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

Author: Mark Fletcher

Every newsagent needs to be across Gotch product code change

Here is the text of an email from XchangeIT to newsagents yesterday.

Dear Newsagent

From 13th February 2018 you will be receiving DD2s/Files from Gotch, via XchangeIT, that contain their new 10-digit Product Code format (an update from their old 5-digit codes because they are running out of numbers).

To make this change possible, your POS provider has been contacted and they are developing processes to implement the new 10-digit Product Codes and update the product inventory in your POS.

On or before 13th February, please look out for any instructions from your POS provider.

NOTE: If you are not on support with your POS Provider you may have to manually update each Product Code from 5 to 10 digits across all Gotch products.

Between now and approximately 5th February, your POS provider will be preparing for the change, as will XchangeIT and Gotch. We will update you on approximately 29th January as to progress.

If you have any questions in the meantime, please call us on 1300 551 212.

Best regards,

The XchangeIT Team

All the Gotch products codes are remaining the same except they are adding 10000 to the start. The change has been in the works for several months with software companies involved in the discussions.

The change means that products arriving with the new codes will have to be matched to the old code. Engaged software companies will make this easy for customers with the latest software.

All returns data going back after February 13 will need to use the new product codes. Otherwise, returns will be rejected.

The change has come about because of the expansion of the Gotch portfolio moving Network titles in and the introduction of giftware.

Newsagents cannot ignore what is happening here. It is essential that every newsagent is on top of this, following exactly the advice of their software company. If this is not done, credits could be lost.

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magazine distribution

Inspiring retail outpost

The kikki.K outpost in the Qantas terminal at Sydney Airport is terrific, a best-practice example of an outpost.

The outpost uses a small footprint but displays a considerable range of stock and even offers a personalisation service. It is easily shopped and laid out for fast selection, which is important in an outpost situation.

If you are thinking of doing and outpost and are in Sydney, check it out.

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Newsagency opportunities

Free workshop: Ideas for transforming your newsagency in 2018

Ideas for transforming your newsagency in 2018.

A free management workshop for newsagents.

newsXpress invites newsagents from across Australia to free management workshops. We also offer to fund air travel for newsagents to ensure easy access to this important event.

Hear how newsagents are transforming their businesses, finding new customers, enjoying a new lease on life. We will share case studies from city and country newsagencies.

  1. See new, exclusive, product that is attracting new shoppers, product you have never seen at a gift fair or trade show before.
  2. See greeting cards not available in any other newsagency, greeting cards that appeal to shoppers beyond the usual caption range in Australia.
  3. See the evidence of success of the newsXpress multi-site web strategy that is driving online as well as in-store sales. We will share the latest sales data.
  4. See the newsXpress P&L – demonstrating transparency.

Here are the only dates in this series. Please tick your selection.

  • ADELAIDE: 5th Feb, 10am @ Rydges South Park, 1 South Terrace SA 5000
  • SYDNEY: 6th Feb, 10am @ Hilton Sydney, 448 George St Sydney NSW 2000
  • BRISBANE: 7th Feb, 10am @ Brisbane Riverview Hotel, Kingsford Smith Dr,
  • PERTH: 8th Feb, 10am @ Parmelia Hilton Perth, 14 Miller St Perth WA 6000
  • MELBOURNE: 9th Feb, 10am @ Grace Park Hawthorn Club, 6 Hilda Crescent

I am posting this here as I am a director of newsXpress and will be hosting each workshop.

Book by emailing help@newsxpress.com.au or by using the booking form.

If you have any questions, call me – 0418 321 338.

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Newsagency management

Newsagency management tip: worry less about competitors

I appreciate frustration newsagents and other small business retailers feel when they see products they have had success with make their way into a national chain or a nearby competitor.

In many cases this comes about because the supplier needs more volume than the independent retail channel can provide. Hence the move to mass or more independents.

Most key competitors of independents attract different destination traffic.

For you to make the most of what could be a growing product category, and or licence, you need to become the destination retailer in your area. This takes more than putting product on the shop floor. It involves being the expert, promoting outside the business, hosting events and giving people to place your store top of mind when they think of the product, category or license.

The easy approach is to complain about the actions of the supplier. The better approach is to deny the supplier this consideration by being better from the outset.

Competitors will always be there. Suppliers will always need to more more stock – usually because of manufacturer pressure.

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Management tip

Toys set to be strong in 2018 for newsagents

The toy category is set to be a strong category for newsagents in 2018 with more newsagents taking it on and with more suppliers prepared to sell to our channel than in the past.

Toys today are broader in their appeal than ever before, especially bad games, which experienced double digit growth in 2017.

While a few years ago it seemed that games were in trouble because of digital disruption, they have come into their own thanks to clever invention of new products and recasting of the appeal of some traditional products, such as Monopoly.

Taking on a local toy shop competitor is possible for newsagents. It takes knowledge, focus and commitment. This is especially true if you focus on niche, special interest, opportunities.

As a guide, toy revenue could easily be equal to 50% of your greeting card revenue. I have determined this base benchmark based on data I have seen from more than fifty newsagency businesses.

If you are not in toys, consider it. The right toy product can attract new traffic across several valuable demos.

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Newsagency management

Beware the doom and gloom reporting about Facebook

News outlets and some social media commentators / consultants have been saying the sky is falling following the announcement from Facebook last week of planned changes to their news feed algorithm.

As often the case, plenty has been said about what might be. I think we are better off waiting to see what actually happens, how the algorithm changes actually play out. Once we see those facts those of us who make active, daily, use of Facebook for our businesses can adjust accordingly.

Facebook is a business. It’s sole focus is share price. Share price is driven, in part, by revenue. Revenue is tied back to boosted posts and advertising. Advertisers will spend money if they can make money.

While we need to wait and see, I suspect facebook will ensure it has a healthy revenue model. That benefits those of use who use the platform commercially.

In the meantime, no, the sky is not falling.

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marketing

Terrific Atlanta gift fair offers insights for independent retailers

I am grateful for the opportunity to visit the Atlanta gift fair this year. It was my fourth year at the event and the most enjoyable so far. In addition to the trade show I was able to sit in on some terrific gift related product and strategy workshops.

There was plenty of new product to see and new initiatives to consider.

This is the major trade show for gift and homewares for the year. It is held in a three tower location with each tower similar in size two the one on the photo.

Many companies have year-long booths for sales people to use. Many of these booths show products as a shopper would see them in retail.

I use the show as an opportunity its to draw inspiration in terms of product range, in-store merchandise rising and retail management practices from way beyond the opportunities for inspiration we see in Australia.

As often the case, there was talk at the trade show about the mood of small business owners. The mood is considered to be optimistic. People were open to buy. This is an advance on the same rate show a year earlier.

I have come away with several new product opportunities as well as what I think will be some good in-store initiatives. Retail competition in the US is considerably greater than in Australia. This challenges small business retailers to do better. That is where I have found good learning opportunities by being at trade shows like this.

The importance of gift retailers  is growing in our channel. It is exciting as what constitutes gift continues to evolve.

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Gifts

Some small business newsagents rely too much on accountants for business decisions

While accountants can play a valuable role in business decisions, I see and hear of situations where the accountant has too much of a say.

In one situation recently an accountant told a newsagent they should put tobacco products into their business because all newsagents have cigarettes. This was in a business the accountant’s client had recently purchased, their first and the first newsagency for the accountant.

The previous newsagent had got out of tobacco five years earlier because of falling sales. But here was this accountant telling someone new to the channel and new to retail that they should get into tobacco. They did.

That was almost a year ago. It has not gone well.

The accountant thinks the retailer failed. The retailer thinks so too. This is despite evidence in the business data showing growth elsewhere in the business, where the retailer backed their own instincts.

This is one example. There are plenty in our channel, where accountants have provided advice that is either out of date, not relevant to a transforming newsagency today or plain wrong. And there are plenty of examples where accountants have provided excellent advice to newsagents.

Some decisions are not about the numbers alone. With the extent of change we are confronting, taking a risk beyond what the numbers show will be key to success in a year or two.

It is important to remember it is your money on the line. As the business owner, you have to back yourself. Relying too much on an accountant who is not in the business, who may not have relevant knowledge about your channel, may hold you back. It could head you in an inappropriate direction.

My advice is to by all means listen too your accountant. However, have the data and knowledge to make decisions yourself, and in a timely manner, based on your own evidence. The pace and scope of change today demand this from us in business.

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Management tip

Inside the pencil factory

Pencils are a core product for Australian newsagencies. While they have travelled a significant distance from where began, they remain vital today as new generations buy them in good numbers.

With this in mind, I encourage you to take a moment to read a wonderful article, Inside One of America’s Last Pencil Factories.

In an era of infinite screens, the humble pencil feels revolutionarily direct: It does exactly what it does, when it does it, right in front of you. Pencils eschew digital jujitsu. They are pure analog, absolute presence. They help to rescue us from oblivion.

This article is a beautiful piece of writing about a wonderful factory where they make an item important to us for decades.

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Stationery

Suppliers promoting retailers on social media need to lift their game

The publisher of Breathe magazine promoted newsagents on social media, and Woolworths.

The post from yesterday says participating newsagents. You have to go to their website to find them.

However, on their website it is all about them selling direct to the shopper.

It is only when you scroll down to the bottom of the home page that you see the store finder link. Once you click that you enter a suburb and it them displays a map of stockists.

Once you get to the map it is terrific. They need to make this easier to find. It could be in front of people landing on their home page, without needing to scroll or even click on a link. That is what they should do if theirs is a over the counter purchase first strategy.

If the publisher strategy is that retail serves to facilitate the publisher / reader relationship then they should continue doing what they are doing.

I like to see suppliers promote stockists and do appreciate that newsagents get a mention from the folks at Breathe. However, I (selfishly, of course) want them to do it with a retailer first approach. In fact, a newsagents first approach. That approach would drive our engagement is it demonstrates respect for the us.

Re this pitch for Breathe: Woolworths is at an advantage and that is unfortunate.

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Competition

TV campaign for newsXpress

newsXpress yesterday kicked off a national TV campaign promoting jigsaws. 93% of purchases with jigsaws have only one jigsaw in the basket. The goal o the TV campaign, in-store promotion and social media engagement is to drive basket depth – in addition to making newsXpress stores destination stores for jigsaws.

Last year, jigsaw sales increased by more than 10% in Australia, off a strong base. Jigsaw shoppers are loyal.

The more newsagency businesses are promoted outside what have been traditional traditional traffic attracting offers for the channel the better.

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marketing

In 2018, make every day your payday

For several years, I have written that newsagents need to make every day their payday.

This is an important message as it focuses on the goal of driving business value. Too often, I see retailers working about, being focussed on, the wrong things, things that do not directly affect business value.

As 2018 gets under way, I am pitching this again, with revisions.

Make every day your payday.

There was a time when small business retailers could rely on selling their business for a handsome increase on the price they paid thereby providing a good pay day, when businesses sold for a good multiple of net earnings.

No more. Today, the best way to extract value from our businesses is to make every day your pay day, to not rely on your pay day being the day you sell the business. In fact, the typical newsagency today will sell for somewhere between 1.l5 and 2 times actual net profit as shown in the business P&L.

The P&L matters as this is what you need to be guided by in all business decisions and actions.

The challenge is how do you do this?

Retailers need to look at their businesses differently. This starts with the mindset of every day being your pay day. Each decision needs to be considered in this context, in the context of the P&L impact.

Focusing on profit today will give you a better result today and make your business more valuable tomorrow.

Here are some suggestions for making every day your pay day:

  1. Run with the leanest roster possible. Just about every retail business I review has capacity to lower labour costs. In a typical newsagency, one hour saved today is worth between $75.00 and $100.00 in revenue.
  2. Ensure you can sell when the business is closed. Yes, this means sell online.
  3. Promote the business outside your usual foot traffic area … increase your customer base.
  4. Promote your business outside the brand people know you as. or example, online pitch under a brand other than your newsagency brand.
  5. Have your best people working the floor, helping customers spend more.
  6. Have stunning displays that attract people from outside the shop.
  7. Have compelling displays in-store that encourage people to browse beyond their destination purchase.
  8. Always have impulse offers at high traffic locations.
  9. Charge more every time you can. Loyalty programs such as discount vouchers, bundling into hampers, multi buys such as 2 for 3 and other opportunities enable you to do this by blocking price comparison.
  10. Buy as best you can.
  11. Grab settlement discounts every time you are able.
  12. Measure product category performance by gross profit. Quit the categories that are not paying for themselves.
  13. Promote outside your store using online and social media opportunities.
  14. Leverage adjacency information. Chase a deeper basket – people purchasing more each visit.

Be responsible for the profitability of your business. Don’t blame your suppliers, your landlord, your employees or some other external factor … it all comes down to you – the decisions you make and the actions you take.

If you relentlessly pursue profit with a clear focus you are likely to see profit grow. That’s better than waiting to make money when you sell because that’s less likely to happen in this market.

Doing all this relies on your measuring the performance of your business. The Tower software helps with this. It is easy.

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Newsagency benchmark

You are not your customer

The next time you decide to not stock something because you do not like it, stock it and give it a good location and good support.

You are not your customer.

Think about the magazines you sell, the diverse number of titles. What percentage of the magazines you stock would you read if you had time? I would be surprised is the percentage was higher than 25%. That would mean 75% of the titles are not to your taste.

You don’t have to like what you sell. You don’t have to like it to be able to pitch it. All you need to do is to understand what you sell. Understand who the customer could be, how they would choose what they buy and how to best represent the product.

The more people who shop with you buying what you would not buy for yourself the better for you and the business.

Don’t think about your shop as an extension of your home, filled with what you want ton see.

You are not your customer.

Hang on to this mantra. Buy with it in mind. Take it as a challenge to see how far you can stray from your comfort of what you like. Let this straying show you what is possible in your business.

The desk nameplate in the photo is an example of an item several newsagents I know stocked under protest. They were shocked that it and others from the sarcastic range sold out in a matter of days, leading them to reorder these products they do not like.

Chase opportunities outside what you like and outside of what people expect for your business or your type of business. This is key to attracting new shoppers.

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Gifts

Advice: retail visual merchandising for blokes

This advice could also be called VM merchandising for people who think they can’t do it. Everyone can do Visual Merchandising! Experience is not necessary.

Visual merchandising is about display products in a way that attracts people to them, to look, touch and feel. It is about displaying products so you sell more.

Sales determine success, and only sales. A pretty display that does not drive sales is a waste of time and space.

A display that wins a supplier prize that does not increase sales is a waste of time and space, despite the supplier award.

Here is my advice on VM for blokes.

  1. Start with a clean space, a flat surface, in a good location.
  2. The best display looks like a pyramid.
  3. Your hero product is at the top of the pyramid.
  4. A seasonal poster hangs above the display or is placed next to it to signpost the display.
  5. Flowing from the hero product down to the base of the display are other products. But not so many that you can’t see what you want people to see.
  6. The display is balanced, even.
  7. A display of gifts always includes cards.
  8. Use coloured paper to highlight certain products. But don’t go for a rainbow.
  9. From a colour perspective, a good display has no more than two core colours as the focus.
  10. Don’t put signs in the display itself unless absolutely necessary.
  11. A display can look untidy and that is okay in some circumstances. For example, a box of Beanie Boos exploding from a box .
  12. Mistakes are okay.
  13. Oh, and don’t treat this as an engineering challenge. Keep it simple and fun! :

Remember, the alternative is no display at all.

A note to others who may be around when someone is doing their first display – we all did our first display once … be gentle.

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Newsagency management

Bauer shutters Reader Rewards program

Bauer Media has announced the end of the Reader Rewards loyalty program. Here is the announcement from the company:

As part of Bauer Media’s ongoing commitment to continuously provide effective and sustainable support to the newsagency channel we regularly review the range and efficacy of resources we offer.

After reviewing customer feedback as well as the low newsagent participation, Bauer Media has made the strategic decision to close the Reader Rewards loyalty app. The available funds and resources will be diverted into Bauer’s keystone trade development program, Connections with Bauer.

Please note the following closure timeline and details.

·         Reader Rewards will continue operating until Monday 22nd January 2018.

·         From the 22nd January customers will no longer accrue any additional stamps.

·         Customers will have until Wednesday 28th February to redeem any remaining free magazines they have earned.

·         Customers will be notified of the closure via email encouraging them to redeem any remaining stamps they have accrued.

This decision has been carefully made in response to channel feedback and an increased demand for alternative business building resources, such as social media support.  Bauer Media’s ongoing priority is to continue to deliver a host of optimised tools through the Connections with Bauer program in-line with new and exciting developments in the retail landscape.

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magazines

Are the banks closing accounts of newsagencies with Western Union?

The Australian published a report Friday claiming that banks have ended services to 100 customers (newsagents) offering Western Union services.

The rift between the small business ombudsman and Australia’s largest lenders has widened further, with Kate Carnell set to pursue the big four banks over their decision to end banking services with more than 100 customers ­offering remittance services through Western Union.

As the threat of being ensnared in a legal stoush with anti-money-laundering regulator Austrac continues to loom large, following the explosive suit against Commonwealth Bank late last year, lenders may be too aggressively ending business banking relationships with newsagents who offer Western Union services.

The report in The Australian is the first I had heard of such action being taken. I have searched online and cannot find any other reports.

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Newsagency management

Newsagency management tip: handling charity donation requests

I have written before about the need for policy and process around community group and charity donations. I like the approach of a cafe I visited recently. Every person approaching on behalf of a charity was given a card.

While the cafe is part of a small chain, their approach of bringing structure to handling the request is good. A single local business could easily do the same. Groups expecting you to support them need to show support for your business.

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Management tip

Pitching Valentine’s Day at the entrance of the newsagency

This photo shows our opening pitch for Valentine’s Day in the newsagency. This is at the main entrance to the business.

I call it the opening pitch as the placement will move twice through the season. We are supplementing this in-store placement with a series of social media posts starting later this week. Social media is playing a big role in our marketing spend this year. We have a budget, which is measured against sales outcomes.

While we will get good traffic for Valentine’s Day card purchases, those who actively promote outside their businesses set themselves up for great success.

2018 is already showing itself to be a year for making our own success.

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Greeting Cards
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