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

Month: March 2021

In attacking Samantha Maiden, The Australian Financial Review plays politics, not news, again

The hatchet job by Aaron Patrick on Samantha Maiden published in The Australian Financial Review today is yet another example of Nine Media outlets ditching news for political engagement / interference, and another reminder that paying to access biased trash is a waste of money. In this week of the Nine hack, surely they had better priorities.

That the Patrick ‘story’ got through the editorial process and published speaks to how weak Nine Media has become. That the story remains publicly available, and not behind their paywall, speaks to the objective of the piece.

In my opinion, this ‘story’ by Patrick is another shitty interfering and biased article in a shitty publication that cares little for evidence based reporting.

It’s an embarrassment to have The Australian Financial Review on the shelf – because of the lobbying in which it engages daily and it’s tiny size for such a high price. I guess the only redeeming feature is that it’s not a News Corp. title.

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Ethics

The Queensland retailers with an advantage

Over the last few days, Queensland retailers with an established and good online presence and back end fulfilment process have been able to offer a timely pitch to existing and prospective customers. Whether for safe click and collect or delivery, having an easily shopped online presence is the key first step to trading which your shop is shut or while people are less likely to leave home or work and shop with you if you are open.

I know of newsagents who last year started on the path too getting online and as the Covid situation eased they pulled back on their plans. The thing is, online is growing, retreating because Covid became more under control was a poor decision.

Queensland retailers who are established online are seeing the benefits of that investment.

If you do not have an online presence through which people can trade with you business, make this a priority. But beware, there are plenty of shonky web development businesses and people out there. Choose wisely.

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newsagency of the future

Why are newsagents the only outlet for the House of Wellness magazine?

News Corp. is promising the next issue of the House of Wellness, the crappy (my opinion) ad platform from Chemist Warehouse. News Corp. is clear that it is only available from newsagents in their FAQs:

FAQ’s

Q. How can I get a magazine?

A. Purchase The Courier-Mail on Saturday April 3 or The Sunday Mail on April 4 and present the original token from the newspaper at participating newsagents to redeem.

Q. Can I get the magazine from supermarkets or petrol stations?

A. No, the magazine is only available from participating newsagents in QLD.

Q. Can I get more than one magazine?

A. No, one magazine per purchase of the paper. If you would like a second copy, you must purchase a second copy of the paper.

Q. Do I need to pay for the magazine?

A. The magazine is free with purchase of The Courier-Mail on Saturday April 3 or The Sunday Mail on April 4, while stocks last and only at participating newsagents.

Q. Is my newsagent participating?

A. Click here to see a list of participating newsagents.

Q. The magazine isn’t inserted into my paper, what do I do?

A. The magazine is not inserted in the paper. You will need to visit a participating newsagent, present the original token from within the paper purchased on April 3 or 4, then you will receive your magazine.

So, why is the House of Wellness only available from newsagents? I suspect because supermarkets, convenience outlets and petrol stations have not agreed the paltry terms for handling this advertising product, because newsagents are the only ones prepared to accept less than minimum wage for handling this title, for putting top with people who buy their paper elsewhere and come to the newsagent for the free title, people who will be angry they had to wait in line to get their free title.

House of Wellness is not worth the time or space it will take up. There is no upside for newsagents in my view. Every time we agree to sell ourselves short, it reinforces that we are agents, not retailers.
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Newspapers

Nike leads on migrating sales from retail to direct to consumer

Nike, like many online present international brands had a good Covid. It was so good, in fact, that they have made some decisions as to future sales channels, a reported recently by CNN:

Nikes are getting harder to find at stores. Here’s why

New York (CNN Business)Struggling to find Nike sneakers at your neighborhood shoe store? That’s by design.

Nike wants customers to buy more of its shoes, clothing and gear at Nike stores and on Nike.com and its apps, as well as at a more limited group of retailers like Dick’s Sporting Goods (DKS) and Foot Locker (FL). So the company in recent years has slashed the number of traditional retailers it sells its goods to while shifting to grow directly through its own channels, especially online. That has affected big and small retailers. In addition to pulling out of some independently owned stores, Nike (NKE) also ended a partnership selling on Amazon (AMZN) in 2019. Nike has not disclosed which retailers specifically it has cut ties with.

The company’s move away from a primarily wholesale distribution model is a departure from the early decades of Nike. Small, independent sneaker retailers were key to growing Nike’s popularity in the company’s early days, when people found out about upcoming shoe releases from visiting the local shop. But Nike has said it can make more than double the profit selling goods through its own website and physical stores than it can through wholesale partners.

Nike gets to control the shopper experience more tightly and the prices at which products are sold when it goes directly to consumers. That’s a big deal for Nike, a premium brand that wants to ensure merchandise is showcased to customers in enticing ways and prevent products from being discounted too heavily.

Is this a trend in our channel? Not yet as far as I can tell. Sure, there are some supplier who sell direct, but not many and not a high volume. Often, their execution is less than ideal.

Is this a trend we are likely to see in our channel? I think so. We should plan for it, expect it. If I was a supplier it is what I would do. The less steps between a manufacturer and the consumer of what they manufacture the better for the manufacturer.

What should we small business retailers do? Be aware. Source locally. Favour suppliers that are clear in stating they will not go direct.

I think it will be another year or two before we understand the extent of disruption to high street retail wrought by Covid. The Nike story is but one example. My advice is don’t blame Nike. They are doing what they need to do for their business, for their shareholders. That is their obligation. It is the obligation of major suppliers, too. hence my suggestion to be aware.

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Newsagency challenges

My newsagency software company is hiring

At my newsagency software company, Tower Systems, we are keen to hire someone who knows and has used our Retailer POS software for a new role on our help desk. This is a technical role. It would suit someone looking to work in a software company, someone keen to learn and keen to help others learn POS software technology.

The help desk is busy and the support call variety diverse. Retail experience is beneficial. Good knowledge of our Retailer POS software would also be helpful as a base on which we can train more on the intricacies of the software.

We need someone who can manage themselves in that almost all of our help desk team members now work from home. Location is not all that important given this.

If you know of someone who could be right for the role, please encourage them to reach out to me at: mark@towersystems.com.au

We will be advertising publicly in the next few days. If an ideal candidate from within our community applies before we do this, we may not advertise.

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newsagent software

Queensland newsagents face challenges with new Covid restrictions

The 3-day greater Brisbane lockdown to commence from 5pm today as announced by the Queensland Premier this morning presents challenges for newsagents, who can remain open as they are essential. The challenges relate primarily to jealousy from retailers who have to close and those in the community who support them.

We have seen some similar challenges elsewhere in Australia in previous months.

The other challenge is the requirement by the state government that masks be worn throughout Queensland. Some mixed reporting in the media today has some in the community thinking masks are not mandatory. Listing to the Premier’s press conference this morning, masks are mandatory statewide.

To deal with masks being mandatory, I suggest newsagents leverage social media to ensure clear messaging. I suggest they also ensure consistent messaging in-store – to head off any fruition that may be seen among shoppers. Early Monday, newsXpress released collateral, including …

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Newsagency challenges

News Corp. to reduce newspaper distribution in regional Queensland

The ABC has just published this story about a decision by News Corp. to scale back print newspaper distribution in regional Queensland:

News Corp Australia to stop distributing newspapers to much of regional Queensland

News Corp Australia has notified a number of newsagents across regional Queensland that it will stop delivering its titles to them from late September, due to the “very high cost” of distribution.

News Corp wrote to select newsagents last Thursday, informing them it would no longer provide physical copies of eight mastheads, including The Courier-Mail, The Australian and The Daily Telegraph, after September 26.

The ABC understands distribution will cease to towns further west than Charters Towers in the north, Emerald in central Queensland and in some parts of the state’s south-west.

The move leaves a large swathe of Queenslanders without access to a daily newspaper covering state, national and international affairs.

In the letter seen by the ABC, News Corp Australia said its decision was based on “the very high cost to distribute to your region, in the context of how people access their news today, [which] makes its continuation unsustainable”.

News Corp. issued this statement to the ABC:

We are following our audience — and our advertisers — to where they consume news and information, allowing our news coverage to be more immediate and focused on our communities. While our changes in western Queensland represent about 1 per cent of state newspaper sales, the true value of a newspaper is in the news, not the paper it’s printed on.

Read the whole ABC story: as it goes into detail and quotes several newsagents.

Here’s the thing … print in not an efficient medium for the distribution of news and opinion. Sales of newspapers have been underline for close to 20 years. The moves being made by News Corp. in Queensland will not be the only such moves.

As I have written here over the years, the only issue to be resolved about the retreat and ultimate closure of print newspapers is the timing.

Newsagents need to run their businesses so as to not rely on newspapers or any legacy products. Hopefully, the story this morning from the ABC encourages more newsagents to pivot.

Now, as to News Corp. itself, it has not dealt with and is not dealing with these decisions in an inclusive way. It is being selfish and secretive. but, hey, that’s News Corp for you. I say selfish and secretive because company representatives tell newsagents they are important, that they support them, that they need them. Unfortunately, too many newsagents and some who support newsagents drink and that kool-aid and fall into line with the News Corp. spin.

News Corp. should be transparent with newsagents about its timeline. Yes, I am sure it has a timeline that documents the trigger points for withdrawing distributions like that covered in the ABC story this morning and even bigger moves like when it will close capital city dailies. I get why it is not transparent …/ but I wish it was as, sadly, there are newsagents who believe News Corp. more than they believe their own sales data.

I support newspapers in newsagencies, but only on terms that are viable for newsagents. By that I mean being frugal in space and labour allocation while at the same time aggressively attracting new shoppers for new product categories that offer growth opportunities into the future.

Anyone involved in print newspaper production, distribution and sale is involved in an activity that will end … soon. Everything being done needs to be done on the basis of pursuing a soft landing. That is what News Corp. is doing with these decisions. If I was a News Corp. shareholder;der I’d be supporting their moves.

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Media disruption

A warning to newsagents considering deleting business data prior to settlement when selling the business

It concerns me when I hear of a newsagent wanting to delete data from their computer system prior to settlement, prior to a new owner taking over the business.

In one instance recently, everything was deleted except for bare bones stock information. All sales history, supplier details and more was obliterated, everything a new owner would need to make good business decisions.

It’s a key point I make to prospective new owners. I suggest they have it written into the purchase contract that business data is not to be deleted without their written permission, and that as part of due diligence, yes that is a thing in buying any business, they scrutinise the data available and ensure it is what they expect and need.

I can’t think of any reason to delete data from the POS software prior to the sale of a business. I appreciate that for some in our channel this is not a popular view. However, I am looking it in terms of the future and not in terms of protecting a newsagent who is selling.

Imagine taking over a business on an agreed set of performance numbers, being in there a few months and needing to compare how you are going and realising that the data you need for the comparison has been deleted. If this happened to me I’d wonder why, I’d wonder what the deletion of data was hiding. This is why I recommend that requirements as to data are covered in any purchase agreement.

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Ethics

Victorian newsagent awarded $399,405.68 by VCAT in matter against landlord

Orders issued Wednesday by VCAT in a matter between the proprietors of Elsternwick Newsagency and their landlord were in favour of the owners of the newsagency:

Having regard to the findings set out above the Tribunal finds in favour of the Applicant and will order the Respondent to pay compensation in the sum of $399,405.68.

It is worth reading the full details published on the matter as they speak to the value of good record keeping and clear and concise communication.

While the orders could be overturned on appeal, the VCAT orders are a key next step in resolution of a complex and expensive matter.

I know of newsagents in dispute with their landlord but are unwilling to commence any proceedings. I think some landlords prey on this reluctance for a legal fight. Forums such as VCAT make it easier for small business retailers to commence action and have a matter considered and resolved for a lower cost in legal fees. Of course, they will rack up if the matter is appealed.

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Newsagency management

US landlords claiming online sales as in-store revenue for rent calculation

The Wall Street Journal is reporting that some US landlords are demanding retailers report online sales as part of store revenue.

Retailers and Landlords Clash Over What Counts as a Sale
Rents based on percentage of sales leave room for interpretation as line between online and store sales blurs

Stores are reopening and customers are streaming back in, which means retailers that withheld rent during Covid-19 shutdowns are now able to pay. But first they have to agree with their landlords on how to define a sale.

Landlords are increasingly offering deals in which retailers pay a percentage of their monthly sales in rent, rather than a fixed amount. Percentage-rent leases give retailers breathing room when sales decline and allow landlords to reap the upside when sales recover.

But there is a sticking point. With e-commerce soaring, some landlords want to include a portion of online sales in the new leases, arguing that physical stores play an important role in many of these transactions. Retailers are pushing back, according to landlords, real-estate brokers and retail executives.

If this does happen it will only lead to more retailers exit9ing shopping malls. Malls are struggling as it is to attract retailers because shoppers are remaining sticky with high street retail they engaged with during lockdowns.

But, hey, we know what major shopping centre landlords are like. Yeah … awful. Look at Westfield, long into a lease they decide to charge a fee to access the post box located in a non public area of the centre that you have had free access to for years. And they wonder why retailers are exiting.

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Ethics

Take care when comparing year on year performance for your newsagency business

To gauge the performance of your business this year, I suggest you not compare with 2020. Instead, compare with 2019.

2020 was an odd year for sure. While many newsagents experienced strong revenue growth in 2020, it was an odd year, one not to compare this year with in terms of assessing where your business is at today.

Having looked at data for a bunch of stores already, I think comparing 2021 with 2019 is a reasonable step. It will provide a better and more useful comparative perspective than comparing 20201 with 2020 in many situations. While the 2020 comparison is not bad, using 2019 as the comparison base provides more useful insight.

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Newsagency management

UK supermarket moves on plastic toys bagged with kids magazines

The Waitrose supermarket group in the UK is removing kids magazines that come with small plastic toys following a campaign by a 10 year old.

The story is getting good coverage in the UK, leading me to wonder if it will gain traction here. This, from Country Living:

Waitrose bans magazines with plastic toys, thanks to 10-year-old girl
The “pointless plastic” has finally been called out

BY LISA WALDEN
MAR 23, 2021

Waitrose will no longer sell children’s magazines containing disposable plastic toys, after a 10-year-old girl from Gwynedd launched her own campaign to persuade publishers to ban them.

Over the next eight weeks, the British supermarket will begin removing magazines containing toys from its shelves, explaining that they are “pointless plastic” with a short lifespan. The ban will only remove those containing small plastic toys, but will not include educational or reusable craft items, such as colouring pens and pencils.

Skye, who has been encouraging the magazine industry to include eco-friendly alternatives, told the BBC: “I’m really pleased so many people have agreed with me and supported my petition – I want to thank everyone who has signed and shared my campaign to ban plastics from comics and magazines. Thank you to Waitrose for agreeing with us and no longer selling the unwanted plastic tat.”

Here is the Waitrose tweet about their decision.

Here are other news tweets about this story:

It will be interesting to see whether this campaign gains traction in Australia, whether supermarkets act and whether publishers respond and address the disposable small plastic toy issue.

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magazines

Are Media / Australian Geographic campaign preferences Woolworths over local small business newsagents

Are Media has launched a campaign that preferences Woolworths over newsagents. What is utterly stupid about this is that newsagents have access to a broad range of Australian geographic products that they could promote with this campaign to make it more successful and valuable than Woolworths is doing. B&T has an image of the in-store execution.

Yes, it’s a floor display unit setup by a visual merchandiser with little or no QWWoolworths engagement.

Had Are Media and National geographic done their research and partnered with newsagents, the display would have been better integrated with the business, better connected with those working in the business.

Yes, this is a stupid decision and those responsible should have been able to make a better decision, for all stakeholders involved. This quote from sally Eagle is particularly galling:

Sally Eagle, customer director at Are Media said: “As category leader, it is incumbent on us to support other magazine publishers and the entire magazine category, particularly Australian made magazines and of course the retailers which are so vital to our collective success in connecting our brands with audiences across the country. We’re delighted to be working with Australian Geographic and Woolworths on the first of planned partnerships with other publishers and retailers.”

Sally – you are not supporting the entire magazine category with this single retailer focussed promotion. No, you are seeking to attract magazine shoppers from newsagencies, the retailers with the best magazine range in the country, and land them in Woolworths, a retailer that cares little for the medium and probably only engages when you pay them in one way or another extra to do so.

With the awesome Australian Geographic products that we already stock and our deeper engagement with that brand, we are a natural fit for this promotion.

I’d love to know how the dollars flowed to make this a Woolworths promotion. Which businesses paid for what. For example, is Woolworths paid for the floorspace? Newsagents place displays like this for free? Are Woolworths staff trained? In my experience, not beyond the very basics? Does the campaign help grow the Australian geographic brand engagement? Unlikely with no branded allied product available in Woolworths – or if it is, it is not located with this floor unit.

Underlying this Woolworths, Are Media and Australian Geographic is a desire to attract magazine shoppers to Woolworths. Thanks for that to all involved.

Yes, this is frustrating. In real terms, newsagents make less out of magazines today than a few years ago. That a key supplier ignores them for good promotions, like this one, challenges one’s support for the category.

To the ex newsagents preparing to comment that nothing has changed: Yes, you are right, good for you. Some newsagents have responded by quitting the category. For others, the foot traffic and GP$ are too much to ignore.

To anyone at Are Media preparing to say newsagents are important, we respect the channel: Words are meaningless when not backed by action.

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Competition

Newsagent rewarded for taking charge with card sales growth of 50% year on year

A newsagent I know took control of their card sales last year, keen to grow the already substantial card revenue further.

By took control I mean that they made every purchase decision, reducing their reliance on their card company account managers. Through this process, they expanded suppliers, reduced card space by 10% and expanded locations in the store where shoppers were presented card options.

The capital investment after the changes was lower than it had been. This makes the saves growth of 50% ever more sweet.

Here’s the point I want to make … newsagents love to complain about card companies. Few want to take control themselves. It’s like they don’t want to lose the right to complain.

I can’t recall ever seeing a situation where a newsagent has invested more time in managing their cards and made less money as a result. By actively managing your cards you are certain to make more money.

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Greeting Cards

Coles out early with Mother’s Day

Coles Supermarkets have allocated some space on their Easter card display for Mother’s Day cards in an interesting move. The photo is from my local Coles store from a week ago.

I suspect Coles buyers sought the inclusion of Mothers Day cards to try and drive return on floorspace for the floor fixture – since easter can be a soft season.

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Greeting Cards

Target US approach to head office staffing reflects a fundamental change on how office based businesses operate

The announcement by US retailer Target last week re it giving up one third of the office space it leases in Minneapolis for its corporate headquarters. The move represents a long-term shift by a large employer to fundamentally change work arrangements for a sizeable portion of its workforce, around 3,000 people.

The Minneapolis StarTribune has the story.

Just how different the post-pandemic world of work will look came into greater focus on Thursday when Target Corp. announced that it will move out of City Center, a major downsizing that will reduce its office space in downtown Minneapolis by a third.

Target, the largest employer downtown, said it no longer needs the nearly 1 million square feet it occupies in that skyscraper as it plans for a hybrid future in which workers will combine remote and on-site work. It made the decision even with 10 more years left on its lease.

The company’s exit from City Center will leave a gaping hole, since it takes up about two-thirds of the 51-story tower. All of Target’s offices have been mostly empty in the past year as the company, like many, sent employees home to slow the spread of COVID-19. About 3,500 of Target’s 8,500 downtown Minneapolis employees worked in City Center before the pandemic.

Be sure to read the whole article.

This story supports what I have been saying since mid 2020. I don’t think office businesses will snap back to the way they were. I don’t think CBDs will have the focus they used to have. The world has changed.

I know Minneapolis well and lived there for a time 20 years ago. It is very much like Melbourne. The decision by Target is a loss for the city and a win for surrounding regions, especially smaller towns.

In my own software company, none of the two thirds of team members who started working from home during the pandemic will return to the office. We are not alone.

These changes benefit you.

Think about what you stock as your inventory mix is key to determining who shops your shop. Think about how you can pitch your business in this changed situation. I know of some newsagents who are well established in catering to this change, which is terrific news!

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Newsagency management

Murdochs and Tabcorp?

There was an interesting story in the Nine Media papers yesterday:

Lachlan Murdoch’s Fox Corp circles Tabcorp
The Murdoch family’s US media business Fox Corporation has been working with other investors on a potential bid for parts of ASX-listed gaming operator Tabcorp.

The Los Angeles based company, which is run by billionaire media scion Lachlan Murdoch, has also registered a trademark for its betting arm FOXBet in Australia, in a sign the company is considering an assault on the local wagering industry.

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Lotteries

And, speaking of Easter

Currently, there are 27,000 daily Google searches in Australia for Easter gifts and similar keywords. While it is too late for this year, newsagents selling online can do better in this season by tuning their online offer the be more seasonal.

Many of us have Easter gifts. Too few of us are pitching them online. None of us are in the top 100 results.

The Google searches indicate there are many on line ready to purchase. This is another example of how we can reach our local businesses beyond those who walk, ride and drive past our front door.

Online is where we have excellent opportunities for growing our businesses.

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marketing

Full face Easter card pitch is working well

We launched Easter with in our high street business a month ago with this full-face pitch. It’s worked a treat, delivering strong sales.

Shoppers like to see the full front of each card. This has led to less touching, less stock damage. It has helped maintain an organised display.

The placement, just inside the front door, is encouraging engagement from some who many not have purchased an easter card or who may have purchased later in the season, and elsewhere.

While I don’t have proof, my feeling is that the tactical placement of this full face display is a key factor in Easter success already. We’re ahead on 2020, of course, and 2019, which was the goal … and we ten days out.

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Greeting Cards

Centenary of Rotary coin a sales and community engagement hit

The Centenary of Rotary in Australia 2021 $1 Coloured Uncirculated Coin is a hit. Indeed, it is a sell out to the point that supply has fallen well short of demand, which is a good thing. It’s proving to be a terrific success. We managed limited supply by limiting how many each customer could purchase.

From The Royal Australian Mint, the coin has a mintage of 40,000 and is available in a limited mix of retailers.

What I like about this coin and other special interest coins from the Mint is that each launch introduces new collectors and they can be valuable customers to find.

The mint coin category can be worth $20,000 and more in a newsagency with capital investment in space and inventory modest. The key is social media engagement as that is how you find new shoppers.

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Gifts

Has Tabcorp been updating Google Maps entries?

Maybe Tabcorp, maybe another party, has been updating lottery retailer details in Google Maps, indicating TheLott as the business name and products sold, but including, often the newsagent phone number and open ing hours.

Here is one example of this, which I chose at random from many examples available:

I first heard about this happening from a newsagent who happened to be checking out their own Google listing. The found a TheLott listing instead.

Something is going on and I am not sure what.

My advice: search for your business in Google and check what comes up in the general search and in maps. You can change it by claiming ownership of the listing.

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Lotteries
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