It struck me this morning standing in line to order a Bacon and Egg McMuffin in Sydney for a breakfast on the go that in front of me was a key reason newspaper publishers virtually ignored retail newsagents to drive over the counter newspaper sales.
Newsagents can’t offer the same value proposition as, say, a McDonalds. McDonalds advertises in the newspaper, it has products that can be bundled with a newspaper and thereby deliver access to the newspaper for almost nothing yet record it as circulation.
I can see that a newspaper ‘sold’ through McDonalds with a meal bundle is more valuable and rewarding for a publisher than a newspaper sold in a newsagency at full cover price. They would think that the McDonalds ‘sale’ is more certain and can be budgeted for. The advertiser probably makes this point too.
Since we don’t have fuel, burgers, suagry frozen water drinks or many other highly sought after daily purchase items that we control with which to bundle newspapers we will not be the focus of attention of newspaper publishers. I suspect we represent the old-school approach to newspaper retail they maintain because they have to and not because we represent what they see as future.
I wish newspaper publishers would give retail newsagents a go. I am certain that retail newsagents can grow newspaper sales through genuine partnership with newspaper publishers.
Like many newsagents I suspect I was surprised to see the Rocks, Gems & Minerals partwork reissued yesterday – even though it did not look like a reissue thanks to new packaging and National Geographic branding. I don’t remember it looking like this last time around. The stock code in the EDI file points to the previous issue so this is connected to the previous rocks title we received.
72 copies, that’s what we received in one of our stores.
What do other newsagents think?
If we had control of our ordering, we’d have asked for 30. here’s what galls me and, I am sure, most newsagents. We have to pay to return the unsold stock. We are penalised for a poor scale out decision, we have to pay for someone else’s mistake. It’s a disgusting impost on any business let alone small business newsagents at the end of the magazine food chain.
And magazine publishers wonder why some newsagents are actively and openly discussing exiting the category altogether.
Supply is the problem. It is drowning the newsagency channel and no one in authority appears prepared to do anything about it. The result will be even more magazine sales lost from the newsagency channel to supermarkets.
Newsagents have been supported by Pete Evans tweeting to his 10,000+ Twitter followers that people should check out Nourish magazine at a newsagency. This type of support for our challeng is terrific. If you’re on Twitter, be sure to thank Pete – @PeteEvansChef. I did.
Of all the charities we support at the counter and elsewhere in the business, the Red Nose Day support gains the most attention and engagement. It’s well known, easily understood and appreciated.
While I have said here many times that the counter today has to be about high-margin (above 25%) product, we do schedule in space and time for charities we care about. Red Nose day is one of those charities. I especially like it as we choose to participate rather than having it sent without reason or connection to us.
If this year is like other years we’ll move all the stock in a couple of weeks.
We have spread the Rolling Stone brand, in three magazine titles, across the best shelf in our music section as we feature the Bob Dylan one-shot, the Led Zepplin one-shot and the regular monthly magazine. Our commitment is to maintain this full face placement for the next two weeks. We’ll give the Dylan title a run with newspapers at the weekends – given the shoppers we typically see then.
Check out a the display of a couple of pages from The Canberra Times newspaper above the urinal in the male bathroom of hotel in Canberra where the Newsagency of the Future workshop was hosted today. You can’t do that with an iPad.
I was grateful for the opportunity to speak at the Lottery Agents Association of Victoria conference yesterday in Melbourne. It was terrific seeing a large room full of retailers giving up their Sunday to network with others and talk business.
The agenda was varied, full of challenges to build stronger and healthier retail businesses. I really like one day conference events. People retain more. There is also an urgency since you only have a day to cover your messages.
Talking with people in the breaks I met people embracing change in their lottery businesses and newsagencies. Suppliers too – breaking with tradition and encouraging retailers to make independent moves. Very encouraging.
For my part I put together a session picking up on some of my Newsagency of the Future themes as well as consideration of the opportunities we find in change in retail.
I’ve written here before about our use of staff recommendations to bring attention to magazines that otherwise be missed in the sea of colour and text we present in our magazine department.
At any one time we have two or three titles we feature with a personal recommendation. the photo shows our latest recommendation – for new magazine renegade Collective. we chose this title as it needs help in being understood.
Creating these recommendations does not take long once you have looked and understood the magazine. The reward is worth it. At the very least you further separate your magazine offer out from that in supermarkets.
The artwork for the recommendation text was developed in-store by one of our creative team members. It’s is consistent for all recommendations.
There has been a story doing the rounds in some newsagency circles that Wrapaway is providing electronic invoices to some newsagents. I have confirmation that this is not the case. I am certain that if / when they do do this all newsagents will have access.
Apps are huge today and we’re trying to tap into the popularity of this software by featuring app related titles at the heart of our IT magazine titles. The free cable with The Essential Apps Guide got it prime place in this small display.
Convenience store owners and their suppliers talk about Grab and Go offers, products that are compelling, easily understood and good value, products places at or near the counter and other high-traffic locations.
The term Grab and Go defines the type of products to place in this high-profile impulse purchase situation. In newsagencies, focussing on Grab and Go items is essential for those with a convenience-centric model.
I mention this term here to help change perception. We have spent too long offering the same old products at the counter. We need to focus on fresh impulse lines that offer more than 25% GP. Newsagents in the convenience space need to get serious about convenience and thinking about products in the context of Grab and Go is part of that in my view.
There is an excellent article at Convenience Store Decisions about this. I encourage convenience-centric newsagents to read this.
Too often newsagents start ringing up all sales in the Point of Sale software after they have encountered an employee theft situation. I have no sympathy for them since it’s retail 101 to track all cash down to the last cent in your business.
The excuse of it takes too long is nonsense – it takes seconds and can save thousands.
The excuse of we have to then to do lottery sales on two devices is because tatts won’t let your Tatts terminal send the sale value to your register. They do even more than this for 7-Eleven. Get over it.
The excuse of the counter is too busy to make this happen is nonsense – many many newsagents handle this without a problem today.
One way you will certainly reduce the opportunity of being a victim of theft is to ring up everything you sell using your newsagency software.
Check out the story in The Morning Bulletin in Rockhampton about the closure of two newsagencies. It’s a reminder of the importance of getting rent right from the outset and not agreeing to lease unless you are 100% happy.
I have recently walked away from two new lease opportunities because the terms were not what I wanted. A newsagency opportunity I walked away from three years ago because the terms were not good is, I’m told, about to close because the tenants are walking away from a ‘bad’ lease.
Get the lease right at the start. Changing it mid-term is challenging with most major landlords.
A side point about the story is the headline: news agents. Talk about focusing on the agent part. I bet agency business accounted for only a small portion of sales in this business.
I placed an ad on Seek for a full-time junior for one of my newsagencies. I was not happy with resumes being handed over the counter so decided to pay for a proper da.
Within twenty-four hours I had to take the ad down as I’d received more than 200 applications. Now I’ve used Seek for this type of role previously – but I have never received this number of applicants in the first day.
Beyond the extraordinary response, I am enjoying looking at the diversity of applicants. Most do not come from a newsagency background and I think this is important for our future in the business for which we are hiring.
We are looking for candidates with initiative, fresh eyes, excitement and a love of small business / independent retail. While it’s a challenge to find these qualities in a junior, I have resumes from some who show terrific promise.
We’ve sold 8 copies of Directioner, the One Direction magazine. I have checked with some other stores and its equally flat there. We pushed the title for ten days with placement on the lease line, facing the mall. We’re now pulling back as we need the space for products that will deliver better GP for the space commitment.
We are giving Harpers Bazaar time in the spotlight this week with prime positioning display – because we want to and not because of the pushy Bauer representatives who visit and try and tell us what to do. This is a special issue, one we are happy to support with tactical displays to drive sales.
I am over suppliers sending reps to my stores to rudely demand space for their product. If they want to pay extra for the space then okay but since they don’t – stop these rude visits.
News Limited approached me earlier this week following my post about their imposition of a new freight charge in some parts of South Australia. They provided a press release / statement on their position. I did not publish it here as it did not add to the situation and I didn’t want to put their case. The ANF in SA has published the News statement, unfortunately.
My view is that what News is doing is wrong. They are passing on freight costs selectively. Also, they are not communicating clearly and do not appear to be communicating with customers – but that may come with time. The ANF should be as clear on its position.
News should apply freight to all non suburban deliveries – user pays right?! Their selective approach is problematic for them. They could also have produced advice for newsagents to place with the products. Finally, they could have a cover price for the affected areas – to show it’s a News charge and not a newsagent charge.
There are times when publishers treat newsagents as agents and other times when they treat newsagents as retailers. They can’t have it both ways.
I know a newsagent who is growing sales of magazines, gambling products and cigarettes. They have a good business in a location that has become a convenience for new traffic.
The growth in convenience traffic has come at a cost as sales of higher margin items have fallen.
Here is their challenge: revenue is up and GP is down. The business is worse off for being busier in some categories.
This is why we need to all know what we need to make per square metre of our stores … so we can chase the GP necessary for us to pay the rent and other fixed costs we have in running our business. We need to work hard at balancing our business.
By balancing I mean managing the growth of low margin items versus the growth of high margin items. Yes, it’s tricky as one can drive sales of the other – but maybe not as much as we think. Our data can tell us just how much in our particular business.
A spike in a low margin product category – and by low margin I mean anything at 25% or less – could hurt the business overall. However, growing higher margin product sales is much harder work. It has to be because of the size of the rewards available.
Now more than ever, newsagents need to balance their business – balance their sales based on GP – for the future health of the business.
No supplier will do this for you. It’s up to you. I’d be happy to engage with any newsagent wanting to work on this.
nourish is another magazine launch we have to make space for. This one is challenging since it looks like a guys magazine aimed at the fitness section but it could also fit in general health as well as food.
We have it with men’s health and fitness titles. I’d love to know where others have it.
Notice the card sticking out of the magazine – the nourish publisher is taking space from titles behind it in a move sure to upset the affected publishers.
We are promoting issue 2 of Collective, now called renegade Collective after a stoush with the News Limited owned messenger news group, with our women’s magazine. We have it placed here because this feels right given the cover – even though this is a far more broadly focused magazine than the cover indicated.
We are planning a staff review for the magazine to help draw attention to the diversity of the title beyond what it looks like.
Small business was lost in the budget and the budget reply in Canberra this week. For me, the best example is the hundreds of millions in benefits delivered to the free to air TV networks to enable them to fund structural change while small business newsagents continued to be ignored as we move through a more significant structural change of our own.
What did I expect? Not much … but this does not block my disappointment.
Politicians care only about where their money comes from and those with the loudest voices. One day maybe they will understand that investing in small business can deliver excellent rewards.
With this happening in SA, I wonder how long before we see it in the 7-Eleven owned Mobil fuel outlets.
When Tattersalls did the deal with 7-Eleven they said Tatts products would be at the counter add-on. Over time that has changed with lottery tickets featuring in advertising to drive traffic.
Now we have this announcement in SA yesterday. I don’t want to call it prematurely but I do suspect that this move is a game changer. It will certainly get newsagents looking at the lottery category more carefully. How can they compete with this.
And to those outside SA, On the Run is more community connected and more local than the supermarkets. I’m told there will be more trust in this being a genuine offer that is the case with Woolworths and Coles fuel discounting.
In the Newsagency of the Future series I’m in the middle of I challenge newsagents to contemplate business without lotteries. It’s a value question, one that must be considered. Now, in the face of yesterday’s announcement, it is more timely than ever.
If you have lotteries in your newsagency and had a fuel outlet nearby offering a discount off fuel with a lottery ticket how would you react? You can’t do nothing for to do that would invite migration.
On the Run has declared war on lottery product sales with this move. Newsagents need a plan for confronting this challenge.
Check out the display promoting retro lava lamps created by the team at one of my newsagencies. This is very cool and very clever. They sourced some retro carpet from the Reject Shop and created a sign and a backing that connected visually with the theme.
All of the elements – carpet, backing sheet, sign and product – combine to tell a story and draw shopper attention. It looks much better than simply putting the products on the shelves.
This display is located at the corner of the counter, near our gift department. It shows us off as being different and connects shoppers with the retro fun of the lava lamps.