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Delivery Run Evolution

Home delivery runs have been a part of successful newsagency businesses for many many years. They engendered a loyalty from customers who appreciate that someone is out there, early each morning, delivering a paper to their front lawn.  This engendered loyalty can provide a stable foundation for a suburban newsagents trade.

And yet, all things change, and delivery runs are no exception. News Limited – QLD Newspapers have recently floated a variety of verbal proposals to existing delivery agents, to consider consolidating their delivery with adjacent agents to create efficiencies by scale. You can see the sense, if an agent is marginal delivering a small number of papers each morning, whereas with a larger quantity they could be profitable…………

Consolidation can pool labour, vehicle and support resources to benefit the staff, agent and customer.  

Over the past decade or so, delivery territories have become more fragmented with Shopping Centres being allocated very small territories within territories, and agents slicing up area themselves for numerous reasons like opening secondary shops in their territory.  As shown already in the southern states, larger delivery distribution businesses have turned this trend around, creating profitable delivery businesses, with better more efficient customer services. 

Mark Fletcher of  Tower Systems has posted some very informative comment here, including this very recent letter from News Limited.  From what we are aware, this is the first written notice regards the proposed changes.

So what does this all mean to someone buying a newsagents business that has a delivery run ? 

Well, subject to how this all happens over the next few months; there is the potential for agents with unprofitable runs to hand them back with little consequence; and the potential for agents with marginal runs to consolidate with others and create a much more profitable delivery focused business.

In the longer run, we envisage there will be a distinct difference & potential separation between Retail Agents, and Delivery Agents.

If this potentially impacts your decision to purchase a newsagency business, call one of our Business Brokers today to discuss
This is another fine example of why you should only consider a newsagency business through a true industry specialist, rather than a general broker. As a potential buyer into the newsagency industry, you need to make an INFORMED JUDGEMENT. Newsagencies For Sale Business Brokers will gladly take your phone call.