We display pens with crossword titles at our Watergardens store. The pens are changed regularly to give coverage to different brands. The clip on bin for the pens as shown in the photo is what makes this easy. We can use the bins in other magazine categories to promote similarly appropriate product. This is all about basket building – getting customers to spend as much as possible, not by being push but by putting offers in front of them for a subliminal pitch.
I attended the second creditors meeting of Bill Express and twelve related companies in Melbourne this afternoon. The key resolution of the meeting was to put the companies into liquidation.
Leading up to the decision to liquidate the businesses, the creditors meeting heard further detail of the mess the business created for itself through an unnecessarily complex structure, lack of transparency, inadequate control and questionable business practices.
One comment which interested me was that Directors thought negative media commentary played a part in the downfall of the company. I am not aware of any negative commentary which was untruthful.
The only glimmer of financial hope for secured creditors such as the ANZ bank is a sale of the business. 7-Eleven has some time left on their exclusivity arrangement around this. For their bid to go anywhere, they will need supplier and retail network support. It will be interesting to see how newsagents react should 7-Eleven get to the point where they are ready to ask the question.
The ACCC and ASIC have active investigations into various aspects of Bill Express. I hope that these are fruitful as they may help provide closure for newsagents. I would also hope that formal interviewing of Directors around the question of possible insolvent trading and dubious transactions is useful.
Today’s meeting was funereal in mood as one would expect.
There is no good news in this – hundreds of millions of dollars lost by ANZ, Optus, Vodafone, Telstra and others and the considerable potential future losses of tens of millions by newsagents relating to Bill Express equipment lease.
I hope that anyone associated with the Bill Express business who is found to have breached their obligations is brought to account.
We have replaced our four day old Dolly counter display with this display for SHE magazine. With the free John Grisham novel and the magazine for $3.00 it is the perfect deal for our demographic. By focusing on magazines with good-value giveaways at the counter we are subtly promoting our newsagency as the place where our customer’s get value for money. In this credit-crunch controlled marketplace, a pitch around good-value deals at the counter is essential.
We have had this display up 24 hours and already it is achieving excellent results.
The ASIC website has a sample of the letter you can send to a bank to cancel a direct debit. Here is a modified version of that letter for use by newsagents in relation to their Bill Express equipment lease. This sample was distributed by the QNF to its members yesterday.
[Your letterhead or postal address]
[Date]
[Name of bank, building society or credit union] [Address]
Dear Sir/Madam
Cancellation of direct debit
I refer to my authority to [Insert name of merchant and your account or reference number with them] to direct debit my account [insert your bank account name and number] for $544.50 (including GST) on or around the 25th of each month. I hereby cancel this direct debit authority, effective from [insert date],
Would you please confirm in writing that you have forwarded this cancellation instruction to the merchant’s sponsor bank and that you will make sure no further amounts are debited from my account under this direct debit authority from [insert date as in paragraph above].
Yours faithfully,
(Your signature, name etc.)
Newsagents involved in the NSW class action were advised more than two months ago to cancel their direct debit. The ANF changed its mind on the direct debit can called on newsagents to suspend direct debit arrangements for Bill Express equipment twelve days ago.
It is important newsagents ct this week given that the next account sweep is due in under two weeks.
My Home is one of a bunch of magazines from Express Publications which are problematic for newsagents. Like other Express titles, My Home is oversupplied – not only in my newsagencies but others from what I have seen. A sell though of 30% – 40% is appalling, loss making. My Home is usually bagged with a back issue as a “free” gift. Most Express titles are bagged with “free” gifts, making them unfriendly to browsers and therefore harder to sell. The publisher may want to revisit the pitch they make for the free back copy – since they do this just about every month it is hardly special as they claim.
If it were up to me, I’d put Express Publications on notice: improve your sell through rate to above 60% or pay newsagents a financial penalty to respect the real-estate and labour investment. I would be looking for $2.00 per unsold copy per month. If they don’t like these terms then we should be able to cancel the title, permanently, from distribution.
The moew successful publishers supplying newsagents should join us in this mission because it is the cost of titles like My Home which takes our attention and capital away from their titles.
Some bright spark decided we should receive 12 copies of the Renovators Organiser, a publication with a six month on-sale period. The Renovators Organiser is difficult to efficiently display because of its odd size, it has a high cover price, a very long shelf life and does not easily fit the magazine category as it is more of a book. We have returned nine of the twelve copies we were sent in one newsagency and seven of the ten copies sent to another newsagency. We made these decisions decision based on sales of renovation magazines in our newsagencies.
The publisher, 27 South Pty Ltd, and the distributor, Network Services, will probably be unhappy with what I have written. I’d ask them to put themselves in the shows of newsagents. Someone sends you $240.00 worth of an item you did not order, have never sold and which is unlikely to sell. They expect you to keep this on your shelves for six months and pay them for the stock on 30 day terms. Every time this happens it takes our capital and attention away from top selling magazines and other more important parts of our businesses.
If a publisher has a great idea of a fringe magazine or related product they need to finance the risk of putting stock on our shelves. It is unreasonable theyt use newsagent money to fund their business.
I am thrilled with the response to the TV campaign for newsagents which I announced here last Friday. Newsagents are pleased that their shingle will feature on a wide variety of TV channels. What is needed most right now is photos of happy newsagnts standing in front of their shops and counters. The more of these we get the more the direct of the TV commercial will have to consider. If you have a photo you would like considered please email mark@towersystems.com.au.
There are a couple of cynics bagging the idea, saying I have an ulterior motive. No, no ulterior motive. My motives are well explained in the letter I sent to all newsagents. I believe in this channel and rely on this channel. The TV commercial is the best way I can demonstrate this to all newsagents regardless of their marketing group or software company affiliation. The alternative is to do nothing – but I figured there has been too much of that over the years.
I have been asked by several people how we are displaying our Intralot scratch tickets given that Tattersalls want us to keep their scratch ticket bays empty for… Here is what our team at Forest Hill came up with.
The placement of the scratch tickets around the magazine display has been in place for several weeks (as the photo shows). Sales have note been affected by the move of the scratch tickets to here from the now unused Tattersalls scratch ticket bays.
The Age today runs the second part of it’s investigative piece on Bill Express. It is interesting, but not surprising to see that art least one Bill Express Director blames newsagents, in part, for the collapse of the company.
We are promoting the latest issue of Dolly at the counter. It qualifies for this special treatment thanks to the free singlet valued at $11.95 which comes with the magazine.
We are now running two magazine promotions a week in this space at the counter. While there is work in regular display changes, if we get the timing right it is worth it in sales. Our weekend demographic is different to our weekday demographic and we try and connect with that in our choices.
Lovatts are running a competition in the issue of BIG which goes on sale August 28 with a prize of tickets to see Andre Rieu later this year. This is a smart competition because the prize will connect well with the typical Lovatts customer – certainly in our newsagencies. I have blogged here before about the pulling power of Andre Rieu – put him on the cover of a magazine and it sells out. We will promote the Lovatts BIG competition in a big way.
It struck me while walking around the GNS Market Fair in Melbourne how well our channel is catered for with suppliers providing stunning visual impact in their ranges. I saw national brands with excellent displays which would look fantastic in any newsagency. Something happens between the trade show and the shop floor. Only rarely do newsagents create a similarly stunning display around a brand or a grouping of brands. While space, demographics and capital can be a challenge, too often we don’t even get part of the way there.
Buying and merchandising for visual impact could lift many newsagencies. rebuilding stationery around brands which are advertised nationally could lift a business from looking second class to looking like it is a worthy competitor.
The Markt Fair shows we have suppliers ready to help with branded product. The key is in our buying.
The post it note type ad for Simply Energy stuck on page one of The Sunday Age newspaper this morning covers promotion for their Olympics coverage. When I followed the instructions and lifted the ad it tore the page in half. While I am sure advertisers love these ads, they continue to damage editorial content.
The first day of the GNS Market Fair in Melbourne was good. While I don’t know official numbers, our feeling is that it was busier than for the Saturday last year. It is a great opportunity to catch up with newsagent clients more so than to sell – especially since most newsagents buying a system now are switching from something else and they prefer to have these discussions in private. Our free stress balls were a hit as was our new Retailer Mobile software which we were demonstrating on the iPhone and another portable device.
Westpac is another bank where at several branches newsagent requests to cancel direct debit arrangements for Bill Express equipment have been refused. Since my post yesterda about National Australia Bank I received two calls from newsagents complaining about Westpac.
Your bank cannot refuse to cancel a direct debit. To do so is a breach of the Banking Code of Prctice. Here are some steps you could consider if they refuse:
I am happy to list banks here which are refusing to refund money which was taken from newsagent accounts against their explicit instructions.
Justin Fox writing at Time this week tries to make sense of why small town newspapers in the US are faring much better than their big city counterparts. I know from the data I have from many newsagencies that rural and regional newspapers are faring much better in Australia. Newsagents actively promoting them are far more likely to get a sales kick than with a capital city newspaper.
The National Australia Bank refused to cancel the direct debit for the now useless Bill Express equipment at newsXpress Parkmore in Victoria. I was talking with Phillip Johnson this morning at the GNS Market Fair and he explained that he faxed the cancellation through to NAB and when he found money had been taken from the account he confronted them. They have point blank refused to act on his request. Phillip drew their attention to the Banking Code of Conduct and they still refuse to follow his instructions in relation to his account.
I would be interested to hear from any other newsagents experiencing difficulty with the National Australia Bank.
Mark Hawthorne and Jesse Hogan shed more light on the Bill Express mess in part one of a two part excellent report in The Age today. While the report will not help newsagents financially, it will help us understand the extent to which we were duped. It is also good to see further detail on the interest being shown by ASIC – they now have a five member team on the case.
For newsagents, the Bill Express mess will not end until there is closure on status of the equipment rental agreements newsagents entered into with parties associated with Bill Express. My understanding is that newsagents owe around $20 million. Many newsagents have cancelled direct debit arrangements and face a showdown with the finance company, Mobius.
While there have been threats of legal action against newsagents to recover lease payments, none has been commenced to my knowledge. The group of newsagents behind the Class Action are ready to defend any action by Mobius on this front. Any newsagent being pursued should know that fellow newsagents will rally to support mounting a defence.
Personally, I am lucky with Bill Express. I signed a four year equipment lease. Yes, I did not thoroughly read the agreements. I joined late and expected others had. Dumb, I know. My equipment contract ended at the start of this year. They tried to get me to sign an extension for the plasma advertising screen they installed – I was one of the first trial sites. I refused to pay – the $5,000 charge for a screen which cost under $1,000 to purchase was nonsense. Also, by that time, I was skeptical of the model and some of the practices being used by the company. Bill Express never pursued me.
My personal position aside, I will help any newsagent out of the Bill Express mess in any way I can.
We have been promoting Annette Sym’s Symply Too Good to be True cookbooks at the front of the shop this week. Annette’s brand is well known and her healthy eating cookbooks sell easily. She is a great supporter of newsagencies. Customers often buy two or more of these – hence the value in displaying all five cookbooks on the stand. In our regular magazine display, Symply Too Good to be True cookbooks to transition between the ACP cookbooks and women’s health magazines. They also sell well as an impulse item at the counter and when displayed with Diabetic Living – Annette’s recipes are Diabeties Australia approved.
On May 6 I blogged (complained) about the Guerrilla Guide Recording and Production and the ridiculous eight month on-sale period. Yesterday, having sold no copies in three months, it was time for this title to go. We have carried the financial risk, provided our real estate and labour for no return. This title has been a dud.
I am sure other newsagents are in this same position. We need to set a price for access to our network. We need to be firm in applying this. Such a fee, for titles outside the top 200, would reduce the volume of loss making titles we receive.
The latest issue of Contemporary Home Design, besides a long shelf life, is fat. It is fat because of the free magazine bagged with the latest issue. Newsagents can only fit one copy in a pocket. This means it either gets a coveted flat stack placement or takes up more retail pockets. As with most freebies which are sent with product from Universal Magazines, there is little genuine value.
On first glance I thought Bliss Victoria was a local magazine related to produce from our own state of Victoria. It is actually a US title which is bound to confuse some who pick it up, like me I guess. Maybe it is just me but I think we are seeing an increase in imported titles hitting newsagencies.
Donna and the team at newsXpress Kingaroy Mall engaged in local marketing at its best when they had Lady Flo Bejelke Petersen in to sign her new book containing her world famous Pumpkin Scone recipe. Being local is important to newsagents. We see ourselves as a community hub so it makes sense that we seize opportunities to reinforce this, as the folks at Kingaroy did with Lady Flo.
Thinking about this today made me wonder how many newsagencies have a Lady Flo in their area and whether any move has been made to embrace the opportunity. In my own situation I’ve neglected to research this.
With fuel prices the way they are, focusing more on local makes sense.
Coles is running radio ads in Melbourne promoting 25% off mobile phone recharge sold at their outlets. This is their way of letting consumers know that they are back in the mobile recharge game. They were hit hard by the collapse of Bill Express too but 25% off! Someone is taking a hit at that level of discount.