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

Month: October 2011

A tax break to help businesses to restructure?

The Sunday Age yesterday had a report about a report to be presented at this week’s Tax Summit calling for government assistance in the from of tax breaks for businesses facing restructure as a result of a strong dollar and or other challenges.

If there is even a hint of such support I would expect newsagents to be at the front of the line with their hand out and arguing that any such assistance should be retrospective given what the government took away in 1999 in the name of competition.

Outside of the federal government facilitated restructure of newspaper and magazine distribution in 1999, newsagents are in the middle of an even more comprehensive restructure.  In fact, it is three restructures: an overall retail restructure, the shopping centre restructure and the print media restructure.

Newsagents could use more than a tax break.  They could use help in dealing with landlords on financial and permitted use terms.  They could use help in dealing with magazine distributors on achieving equitable magazine supply terms.  They could use help in dealing with newspaper publishers on achieving fair compensation for newspaper home delivery.

I doubt that the push from Ernst and Young and others for a tax break to help businesses undergoing restructure.  But in case it does, newsagents need to be ready.

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Newsagency challenges

Kicking up the Halloween display

I love team members who take initiative.  I was sent this photo over the weekend of our new Halloween display while I was away from the shop.

While the old Halloween display looked good and was working 9(selling), this new display has the drama and fun of Halloween … live and on show in-store.  Talk about retail theatre.  I love it.  I love Halloween because we get to have fun and the newsagency itself gets to have fun.

While the supermarkets and so-called discount shops sell Halloween products, that is all they do.  We engage and have fun with the season with our customers.  It’s a great season for us to show off our point of difference.

This display will evolve as we get closer to the big day.

PS. we are cheaper that other outlets and we have a terrific margin.

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visual merchandising

Promoting Australian Traveller magazine

Regulars here would know that I like Australian Traveller magazine.  It responds well to good placement, hence our placement of the new issue last week such that the full cover can be seen and in a location more frequented by female shoppers – this makes sense since more women make travel decisions than men.  In addition to placement in an ideal regular location, we will give this issue a run with a co-location for a week or two in a high-traffic location.

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magazines

Q3 newsagency sales benchmark study announced

I invite newsagents to participate in my next newsagency sales benchmark study – covering the third quarter of 2011.  For ease of data analysis and consistency of reporting, participation is open to the more than 1,760 newsagents who use the Tower Systems newsagency software.  I hope to get between 100 and 130 participating again.

  1. Please run your Monthly Sales Comparison report  This is my favourite report in the software).  On the left, select July 1 2011 through September 30, 2011.  On the right select July 1 2010 through September 30, 2010.
  2. Check that the dates are right.
  3. Tick the category box.
  4. Do not tick any box about suppliers.
  5. Once the report is on the screen, save it as a PDF.
  6. Please email the report to mark@towersystems.com.au.

Thanks in advance for participating in what has become an anticipated benchmark study.  The results are useful in comparing your newsagency with others.  They also give us a health check on the channel overall.  I ensure that the dataset includes a good cross section of newsagencies.

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Newsagency benchmark

MasterCard blames retailers for fees

In a submission to the reserve bank, MasterCard says that some retailers are gouging on fees they charge shoppers for using their MasterCard.  The Australian has the story today.

While I am not concerned if the reserve Bank does introduce a cap on what we can charge for the use of a MasterCard or Visa card, it galls me that MasterCard takes a swipe at us without talking about they fees they charge retailers.

Losing margin is this tight retail marketplace is a cost any business would want to avoid.  MasterCard should look at what it charges retailers before pointing the finger at us in complaining to the Reserve Bank.  In addition to the margin cost of their fees, there is the administrative cost associated with accounting for this method of payment.

Maybe retailers could fight back with a sales counter based campaign against the MasterCard submission.

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EFTPOS fees

ALDI challenges banks on EFTPOS fees

Aldi released a media announcement on Saturday keeping up pressure on the banks over EFTPOS fees. Here is the full announcement:

ALDI calls for proof that banks’ internal costs will increase due to changes to EFTPOS interchange model

ALDI is today calling for Australian banks to prove their net costs are increasing as a result of changes to EFTPOS interchange fees.

Steven Bigg, ALDI Managing Director Finance and Administration says ALDI believes the overall increase in net costs to the banking industry is minimal and is calling for greater transparency of any unjustified cost increase to retailers.

“Any investigation will show the banks will increase their revenue to the tune of tens of millions of dollars each year at the expense of retailers, if all the Major Banks adopt a similar stance to those banks that have already advised their retailers in writing as to the magnitude of the fee increase,” he says.

“We also see the potential for adverse effects on competition due to inconsistencies in how these charges are being applied to retailers, in what is already  acknowledged as one of the most concentrated grocery retail sectors in the world.

“In light of the Federal Court’s judgement that consumers and retailers have been misled, we believe the decision to change the interchange fee structure should be further reviewed in an open and transparent manner, and the changes placed on hold until this review has taken place.”

ALDI has now made a decision NOT to place any surcharge on EFTPOS transactions within its stores.

As I have noted already, it is terrific for small business retailers like newsagents to have Aldi making the running on this issue as they are more likely to get media coverage than us.

For the record, we will not be introducing EFTPOS fees in any of my newsagencies.  We use Tyro broadband Eftpos and appreciate their helpful position on the new fees.  This will help us keep our costs down.

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EFTPOS fees

ACP trialling Sunday on-sale of magazines

As some comments on a recent blog post indicate, ACP Magazines will trial Sunday on-sale of its titles in Newcastle and the ACT.  The trial will commence next Sunday, October 9.  The data from the fixed-period trial will help ACP determine if this is an initiative they could benefit from elsewhere.

The trial will see newsagents, supermarkets, c-stores and petrol outlets receive stock for a Sunday on-sale.  Majors like Big W will not receive stock.

While there are some operational challenges, the trial is an opportunity – especially for shopping centre based newsagents where you are like to see shoppers on a Sunday who you would not see during the week.

Newsagents in high street situations could find that they lose sales as a result.  This will be reflected in data from the trial and should help guide any decisions following the trial.

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magazine distribution

Promoting Pink magazine with AWW

In addition to robust promotion of The Australian Women’s Weekly, we are promoting the annual Pink magazine which is on the back of the current issue of AWW.

We have promoted these as two separate titles in the past with success. I’d encourage all newsagents to do this.

AWW is also on the Pink display to make the connection in the minds of our shoppers.

We will keep promoting Pink for another full week.  There is no doubt that it helps sales of AWW.

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magazines

New Kindle Fire to push tablet market even further

The new Kindle Fire announced last week by Amazon will undoubtedly push the tablet market to new places.  This new device and the almost disposable price of the more traditional Kindle further opens this rapidly growing distribution channel for publishers of print content.

It is vitally important that newsagents are aware of these development when negotiating leases and shop fits.  Given that each is a five-year investment, we need to be committing to what key parts of our businesses will look like in five years.

Flexibility on all fronts is vital.

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Media disruption

Pricing error on Courier Mail challenges newsagents

The Courier Mail newspaper in Queensland yesterday was priced at $1.10 instead of the usual $2.00 for the Saturday edition.  Newsagents had to reprice the newspaper otherwise shoppers could challenge them to sell it at the lower price according to consumer regulations.

While these things do happen from time to time, I know from what several newsagents told me that it was frustrating having to deal with this on a bust Saturday morning when senior people are less likely to be in.

It made the TV news last night in Queensland as well.

The challenge for newsagents is considerable, not only in their own retail sales but in what they supplied to sub agents.  What if they did not provide incorrect pricing advice to a supermarket, for example?  Who is responsible in this situation?

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Newsagency challenges

Another sad day for Australian newspapers

Picked up The Sydney Morning Herald on Friday and was disappointed to see the masthead of this once great newspaper partially obscured by another post-it type stuck on ad.  I feel for the editorial professionals when their advertising colleagues treat them in this way.

Bucks over content … it’s a commentary on the challenges of the print newspaper.

I understand that newspaper publishing companies are businesses and that they need to be profitable.  Chasing revenue by covering your brand does not make any sense to me, especially with a stuck on ad which readers don’t like.

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newspaper masthead desecration

Aldi vs ePAL coverage

There has been considerable media coverage on the Aldi court case against ePAL over the last 24 hours.  Here is just some:  Inside retailing; The Australian; Smartoffice; ABC, AM on ABC radio and ABC news last night.

Also good to see the story in The Australian with news that the Commonwealth Bank will not be passing on fee increases at the moment.

Kudos to Aldi for their court action and in getting this topic onto the news desk.

Today, the world changed for Eftpos fees.  ePAL’s new pricing regime is in place and this means retailers like us could pay more.  Already some banks have made moves.  While we don’t know where it ends up, banks being banks I think that we have a fair idea what will happen.

I and some other newsagents are continuing to lobby politicians on this.  They have the ability to control ePAL through the Reserve Bank.  Unfortunately, all politicians appear to be prepared to do at the moment is to regurgitate ePAL spin on the Eftpos fee changes.  So much for their support for small business.

This is issue has been an excellent opportunity for politicians to put their words of support for small business into action.  We have been profoundly let down.

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EFTPOS fees

Early start to Halloween 2011

It is still a month away and already Halloween products are selling.  We put our stock out Thursday night and sales have been strong since.

While we have an excellent margin on our Halloween 2011 product, we are still beating other retailers with exactly the same Halloween product.  This is another example of newsagents being price competitive – contrary to consumer perception.  We are letting shoppers know through conversation on the shop floor.

We are chasing a Halloween sales bump of 25% on last year and have resourced our Halloween display accordingly.  Being in a busy shopping centre helps as it delivers new shoppers regularly.

Early sales underscore the value of going out early with Halloween and other seasons.  Being school holidays is a key reason for our success these past few days.

I love Halloween as it brings a terrific element of fun to our newsagencies in the run up to the busy part of Christmas.

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Gifts

Great AFL premiership support from Herald and Weekly Times

Kudos to the Herald and Weekly Times for their support for AFL premiership opportunities and communicating with newsagents early about this.  Several days ago they let newsagents know about these traffic building opportunities around AFL premiership activity:

  • Mark Knight Premiers Poster – Monday October 3. The posters will be $2.00 and will be available through Newsagents ONLY.
  • Free Premiers Bumper Sticker – Tuesday October 4. The stickers will be free with the purchase of the Herald Sun and will be available through distribution and retail newsagents and direct relationship outlets such as supermarkets.
  • Premiers Glossy Magazine – Wednesday October 5. A Premiers magazine will be available to purchasers of the Wednesday Herald Sun for $2.00.  This will also  and will be available through distribution and retail newsagents and direct relationship outlets such as supermarkets.
  • Free Premiers Poster – Thursday October 6. A Premiership poster of the winning team will be free with purchase of the Herald Sun and will be available and will be available through distribution and retail newsagents and direct relationship outlets such as supermarkets.

In AFL mad Melbourne it is good to know well in advance about these opportunities.  We certainly plan to leverage the premiership opportunities in my newsagencies.

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Newsagency opportunities

Engaging with the AFL Grand Final

Allan Wickham at newsXpress Eli Waters is a mad, sometimes emotional, Collingwood supporter and has been showing this off with a terrific in-store promotion.  Kudos to Allan and the Eli Waters team for this promotion.

Connecting our personal interests with our shops is a good move as it separates us from the majors.  It’s essential to local community connection as it demonstrates passion which is not on show in soulless supermarkets and convenience stores.

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marketing
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