Newsagencies in decline as demand for online content outstrips print media

Every morning for the past 20 years, 74-year-old Frank Livingstone has woken at 3am to start running his newsagency business in the small town of Mansfield in northern Victoria.

The stacks of papers come in from Melbourne, and Mr Livingstone and his staff put together the home delivery orders.

Couriers arrive about 4:30am to pick up home delivery and mail run items for remote residents.

By 6am, the shop is open and Mr Livingstone is serving tradespeople on their way to work. 

The shop is open seven days a week and beyond getting Christmas off "there's not too much rest", he says.   

After two decades, Mr Livingstone and his wife, Moya, are now preparing to retire.

They had hoped to pass the torch on to new owners, but newsagencies as an industry face a volatile future.

Digital media's impact

The Mansfield newsagency has been on the market for two years but hasn't had any takers.

"Unfortunately, it's an industry nobody wants to take on anymore," Mr Livingstone says.

"So we haven't been able to sell it and so we've just decided that when our lease is up we have no option but to close it down."

When the Livingstones leave, Mansfield won't have a newsagency anymore.

Mr Livingstone says the demand for online content and news has affected the industry.

"The digital side of it has greatly reduced our circulation," he says.

"You know, like holiday weekends years ago, we would order 2,000 newspapers. We're down to about 350–400 at the moment.

"Overall, our circulation is down 70 per cent. So it's just not viable anymore. We just can't rely on the people coming out from Melbourne on holidays."

Mr Livingstone has been in the industry for 36 years and ran a newsagency in South Melbourne for 16 years before moving to Mansfield.

"Years ago if you wanted a newsagency, you had to mortgage your house and your mother's house to buy one. But these days, they just aren't the business they used to be, so nobody's prepared to take them on anymore," he says.

"And particularly in our case, we don't have a tattslotto."

"If you have a tattslotto, it's still a good business to get into but without that tattslotto, nobody's really that interested in them anymore."

An industry in decline?

The newsagency industry is in a "period of change" and facing significant new risks, says Andrew Ledovskikh, senior analyst at the business intelligence organisation IBISWorld.

"The industry has really struggled over the past decade or so with falling circulation of newspapers and decreased readership of physical magazines with everyone turning to online content," he says.

The industry is valued at about $1.5 billion, but is expected to struggle and revenue is expected to decline by 2 per cent over the next five years, Mr Ledovskikh says.

Over the past five years, about 300 newsagents in net terms have left the industry, he says.

Newsagencies have diversified by offering lottery sales, gifts, collectibles, and convenience products.

But even gambling and lottery tickets have now moved online and "that's starting to kind of pinch into the industry's revenue," Mr Ledovskikh says.

He says as many as 30 per cent of consumers are buying their lottery tickets online.

But with more newsagents expected to leave the industry, Mr Ledovskikh says family-owned businesses "tend to be a little sticker".

"So they tend to have a higher pain tolerance because of the fact that these businesses are seen as a way of life, the connection with the community, and so they're more likely to stick it out even as profit margins erode until it really becomes unmanageable."

A focus on adaptability

For Brendan Tohill, CEO of the National Lotteries Newsagents Association and Victorian Authorised Newsagents Association, newsagencies are now a "last-minute gift store underpinned by lotteries".

"That's what we are now. That's what it is," he says.

With the digital boom, the reality is that you can now pick up your news on social media in 90 seconds, he says.

Newsagents are no longer about news and he stresses adaptability as the key to succeeding in the industry.

"Not to say that retail's not tough. It's never been tougher with the cost of living," Mr Tohill says. 

"However, you've got to have a thirst for the contest and most of our members have got that and they're doing well."

A loss for the community

Mr Livingstone says he paid about $600,000 for the business 20 years ago and hoped that by the time he and his wife retired, selling the newsagency would serve as their superannuation for retirement.

Decades ago, newsagencies were "extremely expensive" and it was a competitive process to buy one through the Victorian Newsagency Council.

"But what you did if you managed to get a newsagency [is] then you would work it, pay it off, and then that became your superannuation."

With no buyers, that's no longer possible and the couple will now have to rely on a pension, he says.

As they plan to shut the shop, Mr Livingstone says he and his wife will miss the place that the newsagency had in the community.

"We're absolutely shattered. We feel we're letting the town down because the town loves its newsagency and we love the town. But we can't keep it going any longer."

People don't just come in to pick up the weekly paper, they're also there for a chat with their neighbours, he says.

"And we will miss that community aspect side of it terribly."