WHILE the rest of the world sleeps, brothers Derek and David Downing are cocooned in a small room in the basement of the QV1 building, wrapping newspapers and then delivering them to offices in the West End of Perth.
WHILE the rest of the world sleeps, brothers Derek and David Downing are cocooned in a small room in the basement of the QV1 building, wrapping newspapers and then delivering them to offices in the West End of Perth.
They then disappear as the first of the day’s workers start moving on the Terrace, with only the newspapers marking their earlier presence.
This has been the lifestyle for the Downings for the past 21 years, the past 11 in the central business district operating West City News.
Going unnoticed by their customers, their work recently received recognition from their peers when they won the 2001 Newsagency Industry Awards for Excellence, presented at a dinner last week.
While the 2am starts have become a matter of routine, the brothers are continually faced with increasing challenges that could provide either a window of opportunity or could threaten the very existence of their business.
Since buying the newspaper delivery franchise – extending from the freeway to the West through to William Street and then down to the river and north to the railway line – the pair have increased circulation by 80 per cent.
The gradual shifting of the business community to the west end has been good for business. And their good fortune is likely to continue over the next few years, with Woodside’s eventual move, the convention centre moving ahead and planned developments at Westralia Square and Bishops See likely to provide further growth opportunities for the business.
But while the numbers of potential clients in their patch has increased, it does not bring in extra work automatically. The brothers are continuously keeping an eye on which businesses are taking out a lease in the area and moving so that early contact can be made before the business moves.
Derek Downing said it was all about ensuring the businesses know of their services before they move in. With a newsagent every couple hundred of metres, it is imperative that they make the approach early.
“You’ve got to find people as they come into the area, either through the media, such as Business News, or through word of mouth,” Mr Downing said. “We’ve got to get in ahead of the newsagencies.”
While getting to work is not easy, keeping the 650 customers in the area is even more difficult. The change of the State government had a detrimental effect on business.
“With the change of Government, they closed down departments willy nilly. Now we have to wait for evolution to take place and watch the departments grow again so that our business will grow.”
Demand from customers has also changed. In the past, each building had a central mailroom. Now, the papers must be delivered on each floor. Yet to do Central Park, which has more than 300 papers delivered, only takes about 10 minutes.
News delivery agents also have had to contend with falling margins. Over the past few years, margins have been cut from around 25 per cent to about 18 per cent, while the size of the papers have increased substantially.
“Margins have been reduced. It’s got a lot harder and the level of service has increased. People are looking for more these days,” Mr Downing said.
Yet the biggest test for the business is a change in national competition laws, which would effectively put a stop to the monopoly the agents enjoy.
WA remains the only state yet to deregulate. But while deregulation appears certain, the Downing brothers don’t expect any significant change.
The system works efficiently already for both the publishers and the agents, Mr Downing said.
What deregulation may do however, is threaten the goodwill and hence the sale price of the franchises.
The monopoly position means news delivery rounds can fetch prices around 2.5 times net profit, compared with many other business that only sell for around one times net profit.
But the brothers plan to take everything in their stride.
They then disappear as the first of the day’s workers start moving on the Terrace, with only the newspapers marking their earlier presence.
This has been the lifestyle for the Downings for the past 21 years, the past 11 in the central business district operating West City News.
Going unnoticed by their customers, their work recently received recognition from their peers when they won the 2001 Newsagency Industry Awards for Excellence, presented at a dinner last week.
While the 2am starts have become a matter of routine, the brothers are continually faced with increasing challenges that could provide either a window of opportunity or could threaten the very existence of their business.
Since buying the newspaper delivery franchise – extending from the freeway to the West through to William Street and then down to the river and north to the railway line – the pair have increased circulation by 80 per cent.
The gradual shifting of the business community to the west end has been good for business. And their good fortune is likely to continue over the next few years, with Woodside’s eventual move, the convention centre moving ahead and planned developments at Westralia Square and Bishops See likely to provide further growth opportunities for the business.
But while the numbers of potential clients in their patch has increased, it does not bring in extra work automatically. The brothers are continuously keeping an eye on which businesses are taking out a lease in the area and moving so that early contact can be made before the business moves.
Derek Downing said it was all about ensuring the businesses know of their services before they move in. With a newsagent every couple hundred of metres, it is imperative that they make the approach early.
“You’ve got to find people as they come into the area, either through the media, such as Business News, or through word of mouth,” Mr Downing said. “We’ve got to get in ahead of the newsagencies.”
While getting to work is not easy, keeping the 650 customers in the area is even more difficult. The change of the State government had a detrimental effect on business.
“With the change of Government, they closed down departments willy nilly. Now we have to wait for evolution to take place and watch the departments grow again so that our business will grow.”
Demand from customers has also changed. In the past, each building had a central mailroom. Now, the papers must be delivered on each floor. Yet to do Central Park, which has more than 300 papers delivered, only takes about 10 minutes.
News delivery agents also have had to contend with falling margins. Over the past few years, margins have been cut from around 25 per cent to about 18 per cent, while the size of the papers have increased substantially.
“Margins have been reduced. It’s got a lot harder and the level of service has increased. People are looking for more these days,” Mr Downing said.
Yet the biggest test for the business is a change in national competition laws, which would effectively put a stop to the monopoly the agents enjoy.
WA remains the only state yet to deregulate. But while deregulation appears certain, the Downing brothers don’t expect any significant change.
The system works efficiently already for both the publishers and the agents, Mr Downing said.
What deregulation may do however, is threaten the goodwill and hence the sale price of the franchises.
The monopoly position means news delivery rounds can fetch prices around 2.5 times net profit, compared with many other business that only sell for around one times net profit.
But the brothers plan to take everything in their stride.
