Today’s report of Coles Express outlets targeting corner stores in their latest milk pricing moves ought to concern newsagents. Coles and their duopoly partner Woolworths are certain to target more everyday, habit based, shopping. Some of what we sell fits their model – newspapers, weekly magazines.
The only way to fight this is to band with other independent retailers, before it is too late. We ought to be working even more closely together with butchers, greengrocers, small and independent supermarkets and primary producers and product manufacturers and publishers to drive local shopping.
It will be no use complaining down the track.
Mark, this fight was lost when deregulation of magazines was let pass. For years these supermarkets have sold cards, mags, stationery, papers, recharge, gifts, seasonal stock, cigs, ink, confectionery have I missed anything newsagents sell that they do not already offer?
With an 80% share of the supermarket offer the horse has bolted in pulling these two back in, so work on your own buinsess and don’t look to anyone else for help.
Instead of a once a week shop, more and more peole are just popping into the supermarkets on a more regular basis even sometimes daily to top up and grab mags, cards etc while they are there.
I’m not saying poor us as I think the battle has been over for a long time and the same goes for butchers, milkos, bakers, servos, bottleshops. We need to move out of their range by offering things they are yet to get into and then make our money when customers are instore instead of expecting them to come in for the paper, mag etc. We also need to reduce our runing costs so we can offer things cheaper.
The difference here Luke is that Coles and Woolworths are showing signs of following the UK model and targeting high street retailers. This is a new front in their fight, for Australia.
without the desire from any level of govt to reign in the duopoly, i dont see how this can be stopped. these are the kinds of issues that need to be fought via the various associations that represent small business. if they cant take up this fight then i fail to see any reason to keep supporting the associations.
to expect an individual small business owner to have any idea how to take up the fight, let alone have the recources to do so is laughable.
when you say we need to be working closely with butchers, bakers etc, i dont see how that is possible. i chat to the local butcher a lot and we share the same view on coles/woolies, but what do we do?
there has to be a representative voice to take the fight to the govt to stop the anti competative behaviour of these to companies.
these 2 companies would not be allowed to do what they are doing in a lot of other countries, they would be broken up. more should be made of the fact thet they are the largest owners/operators of gaming (pokies) machines in the country, that alone should bring their moral credibility into question.
as much as i hate coles/woolies at the end of the day it is customers which have the ultimate say in where they buy their goods and guess what most don’t give a stuff about small retailers where do our wives partners buy their milk bread meat from
I see the people to be worried are 7/11 nightowl and smaller spar/foodworks type convenience stores. I think the damage to us has already been done.
Luke what we have seen so far is nothing compared to what will come.
To qualify what I mean, I know of a number of newsagents that are located next to or near a coles/woolies that do well out of what the majors are not interested in, but you need to keep on top of it and change regularly what you offer as a point of difference. The new gamechanger will come in NSW IF they get lotto
1. When.
2. The UK shows that they will their own game changers in significant model extension.
I am actually surprised that coles/woolies haven’t targeted more of the “core” newsagency products. Considering they get way better trading terms in regards to magazines than newsagents, most of the supermarkets I have seen have a below par setup/range compared to your average newsagency.
Same goes for greeting cards. The Coles in the next town to ours has a really shitty Hallmark setup. Only about 50 pockets, dirty old cards, messy.
The companies need to be assured that
newsagents do it better?????? (not all of
us but most of us).
Our Coles (right next door) has two rows
of newsagency type product – magazines,
papers, and stationery and their staff (whom we know as they shop at our shop)
constantly tell us how they hate doing mags and returns etc and no-one does it
properly – maybe I should offer to show them how to do it (just joking!!!)
They do not value the product and it shows in their store, and this store won
Store of the Year for Coles last year.
The $1 milk has been on sale for over a year and now when you go into Coles it
is everywhere and the other brands are getting smaller and smaller.
The ACCC demands competition and yet they are stifling it by allowing Coles to bludgeon both the dairy farmers and other smaller retailers to death.
Our dairy farmers have been forced off their land when they couldn’t/wouldn’t comply with the farmgate price offered by
the duopoly.
It is so disgraceful – our own food bowl being eroded so that profits for shareholders can be upheld. Money over
livelihoods – I can’t understand it!
We are definately in the firing line from Officeworks. Checked some of my prices against theirs and I am cheaper but that just have that huge advertising ability and loss leaders that make customers think everything is cheaper. Had one mother go on line to check our prices and said yep I,m bringing my order to you but how do we get that mesage out there? I also googles the text books and reduced my peice a little on one or two and on the others I was already the same price.
yes june a disgrace, BUT while the consumer allows them to do it, they will continue. its like everyone complaining about hot cross buns out already, only way to stop it is to no buy them. Same with the milk and bread, need to educate (mainly city consumers) the public of what the real social cost of $1 milk is in the bush.
i actually really detest (cant you tell) what coles and woolies are doing to the social fabric of this country, may as well throw the banks in with them as well.
im glad im 50 and not 15, hate to see where it will all end.
Why has no one mentioned Coles sibling in this discussion. Cheap Milk Cheap Copy paper and the price focus. June’s comment is correct. We need to do it better and we can. We can talk about anything to our customers, we don’t have scripts to work from.
Steven, our Coles store only devotes about 4-6 ft (about 2 metres) now to
stationery and I check what they are putting in very carefully because their marketing people are very good.
I noticed last time I looked that they had
gone into brown paper and string and I had my daughter (47) with me and she buys and sells online all the time (aaarrh)
She immediately said “oh they’ve changed their products to reflect what is happening online. They need brown paper and string for people to wrap their
items to post after buying/selling on ebay.”
These are the things we have to keep on
top of. I immediately purchased a whole
carton of brown paper (instead of the usual 6 rolls when the rep calls) and it is
selling and so is the string.
Plastic bubble wrap is another of the new
millennium products that is going well.
Test pads and invoice books etc have bitten the dust and we have to keep looking and I find that Coles help me with those decisions so let’s use their expertise.
BTW they used to have a whole aisle of stationery and they have reduced it exponentially ???????? is there a lesson here?
I’d love to hear from other agents about the changes they’ve made re stationery, mags etc.
Coles/woolies and all their dominion need fast selling cheap products or they dump and move on, that is why mags, papers and cards are not worth their time as they are high cost per item to sell.
What we have learned is that you do not need 5 or 6 types of invoice book just stock the one that can cover most people, no point in chasing single item sales ie keytags, balloons etc we now sell packs of 5 or 10 at better margins. we have reduced our single pen range and now offer more packs of pens. We offer DVD’s as gifts but do not carry the ones offered at coles as they are too cheap and we look bad but we stock heaps of the ones that they do not offer and sell a truck load a month.
Use their marketing to help you make better decisions and see what they don’t stock more then what they do.
They are starting to squeeze out the name brands in favour of their own stock so this is again another oppurtunity for us to offer customers the names they trust instead of “select” or “premium” junk.
It’s a mistake to think about the duopoly in the context of the past. Their moves in the next few years will blow their past out of our memory.
But nothing is going to stop this from happening Mark, no coalition of small business, no stamping of feet. The customers are the only ones that can change what will happen so as long as they are happy to shop on price it will happen.
As small businesses we need to adapt or sell up now and sit on the sidelines.
And calling on newsagents to embrace, pursue, change is a mantra here.
So how do we change this?
I use supermarket as a last resort usually after work, getting home late and always disappointed with their crappy “fresh food” if they even have what I need. Can guarantee they will always be out of one essential ingredient then I kick myself for not being organised and going to the fruit shop/butcher during my working day. I hate going there, I support small shops because they have superior quality and choice and service, which the big 2 don’t, and because i don’t want to lose them, but in our busy lives we help them survive.
We can offer better service and quality but sadly that isn’t important to the majority.
In your original post you think that by banding together we can somehow change what will happen and it things will change. Customers think they do shop local when they go to coles because they employ local people and they see school donations etc. It’s a load of %#$% but that is the power of marketing and $$$$.
Yes you advocate for us to adapt which is what we need to do but you cannot and will not change what other businesses do so move on or get out.
Coles and Woolies sell EVERYTHING I sell, less Lotto, they have already made their move on us, now they are after 7/11 and Spar and the IGAs etc IMHO
You make no sense angry Luke.
You’re entitled to your view Luke. I think you’re wrong. Smart small businesses working together could make a difference.
So what suggestions do you have for small smart businesses to change the shopping habits of the majority?
In terms of magazines, I as a consumer always head to a newsagency to buy magazines. Becuase supermarkets still don’t have the range to compete with newsagencies are on a magazine front.
Jenny, I’ll be exploring this in a workshop I am planning for february but it comes down to range, service and marketing.
James, smart move. Love it.
Jeff, how do I come off as angry and how do I make no sense? Is it sensible to think that somehow coles/woolies will go away, or stop ripping off small business or does it make sense to pick your battles and not compete head on as we are now doing with mags, papers, cards etc. If you stock what they stock then you lose as customers are shopping on price now and they can undercut everyone. But I’d love to hear your plan Jeff.
Coles Xpress this week are selling Womans Day, Zoo magazine and NWE at 50% off when you buy over a designated amount of fuel.
We supply them with magazines and their sales have been to our detriment as we do not have the stock to sell through to our clients. FYI….Coles Xpress sales this week are up 110% on previous weeks sales of magazines.