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

Begging in front of the newsagency

Visiting a newsagency on Tuesday I was confronted by someone begging. Hey mate can you spare some change? they asked as I walked in. Half an hour later when I stepped out of the business they tossed our Got a dollar you can give me for a coffee?

This is in an inner suburb of Melbourne. They were the only person on the strip begging. I suspect they chose the newsagency because of the OzLotto $60 million jackpot.

While they are not attacking the business, their presence could be confronting enough for some to encourage them to shop elsewhere next time they may want to shop at a newsagency.

The challenge for the newsagent is what to do. Calling the police results in a we’ll get to it if we can response. A call to the local council ByLays department results in I don’t think this is our issue. Two calls with plenty of waiting on the line and the newsagent frustrated.

The offer of money for a coffee shows that this is not what the person wants. They are looking to ‘earn’ a certain amount. The only way to move them on that Tuesday is to pay them $50 or more which, of course, no one would (or should) pay.

This scenario is difficult to handle. Maybe a more lateral approach could work. I recall seeing all shops on a street in Los Angeles had identical signs in their windows asking people to not give money to beggars and noting that the chamber of commerce supported a local homeless shelter and included details on the sign. It took a while but beggars stopped requesting that street.

I don’t like seeing people begging. I wonder about their situation. While I am sure there are some who do it because they make good money I am sure there are others who do it because they see it as their only option. Either way, when it reflects on your business you need to have a plan for mitigating the siuation.

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Newsagency challenges

Credit Suisse analysis of Tatts results is essential reading for newsagents

Credit Suisse has today published analysis of the latest Tatts Group results. This is a must-read document for newsagents with lotteries. Here are some key points of interest:

  • Higher-margin online sales grew 22% in FY15 and represent 10.4% of all sales including South Australia.
  • TTS is trialling lottery products in 54 Woolworths convenience/fuel outlets
  • Tatts will need to grow the dollar value of commissions over time, in our view. Tatts’ agency network is responsible for nearly 90% of sales and therefore an integral part of its distribution. It would not be in Tatts’ interest to see falling commissions contribute to agency closures.

This last point is a solid statement from Credit Suisse. Newsagent representatives could use this if they are smart. The Credit Suisse document is for investors. Tatts is a servant of investors.

While the Woolworths trial will be seen by some newsagents as the headline, I think it is not. The first and last points in my list of highlights are the most important in my view.

On the first point, 22% growth in online, newsagents have to consider what they are doing to drive in-store sales. It is too easy to be a victim and much harder to drive sales in-store.

FYI here is my post from June 17, 2013 about the Coles trial.

I expect Associations will express dismay, frustration and even anger at the Woolworths news. It should not have shocked them  had they been doing their job. I have moved on from concern about this as I see it as inevitable and do not see value in investing newsagent funds in pursuing a reversal. Newsagents ought focus on what they can do ti improve their businesses.

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Lotteries

Helping a newsagent prepare for a GNS meeting

A fellow newsagent is meeting with senior GNS management Monday next week following comments on a blog post here. I have opened this thread for others to comment about what they are looking for from GNS operationally and product-wise that this newsagent could raise in their meeting.

I am happy to receive private comments at mark@towersystems.com.au. I will forward all these to the newsagent who has arranged the meeting.

Alex Stewart, CEO of GNS, has been active commenting on posts and comments here in a stand out model of transparency in our channel. Unlike the ANF and others Alex does not lurk in the shadows or duck for cover on issues within his remit.

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Newsagency management

How one newsagent leveraged the local paper out of Woolworths

A newsagent shared this story with me recently about how they won a local newspaper back to their business and out of Woolworths. In their own words, with identifying details edited out, here is their story:

One of the local papers some time ago put their paper in the local Woolworths supermarket located very close to my newsagency.

I had been approached by the newspaper some years ago to supply Woolworths as a sub agent to me. I let them know my disapproval of this at the time and they held off. While I was away from the newsagency later that year dealing with my mother’s terminal illness the publisher started supplying Woolworths direct. I subsequently pulled their paper from my shop and have not stocked it since.

Every six month on average since the publisher has asked me to re-stock their paper. I have refused. Three weeks ago, after a heated discussion with them about my refusal, I told them that if they were serious about their offer to support a local business then they should take their paper out of Woolworths with no chance of it returning whilst I am the local newsagent. To their credit they agreed and have pulled their paper from sale out of Woolworths. It has been very well received by my local customers and I have to give praise where it is due.

I’m not sure if the above is the first time this has happened and I don’t particularly care however it has been a great discussion point in my store. I’m not sure what the implications may be further down the line when one of the visiting product managers come to town and question it however for a short time since this happened it has been a good little win.

What a terrific story.

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Newsagency management

Another spinner gone from the newsagency

IMG_9202I was thrilled earlier this week to get rid of another spinner. While they can be important in introducing new lines to the business and easily pitching products off-location, spinners as they empty are a blight. We have cut four in two weeks and two more will go next week. The job has just been made harder with Westfield declaring that we can no longer discard spinners in their hard waste area. No matter, this will not stop us clearing out the shop floor ready for a stunning Christmas.

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Newsagency management

Big tobacco supporting the ANF

I was surprised to see that Phillip Morris is a National Premier Partner of the ANF. I am not sure when they came on board. If I had a say I would vote against this. I have not sold tobacco products since 1998 and got out because cigarettes kill people and cost our health system billions.

I respect the free will of smokers and retailers. For me, the tricks employed by tobacco companies to hook people disgust me as did their efforts to cover up the tragedy their products have caused. It is for these reasons an industry association ought not take tobacco money.

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Ethics

Attention grabbing magazine display

FullSizeRender 18This fanned stack display of the latest issue of Porter magazine is eye-catching. The photo does not do it justice. Many entering the shop where I took the photo stopped and looked at the title – this is the most important function of any display.

Newsagents receiving sufficient volume of a title to create such a display ought ti try it if they do not do so already.

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magazines

The challenge for the newsagent next to the convenience store

twobusinessesThis photo shows a newsagency and convenience business next to each other on a busy suburban street. No matter where I stood – to the left, to the right or directly in front, the convenience store was brighter and more inviting than the newsagency. I have loaded a high res photo so you can compare in detail for yourself.

Both businesses sell papers, convenience lines and magazines – although the newsagency range is considerably bigger. The c-store has considerably more on the convenience product space.

The convenience store is part of a group that drives discipline. The newsagency is not in any group and left to run the business as the owner wishes.

The convenience store has a brighter future thanks to the discipline of the group to which they belong.

While I am on the record saying convenience is not a good model for newsagencies, if I was in control of this business and convenience had to be the focus, I would join a convenience group. While such a group would not be a newsagency group, it would provide management and marketing guidance that would enable better competition with the c-store next door.

This newsagency will close soon if it does not change direction urgently. The challenges the owner faces reflect challenges we all face in our businesses. Change is essential. It can be invigorating, fun and profitable. Change builds optimism.

If I was in control of this business and not bound by operating a convenience model, I’d make considerable changes, moving out of convenience and into higher margin traffic generating lines I could promote outside of the business.

When I see newsagencies in a situation like this one I saw last week I see opportunity.

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Convenience retail

Range vital to adult colouring success in the newsagency

IMG_9205This photo is a second display of adult colouring art therapy titles in our newsagency. It is located half way into the store. It sits in front of the magazine department to the right, our plush wall to the left and stationery on the wall on the far left.

We have cleared space in front of the display (not seen in the photo) so the full range of adult colouring titles is easily seen and shopped. Customers in wheelchairs and motorised scooters can come in and shop – these are valuable customers for this category of product.

The range on show has been selected to cater to people from teens through to 80+, boys and girls. This is important. In the early days retailers thought adult colouring was a thing for girls 30+. It’s not. We are selling for people of all ages. It is a fun category, we are learning plenty.

We have been in the adult colouring space all year and are enjoying excellent results still. We are watching sales because current sales will not continue. Knowing when to scale back will be important for business.

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Management tip

Did you receive Business First magazine?

CMpd23dUkAA36ZDGordon and Gotch is promoting Business First magazine, saying it is in newsagents now. The appeal of this title is so niche that it ought only have been distributed to newsagents who opted in. I am not aware of Gotch did this as I didn’t see anything from them on it. It is only when good newsagents have complete control over the magazines they receive that they will feel trusted to apply their full skill set to the category.

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magazine distribution

Coles double standards exposed in Zoo magazine decision?

The decision by Coles to withdraw Zoo from its shelves is interesting and with considering.

If the decision is a result of pestering because of how Zoo treats women in its photos and stories then maybe the pesterers could turn their attention to the shelves of unhealthy foods that shorten lives and burden the public health system.

If the decision is because the Coles directors do not think Coles fits their values then maybe they could explain how all the bad and unhealthy food they sell fits their values.

Coles can’t make a decision like this and not expect it to be considered against other decisions the company makes.

the values of a supermarket need to be reflected on every shelf and in every transaction. the Zoo decision cannot be considered in isolation.

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Ethics

Beware Facebook survey scam

I received two invitations this week to participate in a Facebook survey and go in the running to win a $100 gift card. This is a scam. Facebook is not running a survey. It is a phishing attempt. My advice: do not respond to the email.

With many newsagents on facebook and actively using the platform it is important you do not allow your account to be hacked. Take care.

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Newsagency management

Leveraging Darth Vader for Father’s Day card sales in the newsagency

IMG_9195 (2)I love this Darth Vader Father’s Day card from Hallmark so much that it is the feature card I am using on social media and in Father’s Day gift displays to draw attention.

With the Star Wars licence huge in the lead up to the new movie,. the timing is perfect.

Folks, this is a card to remove from the card stand. You need to make sure your shoppers see the full card as this is what grabs attention. Indeed, you ought to sell out of this card ahead of all others.

I moved cards around yesterday to ensure this an other Star Wars cards are in prime position as they will attract a shopper we are keen to attract for Father’s Day and other products we are featuring in-store at the moment.

What I am writing about here is a good example of how we can use seasonal opportunities to attract shoppers for more than the season. It is how we can leverage these peak traffic times to help us beyond.

I love that Darth Vader is a dad role model.

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Greeting Cards

Symply Too Good supply model frustrating newsagents

For years, newsagents supported Annette Sym’s Symply Too Good cookbooks, carrying them on the shelves for long periods of time, often barely covering real estate and labour costs – if they were lucky.

This week newsagents received new supply of Symply Too Good cookbook. Many are frustrated with the long on sale, the long period of delayed billing and that there was no opt in, no ability for the newsagent to control the spending of their money.

Some newsagents have noted they received an opt out email with 48 hours to act. If true, the 48 hour response time is ridiculous. Other newsagents have said they received no such email.

Given today’s retail real estate and labour costs, only an opt in process is appropriate. Further, the on-sale ought to be optional from 30 days with no delayed billing. These rules would respect newsagents whereas the model being used now does not.

Magazine space in newsagencies is under more pressure than ever. We all need to cut space and labour costs. This leaves less space for slow performing titles. It means we have no room for long on-sale titles. Publishers need to understand this, they need to respect us.

Footnote: Annette Sym will be unhappy at this post. It is important to unpack the facts from a range of newsagents before responding. For example, with the retail space a magazine pocket takes in a shopping centre newsagency costing anything from $1 to $3 a week, return on space is a key metric. The low margin from magazines and the low volume of niche titles like these demand they be under the spotlight when assessing magazine performance. The numbers themselves have us looking at the performance of the Symply Too Good titles no matter how much we like them.

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Magazine oversupply

Shopkins collector cards popular

IMG_9199If you have stock of the Shopkins collector cards my advice is have them at kid’s level where they can reach them. This will help sales and give you an opportunity to pitch the other Shopkins products you sell.

Shopkins is a rapidly growing brand globally. The best indicator is YouTube video views – in the hundreds of millions. Kids recognise this brand. hence my advice to make the most of the opportunity.

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Trends

More newsagents should hire with a probation period

When hiring a full time employee for a newsagents I encourage newsagents to consider doing so with a documented probation period. This gives you the opportunity to not continue with full time employment should the employee not work out. It offers a framework through which you can deal with a new employee who does not work out.

If you hire a full time employee without a probation period you risk not having access to a mechanism for easily removing someone who quickly turns out to not be ideal for the role.

The Fairwork website has more on this including sample letters. Hiring with a probation period is easy as long as you follow some simple rules.

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Hiring employees

New York Times promoting in Australia

Screen Shot 2015-08-16 at 8.50.04 amI am seeing this ad promoting subscription to the digital edition of The New York Times come up plenty of times on Facebook at the moment. I am surprised at the considerable marketing efforts in Australia from this US publisher. I think it speaks to the extent of disruption faced by newspaper publishers.

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Media disruption

Coles shows their approach to cards off location

IMG_9175Check out the placement of Father’s Day cards off location at a Coles supermarket. This placement is deep inside the store, far away from the card department and the checkout. It is one of two placements of Father’s Day cards in this Coles. It reinforced to me the importance of interrupting shoppers to remind them of what they can purchase in a visit. This is especially important for Father’s Day as it is a season for which purchasing is too often left to the last minute.

Take a look at how you are pitching Father’s Day cards. Are they all in one place or in a couple of locations to make the most of the opportunity? Are you maximising the opportunity of all your traffic?

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Greeting Cards

Happy newsagents feature in video

Benefits for newsagents of being part of a newsagency marketing group include shared optimism about the future and a unity around a differentiating brand. newsXpress last week reflected these in this video created for members to use in showing their locally owned business are part of something bigger:

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Newsagency management
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