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

Author: Mark Fletcher

Full house at Connections conference

There were 300+ at the Bauer Media Connections conference in Brisbane yesterday. This will be the largest gathering of newsagents in 2016. All marketing groups were represented too, in response to their strong member representation.

While the sessions were terrific and offering practical guidance to attendees, the real takeaway for me was the upbeat mood of the room and at networking. Newsagents are optimistic, embracing change and focussed on the future. There was good talk in some groups of excellent GP achievement.

The optimism speaks to the difference between change-focussed newsagents and those running traditional businesses, achieving traditional GP.

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Newsagency management

How you balance your register at the end of the shift matters

It is tiresome talking with a newsagents, or any retailer for that matter, where theft has occurred and only recently been discovered, and where the business has few or no rules around the processing of cash at the end of the shift.

I say tiresome because my advice has not changed in years. It is advice I have shared here before and elsewhere. It is also basic business management advice.

Retailers who are sloppy with cash management and end of shift reconciliation are more likely mohave employee theft in their business that is undetected for longer.

Using your computer system and taking a structured rule-based approach to end of shift processing means you are more likely to detect theft sooner. You also provide fewer opportunities for theft to occur, because of the structured checks and balances.

Balancing the register is easy if you and your employees are disciplined in how they transact business the=rough the day and to the end of the day. Get this right and the cost of theft in your business will be less.

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Management tip

Using video on Facebook to promote the newsagency

Video is an effective tool for promoting the newsagency in-store, in the window, on Facebook and other social media platforms as it allows you to bring to life the business in a way that challenges traditional views about that the business and what it stands form.

Here is one of four new marketing videos produced by newsagency marketing group newsXpress in the last month to launch new products. This video is one of two launching the Teeny Tys range where newsXpress stores represent 25% of all outlets nationally.

This and other videos are provided in two forms: a YouTube link and an MP4 file. The MP4 file can be loaded to Facebook for autoplay while the YouTube link is good for websites and other places where you prefer integration.

The videos are professionally produced, exclusively by the newsXpress marketing team for the group. This gives the group control over the intellectual property and enables it to speak with its own voice rather than relying on supplier created content.

Here is another video produced to launch new Britto Disney product.

The videos are deliberately short to fit with social media user expectations. They are also non newsagency like – this is vital.

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marketing

Beware suppliers selling without a tax invoice

There are several suppliers pitching to newsagents with excellent deals at the moment that sound too good to be true. One newsagent received the stock and no invoice. When they asked for an invoice the request was ignored for a week. Eventually, they received a spreadsheet of the items supplied but no invoice. Further digging revealed the company’ they purchased from is no company. GST has not been paid and the provenance of the goods is not certain.

If a deal sounds too good, it probably is. Always get a tax invoice.

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Ethics

News Corp. acquiring APN regional

Contingent on regulatory approval, News Corp. is acquiring APN’s regional division, giving News Corp. an extraordinary footprint in Queensland as Mumbrella reports.

There was a time such a concentration of media ownership would concern Australians. No more. Maybe that is as a result of the level of concentration of media ownership we already have in Australia.

From a newsagent interest perspective, the Mumbrella article includes this:

Potential areas for News Corp to examine in which savings could be made include:

  • The Ipswich Advertiser/The Queensland Times
  • Mackay’s The Daily Mercury/The Midweek
  • The Whitsunday Coast Guardian/ The Whitsunday Times
  • Rockhampton’s Morning Bulletin/The Capricorn Coast Mirror
  • Bundaberg’s NewsMail/The Guardian
  • Childers’ Isis Town & Country/Maryborough’s Fraser Coast Chronicle/Maryborough Herald
  • Hervey Bay Observer/The Hervey Bay Independent
  • The Gympie Times/The Cooloola Advertiser
  • Noosa News/Caloundra Weekly/Kawana Weekly/The Sunshine Coast Daily
  • Southern Downs Weekly/The Warwick Daily News
  • Toowoomba Life/The Chronicle
  • Lismore’s Northern Star/The Lismore Echo
  • Grafton’s The Daily Examiner/Coastal Views
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Newspapers

Stay ahead of coming price rises

Price rises are coming in several key product categories for our channel. In everyday stationery and ink suppliers have started talking about price increases due in August.

The price rises are not unexpected given the situation with the Australian dollar compared with when prices were last looked at. That and the increase in labour and other business costs, it makes sense prices will rise.

My suggestion is you reach out to your key suppliers and ask the question. If they know about a price rise from their supplier early advice to you could help you purchase inventory ahead of the rise being hit.

Some suppliers, like Dynamic Supplies, have been on the front foot, encouraging retailers to get in ahead of the planned price rise.

A word of caution though, buying stock at a lower price can be false economy if you hold the stock for too long. You only make money when you sell the item and even then it has to sell at a good price. This is why I think a back room or a warehouse can be dangerous – because you are likely to fill it.

So, by all means buy today to beat a price rise, but make sure such buying will result in sales in a reasonable period of time.

In terms of finding out about price rises in advance – check in with your marketing group as they will know.

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Newsagency management

Quality discount variety stores challenge newsagents

IMG_0846There used to be a time we could ignore the $2 shops and similar as the quality of what they sold was poor, their layout akin to a junk shop and their customer service left wanting.

Things have changed. Discount variety stores in Australia have lifted their game.

The changes we are seeing here are in-line with what is happening overseas. You could call it the Aldi effect where price does not compromise quality as it once used to. It is far more than the Aldi effect. In categories related to us there are plenty of overseas deep discount businesses challenging in cards, wrap, gifts, stationery and more.

The photo is from a discount variety store I saw in Canberra last week. This terrific display of wrap is a metre from the lease line. The main message to shoppers is we have the range. This is backed with at a price you will love.

This shop is the type of business newsagents would often disregard as a $2 shop or a junk shop while, in fact, their offer is more comprehensive, better situated and more satisfying to the shopper than the average roll-wrap display in a newsagency.

We have to look at shops like this as competitors, businesses we need to understand and compete with, businesses we need to be challenged by. Ignoring this type of shop would be folly in my view.

Wrap is in play, as are cards – as the year on year sales data is showing in newsagencies across Australia. The challenge from discount variety is part of the reason this is happening, not all, but certainly part. They have lifted their game. We need to lift ours.

We need to look carefully at where  wrap is placed. We need to consider our value proposition. We need to make shopping easy. we need to make impulse purchases easier.

My advice to newsagents is do not underestimate discount variety stores, treat them as a well-resourced professional competitor. To do otherwise could see you lose sales you might otherwise have won.

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Competition

Why I said don’t buy that newsagency

Twice in the last month I have suggested to individuals who have contacted my for my opinion that they not proceed with the purchase of the newsagency business they were considering purchasing. In each case the red-flags I saw were similar.

For one business the owner did not have current financials. The only reasonable evidence of income was a lottery terminal report. The rest was a claim in the form of a spreadsheet for which there was not evidentiary support including BAS statements. Without basic bookkeeping as required by law my feedback was the business does pass due diligence. By all means purchase it for stock value, but nothing else.

In the case of the second business, the owner claimed income they could not verify as it was not shown in the POS software reports because they deleted a couple of departments to reduce their tax. The prospective purchaser believed the vendor and argued with me when I said I would not purchase a business based on unreported income. They were desperate to buy a business and were bedazzled by the profitability of the business. The problem is the profitability relied on the unreported income.

Each of these situations damages our channel in my view. Business owners operating businesses without proper recordkeeping and basing a sale price on unreported income deserve to not achieve the price they seek.

There are plenty of well run newsagencies for sale out there, good businesses backed by accurate data. These businesses sell more easily than those with key data missing.

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buying a newsagency

News Corp. and Coles team up on half price newspaper deal

IMG_0926Coles supermarkets are offering access to News Corp daily newspapers at half price when people spend $30 or more in the supermarket.

I noticed the promotion at the checkout counters in three different Coles outlets over the weekend. In two cases newsagency businesses are located less than 100 metres away from a Coles.

This News Corp. / Coles promotion makes our channel look expensive.

The half price newspaper promotion is a campaign that could break the habit of someone who used to regularly purchase their newspaper at the newsagency.

While News Corp. employees regularly say how important our channel is to their business their actions challenge belief in those words.

It is one thing for a supplier to have products located in a nearby competitor business it is another thing for them to support that competitor in a half price campaign such as that we see here.

News Corp. folks may respond to this saying this is a Coles run promotion. While I have no evidence about how it is being paid for, I doubt Coles is funding the 50% discount.

This campaign will be another factor newsagents consider when they assess their commitment to newspapers in-store.

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Newspapers

Two Hemsworths better than one

IMG_0903We shifted these magazines to get the Hemsworth brothers together to broaden the appeal opportunity of their brand. We figured this type of deliberate and thoughtful placement is not what you would usually see so it was worth the moment it too to make happen.

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magazines

Sunday newsagency marketing tip: kittens love to play with wool

FullSizeRender 10Bringing a retail display alive, really alive, attracts shoppers and drives sales. This display created by one of the team at my newsagency is perfect, or should I say purrfect, as it shows the kittens getting up to mischief everyone who has had a kitten understands.

The display is fun, engaging and alive and this is key to successful retail theatre – a display looking alive, the products looking like more than a product with a barcode on the shelf.

I was talking with a shopper in the store on the weekend about the display and they had a story to tell about a kitten they had as a child. This 80 something gentleman is not your usual plush customer. The display and the memories it jogged led to him purchasing a kitten for a great grandchild. He came into the shop for a birthday card into which he was going to put $20 as the gift. Instead, he spent $29.99 with us.

This type of conversion, turning a browser into a purchaser, disrupting a shoppers plan to purchase something unexpected, is vital to all retail businesses today but more vital than ever in newsagencies.

Take a look at your shop and how you display products you could otherwise bring alive to have people see them differently. Next, get your best VM person in-house to create something engaging. Finally, engage with shoppers on the shop floor yourself to learn from what they see, their stories can be inspiring.

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marketing

Sunday newsagency management tip: a crappy looking stand hurts sales

IMG_0847Every branded spinner or stand you have in your business is a representation n to only of the health and professionalism of your business it is also a representation on behalf of the brand of the stand.

A broken stand looks bad as does a half empty stand as does a branded stand with products other than for the brand. Such a stand can turn shoppers off. It gives off a message of a business that does not care and this can tell shoppers you do not care about them.

If a stand has a place on your shop floor it has to add to the business not detract from it.

It does not take much to ensure stands look good, strong, full of the right stock. Sure you could argue you don;t have the money for stock. The thing is – the stand is looking empty because you sold the stock, you have the money.

My advice is to set a policy for all who work in the business to follow:

  1. On a branded stand, only place products from that brand.
  2. Check sales for each stand weekly and be on top of reordering.
  3. Any stand that breaks is to be removed from the shop floor until fixed or replaced.
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Management tip

The flimsy Swisse Olympic scarf lacks value

FullSizeRender 9Further to my post about the appalling treatment of newsagents by News Corp and Swisse over the Olympic scarf we are to sell today, I got to see the scarf for myself yesterday. It is an embarrassment, certainly not worth $2.00 in my opinion.

The scarf is flimsy. It does not feel like a scarf. No feeling of quality. Also, it smells odd. It is not a keepsake. I’d love to hear what other newsagents think about the scarf now they have seen it.

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Ethics

Leverage Tour de France interest

Screen Shot 2016-07-01 at 1.51.08 PMCycling Central, the SBS cycling Twitter account, promoted newsagents in this tweet Thursday this week about the Tour de France official program, reaching 42,500 followers. Their tweet was re-tweeted and favourited, helping it to reach more people. Social media mentions lick this about our channel are important in reminding special interest shoppers of the service we provide.

This Tour de France program guide is something we all ought to have in at least two high-traffic locations in-store to make the most of the opportunity. My suggested locations are: with newspapers and at the counter, in addition to placement with cycling magazines.

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magazines

What is the value of a brand

IMG_0858I saw this N branded newsagency business earlier this week and wondered about the importance of the N that is situated in prime position out the front of the business. This version of the N is around fifteen years old. The N has changed twice since, meaning this N is not relevant and, most likely, not delivering any value to the business.

Business branding is important. Any brand you use needs to be relevant, understood and valuable. This N that I saw earlier this week is useless.

Those providing brands under which newsagents trade under have an obligation to ensure their brand image is maintained. In the case of the N, it falls to the ANF to have supervised the use of the N image in and on newsagency businesses. The lack of action and enforcement devalues the N.

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newsagency marketing

Small business policies of the major parties this federal election

As often happens during election campaigns, we are fed headlines and little policy detail. Click on the links below for the small business policy pages of each of the major parties and see for yourself which small business policy you prefer. There is a difference in detail and detail matters for it reflects understanding. The greater the policy detail the more serious the party is on an issue in my view.

I have not posted the links here to suggest one is better than the other. Mo key interest is to ensure opinions about small business policies are fully informed.

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Newsagency challenges

Hosting another collectible event in Melbourne today

Screen Shot 2016-06-29 at 5.49.30 AMAt my newsXpress Knox store this afternoon we are hosting a collectible bear event featuring hand made collectible bears and dragons priced from $100 through to $1,000. We have been promoting the event in-store, by email and on social media.

Events like this, that pitch the business as not being a traditional newsagency, are important as they help us find new shoppers. This is mission critical for any newsagency.

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marketing

Are newsagents getting left behind in the shift in stationery?

IMG_0850A seismic shift has occurred in stationery that appears to have left newsagents behind, even newsagents with good stationery sales today.

Understanding the shift starts with and understanding of what constitutes stationery. To many newsagents, the definition of stationery is traditional: pens, pencils, rulers, tape, pads, folders, the types of items you would have seen in a stationery department ten and twenty years ago.

To understand stationery today we need to ask shoppers what they consider to be stationery. We also need to look at what other businesses are marketing as stationery.

The shopper definition has changed. Sure, the old-school everyday items such as pens, pencils, rulers and the like are considered to be stationery. There is also a more relevant to today range, like you see in Smiggle, Kikki.k and Typo – what we typically call social stationery but what shoppers call stationery.

I am sure there are shoppers visiting a newsagency today and walking out because they are not seeing Typo or Kikki.k type products.

Do a Google search for stationery in any major city and you will see Typo, Kikki.k and even Smiggle come up in search results. These businesses that many newsagents do not consider to be direct stationery competitors are coming up in search results. They are positioning themselves as newsagent competitors.

While many newsagents have focussed on the traditional and see flat and falling sales, growth in this new segment of the stationery marketplace has been rapid. More stores have opened and they have got better in terms of ranging and pitching.

Smiggle, Typo and Kikki.k have been educating shoppers and it is paying off.

Talking to someone from a mid-size business earlier this week, the admin person responsible for stationery has permission to purchase desk supplies from Typo because it makes the staff happier. While that is only one story, it is an example of the seismic shift I am talking abut.

Where are newsagents and their traditional suppliers in this? While some are engaged, that engagement is nowhere near the scope I see from our competitions, those leading shoppers to re-think what constitutes stationery – like Typo and Kikki.k.

For us to be relevant in this new world of stationery we need a fresh offer in-store. This comes from fresh products, fresh ins-store placement, fresh out of store marketing. Most of all, it starts with us redefining for ourselves and those in our business a fresh approach to stationery.

We can do it. Some of us are. But not enough for newsagents to be top of mind for the shopper out there heading to Typo or Kikki.k for their next stationery purchase.

Footnote: the photo is from the Typo store at the Canberra centre that I visited yesterday. It is large, impressive and busy.

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Newsagency challenges

Standards are only standards if they are enforced uniformly

IMG_0848Given the ‘fines’ I have heard being imposed on some newsagents by Tatts in their compliance visits I have been taking more notice of lottery counters and whether they have non Tatts products on them.  Across several states and in plenty of newsagencies I have personally seen anything from counters with only Tatts products through to counters filled with other items. This is a problem.

This photo is of a counter I saw recently with two candy products in the Tatts dedicated area. Personally I doubt the two candy displays would harm Tatts sales yet when this newsagent is visited the Tatts rep will have to ‘fine’ them and have the products removed.

Given what we see in convenience stores with tatts products, the company has to address the inconsistency as to what is permitted. It also have to ensure that all in its compliance force stick to one agreed standard as too often I am seeing differences between what is acceptable and what is not.

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Lotteries

Marketing tips for election day

On my POS software company blog I posted these marketing tips for election day – suggesting easy ways small business retailers could make the most of the opportunity of the extra traffic out and about. I hope the ideas are useful to newsagents.

In writing the post I have sought to show ways we can be non-traditional so our businesses are enjoyed more and in order to provide a more memorable shopping experience.

We can’t rely on the usual for our businesses, we can;t rely on the usual shoppers. We have to find new shoppers and one of the best opportunities is when more people are out in the streets – like on election day.

Election day in Australia is a terrific opportunity for small business retailers with a spike in the number of people who are out and about. Smart retailers will embrace this opportunity as well as the opportunity of people standing in line waiting to vote and on their phone.

Here are some tips to get you thinking about marketing opportunities for any small retail business this weekend on election day:

  1. Set the front of the shop so it looks completely different – make the most of the extra people out and about. You want people seeing the shop for the first time ages to be surprised at the changes.
  2. Have a party. Plenty of music, activities, drinks and food. Make the day a celebration – to celebrate the end of the dreary campaign.
  3. Have an election sale – but make it fun. Do better than a straight sale. For example, in good Asssie tradition call it keeping the bastards honest sale.
  4. Setup sale tables in the name of local candidates.
  5. Give a discount to any customer who tells you and everyone in the shop a joke about politicians.
  6. Have a game of pin the tail on the politician in the shop.
  7. Declare the shop an election free zone. Maybe have a fine jar for anyone talking about the election on the day – raise money for a local charity.
  8. Promote your business online all Saturday with a series of social media posts so those out and about in lines waiting can see you are engaged.

All these ideas are about having fun on the day and offering a different shopping experience to usual. We hope they get yo8u thinking of what you could do, thinking of ideas of your own.

Here at Tower Systems we are not your usual POS software company. We are engaged with our customers deeply on a range of fronts to help them enjoy their businesses more and to get more from their businesses every day. In addition to excellent POS software for specialty retail businesses, we provide business management advice and support – way beyond the POS software itself.

Whatever you do this election day, have fun.

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marketing

The commercial marketing campaign pitched as an olympic fundraiser – for which newsagents are the fundraiser

Screen Shot 2016-06-28 at 7.37.32 PMNewsagents will earn 10c for each official Olympic scarf sold on redemption of a coupon from a participating News Corp newspaper. That is 5% gross profit from a $2 purchase price. 10c to store the stock, collect the coupon, reconcile coupons, process sales and return unsold stock.

News Corp will argue this is a fund raiser for the olympic team. I disagree. This is a Swisse marketing campaign designed to get punters to pay money to newsagents to hand to News Corp to hand to Swisse for them to make a donation, maybe a tax deductible donation? Read this from the News Corp. communication to newsagents:

Swisse are an official Australian Olympic sponsor and as part of that sponsorship they raise money that goes directly towards supporting our Olympians. Newsagent commission and GST will be deducted from the $2 price point and any remaining profit will be returned to Swisse to donate directly to Australian athletes.

Swisse is not directly raising money here. Newsagents are. We collect the money from the punters.

But lets look at the mechanism for the fundraising. It is a scarf with the Swisse brand. We are selling a marketing product for them, they are the key beneficiary. We have to police it too by collecting coupons, to ensure News Corp. gets its newspaper sales. News Corp. is a key beneficiary of the campaign. Not so much newsagents as people wanting a scarf can get their newspaper from anywhere.

So, while Swisse gets its brand further out there and News Corp sells its papers newsagents get nothing from this campaign. This is why I say we are the ones doing the real fundraising.

News Corp. owes newsagents an explanation about their commercial terms with Swisse. Newsagents need to be told how much News Corp is charging Swisse so we can better understand the request that we do our bit for 5%. Without this, it is open to speculation that small business newsagents are being exploited by News Corp. and Swisse, that our contribution is greater than either News Corp and Swisse in terms of the value being delivered to the olympic team.

It is unfair to couch this as a fund raising campaign. Swisse and News Corp are in this to make money for themselves. It seems to be that newsagents are the ones making the real donation here yet News Corp and Swisse have set the campaign so they get all the glory and the knock-on commercial benefits.

I like the idea of the scarf and that it is a fundraiser. I just wish the terms on which our small business channel is engaged with the opportunity were more transparent and fair.

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Ethics

Is the ANF using newsagent funds in support of big tobacco this federal election?

Screen Shot 2016-06-28 at 9.04.18 PMThe ANF is claimed as a supporting organisation of the Association of Australian Retailers, a group that appears to have been established to support the interests of big tobacco. Read what sourcewatch says about the AAR. Read what tobacco tactics says.

AAR sent some newsagents a pack of materials to be used during the current federal election campaign – promoting Senator David Leyonhjelm, a politician who supports big tobacco.

I was alerted to AAR in a comment by Gregg on this blog:

We have just received a parcel from Alliance of Australian Retailers with a letter accompanying signed by a Chiang Lim General Manager. The parcel has flyers and posters promoting Senator David Leyonhjelm and his stance on Tobacco products.
I have just rewrapped and sent it back as a RTS. But who are Alliance of Australian Retailers and who is Chiang Lim?

Chiang Lim is a former General Manager of NANA, the NSW newsagent’s association. Chiang left the organisation quickly under an apparent cloud. Lim appeared before a parliamentary committee in March claiming his organisation represented 3,000 small business retailers including newsagents.

My name is Chiang Lim. I am the AAR’s general manager. Since 2011, the AAR has represented up to 3,000 small businesses across Australia and its member retailers. They include newsagents, corner stores, small supermarkets, mixed businesses and other independent retailers.

I would be interested to know whether newsagents have directly joined AAR or whether the claim of 3,000 is a leveraging of ANF member numbers and members of other organisations.

I am not an ANF member and so am not across their statements to members. It would be good to know if they have made any statement about involvement with AAR and whether any newsagent funds have been used in this federal election campaign.

This is important because Lim in his evidence to the parliamentary committee made claims on behalf of newsagents, claims for which I am not aware of any evidence:

Whether they are newsagents, corner stores, small supermarkets, mixed businesses and other independent retailers, these small business retailers are universally owned by families who have mortgaged their homes and tipped their life savings into the businesses. They rely on customers who buy not just tobacco products but other items in their shopping baskets. Since the introduction of plain packaging and cumulatively high excise taxes, these retailers now operate in a current environment where customers more than ever are actively seeking the cheapest available tobacco products, legal or otherwise, knowingly or unknowingly. With the loss of such customers to those who sell illicit tobacco, our small business retailers lose the sales of those many other items in those customers’ shopping baskets. They are putting at risk overall revenue, their profitability, their ability to employ staff, pay themselves, the future value of their businesses and not to mention their home mortgages that cover their businesses.

Anyone claiming to represent our channel needs to do so armed with irrefutable facts and to do so on issues about which those they claim to represent have been full consulted. I don’t think that has happened in this case.

If you are an ANF member and are concerned about this, contact them and ask for information about their involvement with the AAR – they are listed on the AAR website.

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Newsagent representation
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