Newsagent’s shops closing around Czech Republic at growing rate

26-03-2015

Small newsagent’s-cum-tobacconists are an extremely common sight in the Czech Republic’s cities and towns. However, times are tough for the industry and the shops are today closing at a rapid rate, the newspaper Mladá fronta Dnes reported this week.

Photo: Tomáš FenclPhoto: Tomáš Fencl In the Austro-Hungarian Empire, a small newsagent’s or “trafika” was sometimes granted to a handicapped war veteran as a reward for service to the state. The word was also employed in this part of the world and is still commonly used in Czech to denote a sinecure.

But actual “trafikas” are no longer as attractive as they once were. Last year declining business – particularly on the peripheries of cities and in small towns – led to around 500 Czech newsagent’s shops going out of business. This was a faster rate of closure than in previous years.

Martin Koláček of the national association of operators of newsagent’s shops told Mladá fronta Dnes that his members were closing their doors at a rapid rate as owners are today finding it harder and harder to make a living from them.

Figures provided by PNS Grosso, a firm that supplies virtually all of the Czech Republic’s newspapers and magazines, confirm that the number of newsagent’s shops is falling.

While there were over 22,000 such outlets in 2004, last year the number was down to 16,800. (However, the country has still has more newsagent’s shops per capita than many European countries.)

Operators place much of the blame for the decline on a reduced margin on their biggest seller, cigarettes. While in the past shops kept around 10 percent of the price of a pack of 20, now that figure has fallen to 6 percent.

If that were not bad news enough for the kiosk owners, overall sales of tobacco products fell by almost a quarter between 2007 and 2013, according to figures from the Czech Statistics Office.

The fixed prices of many of the items on the shelves of “trafikas” means they are reliant on having good locations with relatively heavy footfall if they are to make a profit, Daniel Tomeš of Traficon Invest – which operates around 100 newsagent’s shops – told Mladá fronta Dnes.

In addition, small tobacconist’s shops are frequently targeted by thieves. This pushes up their insurance premiums and some simply pull down their shutters for good if they have been robbed a few times, according to Mr. Tomeš.

Industry leader Martin Koláček also said that the growing use of payment cards meant selling another common “trafika” product, public transport tickets, had become unattractive; indeed, the charge for card payments is greater than the margin newsagent’s make on bus and tram tickets, he said.

26-03-2015