Independent newsagents have been squeezed by high street supermarkets and the declining circulations of mass-appeal magazines. We spoke to one which has thrived by getting closer to niche titles.
21 Feb 2017
Sandeep Shreeji is a rarity among newsagents. And not just because he’s still standing. Shreeji knows his magazines beyond merely cover prices and delivery dates. He gives customers advice and suggestions and has a point of view on virtually all the titles on his shelves.
He’s been trading at his Marylebone shop for the last 30 years, but when faced with the prospect of closure around seven years ago, Shreeji decided to embrace the more obscure titles he hadn’t previously stocked, expand his magazine range and cut down on things like sweets and snacks.
‘There was definitely a move away from print for a while, and everybody got really scared that it was going to collapse,’ says Shreeji, who’s seen demand for newspaper and magazine home deliveries drop off over the years, as titles have closed down, gone online or started offering their own subscription service. Independent newsagents and corner shops have been closing in droves and even McColls, one of the UK’s biggest newsagent chains, shut 100 of its shops in 2015.
‘We could see a decline in sales with the opening of smaller Sainsbury’s and Tescos, all starting to stock titles like Vogue,’ says Shreeji. So he started exploring independent titles and their readerships, and built up one of the most comprehensive magazine offerings in London. He believes this strategy has been the secret to his survival.
The four blows to newsagents
1. Supermarkets expanded into small-scale formats, competing for high street trade. There are now over 1,700 Tesco Express stores in the UK, and more than 700 Sainsbury’s Local outlets.
2. Store footfall declined along with print newspaper and magazine circulations, as more media began being consumed digitally.
3. Regular custom also dropped off as more people quit smoking.
4. Ever-increasing costs continue to bite: rising commercial rents, business rates, national minimum wage, pension enrolment and banking charges.
His shelves are lined with everything from quirky gardening title Rakes Progress to iconic modern stalwarts like Cereal (which, Shreeji reckons, ‘is starting to look a little stale’, although it still sells well). He has locked down deals directly with titles such as US tennis magazine Racquet, and a Spanish title, Funnytastes, which sat on the countertop the day Courier visited.
Centring his business around independent print magazines, Shreeji has benefited from their recent resurgence. He has also found a lucrative sideline in delivering a customised selection of titles to many of the advertising agencies clustered in the neighbourhood.
‘Specialising is the only way,’ Shreeji says. ‘If you’re going to be just another newsagent then you need to be on a high street with huge footfall, selling bus passes, lottery tickets… But those margins are tiny.’
Ultimately, the business is increasingly reliant on Shreeji himself; his knowledge, his selection, his relationships with customers and the service he offers.
Following the magazine money
Publishers typically operate through one of the two dominant magazine distributors (Seymour and Comag, which together account for 63% of magazine sales in the UK), or one of several smaller distributors. Publishers send magazines through the distributor to independent newsagents, supermarkets and convenience stores. Shreeji pays a hefty £3,000 a year in delivery fees to newspaper distributors alone. The newsagent typically receives 25-35% of the magazine cover price, the distributor receives around 4%, the wholesaler 13%, while the publisher recoups anything from 35-55%.
Unsold copies are pulped, with publishers and distributors constantly trying to work out the optimal number to distribute across all stockists.