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

Month: December 2008

OnQ Creditors update

Worrells, the Administrator for OnQ, has recommended that the company be wound up.  This was to be put to a vote of creditors today.  OnQ is interesting to newsagents because of its shareholding in Bill Express and its connection with hardware supplied to newsagents as part of Bill Express through Technology Business International, another OnQ company.  Click here for a copy of the report to creditors provided in advance of today’s meeting.  It sheds some light on the Bill Express / OnQ mess.

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Bill Express

Christmas greetings…

Vienna Chen, graphic extraordinaire at Tower Systems, has created the artwork for a Chirstmas greeting for me…

newsagency-blog-blue2.jpg 

I asked for the Christmas tree to be heading out to sea.  Not sure why.

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About us

Books, magazines and returns

The announcement by Borders in the US of an agreement with HarperStudio to buy books on a firm sale basis instead of the usual sale or return basis is a significant move in book retailing in the US.

If magazine publishers and distributors in Australia offered firm sale with better margin, some newsagents would embrace the opportunity.  These newsagents would have more reason to sell product purchased on a firm sale basis.

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Book retailing

Talking with shut-in newsagents

At my newsagency software company, Tower Systems, we have contact with between 150 and 200 newsagents every day through our help desk.  In the course of these calls about software or some other supplier issue, team members often find themselves talking about general industry issues.

It is interesting to me the number of shut-in newsagents we talk with.  These are newsagents from smaller businesses who don’t have the staff or other resources to enable them to be out of the shop.  Often they want to more actively participate in the industry but cannot free themselves from being behind the counter.

I have heard some suppliers and industry representatives say that these people are holding the industry back by not getting out of their businesses are participating.  My view is that they are participating by running their businesses. 

I would not criticise anyone for owning a business which is too small to justify hiring staff so the owner could have free time.  All of us in our own businesses sacrifice our own time for the future of the business.

At Tower Systems this year we have run many online training sessions and workshops for newsagents.  These have been a success with the shut-in newsagents and provided to them access to a community of newsagents which would have otherwise been missed.

I’d like to see other suppliers pursue online meetings and other models which build a better connection with shut-in newsagents.  The result will be a better informed and motivated channel.

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Newsagency challenges

Newspaper home delivery discussion

Further to recent discussion here on newspaper home delivery, click here for a copy of the business plan I developed three years ago when I was looking to expand in this area.  As I was unable to interest anyone in this or acquire any adjoining runs I sold my home delivery business.  Timing is everything as they say.  I was lucky.

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newspaper home delivery

Ferrets and point of difference

ferrets.JPGMost of the calendars we sell in our newsXpress Forest Hill store we selected by title, carefully based on past year sales data and with attention to our demographic.  Like special interest magazines, our calendars speak to range.  They pull customers in looking for special interest titles – because they have seen them before in our shop or because of word of mouth. 

For most of our pre Christmas customers, calendar price is not an issue.

Several times, customers have told us that we have saved them buying a certain calendar title online – they love that they were able to buy it over the counter.  These are customers who will be back next year.  Some will also be back for the Boxing Day sale for a second and third calendar – we have stocked up for this.

The Ferrets calendar is a good example of demonstrating a point of difference.  Ask a newsagent if they would carry it and most would say no.  However, once you have had some success with calendars and you want to expand on that you will soon find yourself carrying and selling the Ferrets calendar.

Like overseas crossword titles, calendars from magazine companies are, for the most part, a waste of time and space.  You can build the kind of business you want.

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Calendars

Crosswords as Christmas gifts

crosswordschristmas.JPGCrosswords are also selling well athis Christmas, especially the titles next to our women’s weeklies section in our magazine department.  We have eight Lovatts titles and one Puuzzler title in this second location. I have noticed several customers buy multiple titles as a gift.  By placing crosswords in this higher traffic area, with a poster promoting them as Christmas gifts,  we get sales to people who may not do crosswords but will give them as a gift.

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magazines

Top Gear top Christmas gift

topgearchristmas.JPGThe Australian edition of Top Gear magazine has sold very well in the lead up to Christmas.  I have had several customers tell me they are buying it as a Christmas gift.  I’d like to think that our promotion of magazines as Christmas gifts with the posters I blogged about here has had something to do with this.  I have no evidence other than good magazine sales.  One customer commented that Top Gear was the perfect stocking stuffer for her husband – helpful to remind staff of this over the next few days.

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magazines

Magazine predictions for 2009

Dylan Stableford at Folio magazine in the US has brought together 117 predictions for magazines next year.  Some are thought provoking others are lazy.  I am about to sign off on a new shop fit for our Frankston store.  The plans include a good allocation of prime space for magazines – using UK designed and made fixturing.

While I am sure 2009 will present challenges for magazines, I expect that newsagents who embrace being a specialist will end the year with good results.  Our new shop fit seeks to position us to improve retail efficiency with the category and offer flexibility to roll with challenges which present.

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magazines

Exclusivity for carols

hscarols.JPGKudos to the folks at the Herald Sun for distributing the program for Carols by Candlelight excusively through newsagents. 

Beyond the extra traffic, it lets us show we are supporting the Melbourne based Carols event and not just chasing a buck for Christmas.

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Social responsibility

Devaluing the Vogue brand

voguedamage.JPGVogue does not look like a premium title when the promotional material shoved into each copy is so easily damaged in transit.  All of the cards promoting the bonus with the latest issue were damaged in our shipment.  We are contemplating removing them because they mage the magazine look damaged.  I appreciate that the publisher wants to promote the bonus – they need to do this in a way which respects their excellent brand.

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magazines

Weekend Christmas trade

I was fortunate to get to five shops I am connected with yesterday – three newsagencies and two card and gift shops.  Cards are strong all over – now is where I would love a card full of backup stock.  Calendars are doing very well.  Nothing is discounted except for the remaining small range of Advent calendars.  Magazines are strong in economically weaker areas. 

What surprised me was the number of other stores discounting – 50% off Christmas cards, gifts and calendars.  But they are not screaming discount.  It is a more passive approach and in one case something you know hear about only when you are in the store.

In one centre Calendar Club is discounting calendars at 25% off and in another centre Calendar Club is selling the same calendars at full price.

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Newsagency challenges

Great customer Christmas gift

fhn_pads.JPGWe took up the newsXpress Christmas gift offer and have these personalized pads to give to regular customers.  They promote our contact details and act as a nice Things To Do Today pad for placement next to the phone or elsewhere in the home or office. 

Customers react well when you give them something for nothing like this.  I’ll take any opportunity I can to promote my newsagency and the brand under which I operate because this is my point of difference. 

Gifts such as these pads are common in other national retail chains.

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newsagency marketing

The last weekend

Here we are, the big weekend before Christmas.  If today and tomorrow are anything like the last two weeks we will see cracker sales.  All stores in which I am directly involved and in a variety of demographics are trading well.  The only items we are discounting are Advent Calendars.  Year on year, where we have such data, we are in great shape.  But all that can change at Christmas based on one or two days trade.  Hence my interest in this weekend.  Rain would be nice – people flock to shopping centres when it rains.

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retail

Promoting Christmas

The photo below shows the Christmas product display customers walk past as they approach our lottery counter right at the front of our newsagency.  As you will see from other posts today, this is one of several in-store offering Christmas products.

mainpitchchristmas1.JPG

We are not as into gifts in this shop yet as other newsagencies so our Christmas pitch is more about the season and celebrating this than gifts in general.

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retail

Christmas at the counter

counterchristmas.JPGAfter an amazing three week run we have replaced our counter Australian Women’s Weekly display with Christmas gifts – as shown in the photo.  We have gone for easy to sell Christmas items here.  The mugs are selling especially well from this position as are small Christmas decorations.  It is great seeing people come to their counter with a newspaper, magazine or other items and then add a $9.95 mug to the basket. 

AWW will sell out this month as a result of the display we left in place at the counter.

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Gifts

Baby’s First Christmas

babyfirst.JPGGiven our sales of new baby, christening and similar baby cards, it’s a no-brainer to have Baby’s First Christmas gifts as part of our Christmas gift story. 

This display at the front of our newsagency is at the corner of the counter.  The range covers a broad price spectrum and as such suits various budgets.

While we have bigger Christmas displays elsewhere, we have found it useful to also have smaller themed displays such as this.

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Greeting Cards

Andre Rieu in Holland Focus

hollandfocus.JPGWe are promoting the latest issue of Holland Focus at the counter as it has Andre Rieu on the cover.  We should sell out all 12 copies we received.   Some of those will be Christmas gifts, this has arrived just in time.  We are seeing plenty of magazines bought as Christmas gifts this year. 

The counter promotion also reinforces our depth of range of magazines.

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magazines

Too big to sell

weliketosurf.JPGThe We Like to Surf book is too big for us to sell.  Way too big!  In our magazine fixtures it takes three pockets.  So, in addition to magazine KPIs around supply, return and shelf life we need to add product size and the definition of a magazine.  While sure to be of interest to some of our customers, this book is too big for us.

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magazines

Learning to trust (or not) a supplier

frillpen.JPGThe rep for these bright fluffy pens said they were selling well.  Since this was a new relationship for us we trusted them and placed an order.  A few weeks later we found the same product in a discount shop for what we paid the wholesaler.  Ours are not selling and I doubt they would in any store buying from this wholesaler.  The buy price is not good.   Based on our experience, we are less likely to trust this rep.

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Suppliers

Newsagents could leverage the Detroit situation

Some diesel fumes must have leaked into the executive suite at Detroit Newspapers and driven the bosses mad. The decision-makers announced Tuesday that the daily newspaper reading habit was as dead at the domestic auto industry. I call it Motor City Madness.

Read the rest of the assessment here by John K. Hartman, professor of journalism at Central Michigan University, of the announcement this week to cut newspaper home delivery in Detroit.

While there is certainly robust criticism in newspaper circles globally, that the shift is happening puts home delivery onto the agenda – as if it was not already.

If I were a distribution newsagent I would be calling for a summit ASAP, in the next couple of weeks (not after summer) to look at the Detroit move from an Australia perspective.  Such a newsagent only summit could also develop strategies around pursuing a fair return for home delivery effort. 

Something has to hapen because those representing newsagents on this have failed for decades – up to an including last week.  Use Detroit as a reason to come together and roll up the sleeves and decide what is best for newsagents and their families.  Then pursue that with vigour.

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newspaper home delivery

Newspaper subscriptions offer churns from good margin to bad

The Border Mail / Age offer from Fairfax is churning newspaper home delivery customers from good margin business to discount business.  This is not what these offers ought to be about, they should deliver incremental business.  I have now seen evidence of the Border Mail / Age joint subscription offer converting a customer for no increase in delivered days but delivering less margin to the publisher and to the newsagent.  Newsagents should not have to pay for publisher folly.  I hope that the newsagents involved make complaints direct to the ACCC.

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Newsagency challenges

Kudos to Whitcoulls

whitcoulls.JPGI visited the Whitcoulls store in Manukau yesterday and was most impressed with what I saw.  The store layout, signage and ranging is excellent, far better than their Australian counterpart Supanews and better than what I have seen from Whitcoulls before.  While Supanews and Whitcoulls operate in different markets I am surprised at the considerable difference in their retail offers.  This Whitcoulls store looked corporate yet the service was very personal.  Staff I noticed were knowledgeable and friendly.

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newsagency marketing
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