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

Month: September 2016

Major newsagency of the future initiatives launched at newsXpress national conference

IMG_3025130+ newsagents gathered on the Gold Coast earlier this week for the second national newsXpress conference of 2016. From Sunday afternoon until Tuesday afternoon these newsagents any plenty of suppliers talked business and socialised in pursuit of mutual success.

At the conference, newsXpress launched several initiatives for newsxpress members including:

  • A new cloud based free business intelligence platform enabling individual newsXpress stores to benchmark their year on year performance (revenue, GP, transactions, average sales value of top items per department) against that of other businesses in the group – real time.
  • A national newsXpress branded TV campaign for November pitching exclusive products from a sought after brand – at no cost to newsXpress members.
  • Expansion of the already successful e-commerce strategy delivering online sales for newsXpress members with the launch of three additional websites, which are already live. These brand-fronted websites leverage a live, real-time, data feed from newsXpress stores to online, enabling online shoppers to shop local shops with certainty. Online shoppers search by intended purchase brand far more than the retail business brand.
  • A new retail season to drive in-store traffic for products through which participating businesses can expand their appeal.
  • A new nationally co-ordinated in-store event strategy to attract new shoppers.
  • New product categories to expand the appeal of newsxpress businesses beyond traditional.
  • A newsXpress branded gift card – professional, plastic and presented in a wallet to help businesses capture revenue when the gift choice is not obvious.

In the main conference session, the newsxpress Profit and Loss statement for the 2015/16 financial year was presented. This is done each year at the conference in the second half of the year.

The conference also included an insightful presentation from experts at Pacific Magazines in a presentation unlike anything from a magazine publisher at any newsagency conference in the past.

Three suppliers presented who do not supply other groups in the newsagency channel, sharing traffic generating strategies – two of them announced newsXpress exclusive products for 2017.

Optimism was everywhere with plenty of talk of transformation, reconfiguring businesses and finding space for new opportunities.

From 8:30 to 12 noon on Tuesday an open forum was run that included comprehensive training on the latest best-practice approach to using social media to drive new traffic. This session was of particular value to those not currently using social media successfully.

To help members get to the event newsXpress provided travel reimbursement up to $500. There was no cot for participation.

I mention all this here as, for me, the conference represented the world of the future of our channel – talking about traffic generating strategies, working with suppliers who do not usually supply newsagencies and seeing technology advancements that unite the newsxpress channel in a unique and commercially valuable way for locally owned stores.

Yes, I am a Director of newsXpress. In the past I have been a member of Newspower and a member of and shareholder in Nextra.

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Newsagency management

South Australian power outage wreaks havoc with newsagents

The shutdown of power in South Australia late yesterday through to today has caused extraordinary disruption for small business newsagents in the state. Some have boon closed because of no power, plenty don’t have stock they were due to receive today, some have considerable storm damage to repay, some have electrical equipment that has been fritzed, some have food rendered unsaleable because of the blackout.

At Tower Systems the help desk team has been giving priority to calls from South Australian businesses. I am sure other service companies have been doing the same thing to help SA businesses recover from the disruption.

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Newsagency challenges

Fascinating insights from a magazine publisher

I firmly believe that print and digital media products live or due based on the relevance and quality of their content and not based on sales gimmicks and multi masthead bundling (discounting).

I was interested, therefore, to read the terrific report from Mediaweek of their interview with chief executive of The Week, Kerin O’Connor. He made some fractionating observations about newspapers and magazines including:

“If you went to your tap and turned it on and no water came out you would go and get another water supplier pretty quickly. Magazine and newspaper publishers often don’t bother with that part of their business – they can be too obsessed about what their social media strategy should be or what they should be doing on mobile.

The interview is much more than this brief quote. I urge newsagents to read it as it offers an interesting insights from a UK magazine publishing perspective.

Content matters, yet for some titles in Australia right now it feels like content is not as important as it should be.

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magazines

The cost of late payment is a key factor for suppliers

Screen Shot 2016-09-28 at 10.08.26 PMAn interesting report from the UK on invoice settlement times and practices shows Australian businesses as being among the slowest to settle invoices – an average of 26.4 days late.

Late settlement is a cost of business to suppliers. I suspect some suppliers factor late settlement into product pricing, impacting all their customers. Other suppliers take the hit and this can hamper the future if their businesses.

Retailers need successful suppliers. Key to the success of a supplier is the on time settlement of invoices by their customers.

If you can’t afford something, don’t buy it. Suppliers don’t force retailers to purchase their product.

One thing suppliers could consider is a stronger pitch of pricing based on on-time settlement and increased penalties for late settlement.

This report from the UK is a timely reminder about the management of indebtedness and settlement off supplier invoices.

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Newsagency management

Poor communication from Blueshyft leaves newsagents hanging

Blueshyft emailed newsagents yesterday afternoon asking them to call their POS software company for a stock file update.

Screen Shot 2016-09-28 at 7.26.24 AMDespite the claim in their email, Blueshyft had not told my newsagency POS software company – serving more newsagents than all other POS software companies combined – anything about the update, they had not provided the file, we had not seen the file and could, therefore, not help. We were not told the email was being sent.

But the support calls came. In huge number. Newsagents calling Tower because Blueshyft told them to. Some newsagents were rude to Tower employees, saying we were fools for not knowing about this.

This all happened when the Tower COO and I were on a flight from the Gold Coast to Melbourne. We had been on the Gold Coast on business.

The Tower help desk was slammed – all because Blueshyft had kept us in the dark and because some newsagents didn’t believe that we had no knowledge of this new file.

I called Blueshyft CEO Kain Warwick at 04:06pm when I landed and had realised the mess. Kain returned the call at 05:12pm. I and expressed by frustration at what is, in my opinion, appalling communication from Blueshyft and a lack of respect for what Tower Systems does for them. Kain had no empathy for the situation. I felt the call was a waste of time.

I also called the CEO of XchangeIT as they had subsequent to the Blueshyft email sent the file. He as not aware of the issues, of the broken communication. I also expressed frustration at the large file but it was not his position to comment on this.

The call did not go well. Here it is 7am the next day and I am yet to receive any update from Blueshyft on why they would email their customers telling them to call my company (and other companies) hen they had not advised to expect the calls and have the information ready to assist.

Tower Systems gets get no compensation for any work related to Blueshyft. XchangeIT is paid to do what they do. I suspect Blueshyft pays VANA for their support and kind words. Yet the POS software company with the most newsagents is expected to be mind readers and know about a file we have never seen.

What happened yesterday is ridiculous in my opinion.

I have told the Tower help desk we will not take calls on this new file. Instead, the help desk experts have updated our online advice. This has all the instructions you need to load the file. Click here for our advice.

Had Blueshyft been professional, they would have provided the file to the Tower support team, let them test it, let them provide Blueshyft with advice on loading and then communicated with newsagents. Instead, they dumped the heavy lifting on companies like Tower for no compensation at all. This is typical Blueshyft. They say they are helping newsagents yet it is others who are being asked to donate to their cause.

But on the file, it has 2,700 stock items. It does not make sense they want to bloat your system with all these but that is a separate issue.

Yes, I am frustrated as it is things like this that divert our attention from providing support individual customers of ours call us for – calls from the businesses that pay for our support services.  Blueshyft is freeloading at my expense and, ultimately, at your expense.

In his defence, Kain Warwick will say he emailed me and the Tower COO on Monday about a new file comping saying he would like to discuss it. This is kind of odd. he has our phone numbers. he has the Tower help desk contact details. yet he sent an email saying he would like to talk. there was no time indicator on the file release, no details at all. As Gavin and I were at an important conference on the Gold Coast we figured we would call Kain on our return.

This whole situation is ridiculous. You have VANA doing their song and dance about money some newsagents are making from Bueshyft, probably because Blueshyft pays them a fee to tout for them, yet others are expected to carry Blueshift for nothing.

This is agency business for which, in my opinion, there is no long-term upside for newsagents.

9 likes
Newsagency challenges

Fresh approach to Halloween generating foot traffic

Screen Shot 2016-09-24 at 7.31.05 PMThis Facebook post on the weekend pitched masks we have in-store for Halloween. The idea was to get people in our area thinking about is for Halloween party items. We deliberately are not promoting the cheap Halloween products discount stores and supermarkets carry. We have chosen a less cluttered space – and it is working based on the terrific response.

This approach is what they call a blue ocean approach – making a deliberate choice to place or pitch the business in a less cluttered ocean – a blue ocean of clean water rather than a cluttered red ocean full of blood from all the competitors swimming there.

While in-store we will pitch traditional Halloween, our external marketing right through Halloween will focus on innovative products through which we appeal to a broader audience.

Halloween is a wonderful retail season. We love it.

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marketing

Think of your newsagency as a start-up

Startups are all the rage. Politicians especially love them and love talking about financial support for them – as if they think there are votes in startups.

I think the interest is in part due to the new of the startup, the opportunity to create something new that could be a great big thing.

Thinking about the obsession with startups recently got me thinking of them in the context of the Australian newsagency. The reality, our reality, is that we are at a moment in time where we need to create the next model.

Tweaking the newsagency business here and there buys time but not a long term future. No, we need to bring the principles and clean slate view to the future of the newsagency business.

This is the key element of the startup world that I think applies to our channel today – the idea of building a business from scratch, with a clean slate and full of hope from looking forward and not looking back.

That is what I mean when I suggest you think of your newsagency as a startup. You stop thinking about the old-world things you do that hold you back or the old suppliers who now contribute only a fraction to your bottom line.

A good startup starts with a good idea, rooted in a mission for the business. What does your business offer? What does it stand for? What is its USP? What makes it relevant decades from now – rather than why it is relevant thinking about decades of history.

Too many newsagents spend too much time worrying about old-school things that add little or no value to the business. In many cases plotting business performance data shows where those old-school worries will end at some point in the future.

So, think of your newsagency as a start up. Work out the new business you want to create where you are currently located. Even if you don’t do it, the thinking can open you to change to your current business that could be beneficial.

Thinking is free. All you have to risk is some time. What you can gain is excitement for changes ahead that you can bring to the business as a result of being open to thinking like a startup.

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Newsagency challenges

Animal Jam terrific at the newsagency counter

IMG_2980Animal Jam product is working a treat at the counter of the newsagency – as a destination purchase while others purchase on impulse. Key to the success is depth of range available. This display says we can satisfy most Animal Jam fans.

This placement is a good example of the moves we need to make at newsagency counters – moves that start with you looking for product outside your traditional suppliers.

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Newsagency management

Marketing tip if you have cruise ships or tour groups in your area

IMG_2858This sign in the window of a Priceline on George Street Sydney is interesting in that a national chain would only do something like this if it worked. It looks like an opportunity for newsagents in areas where cruise ships dock or tour groups visit to try if not being done already. You can leverage the opportunity with discount vouchers or similar as the traditional loyalty offer would not work with these types of shoppers.

1 likes
Management tip

Sunday newsagency challenge: respect your own time

When assessing the labour cost in your business ensure that you cost your own time at the going rate.

As a newsagency management benchmark guide, I suggest a labour cost equal to between 9% and 11% of revenue where revenue is product sales revenue plus commission earned from any agency sales.

If you don’t include the cost of your time it makes comparing your business performance against the benchmark.

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Newsagency benchmark

Sunday newsagency marketing tip: light your shop to be noticed

What does your shop look like when you are closed? Smart lighting and a good window display can help your closed hours be profitable. I saw the different smart lighting can make last week in Manchester in the UK. Here is a photo of a real-estate agency on Deansgate:

IMG_2914

Here is another real estate agency right next door.

IMG_2915

I took the two photos one after the other and from the same distance from each window – to facilitate comparison.

The first agency looks more appealing at night. It is the one of the two you are drawn to.

Take a look at how your shop looks at night time. Are you making the most of any night time traffic?

3 likes
marketing

Sunday newsagency management tip: clean up your signs

An out of date sign indicates an out of date business in my view. Take this sign I saw hanging over the front door of a newsagency on Friday:

IMG_2969

Valentine’s Day 2016 was more than seven months ago. This sing is out of date. It’s presence above the door does not put the business in a good light.

Take a look around your shop, remove eve out of date sign. Make your team aware of the importance of current signs to reflect the focus of the business.

5 likes
Management tip

Old-school newspaper publisher subscription obsession misses revenue opportunities

While I have no newspaper publishing experience, I am a consumer of news, especially on my phone, tablet and laptop.

But I don’t pay for it, I won’t pay for it. If there is a story behind a paywall that interests I wait or seek it out elsewhere – not because I am cheap but because the publisher wants me to sign up to a subscription.

The subscription model is an old media approach to a new media opportunity. It is out of date and not suited to today’s online and mobile consumer.

Screen Shot 2016-09-21 at 6.26.53 PMWhile in the UK earlier this week the Herald Sun had a story about the back room moves at Richmond Football Club. I clicked on the story and got this screen.

They wanted $10 for two months access before they would let me see the story. I love a good AFL back room story but it is not worth paying $10 to access it. That is how I saw it, a $10 fee because of this one story.

I suspect that is how plenty of people see it, especially those of us who travel overseas and want to catch up on stories back home for a short while.

Had the offer been, say, a fee for the story I would have been more interested. How much I’d pay would depend on the story. In this case, I might have paid up to 25 cents.

How much I would pay for future Herald Sun stories would depend on the trust that builds from earlier purchases. If the value is there I’d pay a few cents per article.

Imagine what would happen if publishers adopted this pay per story model. It would make the stories the thing rather than the current obsession with clickbait headlines. It would make journalism the thing as the better the journalism the better the value of the story and the more consumers would respect a masthead and the more stories they would buy. Hey they might even subscribe.

Today’s digital world is often about either free or low cost access to services and products. This is where newspaper publishers ought focus their attention – micro payments per story. The old subscription model is as old as the old paper model and ought to be discarded as the entry point for digital revenue.

Rather than pushing to lock people into long-term subscriptions, yes, two months is long-term, give is story by story access, take micro payments and get more value from each good story you publish.

This approach of a payment per story makes the journalists and editors more connected to the business model. It would make them work harder to develop content people want as they would want to be in the top grossing stories from the masthead.

I’d like to see News Corp. or Fairfax offer this pay per story approach today. I think a trial with fair pricing would produce a good result for them, their editorial staff and their advertisers. yes, I’d accept non intrusive advertising with any sort I purchase.

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newsagency of the future

The future of newspaper distribution and distribution newsagency businesses

You only have to look at the pitch from News Corp. to understand where they are focused for their future distribution channel.

Screen Shot 2016-09-21 at 6.27.02 PM

The tablet is the distribution mechanism. It is faster, cheaper, more accurate in placement and more current than the current method of printing, stacking, putting in a truck, driving to the distribution newsagent, them unbundling, rolling, loading the delivery vehicle and going out on the road to deliver news that is hours out of date.

These are the facts.

Newsagents need to invest in distribution knowing the focus of publishers. Yes, there is enjoyment from turning the page, not needing a device to read the news and being able to easily dive into a section you like. The thing is, the distribution platform is no longer commercially viable.

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newsagency of the future

Fascinating Sydney Gift Fair

The September Reed Gift Fair in Sydney was fascinating on a range of fronts.

  • A greater diversity of retailers attended. This is no longer a gift fair.
  • A greater diversity of suppliers – if you looked hard enough.
  • Plenty of newsagents were only talking about side what has been traditional for their businesses.
  • Just about every retailer was optimistic.
  • Suppliers were optimistic.
  • Suppliers happily talked to newsagents and didn’t say: I’ve got the perfect product for newsagents … when they say this the product is not usually perfect for newsagents.

It was a terrific fair, important at this time of the year for making sure you have what you need for the next few months without the craziness of the larger fairs.

The biggest takeaway was the focus on change by the retailers I spoke with. Most retailers, from various channels, were focused on change in their businesses. Newsagents are not alone with the challenges of disruption in the channel. I got a lot from listening to, for example, the challenges faced by a jeweller or the challenges faced by a specialty garden gift shop being challenged by a new mass-market retailer coming to town.

One thing I didn’t like at the gift fair is the cheap China junk some wholesalers carry. I saw some dreadful products that mimic more expensive lines, products would retail at under $10. They look cheap. They give off a message in retail I’d not want for my shop.

We in our newsagency channel often see what has been and is happening to us as unique to us when it is not. Small business retailers in many channels face similar.

The key from the gift fair is how you face into the challenges.

Getting out of your shop and looking for opportunities beyond what is usual for your business is a good start. That is where trade shows like this are important.

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newsagency of the future

Lego at Officeworks

IMG_2639 (1)While independent toy retailers including newsagents struggle to get the Lego products they want, Officeworks has a range of Lego stationery. I saw it in the Sydney CBD store, at the front of the business in prime location. This range wold be ideal in newsagencies.

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Newsagency challenges

Ten ways you can save money in your retail businesses that too many retailers ignore

Saving money is something all small business owners want to achieve, when it suits them, to make the business more profitable.

When it suits them is the key phrase. I don’t want to sound bratty but I often see situations where the retailer, maybe a newsagent, maybe not, chooses to ignore a money saving opportunity because it does not suit them.

The thing is, money saving opportunities need to be embraced without the qualification of it suiting. I get that some money saving opportunities have personal implications. However, if saving money matters, these personal implications will be parked.

Here are ten money saving ideas for any retail business:

  1. Buy better. One of the biggest overheads for a retail business after rent and labour is underperforming and dead stock. Buy better. It is easy yet often ignored because it is seen to be hard work. It’s not.
  2. Stop buying what you like.
  3. ‘Do not buy just because you like the rep. The numbers must work.
  4. Stop sponsorships of local groups that do not benefit the business.
  5. Stop advertising in the local paper unless you have measured success as a direct result from the advertising.
  6. Cut the roster based on the commercial needs of the business rather than keeping people on to maintain friendships.
  7. Don’t use a shopfitter. Next time you refit or even partially refit, use off the shelf materials and save money.
  8. Look at your hours. If you are not making money early or late in the day why be open.
  9. Cut with tradition. Traditional decisions often see a specialty retail business, like a newsagency, hang on to products and services to be true to the shingle, long after they made money. Break with tradition and cut these loss making activities.
  10. Stop suppliers ordering for you. Their need may not match your need. Use your technology to order and you should see a reduction in inventory investment by 10% or more. That is cash freed up for you.

If you are in a business where every cent counts, look carefully at this and go further, make your own. The best opportunity to cut costs is when the business is open. Once you have gone under or walked away it is too late.

Management decisions in retail need to be data driven. 100%. Take away the emotion, friendships and other non data related factors. Savings should follow.

12 likes
Management tip

Oxford Street Newsagency location still empty a year on

Taylor Square Newsagency closed a year ago. The shop remains vacant today. I wonder if the landlord now wishes they had taken a different approach to rent negotiation for an empty shop is an expensive investment to carry.

When I drove past earlier this week I was keen to see what retail was now in the place. Under the Newsagency shingle is an empty shop.

Landlords need to understand the occupancy cost benchmark for newsagents and similar businesses: 11% of turnover where turnover only includes agency commission and not total sales.

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retail leases
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