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

Author: Mark Fletcher

Star Wars the top licence this Christmas

IMG_0974Licence experts in the toy and games space have declared that Star Wars will be the top licence this Christmas in Australia.

One expert in the field who I heard from this week claims it will outperform its nearest licence rival by more than three to one. If this happens it will be an extraordinary result.

The time for picking successful licences was back in March this year when most major brands released their Christmas lines.

With Star Wars licenced products from a range of suppliers, engaged retailers are able to tell a terrific story across multiple product categories, some of which are traditional to newsagency retail while others are not.

If your business has a Christmas catalogue out with toys and no Star Wars representation – ask those who created the catalogue why they have ignored this opportunity.

What is fascinating about Star Wars for newsagents is that through this licence you can sell items that are far more expensive than the average item value sold in a newsagency. This type of move is key is you are to life basket value and dollar margins per sale.

Licence insights and trends are vital to understanding the opportunities down the road and around the corner. Being able to decide in March, for example, what will dominate in December is challenging even for major retailers. However, it is vital to have a go at this, to try and ensure you are in the game. Otherwise, it will be a low-margin Christmas based on cheap toys and that is a game newsagents should have got out of years ago.

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newsagency of the future

Changes at ANCOL in South Australia

ANCOL, the newsagent owned stationery wholesale business and local shareholder in Newspower, issued this statement two days ago:

We have conducted  a review of the ANCOL Group’s operational requirements.

As a result of this review the position of ANCOL Sales Manager has been made redundant, effective immediately.

Your existing Account Manager will continue to call and be responsible for the day to day needs of your business. There are no changes to call cycles and the Account Managers will continue to provide the exemplary service levels the Co-operative currently provides.

If you need additional assistance with an issue, query or problem do not hesitate to contact the Operations Manager, Ben Myles or myself.

In my opinion there will be a rationalisation of stationery wholesale in South Australia as the changes under way at GNS play out. South Australia is too small for ANCOL to help newsagents to source stationery on competitive terms.

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Newsagent representation

So what happened about the newspaper flat wrap project?

Back in 2006 the flat wrapping of newspapers for home delivery was a big issue. After various trials, flat wrap papers became a standard in South Australia.

But what about the rest of the country? Why did flat wrap not become a national standard?

Ten years ago this was a big story. There were many meetings and many arguments. It was thought by some to be crucial to the success of newspapers into the future.

We now know flat wrap has had no impact on the sales success of a newspaper.

The South Australian situation was and is unique because of how home delivery agents are clustered in depots, groups of newsagents sharing infrastructure. Even so, newsagents with larger distribution businesses elsewhere have not embraced flat wrap.

In Adelaide yesterday I saw a flat wrapped paper in a cafe and this reminded me of the discussions in 2006. here is a photo of the paper:

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That flat wrap has not taken off around the country makes me wonder about the claims in 2006 of how vital flat wrap was and about the costs of the infrastructure given the poor return newspapers provide today.

I am writing about it today in the hope some newsagents till involved in flat wrap share their experiences as I am sure there are newsagents in the channel who know nothing about this type of newspaper delivery.

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Newspaper distribution

Tatts double standards for On the Run in South Australia?

Go into almost any On The Run c-store in South Australia and you see Tatts product placement at the counter that is not permitted in newsagency businesses. Unless I am missing something tatts is permitting a major competitor of newsagents to have a lower cost and more commercially valuable lottery offering in-store.

Here is one store I saw in Adelaide yesterday.

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I know of newsagents who have been fined for non lottery products placed this close to their Tatts terminal.

If I was a Tatts outlet in South Australia I would want to know why On The Run has been permitted what appears to be more competitive terms than newsagents.I would want this tested with those in authority over such matters.

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Ethics

Don’t do as I do, do as I say

News Corp. asks, some say pressures, newsagents to give prime position in newsagencies for newspapers. Check out how the company promotes its print product on their office in the Adelaide CBD … they don’t promote print and have not for more than a year. I took this photo yesterday morning.

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Newsagent suppliers

The Australian reports magazine sales data shake-up for supermarkets

IMG_1051The Media column in The Australian yesterday reported a shake-up in the way Coles handles magazine sales data and payment. The Australian claims Coles will move to a scanned sales model with Woolworths soon to follow. I thought Woolworths had scanned sales in place already – they certainly provide overnight sales data from what I understand.

Regardless, the story is interesting for a few reasons:

  1. Public acknowledgement that retailers until now have had to pay for shrinkage.
  2. Surprise that Coles supposedly pays for all magazines supplied and then claims for unsold stock. This does not sound right.
  3. Supermarkets sell fewer magazines than newsagents yet they appear to have a better deal than us when it comes to shrinkage.
  4. We can offer a scanned sales model today – at least newsagents with accurate data can and that number of newsagents is close to 1,000.
  5. Shrinkage. We already know that the magazines most affected by shrinkage in newsagencies are the top 50 titles. The average cost is around 3% of sales. Being compensated for this would be a valuable benefit for any retailer.

This brief diary piece should interest newsagents as it goes to matters at the heart of our competitiveness in the magazine space. The item puts publishers on notice not only from supermarkets but from other retailers including newsagents.

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Competition

Gross oversupply of New Statesman or bad management at Gotch?

New StatesmanThe unjustified massive increase in supply of New Statesman for one newsagent, from 13 to 31 – probably a data entry issue – is a headache. I suspect the folks at Gotch will say it was a mistake. This is happening so much that to me it looks like a broken technology system in need of urgent replacement. Why would there be data entry at all?! Human error was the problem a decade ago so I wonder when Gotch will have a state of the art allocations system that stops mistakes like this.

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magazine distribution

Someone is trying to damage all newsagency businesses

Screen Shot 2016-11-20 at 2.47.11 PMSomeone has started a blog that appears hell-bent on harming all newsagency businesses. The Bad Newsagent has only just started but the venom is obvious.

The author of the blog is not confident enough of their opinions to publish their name. Shame on them.

I wonder what they hope to achieve from their blog. reading the few posts, it is as if they want to make selling a newsagency business difficult. It also reads like they don’t want others to try and help newsagents evolve their businesses to be relevant to today.

If we knew the author we might have context and understand their anger.

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Ethics

The ethics of selling magazines for which you have claimed a credit

I have been contacted by a newsagent expressing concern about another newsagent who sells in-store and online magazines and newspaper publisher supplied items they have processed for return, for which they have received credit.

This behaviour is unethical, it gives our channel a bad name and is likely to lead to more audits of returns costing all newsagents time.

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Ethics

Sunday newsagency challenge: be serious about your data

I was talking to a newsagent last week who said they don’t have time to scan their sales so they use their out of date computer system as a cash register and process magazine returns through the Gotch website.

Data is vital in guiding the best business decisions you can make. By not tracking sales you open yourself to undetectable theft, poor decisions, a less attractive business when you decide to sell, slower customer throughput and being out of date with today’s marketplace.

Retailers need to own their data situation. It is 100% on them to respect data as much as you respect cash.

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Management tip

Sunday newsagency management tip: cut employee theft – check the resume

A newsagent colleague recently was stolen from by an employee. The cost to the business was $2,500. The person’s story at the interview was they had been out of the workforce for a year taking time off. However, given their age and health the story did not make sense. But it was not questioned. The reality is they were working in another newsagency for much of the year and were intimately sacked because of theft. They paid money back and left without prosecution. They found a new job in a newsagency an hour from the old job and the new boss eventually discovered their dishonesty.

If there is a gap in a resume, pursue it, ask questions. If you are not sure, don’t hire them.

There are people who like working in newsagencies because of the family aspect and the last of strict controls managing cash. This can provide a window long enough for them to steal, as they did in the latest case, thousands of dollars.

Employee theft costs between three and five times more than shopper theft yet small business retailers obsess about shopper they and tend to ignore employee theft – until it hurst them.

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Management tip

Sunday newsagency marketing tip: use Nexus emails

Newsagents that are members of the Pacific magazines nexus program has access to a free email service allowing you to send an email to customers in the database you have built every two weeks.

I know form personal experience these emails work. I have had people in the newsagency as a direct result of receiving an email.

The service is free. Emails are easy to setup.

This is no brainer marketing in my view.

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marketing

The key to new traffic is to not look like an old newsagency

In the first three hours of today 50% of the shoppers entering the business were new shoppers thanks to a major promotion and the front of store pitch into the shopping mall.  Here is what the ‘newsagency’ looks like today:

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As the headline says, the best way to get new people into your newsagency is for the business to not look like a newsagency as a business that looks like a newsagency connects with old memories that are most likely not relevant to most shoppers today.

Sales are excellent. GP is nicely above 50%. A good number of the new shoppers are connecting with our multi layered loyalty programs and will be back.

Attracting new traffic is a complex task that required planning and excellent in-store execution. Key to success is changing shopper perception about what the business is.

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Newsagency management

Selling News Corp. Hasbro Board Games on eBay

I was surprised to see many eBay sellers offering the recent News Corp. Hasbro Board Games including this one that has sold 57 units so far.

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Looking further at some of the sellers it is surprising the extent of their offers. I’d love to know the revenue they are generating and if this makes the promotions worthwhile in the long run.

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Newsagency challenges

Bananas with magazines

15036354_10153838081782003_5294406306785513749_nOne newsagent received a magazine bundle with part of a banana crushed on the outside of the bundle. In the middle of bundle was the rest of the banana. Sticky and messy.

This leads me to ask the question: what surprises have you found in magazine bundles?

A newsagent I spoke with yesterday told be about an unopened condom pack – seriously.

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magazines

The journal challenge for Universal Magazines

IMG_0823Universal Magazines has a range of journals under the brand of Signature. I was sent a pack recently. I like the product as do others in the office.

The model is a challenge. 33% GP is insufficient. GP should be 50%+. Calling what we make commission demonstrates a disconnect with our model today.

Sale or return does not help. nor does delayed billing in that it is easy to get terms like 60 days or close to without much difficulty.

At the Hong Kong Gift fair a few weeks ago I saw journals like these with a similar look and a matching quality. If I was bringing in a container I could land them for around 20% of the suggested retail price. There are wholesalers doing this and knocking on newsagent doors. Making tough competition a challenge for Universal too.

The final issue is the story. Many of us want stationery related items that fall into a broader category story. While I like the two stands Universal has for this product, it is the the size story I am looking for.

I applaud Universal for trying. next time they should listen more carefully before sourcing products.

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Suppliers

Signs that turn customers off #1

This sign in a Sydney c-store was noticed by a customer who had waited in line to purchase a top up. The retailer didn’t care they walked out. They also didn’t care if I took the photo. I don’t need her he said in the direction of the customer leaving without making a purchase.

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Newsagency management

Darrell Lea in Officeworks

IMG_0964I was surprised to see Darrell Lea liquorice at Officeworks in Pitt Street Sydney yesterday. The Officeworks price is $1.00 per pack higher than I can easily find it elsewhere. So much of the Officeworks low prices claim in their expensive ad campaigns.

The other surprise was the placement of the product in a dump bin, next to what look like cheap products. This is not the type of representation I expect to see for a quality brand.

Dump bins in Australian retail typically suggest a deal. This is not a deal.

If you sell Darrell Lea and have an Officeworks nearby, be aware.

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Competition

newsXpress launches national TV campaign today

newsXpress kicks off a national TV campaign today, launching its EXCLUSIVE National Beanie Boo Week, to coincide with the launch of six exclusive to newsXpress Beanie Boos. Here is the call to action TVC:

This campaign is not costing newsXpress members anything. In addition to the TVC, newsXpress has provided members free stock to give away, A1 posters for in-store, flyers for local distribution, a colouring competition and more. Do a Google search for Beanie Boos and see our online strategy. The store-connected newsXpress site is the second highest ranked Australian site – ahead of Toys R Us and KidStuff.

The Beanie Boo TV commercial and National Beanie Boo Week campaign by newsXpress are part of an integrated campaign of transformation. Regulars here would know I think transformation is mission critical for newsagents.

Through careful targeting, newsXpress guides members to find new shoppers in four valuable and specific demographics with little overlap. This is all about finding new traffic, which is vital for any newsagency business.

Through new products and some exclusive products, in-store engagement, online marketing and other activities, newsXpress is helping members not only find new traffic but to lift overall business GP.

The newsXpress online strategy is driving in-store traffic as well as online sales. In a few hours yesterday, for example, one of our six public websites generated more than $1,000 in sales for several newsXpress stores and led to calls and emails to newsXpress members seeking out products.

My opinion is the old-school traditional newsagency has no future. Further, the old-school traditional retail business website has no future. The brand focus is paying off with local newsXpress businesses being found easily when people are searching on their phones and online for popular brands.

I am a Director of newsXpress.

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marketing

This is what magazine oversupply looks like in a newsagency

I took this photo in a newsagency recently. This business tries hard to display magazines well yet every week they are sent far more than they can reasonable display.

Magazine publishers take a look – you cause this.

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This is one section of the magazine department. There are two others like this.

No wonder there are newsagency businesses without a magazine department.

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magazines
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