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

Plush sales surge

We’ve enjoyed a surge in plush sales in the last week of holidays with $400+ days since mid last week. I’d like to say it’s in response to some initiative we’ve run but I can’t. Sure we have had featured plush ranges at the front of the shop but we have done that before.

What I find most interesting about plush is that it sells off beautifully merchandised displays as well as it sells our of stuffed-to-the-hilt displays shelves. Something we have found that works for us is to relay plush regularly – every four weeks or so. regulars find new items and a fresh display attracts new shoppers to the business.

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Plush

Sunday newsagency management tip: managing cash from drawer to bank

I have been working this week with a newsagent dealing with a possible employee theft situation. there was a disconnect between the cash they balanced at the end of the day and what they balanced.  A colleague of mine prepared advice for them on managing cash from the end of shift to the bank and I share it here for others:

  1. Conduct your end of shift, including counting the cash, using your computer to record counts for each note denomination.
  2. Store each days takings in a separate, dated, bag along with the end of shift report from your computer system.
  3. Each day, after the end of shift, count the cash recorded in the end of shift to ensure it matches the cash contained in the bag.
  4. The preferable option is to deposit each shifts monies separately in to your bank account. This eases reconciliation to your statement and problems can be found much easier. You need to be able to reconcile every cent of cash received against what you bank.
  5. Setup MYOB or whatever accounting system you use with a Safe account to manage your bash balance between bankings. Then move cash in safe to the bank with an MYOB transfer. This provides an audit of cash movement from the time it is recorded as a sale to it reached the bank.

While different people will have different processes, the key is that know track all cash from register drawer to your bank account. Any hole in your process is an invitation for theft.

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Management tip

Sunday newsagency marketing tip: show off your experience

Newsagencies don’t have any exclusive products. Magazines, newspapers, stationery, lotto, toys, gifts – what we sell is available anywhere.

What is exclusive to us is our experience and the customer service through which we provide access to that experience.

My newsagency marketing tip today is in the form of a question I think we each need to ask ourselves: what are we doing to show off our experience?

  1. Are we working the shop floor and sharing our magazine range knowledge?
  2. Are we guiding people on their stationery purchases?
  3. Are we helping card shoppers really see the depth of our range?
  4. Are we showing off with delight new cards in store or new stationery lines?
  5. Are we showing off through demonstration to customers on the shop floor products no other retailer with these products would show off in a practical way?

Sure we have lots of retailers competing with us. Almost none of our competitors has our experience nor our ability to get on the shop floor and show this off.

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marketing

Terrific Tour de France promotion at Newslink

Newslink and Relay newsagencies are running an excellent Tour de France promotion which is being supported by a broad range of suppliers.

This promotion shows how a retail network where decisions are made at head office and store level engagement is not in question can work with suppliers to unlock prizes of excellent value for even smaller opportunities like the Tour de France.

Unity has commercial value.

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magazines

Oxygen magazine tweet wrong to point to good newsagents

I’m disappointed by the Tweet from Oxygen magazine that say: Fat Loss 2013 is on sale NOW! Pick up your copy from selected Coles Supermarkets, all good newsagents or online at the following linkhttp://ow.ly/mQCRq.

My disappointment is that a Coles outlet without the title was not selected and that a newsagent without the title is not good.

Most newsagents do not have a say in whether they get this title or not. To label those with it as good reflects an ignorance in the way the magazine distribution model operates. The number of Coles outlets with the magazine is more a function of the pockets the publisher is prepared to pay for.

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magazine distribution

Terrific school holiday sales

We have had a terrific couple of weeks with school holidays. We have seen plenty of new shoppers in the centre. Our good sales have been driven by a front of store pitch that is not common for a newsagency. This opens us broader range of browsers.

I have included a photo to illustrate my point. (click on it)  You can see our focus on younger shoppers and those shopping the centre with and or for younger people. There is a small representation (far right) of magazines. The rest is plush,Beanie Kids, AFL products interactive toys and gifts – with a backdrop of greeting cards.

We are not doing anything special here, it’s basic retail – configuring the store to suit the opportunities of the season.

This type of work, generating new traffic for good margin product, is far more important for an newsagency business than taking on products or services that leech off existing newsagency traffic. I mention this because of current offers being put to newsagents that do this – leech … rather than generate new traffic.

The newsagencies that will do best from here on will be those generating new traffic for good margin product.

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Gifts

Classic Car anniversary

We received Classic Car magazine for the first time this week in one of my newsagencies. It’s their 20th anniversary issue so it’s not surprising I guess.

I have removed the card inserted in the magazine promoting a bonus anniversary lift out. as it’s mainly promoting subscriptions and I’m not about give them bonus space to do this.

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magazines

Displaying Hugh

We have three unlikely magazines next to each other thanks to their covers featuring Hugh Jackman and his new Wolverine movie. SciFoNOW, EMPIRE and Men’s Fitness look good next to each other in this simple full face display.

We also have the titles on display in their usual location.

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magazines

More bagged magazines from Bauer

I am disappointed at the ever increasing number of bagged magazines from Bauer. We received two this week. Each bagged offer requires additional pocket allocation. They don’t drive incremental business and each time I have asked for data to support the publisher claim it has not been forthcoming. If I was presented evidence I might look at them differently. As it stands, these bagged magazines only serve to educate shoppers to not pay full price in my view.

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Bagged magazines

Newsagency business performance assessment

I am regularly asked to assess the performance of newsagency businesses and comment on what I see in their data.  What follows below is the feedback I provided to one new newsagent earlier this week. I share it here with their permission:

The comments I make below are not intended to offend you however it is possible they will. They are direct, to the point as I have found there is value in calling it as I see it. The comments reflect what I see is the state of your business as represented in the Monthly Sales Comparison Report for April through June 2013 compared to 2012.

Your business data is the best assessment of business performance as it does not lie as long as you use the system to track all sales.

I have broken the assessment down by various parts of the business.

  1. TRAFFIC. Number of sales is down by 13%. This is very significant, considerably above average for a newsagency. It makes me wonder how you are marketing the business externally – advertising, promotion, offers.
  2. SALES. Revenue is down by 11%. Also very high and concerning.
  3. CARDS. You are not arriving stock properly – see unknown category. You should talk with support about getting this sorted out. This could be because you may have changed card companies. The sales decline is on par with the rest of the business.
  4. CIGARETTES. The decline here is less than for the average for the business. This is good news. However, be careful since there is no upside in tobacco product sales.
  5. CONFECTIONERY. 22% decline. Worse than the business average. You need to take action here. Look at your product range, your display and your pricing. Something is not working for you. Also look at the value of your sock. If you have more than $1,000 in stock you;re losing money. Act with urgency here.
  6. GIFTS. You are managing the data poorly. What does assorted gifts mean. Assorted gifts account for 67.72% of your sales. Categories are supposed to guide you meaningful information. I like to see: male, female, teens, kids, babies. Or: home, traditional, retro, funky. Categories should help guide your decisions. Assorted is meaningless. So, get your data right – the help desk can help you with this. In terms of sales, the 7% decline is just below the business average so that is good news.
  7. LOTTO. 12% up is good news. My question is what are you doing to leverage lotto customer traffic? Are you helping your lotto customer spend on other products you offer? your data suggests not.
  8. MAGAZINES. Unit sales down 21% and revenue down 18%. Both are bad numbers compared to the rest of your business and the average for the newsagency channel. This situation needs urgent action. When did you last do a full magazine relay? If not in the last six months get to it urgently. Take a fresh approach with magazine location and display. One you get the layout right I’d look at some form of magazine related promotion to reward people who are especially loyal to you.
    – Your data shows that Motoring titles are your top performing, accounting for 17.10% of your magazine sales. Wow! This is your hero category for the men’s section. Sport at 9.40% is also doing well.
    – Your women’s titles are troubled. Women’s Weeklies are down 22% in unit sales and Women’s Interests down 25%. Has something happened in your newsagency to turn women off? I ask this question seriously. These declines need arresting first followed by rebuilding.
    – You are under-performing newsagency channel averages when it comes to Food (2.06% of sales), Crosswords (2.03%), Music (1.84%) and Teenager (0.62%). It would be easy to blame this on your shoppers. Your challenge as a retailer is to look at where you have them placed and how you promote them.
  9. NEWSPAPERS. Unit sales are down 14% and revenue down 9%. The unit sales decline is the real worry as it’s worse than the overall average for the business.
  10. SCRATCH TICKETS. A 27% decline in sales is dreadful. The traditional decline I am seeing in Queensland is around 15% so your business is performing worse that the statewide trend. The question is what are you doing about this. A shopkeeper will shrug their shoulders. A retailer will work on an action plan and then implement the action plan.
  11. STATIONERY. This is a good news department. Your sales are down 10%, slightly less than the average for the business. While not good, at least it is close to the average for your business. In this department again you have Assorted as a category. This is useless. It accounts for 41.60% of sales and we can’t further assess this. Pens, Pencils and Markers is the next big category at 11.07% of sales. They declined only 5% and this is excellent news. What are you doing there as it is working better than for other products? You should talk to your GNS rep and ask them to conduct a review of your stationery. They could guide you to relay stationery to tell a better retail story.

With non lottery product sales of $300K for the quarter and an average of 3,600 sales transacted each week you have a sound business base. What happens from here is up to you. If this were me I’d be urgently overhauling my approach to key traffic driver categories in the business:Lotto, magazines, stationery and cards. I’d engage with suppliers for help. I’d also develop a series of plans for change in the business to give customers a fresh experience. Once I had that where I wanted it I’d promote the business externally. I can’t stress enough the importance of external promotion of the business.

The best business growth is that achieved over time through a series of small steps: a small bump in traffic, a small bump in the average spend and a small bump in the margin you achieve on the items you price for yourself.

I appreciate you’ve not even been in the business for a year. Since it’s your money invested, the future of the business comes down to you. Get your data right, set your focus on a plan and get cracking on that plan.

Let me know if I can help in any way.

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Newsagency benchmark

Target discounts Robo Fish while we can sell out at full price

Target is advertising the Robo Fish to $8 toy I wrote about here at the weekend. We sold through all our stock at full price – $15 a unit. While the Target volumes will be higher our achievement is better as it is down to our retail skills rather that falling back on price alone.

I know mass-merchants like Target will continue to discount much of what they sell as this is their only trick. I hope that more suppliers will realise the damage discounting to their brands and that they pull back from mass and focus more on us independent retailers.

Our success at full price with Robo Fish and other brand releases I have written about here is proof of what newsagents can achieve.

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Gifts

School holiday Top Model pitch

Our school holiday promotion of the Top Model range has been working well. This promotion is being run at the counter toward the front of the shop.

We have also placed the Top Model magazine in the display with good success. Indeed, it’s good to get magazine and higher GP sales from the one brand.

Our overall Top Model product sales are also being helped by the free manicure set on offer for purchases over $50.

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Gifts

Good in-store signage helps drive sales

I love the sign one of our team members created of their own accord to go above the soft toy snakes we have in-store. The sign is different to what you often see drawing attention to products in a newsagency. The red and yellow colour choice cuts through. It also projects a bit of fun and that’s important for things like these snakes that are not a destination for our shoppers.

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Gifts

More on the ATO Tax Pack changes that are wasting time for newsagents

I am told that the ATO has around two million tax packs printed and ready for use and that they are not using newsagents to distribute these because only between 20% and 25% of those we distributed in the past were submitted as tax returns.

When challenged about the paltry $8 fee we have been paid to distribute 400 postcards, put up a sign and answer customer questions, I am told that this figure was set between the ATO and the magazine distributor, that it was allowed for in a contract between the two parties.

The decision to send out postcards and not the packs was about saving money. The result has been to push onto small business newsagents considerable cost, having us spend our money covering what should be an ATO funded service.

I’d be interested in knowing the fee the magazine distributor got for their part in the ATO tax pack mess.

Based on the questions I know are being asked in my own newsagencies it is clear there remains strong interest in easy taxpayer access to the tax packs. I’d suggest a metric of completed returns versus tax packs in circulation is not ideal since people used the tax packs for more than completing their return.

It is not too late for the ATO to change its mind and distribute the tax packs. My suggestion would be that they distribute a smaller allocation, say 50%. This would provide relief for taxpayers and newsagents. A smaller allocation could be part of a better publicised phase out of paper based tax returns.

The current situation is appalling. It shows how out of touch management at the ATO is when it comes to customer service.

Saving money for the ATO by pushing a significant customer service obligation on to newsagents without fair compensation is disgusting. I’d suggest that the ATO approach on this matter is a breach of their Taxpayers’ Charter a charter that includes:

It is fundamental to the system of self assessment that taxpayers must have sufficient confidence in the collecting authority—confidence that we will provide them with the information they need and that we will act fairly and treat taxpayers according to their individual circumstances. We believe we need to position ourselves in such a way that demonstrates to Australians that we are fair and reasonable and that we treat people according to their individual compliance behaviour.

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Newsagency management

Ironman attracting shoppers

We have the life-size Ironman cardboard cutout located at the end of our main magazine aisle attracting attention down to our men’s magazines as well as our technology related magazines. You can’t miss Ironman from part way into the store. We have him placed here not only to draw traffic to the rear of the store but also to drive sales of the expanded cardboard cutout range.

Click on the image if you’d like to see a larger version.

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visual merchandising

Promoting Men’s Health

We are promoting the latest issue of Men’s Health magazine with this aisle end placement in our men’s section.

We have Coach located in the display because it’s a Pacific Magazines stablemate of Men’s Health and the two often sell well together in the one basket FYI.

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magazines

Newspaper frequency changes don’t work says expert

Writing at Editor & Publisher, John K Hartman, professor of journalism at Central Michigan University,  says that frequency reductions for daily newspapers do not work.  This is interesting because of the speculation as to what is next for some Australian daily newspapers.

I am sure people in newspaper publishing companies here are looking at what has been tried in the US and elsewhere. Hartman’s assessment would be of interest to them.  Some of his comments mirror those of Greg Hywood, Fairfax CEO – that they will continue to publish as long as the numbers work. Right now for most Fairfax titles, the economic model is more a function of the demographic of their typical reader than sheer circulation volume.

My view is that it’s essential for newsagents is for to control when you get out of newspapers rather than someone else deciding this for you.

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Newspaper distribution

How our newsagency is handling the ATO Tax Pack stuff-up

We have the postcard advising taxpayers how to access the Tax Pack in the location where we would usually have the tax pack available.  I am yet to decide how long we leave the postcards here since the $8 we are receiving is not paying for this space. We have to balance the disrespect for us with our desire to serve our customers.  suspect it’s newsagent customer service that led to us being ripped off over the Tax Packs.

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Newsagency management

Promoting The Block one-shot

We are promoting The Block one-shot with this placement on the lease line as well as prime location with newspapers deeper in-store. This premium exposure puts the title in front of the maximum number of our shoppers. We’re competing with five other retailers in our centre.

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magazines

Promoting Prevention magazine

We’re promoting the latest issue of Prevention magazine with this in-location display as well as a placement of the display unit at the counter. The counter placement will change at the end of the week to a run with weekly magazines. Prevention responds well in our store to off-location support at the counter and elsewhere.

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magazines

25% price increase for News Limited Sunday newspapers

News Limited has announced an across the board increase of 25% for it’s capital city Sunday newspapers except for The Sunday Tasmanian which will experience a 10% price increase.

The price rise takes effect from July 21.

For almost fifteen years newsagents called on News Limited to increase cover prices with no success. It’s only when sales started to seriously decline that the company acted. Now, newsagents are wondering if recent rises, including this one for Sunday titles, are too much.  Several newsagents contacted me yesterday saying they expect sales to fall.

Customer responses to recent newspaper price increases suggest that there will be plenty of complaints. As for lost sales – I expect there will be some. I think we are approaching a tipping point, a price point beyond which customers will not pay for a print newspaper.

It’s disappointing that the announcement from News also heralds a decline, albeit small, in newsagent margin.

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Newspapers