Australian Newsagency Blog

A blog on issues affecting Australia's newsagents, media and small business generally.

Newsagents keen to embrace initiatives and opportunities

Mark Fletcher on July 26, 2014 6:34 AM

newsmeetIt has been terrific meeting with newsagents at the newsagency management workshops being run around the country at the moment.

Newsagents I am talking with are looking for practical advice and ideas appropriate to their situation. They don’t want to be sold some froth and bubble, they want specific information on actions they can take in their own situation.

I am sensing a change in the newsagency channel. I have spoken at many events like these over the years and the mood of this series is different. It gives me optimism about the future of the newsagency channel.

It’s been particularly thrilling to meet with newsagents from rural and regional areas. Hearing of someone travelling for four hours to participate is fantastic.

3 likes

→ No CommentsCategory: Newsagency management · newsagency of the future

Eftpos / credit card fraud minimisation advice

Mark Fletcher on July 26, 2014 6:30 AM

I was contacted by my bank yesterday about an online transaction their internal systems claimed was fraud. I called the number of the person who ordered goods from the website and sure enough their response reinforced the bank’s view. The quick check avoided the frustration of cancelling a sale we had yet to fulfill.

Click here for advice from the ANZ Bank on fraud minimisation. This list from the ANZ is particularly useful:

  • check the appearance of the card (for instance, does the card appear damaged or altered?)
  • make sure the signature on the signature panel of the card does not appear altered, and that the signature on the transaction voucher matches the one on the card if a PIN has not been used
  • be alert to customers who appear nervous, have no means of identification and ask for the transaction to be split or hand-keyed
  • do not allow equipment to be used by unauthorised persons
  • only process a refund to the same card used in the original transaction
  • always use CVV2 as part of your authorisation procedure for purchases where the cardholder is not present.
2 likes

→ No CommentsCategory: theft

Inspiring kikki.k window

Mark Fletcher on July 26, 2014 6:26 AM

kikwindowThe latest window display being used by kikki.k looks terrific: it uses bold colours, an inspiring message … follow your path … and a sense of forward motion to attract.

I am sure this display, in all their stores, will drive good shopper traffic for the group – how could it not?

This is the type of window display we can use for inspiration in our newsagency businesses.

1 likes

→ No CommentsCategory: visual merchandising

Terrific visual merchandising at David Jones

Mark Fletcher on July 26, 2014 6:22 AM

djvisualmerchandisingI was impressed with this visual merchandising display on the floor of David Jones in Sydney. From the required pyramid shape to the story of the product mix to the placement such that it disrupts traffic flow and therefore had to be noticed – it works well.

This display is a good one to remember when creating displays in-store because of the VM boxes it ticks.

1 likes

→ No CommentsCategory: visual merchandising

SMH article: the slow, painful death of our newsagents

Mark Fletcher on July 25, 2014 7:17 AM

The Sydney Morning herald overnight published a comment piece by Derek Rielly: the slow, painful death of our newsagents.

I was interviewed Wednesday for this article. The interview covered more than has been published.

My views are: yes, plenty of newsagencies have closed in recent years and some major suppliers treat us poorly and are busy moving elsewhere. However, there is GOOD NEWS. There are newsagencies that are growing. There are suppliers who work actively with our channel in exclusive ways.

It a newsagency closes, it’s on the owner. I have seen many turnaround situations.  I live this myself as I recently wrote when sharing the latest newsagency sales benchmark results.

The future of your business is up to you. The future of the newsagency channel is up to all newsagents.

4 likes

→ 3 CommentsCategory: Newsagency challenges · Newsagency management · newsagency of the future

WH Smith purchases Kennys Cardiology?

Mark Fletcher on July 25, 2014 5:40 AM

There were reports circulating yesterday that WH Smith PLC had purchased Kenny’s Cardiology. While there has been no announcement from WH Smith, I have been told that Kenny’s franchisees have been advised.

If true, the acquisition would be another by the UK public company of a card and gift related retailer in Australia – WH Smith recently purchased Wild Cards and Gifts.

WH Smith is on the record saying they are keen to expand wholesaling opportunities through acquisitions.

There is another rumour about WH Smith having interest in a newsagency related business. That, for now, remains only a rumour.

0 likes

→ No CommentsCategory: Newsagency challenges · Newsagency management · newsagency of the future

A terrific healthy snack food display

Mark Fletcher on July 25, 2014 5:35 AM

healthyfoodCheck out the display of healthy snack food on show at a Newslink store in the Qantas terminal of Sydney airport.

On this display they are offering a good range of snacks presented well and with terrific signage.

This is an excellent pitch. Plenty of shoppers were browsing the range. It’s something other newsagents in transit locations could try.

1 likes

→ No CommentsCategory: confectionary

Bauer showbag a challenge to display and sell

Mark Fletcher on July 25, 2014 5:31 AM

awwgoodiesThe double width bag from Bauer promoting Mother & Baby is packed with some terrific items. However, and it’s a big however, it’s difficult to display. I visited three newsagencies this afternoon, one had it behind the counter as they didn’t know where they could place it, one had it shoved behind newspapers and the other had it on the floor in front of baby titles.

It would have been helpful to have a floor display unit. This is what a supermarket would have required with a similar pitch.

The other issue is that the front promotes The Australian Women’s Weekly – but this title is not in the bag. What’s with that?

2 likes

→ 3 CommentsCategory: magazines

Respectful Who cover story

Mark Fletcher on July 25, 2014 5:28 AM

magswhomh17We have placed Who magazine on the counter to drive impulse purchases. The cover and the stories inside are respectful of the Malaysian Airlines tragedy – the full extent of which is still unfolding.

Who is a good title for this type of story, they do it well.

2 likes

→ No CommentsCategory: magazines

The importance of checks and balances in your cash management processes

Mark Fletcher on July 24, 2014 5:24 AM

I was talking with a retailer a couple of days ago about the theft from his business of more than $50,000 by a business partner. He was devastated that the long-term business partner would steal from their 50/50 owned business.

The theft has challenged the future of the business as two long time family friends collapse their business relationship. It is touch and go if the business will survive.

Partners can steal from each other if there is easy opportunity. That was the case in this situation I am writing about.

For the sake of everyone involved, partners should agree on a transparent process for handling cash with different people responsible at different times. This coupled with good checks and balances and a fine attention to actual grow profit by department and with proper stock control processes and you have several points at which theft can be uncovered.

The easier you make it to detect theft in your business the less likely you will be stolen from including by your business partners.

It is wrenching hearing someone talk about theft by an employee or a business partner. The damage beyond the cash itself is far-reaching. It can change someone forever.

8 likes

→ 2 CommentsCategory: Ethics · Newsagency management · theft

Anzac calendar a hit with shoppers

Mark Fletcher on July 24, 2014 5:19 AM

anzaccalThe calendar commemorating the Centenary of ANZAC is popular with shoppers even though we are a year away from the commemoration. We are it out and on display as part of a Father’s Day calendar pitch. While calendars are popular for father’s Day, this ANZAC calendar is attracting new shoppers to the category very early into the2015 calendar season.

Placed at the front of the newsagency I have noticed shoppers stopping at to take a look at it. This tells me the calendar has the potential to find new shopper traffic for us.

3 likes

→ 2 CommentsCategory: Calendars

Working around columns

Mark Fletcher on July 24, 2014 5:14 AM

columnsWorking around load-bearing columns in any retail situation can be difficult.

I have seen some newsagents use mirrors effectively. I have seen others not use a column at all, treating it as a frustration.

In one of my stores we have premium slat-wall attached and we use each side of the column to promote a different category or product. What we promote is dependent on the product adjacencies.

Sales determine the frequency with which we change what we have located where on the column.

Sometimes we dress the column completely in a colour to best feature the product placed there and other times we use the original fixtures as the background.

0 likes

→ No CommentsCategory: Newsagency management

A good small brand for kids

Mark Fletcher on July 24, 2014 5:11 AM

itngThe In The Night Garden plush range is a nice counter offer parents like to see in the toy / plush range. It’s a rand they trust thanks to an international TV show that ended a few years ago but still attracts interest.

One thing I’ve learned about plush is that it’s not a fixed department – lost of evolution responding to trends. It’s also a broad appeal department serving shoppers of all ages buying for all ages.

1 likes

→ No CommentsCategory: Plush

Fairfax Digital report on newsagencies and the future

Mark Fletcher on July 23, 2014 3:46 PM

I’ve just done an interview with a journalist from Fairfax Digital on newsagency businesses and the future of the channel. It started out with a question about why many newsagencies are closing. But the time we finished we’d had a good discussion about the considerable good news about the channel and proactive newsagents with growing businesses.

3 likes

→ No CommentsCategory: newsagency of the future

How to grow your newsagency

Mark Fletcher on July 23, 2014 5:21 AM

Here is a video shot just over a week ago looking at one of the most valuable tools I am finding for growing my newsagency – discount vouchers. This video looks at the April through June data.

To those who say this is a post advertising Tower Systems, I’d note that POS Solutions say they have the same facility in their software.

I don’t care so much which software you use – more that you engage in a smart front-end loyalty facility that is genuinely competitive to the me-too points based programs.

14 likes

→ 14 CommentsCategory: Newsagency management · newsagency marketing · newsagency of the future · Newsagency opportunities

Finger puppets!

Mark Fletcher on July 23, 2014 5:17 AM

ingerpuppetsHere is a good example of the type of impulse purchase item that works well at the counter. Kids, parents and grandparents love these finger puppets. They purchase them for a kid right away – instead of a candy – or to slip in a card and post. While c-stores, supermarkets and plenty or others have candy at the counter, it’s with items like these that we can pitch a point of difference.

A single item will not make our fortune … many single items could.

1 likes

→ No CommentsCategory: Newsagency opportunities

Okay so the Classic Cookies cookbook is not really $5

Mark Fletcher on July 23, 2014 5:13 AM

awwclassiccookiesA colleague newsagent sent me this photo showing the collateral they received from Bauer pitching the  premium Classic Cookies cookbook at $5.00 when purchased with another item. Their merchandiser provided the material.

The problem is that Bauer has not been consistent in pitching this to newsagents – I’ve heard of many who received no such collateral.

The other problem is that Bauer did not set this promotion up with the newsagency soft are companies. It would have been easy enough to do had the company wanted to enforce the benefit.

This promotion looks like it has been poorly managed – unless there is communication and marketing collateral I am missing.

6 likes

→ 1 CommentCategory: magazines · Newsagency challenges · Newsagency management

Newsagency sales benchmark study: April – June 2014 compared to 2013

Mark Fletcher on July 22, 2014 5:59 AM

Some newsagents had a strong June 2014 quarter while the majority did not. The latest newsagency sales benchmark study shows the gap between newsagency businesses continues to widen. Here are the headline numbers:

  • Customer traffic. 68% of newsagents recorded an average decline of 2.6% in transactions. 9% reported no change and the rest an average growth of 2.2%.
  • Overall newsagency sales decline. 61% reported an average revenue decline of 5%. Of those reporting growth, the average was 5.4%.
  • Basket depth. 58% reported a decrease in basket size (items in the basket) with an average decrease was 3.2%. 3% showed no change. The rest achieved 1.9% growth.
  • Basket dollar value. 23% of newsagents an average increase in basket value of 2.4%.
  • Discounting. 11% of respondents engaged in discount based loyalty marketing of one form or another.
  • Circulation product sales continue to fall for most.

Newsagencies are not one size fits all – some doing very well and others doing poorly.

The gap between those doing well and those doing poorly does not need to be as great. Much of the success, or otherwise, comes down to leadership.

Newsagents make choices every day that can help a business grow or hold it back.

That said, would be wrong to talk about newsagents and make a common statement about how they (we) are doing as there is no common situation.

For the record, I note that the dataset includes independent newsagencies and branded businesses: Nextra, News Extra, Newspower and newsXpress. Of the latter, with which I am connected, there are only four.

Benchmark results by key departments:

  1. Magazines. 74% of newsagents reported an average decline (in units) of magazine sales of 7.1%. 5% reported no change and 21% reported average growth of 6.2%. NEWSAGENTS CAN GROW MAGAZINE SALES. In the 21% reporting magazine sales growth, most growth was outside the weeklies. Partworks continued to play an important role in the growth achieved by those achieving growth.
  2. Newspapers. 81% reported average decline of 3.8% in over the counter newspaper sales. HOWEVER: Cover price rises continue to account for revenue growth.
  3. Greeting cards. 55% of newsagents reported average growth of 2.2%. Of those reporting a decline, the average was 4.1%. NOTE: Everyday counter cards account for between 50% and 60% of all cards sold in most newsagencies – this where we need to focus our attention.
  4. Stationery. 56% of newsagents reported an average decline of 2.3%. Of those reporting growth, the average was 4.3%. While over a softer quarter for stationery, the results are not too bad.
  5. Ink. 46% of stores report ink separately. Of these, 56% reported growth of 2%.
  6. Gifts. 71% of the newsagents in this study have a separate gift department. Of these, 52% reported average growth of 4%. Gifts are down overall on previous benchmark reports – speaking to the importance of careful management of this category.
  7. Plush. 4% of newsagencies report on plush sales separately. I recommend this. A reasonable sales benchmark for plush is revenue equal to 25% of card revenue. In stores reporting on plush, sales are up on average 46%.
  8. Tobacco. 91% of stores with tobacco reported an average decline of 7%.
  9. Confectionery. 58% of stores reported an average decline of 5%.
  10. Toys. 51% of stores with the department reporting growth of 4%. However, only 7% of survey participants have a toy department.

The strong are getting stronger and the weak are getting weaker.

There is no geographic or demographic barrier to growth from what I can see. One newsagency in a town with tough economic challenges and competing with several newsagencies achieved excellent year on year growth – by owning their situation and being proactive.

Product mix shift. Embedded in the data I receive is information about unit sale and revenues contribution between all product categories. The shift I saw last quarter is continuing – from the traditional print, lottery, card and stationery mix to a broader appeal by some. It is fascinating seeing the results of deliberate actions on the shop floor to attract more shoppers to a business.

Why my own newsagency is not included in this study: My numbers are significantly outside the average and I did not want them to skew the results. I don’t mean this to be an arrogant statement.

My numbers, all off a good base, are: Art & Craft up 83%, cards up 13% with Everyday Counter up 10% and it accounting for 47.44% of all sales, Gifts up 66%, magazines up 13%, Women’s Weeklies magazines (New Idea, Who, Woman’s Day, Famous etc) up 11%, Party Supplies up 96%, Plush up 47% and Toys up 86%.

This business does not have lotteries and does not sell tobacco products.

Average sales – up 2%. Average sale value – up 15%. Average items per sale – up 5%. Overall average GP – up 11%. Each of these measurement points compounds on the other, delivering a very strong result for the business.

This growth is as a result of a structured approach established in our business plan. This newsagency is in an outer suburban Westfield centre in Melbourne with around 300 stores including majors, another newsagents twelve gifts shops – plenty of nearby and price competitors for cards, gifts, magazines and plush.

It is run 100% under management.

I mention that the numbers are off a good base to provide context. The growth I claim off a low base would not be as good as these results off a good base.

I include my own data here for comparison and to illustrate that I walk the walk with newsagents. When I encourage newsagents to try things it is because I do in my own business. I put my money where my mouth is.

Newsagencies are good businesses to own. This study supports this belief. That many newsagents are reporting growth is magazines sales is a testament to the active engagement of those newsagents and their employees in this traffic-critical category.

The best type of newsagency to own is the one where you have the most control over what you sell and where you generate traffic for several product categories where average gross profit is 50% or higher.

The most important advice I have for newsagents has not changed: Run your business today as if today is your pay day. Too many newsagents continue to run their businesses as if their pay day is when they sell. This will not happen.

Newsagents: look at your business, your sources of traffic, your average GP. Your success will come from many small steps.

Suppliers: Get smart in your engagement with newsagents. Trust them. Treat them with respect. Share their mission to grow traffic and GP and basket value. Give newsagents complete control over what they sell of your products.

This year on year same-store newsagency sales benchmark study is an analysis of basket data from 136 newsagencies: city and country, shopping centre and high street, banner groups (Newspower, Nextra, News Extra, newsXpress and independent) and independent. To be included, a newsagency must have been using the same software for both analysis periods and be compliant with industry data standards.

12 likes

→ 2 CommentsCategory: Management tip · Newsagency management

No, delayed billing does not let you use my newsagency as a warehouse

Mark Fletcher on July 22, 2014 5:41 AM

magsdiamondringsdbNetwork Services sent us four copies Diamond Rings magazine. had they asked us we’d have said no thanks. Instead, they sent the four copies. I am guessing they thought the delayed billing to the end of September let them think it was okay. It is not okay sending a title we are not likely to sell and for which we have no space and no decent category. It sucks that we had to send back all four copies as full returns – what a waste of money.

This is a perfect example of how newsagents are disadvantaged over our biggest competitors in the magazine space.

5 likes

→ 1 CommentCategory: magazine distribution · magazines

Tapping Star Wars fans

Mark Fletcher on July 22, 2014 5:37 AM

magsscifientertainIf you have SciFiNow I suggest to place some copies with your entertainment titles as the cover story about Star Wars Episode VII should drive impulse purchases for you – of the magazine and other products you may have for the brand. Star Wars fans spend big on their interest.

1 likes

→ No CommentsCategory: magazines

Home Beautiful responds to promotion

Mark Fletcher on July 22, 2014 5:34 AM

magsbetterhomesWe have been promoting the latest issue of Home Beautiful magazine with this aisle end display. Home Beautiful responds well to promotion – right through the on-sale period. We have found the key is having the full cover on show.  We’re increasing supply.

3 likes

→ No CommentsCategory: magazines

Unfair magazine distribution model makes newsagents less competitive

Mark Fletcher on July 21, 2014 6:46 AM

afr-june102014

The installation of ExchangeIT software at newsagencies enabled PBL to track real-time sales of all titles and thereby fine-tune its distribution and cut costs.  After that triumph, Alexander as also put in charge of the Nine Network, which has since improved its leadership of the television stations. SIC.

This is from a story by Trevor Sykes published in The Australian Financial Review on June 10, 2004.

It is July 2014. While the magazine distributors may have fine-tuned their distribution and cut costs, newsagents have not. Indeed, the magazine distribution model does not offer levels with which we can control this side of our business. The processes imposed by the magazine distributors hobble our businesses.

Too often today, ten years on, we receive magazines supplied at volumes that do not reflect sales data. Indeed, the experience today and in the last ten years makes a mockery of the story by Sykes.

A good journalist would have done their research rather than taking the PBL spin about XchangeIT. Sykes clearly did not. I wrote to Sykes at the AFR at the time and no correction was printed.

For the record, the problem is not XchangeIT, it is a model that sees distributors ship all stock they are provided. For the most part, that is how they are paid – as a freight company. If their compensation model was based solely on sales newsagents would start to see fairness.

Today newsagents are not treated the same as our competitors – the two big supermarket groups. Coles and Woolworths are supplied on a more equitable basis, giving them an unfair competitive advantage.

With more than 60% of all magazine titles supplied to newsagents loss-making, something has to give. I think we are reaching a tipping point where newsagents will exit the category. Several have done so already – they have stopped selling magazine altogether. I am not advocating this, just reporting that it has happened.

Magazine distributors have the capacity to supply on the basis of sales data and to a model with a goal of selling out close to the end of the on-sale period. It is time they started using their data to achieve this.

22 likes

→ 8 CommentsCategory: magazine distribution · magazines

WARNING: If you sell or give away a computer you have used in your business…

Mark Fletcher on July 21, 2014 6:03 AM

Slastdot has a post about an old computer that had been used for running POS software in a retail business which was sold on eBay. Here’s what was found on that old computer: default passwords, a security flaw, and names, addresses, and social security numbers of employees of the terminal’s previous owner.

The safest way to get rid of a computer you no longer need is to take a hammer to the hard drive or solid state storage. Smash it to bits. If you do sell it or give it away, format the drive first.

5 likes

→ 11 CommentsCategory: Newsagency management

Vogue covers up the competition

Mark Fletcher on July 21, 2014 5:58 AM

magsvoguecoverupThe latest issue of Vogue Australia covers the title behind it with the card holding the St Tropez tan gift with purchase. I moved it after I took the photo so it was in the top pocket and not obscuring anything. In many newsagencies I suspect it would not be moved – thereby blocking the title behind. Publishers of the obscured would have every reason to be frustrated, especially if sales are impacted.

While a good gift can lift sales, publishers sending our packages like Vogue Australia with this issue of should ask for placement that respects other titles.

3 likes

→ No CommentsCategory: magazines · visual merchandising

Quality Classic Cookies cookbook too cheap?

Mark Fletcher on July 21, 2014 5:54 AM

magscookiespricewhatThe AWW Classic Cookies cookbook from Bauer feels too cheap at $5.00. It’s a good quality product that feels like it could sell at two or three times the price. It’s the type of cookbook that could sell as a gift.

Am I missing something in thinking it’s too cheap? What do you think? 

4 likes

→ 11 CommentsCategory: magazines