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

Author: Mark Fletcher

Hello Chris Bowen, welcome to small business

We have a new Minister for Small Business in the federal government from today. Check out Chris Bowen on Wikipedia and at his own website.

Sadly, like many small business ministers from both sides of politics before him, Chris has no hands-on small business experience.

Political parties need to understand that one way they can engage small businesses is to appoint a minister with real-life small business experience. They also need to appoint someone with the time necessary to do the portfolio justice.

If small business is as important as politicians say they they can demonstrate this with an appropriately skilled minister who has enough time in their schedule and a sufficiently strong voice to represent what we keep being told is a vital part of the Australian economy.

In this situation, where the minister has no small business experience, I’d like to see his time invested in genuinely connecting with small businesses, on the shop floor, in the back room and engaging in a practically way that leaves a meaningful impression of the challenges of small business.

For example, I would love Chris Bowen, our new minister for small business to:

  1. Understand the damage the government-owned and protected Australia Post retail shops does to our small business newsagencies every day.
  2. Understand cost to us of the protected banking system in terms of exorbitant transactional fees and unfair terms for small businesses.
  3. See and feel the competitive pressure from the supermarket duopoly.
  4. Realise the high cost of retail space in Australia compared to elsewhere in the world.
  5. Understand the cost of penalty rates we have to pay when there is no penalty to the employee for working the hours they prefer.
  6. See the inflexibility of some aspects Fairwork.
  7. Learn why many of us do what we do and would probably not choose any other business.
  8. See the impact we have and value we bring to our local communities.
  9. Understand why small and independent retailers are important to the country economically, socially and environmentally.

I am sending a letter to Chris Bowen welcoming him and covering these points.

Newsagencies provide an excellent place for any politician to learn about and understand small business. A week in our businesses could help them meet more local constituents than they would meet in a week of door knocking.

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Australia Post

The Homespun magazine Anzac connection

I like the connection with the Anzac spirit on the cover of the latest Homespun magazine. It’s something newsagents could support – for quilters and others who would like to make something special to connect with Anzac Day this year.

We are doing several things: educating our team members about the title, ensuing the full cover is on display and featuring it in display (next week).

Whereas other retailers will see this as a product to sell, we see it as something some our customers will appreciate long after purchasing the title from us. Our job is to help them see this.

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magazines

Sunday newsagency marketing tip: use coupons to bring customers back

Coupons are big in the US. They are understood and well entrenched in shopper culture – from large retailers to small. It is hard to go into a US retail business and not receive a coupon or some other mechanic for bringing you back into the shop.

Coupons are becoming more widespread in Australia. Woolworths, for example, is using them regularly on shopping dockets – not the shop a docket type but these ones are printed on the same side of the receipt by their system.

While I don’t think we here in Australia will get to the Extreme Couponing craze as evidenced in the reality TV show, I do think there are opportunities for small and independent retailers like newsagents to use coupons or coupon like flyers and promotions to bring shoppers back.

The keys are:

  1. Make the offer financially compelling.
  2. Have an expiry.
  3. Make the coupon attracting – with some elements of a banknote.
  4. Don’t just hand the coupon, mention it in the sale.
  5. Give away a coupon to every shopper.
  6. get a key supplier engaged to share funding of the offer.
  7. Cheerfully give away the coupon value or bonus when it is redeemed.
  8. Try it several times and measure results before you decide if couponing is for you.

Okay, so no one nearby your business is using coupons? Being first can be fun, valuable and informative.

Creating and running a coupon campaign can be easy and specific to your business. It could be a way of presenting your business as offering better value than what shoppers think.

Now, watch the Extreme Couponing TV show promotion.  Yeah, it’s crazy … but it also gives you ideas.

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marketing

Sunday newsagency management tip: get your backup checked

No matter how daily backups are taken – yes, daily as anything less than daily is poor business management – get them checked every six months or so by your newsagency software company.  This should be a free service.

There are newsagents in Queensland right now who do not have access to current data either because there were not backing up daily or they had not had their backup checked to ensure the backup was completing.

Losing business data can affect your tax situation, your own financial situation and or what you could sell the business for if you decide to sell.

Contact your software company and arrange to have your backup checked.

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Management tip

Terrific sales result from How It Works

We sought out How It Works, a terrific magazine from the UK, as part of the expansion of our magazine range. With the regular magazine came allocation of the annual. We received four copies and sold three in four weeks.  That’s $59.85 of additional revenue.

I am often challenged by newsagents on how they (we) can increase revenue from magazines. Here is one example. Chase titles, expand the range to suit those who shop with you.

We are using the various versions of How It Works and sister titles to make our newsagency more interesting to people who like shows on TV like Mythbusters. It’s a title that sits well next to Smith Journal, as well. We’re happy with sales so far.

Magazine publishers need to understand that the magazine push model makes it hard for newsagents like us who want to expand range.

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magazines

IT failure at Newsagent owned Ancol stationery business lets newsagents down

The computer system running the Ancol business in South Australia has been inoperative this week. The newsagent who shares the information explained the impact:

Orders are being manually picked and are taking and extra couple of days to come thru, and then there are no electronic invoices.

My understanding is that communication from Ancol has been poor, leaving newsagents to chase information, spending more time away from running their own businesses.

The issue is, apparently to do with a server.  Professional IT infrastructure managements that a systems such as this has built-in redundancy, better serving customers in times of failure of almost any size.

For Ancol’s customers to be without their usually good computer services this week is dreadful for them and a blight on the leadership of Ancol.

I hope that newsagents in South Australia make their voices heard to those leading the co-operative.

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Newsagency management

Gift Fair opportunity in Melbourne this weekend

The Reed Gift Fair in Melbourne this weekend is a boutique affair, very small compared to the major gift fairs this year in Melbourne and Sydney. However, it is a fair well worth attending by Victorian newsagents.  I have seen the exhibitor list and it is good – there will be plenty of opportunities for newsagents.

As the first fair of the year, this Melbourne event is a good opportunity to get in early on trends and opportunities with some key suppliers.

If you get to the fair, pass through to the accompanying jewellery fair and see some opportunities in that space for newsagents. It’s the first time the two have been together like this. It’s an opportunity to embrace.

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Newsagency management

The relevance of the Lego brand

All around is, in some old businesses, we and see lessons of maintaining and even growing relevance. Lego is one such brand. The company itself continues to innovate. more important, it partners with others to innovate.  From the retail examples I have shared here of innovative retail stores to new products, Lego is as relevant today – to new kids and to the nostalgia shopper.

Check out a video about a Lego pancake making machine. It’s fascinating on a range of levels from what it actually does to showing off how Lego is more than building bricks.

My takeaways are don’t be bound by your original business plan or the expectation of the majority about who you are and what you do.

It’s Saturday morning and time for breakfast. I wish I has one of these up and running right now.

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Fun

Refreshing the women’s health and fitness magazine display

We have adjusted the display of women’s health titles, ensuring well selling and promoted brands get good positioning. What you see in the photo and beyond is part of our regular magazine placement work.

I do this myself as it’s something to think about away from the daily work of putting magazines and taking titles off for return. It requires consideration of data and the focus of the business. It’s work that helps drive year on year growth of magazine sales.

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magazines

A learning opportunity for newsagents in Bevilles restructure?

The retail jeweller space is experiencing tough times beyond the challenges of retail. They are being hit hard by online businesses at the low end and by high operating costs at the high, designer, end. The last twelve months have seen significant structural change – closures, consolidations and significant business direction change.

Yesterday, Jeweller Magazine reported news of an ‘alliance’ (partial takeover maybe) between Tara Jewels of India and the Bevilles group. The result will be more store closures.

What is interesting about this news is that it is another significant vertical alliance in the retail jeweller space.  We have not seen this type of vertical alliance in the newsagency channel but I think it is only a matter of time.  here are some details from the Jeweller Magazine report:

In a media statement, Bevilles CEO Michelle Stanton said, “This strategic alliance will provide Bevilles with a wide range of product, sourcing and operational efficiencies as well as a more enhanced IT infrastructure.

“It allows Bevilles to have direct relationships with diamond site holders and remove several steps from the product sourcing process which benefits will flow through to our customers,” she said.

Note – they are cutting out the middleman, maybe several in the process from manufacture to store. This is evidenced further in the report:

The supplier notification also outlined new shipping and payment details to begin next month adding, “From 4 February 2013, all suppliers will be required to ship orders directly to the Indian jeweller’s Hong Kong office for consolidation and transhipment to Bevilles.”

The Indian company, which was established in 2006, conducts a vertical business model operating in both the manufacturing and retail channels. Currently, it has 30 retail stores in India and has quickly expanded its jewellery manufacturing and retail business to include a presence across five continents and more than 20 countries.

There are plenty of products newsagents sell that we get through local wholesalers.  Smart groups of newsagents able to leverage volume in a disciplined way could do a Bevilles and cut out one or two middlemen, depending on the route products take from manufacturer to retailer. The savings from such better sourcing could increase margin on some products dramatically.

Bevilles is well positioned to make such a move because of their structure.  For the majority of independent newsagents today this is not an option. But it will happen. Retail competition, cost pressures and other challenges will force it to happen.

These are retail trends we need to understand and consider as retailers as they reflect the broader changes in retail beyond those specific to our channel.

Footnote: some will know that my newsagency software company also serves over 300 jewellers. Bevilles is not and has never been a customer.

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Newsagency challenges

Loving desk calendar refills

Selling desk calendar refills is easy since most others offering them only have inventory for a brief period of time. We have made sure that we have the refills in several locations, to grab impulse purchases. It works. sales are excellent. They are a valuable basket extension.

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Calendars

Show and tell sells gadgets

One of the most popular gadgets / toys at CES in Las Vegas this year was this remote helicopter.  Check out the video I shot at a display outside the main CES convention hall. The display goes longer than I filmed. It was a heap of fun.

Remote helicopter ballet at CES 2012 from mark fletcher on Vimeo.

I’d like to sell these but would need a bunch of other product to make a strong commitment to the geek / gadget / toy space and I don;t currently have the floorspace for this.

The takeaway from seeing products like this is that they sell best through show and tell.

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Fun

Promoting Cleo magazine

We are promoting the latest issue of Cleo magazine with this aisle end display facing the dance floor.

The free Quicksilver dress should help boost sales.

Back in the usual location for the title we are using a double pocket half waterfall to show off the value-add bagged with the issue.

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magazines

Newsagents on Media Report today

Media Report on ABC Radio National this afternoon looks at newsagencies, T2020, the disruption of digital to print product, the challenges of retail and other opportunities facing Australia’s small business newsagents.

I recorded an wide-ranging interview with Richard Aedy, host of Media Report, for the program last week.

You can catch this on Radio National, online and via podcast.

 

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Media disruption

Visiting other newsagencies

I’d be interested in how newsagents go about visiting other newsagencies.  Do you make an appointment?  Do you identify yourself in-store?  Do you ask before taking photos?  Do you share feedback to their face or behind their back?

Newsagents can learn a lot from each other … fresh eyes and all that. The owner of the store being visited can also share insights and explanations that could provide a better understanding of what is seen.

Partly because of what I write here, my newsagencies have been visited many times over the years. I appreciate the courtesy of an appointment. I appreciate being asked if photos can be taken. What I don’t like is the people who talk about what they saw (or think they saw) behind your back without the courtesy of even telling you they were in your shop.

What’s your experience?

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Ethics

Launching Bike magazine

We have been supporting the launch of Bike magazine from Pacific Magazines with this in-store display toward the front of the business.  We also have the magazine with our other bike titles.

For what it’s worth, we need to look at this title as more of a men’s lifestyle title than a sports title. Bike riders often engage in riding as a lifestyle more so than sport activity. We are thinking that this is a title to have in two locations beyond the launch, to catch as many readers as possible.

The other interesting point to note about bike magazines is that they sell through the on-sale – i.e. not bunched up early in the on-sale as is the case for many other magazines.  This is probably a title to not early return.

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magazines

Promoting Melbourne Wedding & Bride

Check out the display promoting the latest issue of Melbourne Wedding & Bride magazine at one of my newsagencies. This is located on the corner of the counter, facing shoppers as they enter the business.

I like the display. It shows off the title in an impactful way with the product as the hero. It also shows off other products appealing to the same shopper.

Wedding titles perform well for newsagents, delivering good year on year growth.

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magazines

More on bookshop challenges

Further to my post yesterday about bookshops, take a look at the report in the Courier Mail yesterday about bookshops in Brisbane and their use of an e-book kiosk.

Maybe I’m missing something here. I can’t understand people going to a shop to purchase what they can download from anywhere.

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Book retailing

Nice boost in ink sales this year

We are still a couple of days away from a major ink promotion yet ink sales are powering on. In the last couple of weeks we have seen an excellent sales bump thanks to people getting back to school and back to work.

The lift is gratifying since the sales bump is not due to external activity.  For me it reinforces the value of the behind the counter. More of our shoppers are noticing that we are in the ink space – and competing with the ink kiosk right ut the front of our shop.

We only carry brand name ink and offer this at competitive prices in our shopping centre and the surrounding area.  Being known for good prices on ink helps encourage ink shoppers toward other purchases.

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Stationery

Tough times continue for book stores

Reports were published in the US yesterday that book retailer Barnes & Noble plans to close a third of its stores over the next ten years.

I expect a look back in ten years time would wonder at such an under estimation. The Barnes & Noble model of mega book store is challenged in terms of retail space cost, labour cost, inventory cost as well as disruption caused by devices such as the iPad and Kindle.

Just as shopping centre newsagents have found in recent years that smaller format stores are a smarter move, mega bookstores will fade to just a few.

For a brighter future, bookshops will expand into other areas. Newsagents should expect some to turn their sights on products traditional to our channel.

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Book retailing

Serving One Direction fans with new It Girl title

We have made sure we have all covers of the It Girl magazine special on display as there are One Direction fans who will purchase each. While I do have questions about the viability of the 1D franchise through 2013, that’s a concern for down the track as interest this side of Christmas continues to be strong. This group continues to make money for us.

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magazines

Promoting Rebel Wilson cover on if

We are showing off the whole cover of niche film title if to leverage the rebel Wilson cover story. It’s an excellent story about an Australian performer doing very well in Hollywood, someone other than Kidman, Griffiths or Jackman.

Wilson’s first major role is about to hit the screens and this cover story is an excellent opportunity for us.

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magazines

Network Services lists locations not receiving magazines due to floods

Here is a list of towns and cities in NSW / QLD that will not receive magazines from Network Services this week due to floods.

Network advises that either all deliveries will be missed or, at least, part of the deliveries will be missed.

Network has also offered help in urgent supply adjustment where businesses have been affected by the floods. the contact is the point of reference for this.

To help inform newsagents of the impact of the floods, please send photos to: mark@towersystems.com.au.

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magazine distribution
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