return for me as the seller wanted 4 1/2 times nett as the sale price............hes definitely kidding....

i made a cash offer to them early today, WIWO but it was rejected straight up with no counter offer on the table so i simply walked....they can have it...probably suck in someone at their asking price.

the non disclosure agreement was torn up as well after the figures came back rubbery...

good luck.

 

[Property Meister]

hi csc,

thats all very interesting reading you stuff, admittedly I ve been looking at businesses as well, it sounds like they were asking too much,

what ROI are you looking at, do you go by a particular figure, PM me if you prefer, up to you?

have you looked at other businesses.

I ve always thought newsagencies are quite safe....

not too sure when you said that you saw potential to increase on how you'd go abouts increasing t/o, profits, etc.

Ive looked at a few of the figures for a tattslotto agency, they look good too!

feel free to PM if you'd prefer!

 

[enricofermi]

I don't know about newsagencies, but I spend less and less each year on magazines and newspapers. The internet is the culprit. With a big screen, its becoming more convenient to be hooked to ones computer. Still, I love to buy the newspapers sometimes and read it while watching the waves and drinking coffee.