Sunday newsagency management tip: be responsible for what you order
How many times do you receive stock that you have not ordered. I am not talking here about stock you do not usually order such as magazines and newspapers. No, I am talking about greeting cards, stationery, gifts and other items which you have control over in your business.
If you receive stock you have not ordered and complain to your supplier only to have them say that you did order it when you spoke to their rep – I;d say the problem is yours.
Establish a structured approach to placing orders which includes a paper trail of approval. Explain to your suppliers your process – make it clear that you accept no responsibility for goods received for which there is not evidence of your approval of the order.
Sure, suppliers will not like this. However, if you want genuine and full control over the stock in your business you need to take these steps. representatives of suppliers will soon learn that your processes need to be followed if they want to be paid.
Next time you complain about receiving goods you did not order – have a structured process on which you can rely.
Sunday newsagency marketing tip: stop following the leader
Newsagents and, indeed, many small business retailers, think that the only way to compete with big business competitors is to match them on price.
I think chasing a big business competitor on price is a mugs approach.
Big business will beat you on price every time. Not necessarily on a real price comparison but absolutely and certainly on perception. They spend millions compared to your pittance convincing shoppers they have better prices – even if the claim is not true.
So, my marketing advice is – save your money promoting on price.
Newsagents spend too much money competing on price with no long term gain.
Instead, spend your marketing dollars on a different promotion. The jigsaw promotion we are running at the moment is a good example. Here are some more to get you thinking:
- Instead of a back to school promotion in January, run a back to work promotion after Australia Day.
- Or, instead of a back to school flyer based on price, write a letter explaining what it means for the community, your employees and you when people buy their school supplies from you.
- Create your own card season in between major seasons.
- Promote everyone in your business as an expert.
- Be part of an important local community group – giving of your time and expertise could be more useful that donating cash.
- Distribute flyers in low seasons – not when letterboxes are full.
The better you explain the value you bring to a community, especially if your newsagency is away from the city, the greater the opportunity for locals to engage with you because of the emotional value proposition you offer.
The first early magazine returns sweep of 2015
With no reasonable or fair mechanism through which to manage magazine supply, early returns are a must to manage space use, inventory investment and cash-flow. Today, I’ve done the first sweep for 2015, in plenty of time for the returns to be processed with this month’s data. In addition to taking of all stock for some titles that are not paying their way, I reduced supply for titles where supplies have been increased despite no requirement in past sales data. Homes+ is one such title.
At the end of it there is the usual feeling of wasted time, wasted paper, wasted space on the trucks. What a sick distribution system we have and how disadvantaged are newsagents compared to our competitors. Dumb.
Newsagents having trouble handing back Hubbed equipment and cancelling the contracts?
I have been contacted by three newsagents in the last two weeks seeking advice and assistance on handing back their Hubbed equipment. each had reached the decision to not continue with Hubbed because of lack of customer interest and lack of revenue. They say that Hubbed is not honouring a promise to take back equipment when the service is not commercially viable.
One newsagent yesterday shared details of discussions with the Hubbed CEO that started well but soon went nowhere with a reported retreat from a claimed pre-installation promise they would take it back. As this newsagent acted on endorsement fro the ANF I suggested they make contact with them.
As I noted at the time of the gushing yet ill considered ANF endorsement of Hubbed, all that matters is what is in any contract you ultimately sign. If what I am being told is true, the contracts as proving problematic for newsagents who want to leave Hubbed. I am told there is a contract for Hubbed and an equipment lease contract in some cases.
I’d urge Hubbed to let newsagents out, take back any hardware and relive newsagents of their contracts.
Amazing jigsaw sales in the newsagency
Our Jigsaw promotion is two weeks old and the sales have been excellent. The display facing into the shopping mall is attracting people who would not usually shop with us. A bonus is the learning the jigsaw customers are like collectors, they complete one, they come back for the next challenge. This is why we have an excellent depth to our range and why we stock a brand that is respected among jigsaw fans. Our biggest jigsaw so far is 5,000 pieces. That will grow with our customers.
I shared our plans to run a jigsaw promotion January here on Jan. 4. While it is a newsXpress initiative for newsxpress members, there was enough information shared for others to copy. The strategy demonstrates a commercially valuable point of difference as the sales results show.
The experience two weeks in is that the planning, space and inventory investment in a new season, playing away from where most other retailers including newsagents are playing is delivering excellent rewards for us. We’re tracking sell though and are thrilled with the result.
The photo shows the display at the front of the shop – I took it from the back of the display inside facing outside.
Relevant Sneaky magazine cover story
While I think Geoffrey Edelsten and his revolving door girls are publicity whores, I do love the cover on the latest issue of Sneaky magazine. I’m not my customer and plenty are interested. Also, whether one likes them or not, the photo and story are fascinating as the photo shoot in Melbourne generated considerable publicity. Sneaky themselves posted a video of the shoot. Warning: NSFW.
Trends in retail: the sharing economy and opportunities for newsagents
Sharing is cool right now and engagement is growing across a number of engagement points. In cities we can see parking spots allocated to vehicles that are shared. There are websites dedicated to enabling people to share items used infrequently like tools and baby furniture. I have seen services in the US for sharing high-end fashion that would otherwise be out of reach. More and more restaurants have shared seating – large tables for eating with people you’ve never met. Sharing plates of food among people you dine with is also big – this all connected with the sharing economy.
It feels to me like there is a surge in sharing.
I wonder if there are ways we can connect with the increased interest in sharing in our newsagency businesses. On first blush it may appear not as we are retailers. We make money from selling things and not from renting them. But I don’t think it is as simple as that.
The world is changing rapidly in areas connected with social responsibility. For decades car makers resisted embracing renewable energy technology. Today, they are fully in that ocean releasing hybrid and completely battery powered vehicles at a significant pace. I was at the Consumer Electronics Show is Las Vegas last week and was thrilled to see what Tesla are doing along with their battery partner Panasonic. Here is this young car company overtaking the majors by engaging with what people want and doing it in an open way, sharing insights so others can come on that journey too – they are sharing their intellectual property!
That’s what the sharing economy discussion comes down to … what people want for the good of the community an the world.
Here are some ways in which we could connect with the interest in sharing.
Renting. What do we sell today or could sell today that we could rent to those who prefer this model to sale? Toys are a good example. Jigsaws maybe? Homewares. Jewellery?
Recycling. Are there products we are known for where we become an outlet through which people can recycle items they no longer need. Some years ago I developed a business plan for newsagencies having a book recycling outlet. While it didn’t go anywhere I think it’s worth exploring.
Clubs. Core to the sharing economy is people connecting through common interests. What products do we sell through which we could engage in creating our own clubs or connecting with clubs.
Food. We sell food magazines and books and some of us sell cooking utensils. Do we serve shoppers who love to cook but who do not have big families to feed. Can we connect them with others who would love to be cooked for. We’re the glue and while we are not necessarily increasing sales, we’re becoming known for offering a connecting service.
These are just some ideas. I present them here not as an advocate but to get you thinking of ways you could connect with the sharing economy.
Think about the person using the share vehicle, the lady renting a dress for one evening or those folks who are happy to sit at a shared table in a restaurant. How can we tap into these opportunities to make our businesses more relevant to them?
I appreciate this topic may seem quite a distance from what you do in your business today. However, embracing the sharing trend is a way you can pitch your relevance and through which you can explore new business opportunities.
The newsagent who acts in a traditional and average way will achieve traditional and average results. 2015 and beyond will be more about embracing, chasing, change than ever before.
Last call: newsagency business penalty rate survey
Share your opinion on weekend penalty rates: click here to take the survey. I’ll close the survey tomorrow sometime and share the results here soon thereafter.
Snacks and magazines
Check out how suppliers are working together in the US to offer snacks and magazines together as a deal on a purpose created shop floor stand. While I think this is a terrific initiative for convenience / transit businesses, it’s not something I’d run with as my shoppers are not likely to purchase snack products with a magazine.
I mention it to show newsagents another initiative being used in the US to drive basket size.
If magazine publishers and distributors do not offer viable terms, what then for newsagents?
On the issue of newsagents achieving better margin on magazines, I appreciate there are some newsagents who think there is no hope, that things will never change. I’m an optimist and think that there are enough magazine publishers who value the role we play in putting their titles in front of new eyeballs for them to want / need to engage with us in a discussion about viability.
With the majority of newsagents losing money on magazines something has to change.
There is no doubt that the current model, as I wrote earlier this week, is not financially viable for newsagents, especially those paying shopping mall rent of $1,250 per square meter a year and more. Even allowing the traffic magazines generate there is a live question about viability. That question goes to the future of the channel as it is seen today.
One alternative is that magazine publishers pursue alternative channels. No single channel can be as valuable as the newsagency channel. We’re known and, for the most part, engaged. We are also well located and locally connected.
The other alternative is they sell more through other channels they have already such as supermarkets, convenience and petrol. But these channels have space challenges and engagement costs.
I think the newsagency channel continues to be the most economically viable for magazine publishers, even at a higher margin for newsagents of, say, 40%.
I am confident that with as higher margin we as a channel would see magazines differently and engage with them as something as more valuable than agency business.
Newsagents are challenged by disorganisation and lack of national leadership. While the ANF directors and staff will say they provide good leadership, the proof they do not is lack of engagement by newsagents. Leaders have followers. The ANF has failed newsagents on matters like magazines and spent too much time on questionable commercial offers.
But back to my topic – what if publishers do not engage and provide newsagents with better margin, what then? The obvious option is to get out of magazines. Do you have the guts to do that, to quit magazines? Think about it, look at your data, what would your business look like.
Another option is to quit one of the major distributors in return for the other major distributor offering better terms. This could work if the better terms are seriously good and if they included control over stock received. Imaging the seismic shift in distributor use if this happened and newsagents started carrying titles from only one distributor.
Another option is to keep cutting range. The problem with that is that you no longer satisfy browser interest and you lose that traffic and that plays out into declines in other categories.
The fourth option is that you say bugger it yes we are treated poorly but I will prey on other newsagents cutting their magazines ranges and increase mine and become the go to newsagent for magazines. This is an interesting option, making your shop mor of a destination. But you are stuck, probably with the current terms.
There are other options too. Newsagents need to think about this, they need to explore what they could do and would do if they do not achieve more equitable terms for magazines.
To the magazine publishers reading this – take the concern seriously. The current arrangements cannot continue.
Useful magazine barcode info could help newsagents save time and money
I love the information placed with barcodes on magazines in the US. If this were included for Australian titles it would mean newsagents could choose to not label titles. – thus saving time and money. While I like knowing the quantity received when I am doing my shop floor cull, it’s not essential. Magazine publishers keen to help us drive efficiency will consider this. However, it would make it harder to re issue titles … but I’d see that as a good thing. Anything to stop magazines going around and around.
How can distribution newsagents create a more viable future?
Years ago there was discussion about distribution newsagents using their infrastructure to deliver other ietms and thereby get more value from their capital investment. Not many have gone down that road. Some have consolidated and I regularly hear that camp is not happy.
The challenge facing distribution newsagents of what to do to drive business viability is stronger than ever.
There is no upside in print media. Capital city daily newspaper sales continue to decline at an extraordinary rate. Newspaper publishers are pushing content access and advertising delivery models which cut revenue for distribution agents or eliminate it altogether through digital platform promotion. Magazine sales are declining, albeit not as fast as newspapers. The finaicial model for distribution agents is loss making in the majority of cases.
If I was a distribution agent in this climate and wanted to remiain in business I’d consider these options:
- Scale up. I’d take on more territories and chase scale with low-overhead management, no shared ownership with others. I’d be chasing 15,000 home deliveries or more.
- Be the distribution expert. I’d look for a way to be the partner for online businesses and providers to handle the last mile delivery in a personal and lcaol way. I’d use smart technology tom make this easy for retailers.
- On demand local courier service. This idea is about creating a very local, defined area, deliver service – the kind of service small businesses could use to deliver something to a local shopper. Something a shut-in could use to get you to purchase forn them and bring to their home.
- Go into retail. This is the idea I like the most., I’d look at retail in my area and create a shop of the future selling newspapers and magazines but in a way that’s fresh. Around these two categroeis I’d build other product offerings that are unexpected and traffic generating of their own. The shop would be on the high street with good parking. Probably a space that has low rent.
As things stand today, the majority of distribution newsagents rely entirely on newspaper publishers and magazine distributors for their income. Newspaper publishers are responsible for this. It’s a dangerous situation because your future relies entirely on their decisions and their decisions must put the needs of their shareholders ahead of newsagents.
Terrific newspaper stand for newsagents who want control
I love this newspaper stand I saw at a Duane Reade drug store in New York yesterday. It’s strong, has a small foot-print, makes the product the hero and can be used any way we choose.
This is the type of stand I will go for rather than a newspaper publisher specific stand that is selfish and not viable in today’s retail newsagency.
An unbranded stand like this is a move retail newsagents should make.
News Corp. offers free magazines with newspaper App subscription
This image is an ad from The Advertiser from News Corp. in Adelaide – Friday 9, page 36. The ad is promoting a subscription to the newspaper App and a bunch of magazines. It’s a compelling offer that appears set on cannibalising the print product.
I wonder how retail and distribution newsagents feel about this?
While the magazine range offered is limited, it could be enough to get some to stop purchasing the paper from their usual outlet.
The ad also appears to be encouraging existing Subscribers to ‘close’ print home delivery and convert it to digital only.
This ad was in the metro edition – it is targeting metro customers. Newsagents ought to be concerned about this in my view.
A newsagent colleague who alerted me to this ad noted:
Metropolitan Newsagents in Adelaide are beginning to realise that even the local crew, despite denials, are actively working to erode Distribution Newsagents core business.
What else are they expected to think given the actions of ANPL at a time when we are seeing plummeting HD numbers.
News needs to do what it needs to do to survive the extraordinary disruption to print. However, it ought to be transparent with newsagents about its plans. I am certain the company has timelines it could share which would help newsagents make more informed capital investment decisions.
The best indicator newsagents have of News’ intentions is ads like this.
US magazine publishers are consistent about barcode placement
Further to my post about magazine barcode placement, it is good to see US magazine publishers be consistent about barcode placement. It makes managing the category easier plus it makes selling easier. We ought to pressure Aussie magazine publishers about this.
Newspaper barcodes
And while on newspapers and harking back to my post about magazine barcodes, newspapers in the US tend to all place barcodes in the same place. Maybe Australian newspapers could boost retailer productivity with the same considerate placement. Such consistent placement would help retailers and, I suspect, distribution agents. It’s all about driving efficiency of all stakeholders.
Odd sized newspaper
Check out the size of The Atlanta Journal-Consitiution newspaper. I placed my pen next to it to provide perspective. Click on the image for a bigger version.
To me, this newspaper is too narrow. I found it awkward to handle when I opened it out as I would a broadsheet. But maybe it’s what I am used to. Others nearby reading the paper seemed to be handling it with ease.
FYI the format is what’s called a Berliner.
Cheap news
While the cover price of newspapers in Australia has increased considerably, I was surprised to realise that the New York Post is promoted at just a buck as it says next to the masthead. While the New York Post is not much of a newspaper in my view, the low price is a surprise given the strategy adopted by News Corp. elsewhere.
