Month: September 2007

We opened newsXpress Watergardens this morning – the first corporate store for the newsXpress group. I am one of three shareholders in newsXpress. The photos below show parts of the store and some of what we are trying to achieve in our own journey to the newsagency of the future.

Creating a business from scratch involves an extraordinary amount of work. In the case of Watergardens, Ben Kay has carried the bulk of this. It is rare that a business manager would work as hard and selflessly as Ben has over the last six months to make Watergardens a reality.

I have received six emails in the last week from people asking if I can help them source copies of the Art of Knitting and the John Wayne Collection. They emailed me as a last resort – each had been to two or more newsagents asking about backorders and had been told they were not available. They then searched online and got to this blog. Two have gone back to their local newsagent and four have refused because the service they received was so bad.

Newsagents used to be known for exceptional customer service. Except for a few small products categories, this is our only point of difference. One newsagent delivering poor customer service reflects on all newsagents.

If I can get partwork backordered then so can other newsagents. Sure they are a pain – the reward is a happy customer and someone who has their faith in the small business newsagent channel upheld.

Bernard Zimmermann has published a long post on his POS Solutions blog tonight following my post earlier today. While most who read his post will see it for what it is, there is one point which goes to the heart of Mr Zimmermann and the company he created. He claims:

The last offer of any note for purchase of our respective businesses was from POS Solutions to buy Tower Systems, which we had a meeting to discuss.

This is a lie – there has been no such meeting. I made an unsolicited offer in writing to Zac Varga and Bernard Zimmermann – the owners of POS. After due consideration they rejected the offer as is their right.

My view is that POS Solutions is in trouble. This is a view I have formed based on steep discounting. I have seen quotes offering for under $5,000 what they usually charge over $20,000 for. Such discounting tells me they are in trouble. That and the number of newsagents who have switched.

To regular readers here – don’t worry. I am not about to let this valuable newsagent resource be hijacked by a fading competitor.

Bernard Zimmermann is demonstrating why POS Solutions, his software company, is losing customers to Tower Systems with his latest blog post. Zimmermann says we have blogged that our Eftpos link is new. I have not said that. Zimmermann, an avid reader of our blogs, would know that I have said the Eftpos link is not new. What is new is our decision to promote the link we have had since 2002 and a couple of additional banks now supported by the thirds party supplier: Westpac and NAB.

POS Solutions uses the same banking interface providor that we use.

POS Solutions is in trouble in my view. Take a look at our blog and the POS blog to see Zimmermann’s reaction to innovation. He is copying our posts about EDI, returns, Eftpos and, now, training videos. Zimmermann read my post about Tower releasing training videos and is saying he has had them for 15 years.

Newsagents expect a certain amount or argy bargy between software companies as they jostle for market share. What they do not want is dishonesty – like when POS told newsagents they had a multi million doollar data centre 7 or 8 years ago. It never existed. Or like when POS told newsagents they were EDI compliant – when they were not.

Tower Systems serves in excess of 1,400 newsagents. POS Solutions serves, by my estimation, 700. Zimmermann claims 1,100. But his company’s literature also claims 1,100 total customers. Take out 300 chemists, 100 other businesses and you can see how I reach my belief they have 700 newsagents.

POS Solutions has lost more than 150 newsagents to Tower Systems in just under two years. Newsagents have shifted to Tower Systems as a rejection of the POS software – in pursuit of greener pastures. I hope this is what Tower Systems provides.

I put an offer in writing to the two Directors of POS Solutions Australia Pty Ltd some months ago offering to acquire their business as I was tired of their poor standards pulling the newsagent channel down. The Directors rejected the offer as is their right. However, this does not help newsagents: at conferences and industry meetings the poor support and poor quality software from POS is the elephant in the room. Their inability to shift their 500 DOS users to Windows is especially damaging to newsagent prospects.

Tower Systems is pleased to be helping former POS Solutions users switch their businesses to Tower Systems and better software backed by better support.

I’d rather not have to write a post like this but I had to because of the spin Zimmermann has published.

The rumour put to me late yesterday was that a deal was very close which would bring Borders into the Angus and Robertson / Supanews group. While I have bogged about the PEP backed offer for Borders previously, my informant said there had been significant progress. If true, the result would be a book / magazine / stationery / greeting card offering covering big, medium and small formats. I’d expect rationalisation in the book side of the business (maybe some stress with A&R franchisees?) and rapid expansion of the Supanews brand. Of course, since it’s a rumour it needs to be approached with caution.