Author: Mark Fletcher

A payments surcharge in retail businesses is an indicator of how well the business is run and how much it genuinely cares for its customers. In my opinion.

At a local market here in Melbourne yesterday morning across 10 different butchers and fishmongers there were 8 different surcharge percentages ranging from 1% to 1.75%.

Most had a sign saying they were passing on the cost to their business. The businesses are similar in size and would, I expect, have similar capacity for negotiating with their payments provider.

To me, the surcharge percentage is a way to compare businesses. I switched an $85.00 meat purchase from one charging 1.65% surcharge to the next one along who was charging 1%. The meat I purchased was the same price per kilo in each shop, the same noted quality: hormone free, grass fed etc.

While the actual saving was only a few cents, I felt my point was worth making through my purchase decision.

All of us who own retail businesses get make choices about our cost base. Our payments provider choice is a public-facing indication of our ability to negotiate for the benefit of our customers.

I see a high surcharge (above 1%) as disinterest by the retailer in their customers, laziness even. Some providers make this pitch today: go with us and it will cost you noting since the customer is surcharged the full cost. This is the model most likely to result in a surcharge of 1.65% or higher. It’s an easy decision, one you do not have to manage.

The alternative is to shop around. Right now there are payments platforms offering small business retailers blended rates as low as .7%. Given terminal costs, you could surcharge at .85% (maybe even 1%), cover your costs and present as a more engaged and customer-caring retailer.

For all the talk at the moment about cost of living, we retailers can help our customers save money by accessing the best payments rates possible and thereby keeping the surcharge ‘tax’ applied to our customers as low as possible.

Retailers with a lower surcharge nurture trust with their customers whereas retailers with high surcharges can foster resentment and lead customers to question the value of shopping the business. In an environment where consumers are increasingly conscious of every dollar, a low and transparent surcharge can be a valuable differentiator, signalling a business that prioritises fairness and customer satisfaction over maximising profit at every transaction.

So yes, I think a payments surcharge is a reasonable comparison point when comparing retail businesses. It suits me because my own shops have a low % surcharge. Customers appreciate it.

Trump’s tariffs are already impacting Australian retailers selling into the US market. The proposed removal of the $800 ‘de minimis’ threshold on May 2, which until now has allowed duty-free shipments up to $800 in value, will increase costs and compliance burdens, for smaller these shipments.

Foreign companies, now less competitive in the US, will likely divert their goods to markets like Australia, intensifying competition for local businesses.

The supply chain is also experiencing significant disruption. Manufacturers and shipping companies are adjusting their operations to absorb the tariff’s economic impact. This is leading to price increases in markets without tariffs, effectively subsidising prices in those newly affected. This price shift is a concern.

There is one other possible impact I want to raise – that of suppliers increasing prices under the cover of tariff noise. I have suspicions about a couple of suppliers in the Australian marketplace doing this.

Beyond direct impacts, the flip flop approach from the US over the last three months and fed uncertainty. This makes planning difficult for small businesses. We’re already seeing this uncertainty reflected in supplier decisions, leading to less predictable product availability.

It’s crucial that businesses assess the potential impacts of these fluctuating US policies on their supply chains and revenue. We must consider the risk of a US, Australian, or global recession and engage proactive mitigation strategies. Acting now is essential; waiting until the impact is fully realised may be too late.

Historically, businesses that thrive during recessions and economic instability are those that planned and acted before the crisis hit.

While many small business retailers will dismiss these concerns, I don’t think it is smart to do so. I know of three suppliers who have increased prices in Australia citing the US disruption as the cause. Given Trump’s initial actions, it’s reasonable to expect bigger negative economic consequences for many, driven by decisions that primarily benefit a select few.

In this moment it’s vital we build resilience and adaptability into our local small retail business models. This means diversifying supply chains, exploring new markets and new products, and strengthening financial reserves. Those who prioritise proactive planning and strategic flexibility will be best positioned to navigate the inevitable economic shifts ahead.

If you are in local small business retail, now might be a good time to step outside what has been traditional for your business, to find new customers through new products and services. Broadening your base will make your business stronger.

Sometimes, the path ahead in your business can seem overwhelmingly obstructed, the air thick with uncertainty, making it difficult to see a clear way forward.

I have seen it myself in business, in my own business.

The situation can seem helpless. You can feel exhausted. You can want it over.

If this is you, there are plenty in the newsagency channel and nearby who can help. Call someone. Tell them about your situation. You’re welcome to call me – 0418 321 338. Talking to someone can help provide clarity and ease the burden, even if all they do is listen to you.

My advice is to not walk through this alone.

Before I get into this I have a note to share about why I am posting this today, on Good Friday. In my experience, breaks like Easter and Christmas are when some reflect on their businesses and fall into worry about the state of the business and, sometimes, personal circumstances.

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If you are at a point where closing your newsagency feels like the only viable option, please take a moment to read this. It’s an updated message I’ve shared before, and I’m sharing it again today because of a situation recently where someone had made the decision to quit.

If you genuinely believe that closing your doors is your only recourse, I urge you to seek a second opinion. Myself, and many others within our newsagency community, are willing to offer this perspective, based on your business data: your sales figures, Profit & Loss statements, and other relevant information.

Often, the evidence within your data holds hidden opportunities. The challenge is that these opportunities can become obscured by the overwhelming “noise” of perceived obstacles and the fog of uncertainty.

My sincere hope is that within your business’s data, there lies sufficient opportunity to identify a path forward, both for the business itself and for you personally.

Turning a situation away from “closing is my only option” can only be achieved through one or a combination of the following strategies:

• Attracting new shoppers.
• Encouraging existing shoppers to purchase more.
• Increasing profitability on some of your current sales.
• Reducing your operating costs.

When you see it written down, it seems quite straightforward. The real difficulty lies in the execution – that’s where many retailers can feel stuck. Attracting new customers, in particular, can be challenging for small businesses with limited resources.

The most effective way to bring in new shoppers is often by introducing new product categories and actively promoting these outside of your physical shop.

I understand that finding the energy and the funds to invest in new products when you’re struggling can feel like a huge hurdle. However, if the survival of your business is paramount, you will find a way.

The most successful approach to getting your existing customers to spend more is by implementing a well-designed loyalty program and cultivating a shop environment that people genuinely enjoy being in.

To increase the profitability of your sales, you’ll need to either charge more for your products or secure better purchasing terms, or ideally, a combination of both. Don’t aim for drastic price hikes; even a modest increase in your gross profit percentage can make a significant difference.

While pursuing these revenue-generating strategies, you also need to actively work on reducing your costs. This is a common tactic when trying to save a business. While cost-cutting can certainly help, in my experience, it’s rarely enough on its own to turn things around. It can be a valuable part of the overall strategy, but it’s seldom the sole solution.

A crucial element for any successful turnaround is to start addressing the issues early, before the fog of problems and the debris of challenges completely block your path. It’s vital for all of us who own businesses to be looking ahead, over the horizon, and cultivating assets that we can deploy when we anticipate the need for change.

If you genuinely believe that closing your newsagency is your only remaining option, please reach out. There are many of us within the newsagency channel who are willing to listen and offer advice if you’d like it.

Remember, you are not alone in this.

Mark Fletcher mark@towersystems.com.au mark@newsxpress.com.au https://www.linkedin.com/in/mark-fletcher-tower/

I’m grateful for the invitation from Shoptalk for myself and a newsXpress colleague, Anthony, to attend Shoptalk 2025 in Las Vegas a week ago. Here is a video of us discussing some takeaways from the conference and trade show.

Whether you’re a retailer, a tech enthusiast, or just curious about where shopping is headed, this video offers a glimpse into the future. It highlights the importance of personalisation, the rise of AI, and the enduring need for unique, engaging customer experiences in an ever-changing landscape.

What you’ll discover:

• The Buzz Around Personalisation: Learn how brands are using personalised merchandise, like hats, jewellry, and bags, to create engaging experience.
• TikTok’s Unique Approach: See how TikTok created a standout, personal experience for attendees amidst the trade show buzz.
• AI’s Growing Role: Explore the impact of Artificial Intelligence on retail, from personalised ads to tools that help small businesses analyse data and even generate blog posts. Is AI a disruption? The video delves into this question. Side note: it was great to realise that what Tower Systems offers in terms of Ai tools in its newsagency software is well advanced in this space.
• Rethinking the Retail Environment: Discover how simple changes, like rearranging a supermarket’s biscuit aisle, can significantly impact sales and why constant change is key for small retailers.
• Beyond the Trade Show: Hear about unique experiences like Martha Stewart’s tranquil Las Vegas restaurant and the surprisingly reliable Waymo driverless cars, connecting these to growing trust in AI.
• The Power of Experience: Get inspired by a visit to a unique garden centre offering live music and local vendors, reinforcing the importance of creating fun, memorable customer journeys.

I appreciate not everyone can get time away from their business to learn and reflect. I am grateful to be able to do this. While the video does not get into some very cool competitive-edge learnings, we did try and provide actionable value for those who watch it.

Shoptalk is a crazy event: around 10,000 retail and tech/retail attendees and 900+ suppliers. There were conference sessions, one-on-one meetings, trade show presentations and plenty more. Being invited by Shoptalk made the event low cost for us. This did not dilute the value we are extracting from it though. Already there are some retail changes we have made.

In 0ur suburban Melbourne newsagency, March 2025 was a good month, up on 2024 and some terrific results for previously challenged categories.

But first, some context: this is a high street shop in Malvern, Victoria. It does not sell lotteries, candy at the counter, tobacco or any convenience lines. When I bought the business three years ago it was traditional, without gifts, toys or anything outside of papers, magazines, cards, stationery and transport tickets.

Overall sales in March 2025 over 2024 were up 2%. Gift revenue is up 100%. Toy revenue is up 70%.

Here are the surprises: magazine unit sales (we never compare revenue) were up 4% (2,569 magazines sold in the month) and newspaper unit sales were only down 3% (a third of the national trend) to 2,937 units sold. These results are despite us further educing magazine space and placing newspapers in a lower cost space further into the business.

The high value growth in the business is coming from good margin products achieving more than 50% gross profit. This is what I like to see in a transitioning newsagency, a shift in gross profit contribution from low GP categories into high GP categories.

In the business a conscious decision has been made to focus on toys. The close to $4,000 in toy revenue in the month shows this focus paying off.

I am writing this at 6:25am on Tuesday April 1. We have now reviewed March and made some decisions for April and beyond. The analysis time was under ten minutes and decisions quickly flowed from that. I mention this to remind folks here that there is little to be gained from overthinking decisions you make about your shop.

The focus is simple, do more of what is working and less of what is not working. As soon as something that is working shows that it is not working, retreat. Oh, and always have ideas ready for when space and capital are available to make a new move.

I need to mention stationery. Sales were down 20%, by $1,500.  What we have found in this business over the last three years is that stationery revenue is unpredictable. Of I do a 3 or 6 month year-on-year comparison, it’s up nicely. Then, as we saw in March, there are odd months in which we see a drop. In this situation we take a quick deeper look at stationery. What hurt us in March is that we completely moved the location of stationery. The move cost sales. In the latter part of the month we see the move paying off.

In this moment in time where news outlets and commentators are yelling about the cost of living and talking down retail and focussing on store closures, there are businesses doing well. 2% growth in March is good for our small business. I’d note that for this analysis I am only looking at in-store purchases and not online.

I know from others I have talked with there is plenty of good news in Aussie newsagency businesses.

Take a look at your March 2025 sales versus 2024. Look for opportunities. I am sure there will be plenty.  For reference, the report I used for the above data is the Monthly Sales Comparison Report in the Tower Systems newsagency software.

If I can help, please reach out: 0418 321 338 or mark@newsxpress.com.au.

It takes less than a minute to see the value of dead stock in your newsagency. Your newsagency software can give you the number and, if you want, list the items that are not selling and have not sold in six months or more.

In the Tower Systems newsagency software the insights dashboard has the dead stock data ready for you without you having to run a report.

Too many newsagents say dead stock is not an issue for them when it is an issue. Too many newsagents prefer to live in ignorance than know their real situation. These same newsagents will desperately want to deal with their dead stock issue when they come to sell their business because plenty of buyers will not buy dead stock if they are smart.

Here’s my challenge today: find out the value of dead stock in your business. My advice is if you have not sold any of an item in six months, it’s dead.

Get your number and then resolve to cut this. As a benchmark, dead stock should make up less than 5% of your total inventory investment. I think the best goal is 3%.

So, what’s the value of dead stock in your newsagency?

Here is how we quit stock in retail businesses we operate:

1. Set a deadline. We’d suggest two weeks for quitting a product or range of products.
2. Set your initial price. The discount must be compelling. We’d suggest 50% off. A smaller discount in this marketplace will not get noticed. Think about your discount words: in some areas, HALF PRICE works better than 50% OFF. Sometimes, 2 FOR 1 can be even more effective. A $$ price can work better – for example a dump bin with everything priced at $1. People then don’t have to work anything out.
3. Move the product to a high traffic location. Display it as a line you are quitting – in a dump bin or on a table. This is not a time for pretty displays.
4. Put up a sign that is either black on white or white on read. Nothing fancy.
5. Adjust your price. If sales are not strong enough, go harder with your discount.
6. Give it away. If the products are not selling, consider giving the stock away to a local charity.
7. Keep track of time. If you decide to be out of the stock within two weeks, stick to that and make it happen with your pricing and placement decisions.
8. Use the bin. If you can’t sell the item and you can’t give it away, use the bin.
9. An alternative: If you have a large amount of stock to quit, consider hiring a local hall and running an off site sale.

Quitting stock takes strength and commitment. We urge you to do it to keep your business fresh. Product not selling gives shoppers a bad impression of your business.

This all starts with you knowing the value of your dead stock.

I have been contacted by two suppliers in the last few days with notice that their prices are increasing as a result of tariffs imposed y the Trump administration.

Despite the claims by Trump, tariffs are paid by the importer, who passes them on in a higher cost of goods. One supplier has advised there will be price increases they are yet to calculate while another US based supplier has written with details on an increase to apply from April 1.

Screenshot

Given the routes some goods go through, priced paid in Australia by some suppliers will increase. While some suppliers will re-route goods to avoid the US imposed tariff, for others this will be a challenge.

The reality is that the tariff moves by the Trump administration are having knock-on affects on manufacturing around the world, leading to significant supply chain disruption.

The Trump tariff move has been made, according to him, to stimulate manufacturing in the US. For plenty of these goods Americans will need to be happy paying significantly higher costs due to higher local manufacturing costs if manufacturing is moved to the US for even the log wages paid in the US are considerably higher than in China, for example. Some US suppliers have noted already, the tariffs are lower in cost than US based manufacturing.

Plenty of economists have explained the folly of imposing tariffs, that the additional cost is borne by US consumers and not the exporting country.

A consequence of the tariff move is more people becoming aware of where what they buy is manufactured. You only need to see some of the news out of Canada in the last couple of weeks to see the extent of the own-goal by the US. I think there is good opportunity here for a more nuanced buy local approach.

While the current federal government in Australia has said it will not impose tariffs on the US in retaliation, trade into our country is already caught up in the US moves. It’s messy and expensive.

In my own case we are making alternative arrangements in at least one instance.

The situation is fluid as we have seen in recent weeks. None of this helps with business planning.

Ugh.