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

Magazine distributor introduces electronic invoice fee

Further to my post last week about Speedimpex introducing a $3.50 delivery fee, they have also introduced a $1.00 charge per electronic invoice. This is set to lose them accounts. Maybe this is what they want.

Check out what one newsagent wrote to them about this:

Today I received Elle Decoration, it was  single title, my cost was $7.50, the delivery charge was $3.50 and the invoice charge was $1, so it has cost me $12.  The retail price for the title is $11.  So I am making a $1 loss for the privilege of selling one of your titles, which is also taking up a pocket that could house a magazine that I actually make money on.

Well said. Maybe Speedimpex will take notice and reverse their decision.

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magazine distribution

More products using best-practice shopper engagement

We have more products coming in-store with LCD screens playing content showing how the items work. The display unit on show for the Make-Do range in the photo is the latest. It’s the third LCD we have on the shop floor at the moment.

I’m pleased to have these in-store shop floor sales assistances. The movement in the video can be enough to draw attention, same with the sound. It significantly adds value to a floor unit and gets it more attention that a unit without a video playing.

The only challenge in some locations is access to power.

Display units like this help us present a more professional and current retail image and this helps attract shoppers and drive sales.

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retail

One Direction drives sales of Girlfriend magazine

The One Direction boy band still has it if my sales of Girlfriend magazine are anything to go by. Sales in the first few days of the on-sale of the latest issue are stronger than for what is usual at this point.

We overheard one teen girl say to her friend – the only reason I’m buying it is because the boys are on the cover.  I’m happy with that.

We’ve ordered more stock to ensure we can satisfy demand. We’re expecting double digit growth over recent issues of Girlfriend. The aisle-end display will get a longer run as a result.

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magazines

Chocolate the key ingredient in food magazine covers

I love the covers of these magazines! Excuse the pun … they look delicious. Chocolate never looked so good.

Gourmet Traveller, donna hay, good taste and Feast all look terrific individually. We’re leveraging the four titles with full cover display as shown in the photo. We’re already ordered extra copies of Feast as we’re set to sell out.

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magazines

OnQ (Bill Express) resurrection of sorts?

The Liquidators of OnQ are contemplating recapitalisation of the company. They are currently reviewing expressions of interest. This means the corporate carcass of a key part of the Bill Express operation could live on.

Newsagents collectively poured tens of millions of dollars into Bill Express on the back of robust industry association endorsement only to have the value of the bill payment network wiped out overnight in 2008 when the business collapsed amid scandal.

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Bill Express

Has Bauer dropped the newsagent exclusive for AWW cookbooks?

For years, Bauer (formerly ACP), provided newsagents with around six weeks exclusivity for new AWW cookbook titles. This was an excellent opportunity for us to promote the new titles without competition from supermarkets.

It looks like the exclusive window is over as the latest title, baking puffs and pastries, is on the shelves in Woolworths already. In one Woolworths I visited on the weekend it was a feature on the service counter – a position suppliers usually pay extra for. We received baking puffs and pastries on March 6.

Supplying newsagents and supermarkets at (or close to) the same time as newsagents would be a blow to our channel … and something I’d expect to have been widely announced.  If this is a policy shift, it further strengthens our case for being treated more equally with supermarkets in terms of title selection, payment for premium placement, full copy returns and other financial benefits afforded supermarkets. Also, Bauer they will need to reconsider their scale out to newsagents and the expected on-sale period.

I’d prefer to order my own stock of AWW cookbooks as I’m expected to be financially responsible for it.

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magazine distribution

News Limited preparing for migration of newspaper subscriptions in NSW

News Limited has advertised a role key to their implementation of newspaper subscriber migration. The role, Change Manager – Subscription Migration Project jobs in Sydney NSW 2000, was advertised a couple of days ago.

Migration is separate to T2020 but does form part of the overall goal of T2020 – to make newspaper distribution more efficient for the company and more viable for newsagents.

Migration when first announced in South Australia some years ago was flawed. News did listen to newsagents and adjusted their plans. This was especially important to retail / distribution businesses that rely on newspaper home delivery payment traffic to support viability of the retail operation.

This latest advertisement for a change manager shows that Migration in NSW is close. It also provides timeline guidance on the project.  The ad included this information about the role:

This position will lead the development and implementation of a change management plans in support of the Subscriber Migration project. The primary focus will be developing and coordinating the implementation of the change management and communication plans to facilitate the collection and migration of subscriber data from Newsagents to News Ltd.

The change manager will work closely with senior stakeholders within the business as well as with newsagents and their state organisations to analyse issues, develop approaches and deliver change management outcomes in line with defined program objectives.

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Newsagency management

Sunday newsagency marketing tip: host an open house to show off new ranges

Many newsagents are stocking up for Mother’s Day and receiving products purchased at recent gift fairs. Now is a perfect time to schedule an open house, an event where you invite shoppers to check out new ranges and get in some good value buying at a closed-door event.

Open house events are popular among US retailers. They are simple to run:

  1. Run the open house when you would usually be closed.
  2. Usually for two hours, three hours tops.
  3. Invite customers in the mail and with an over the counter flyer.
  4. Be strict on numbers in case you get too full.
  5. Have the featured products on show prominently – show people what the fuss is about, what you want them to buy.
  6. Offer attendees a discount on purchases.
  7. Consider setting a theme. the shop has to look different to usual.
  8. Have catering.
  9. Support a local charity. For example, 5% of all purchases to the charity – set your shopper discount to not hurt GP too much.
  10. Remember, this should be a premium event – make it so.

A good open house will attract new shoppers and renew a buzz among existing shoppers. It gets people talking about your business and gives an opportunity to make a fresh pitch.

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marketing

Sunday newsagency management tip: chase GP growth

What is the percentage of gross profit of your newsagency business today compared to a year ago and a year before that? If it has not increased then you are behind the game as many newsagents I speak with are chasing GP growth.

The current retail newsagency business average GP is between 28% and 32%. if you are within this band and run a traditional newsagency it should be relatively easy to get close to 40%. Climbing from 40% to 50% is harder work, relentless work in fact as you need to completely reconfigure your business and move it away from the more traditional agency model to a self reliant retailer model. While I say it’s harder work, there are newsagents doing it.

My management tip today is pretty simple – know your GP percentage as it is now and compare this to last year and a year before. Are you headed in the right direction? If not, ask for help. I’d certainly be glad to help.

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Management tip

Driving impulse magazine purchases

Our placement two weeks ago of some health related magazines below weeklies has worked. Almost all titles benefited from a sales lift from this location – we pocket count copies.

Often, magazine shoppers only visit the part of the magazine department containing what they want. Our off-location placement brings the mountain to mohammed.

Not every range we place here works. Over time, we have found what works best for us and cycle through these categories every couple of weeks – keeping the up-sell promotion fresh.

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magazines

Newsagency counters like taxis for canvassing public opinion

While we did sell out of newspapers yesterday, as expected, politicians on all sides will have a battle come the federal election. Shoppers mentioning politics condemned all sides.  We are like taxis in that respect, shoppers often tell us what they think about current events.  I enjoy hearing people with opinions. Yesterday, however, disinterest in politics was the norm – even though we sold out of papers.

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Newspapers

More on SA newsagents protesting loss of stationery contract

Further to my post about the $100,000+ campaign being run by SA newsagents to protest the failure of ANCOL to win a state government contract, see the ANCOL Media Alert providing further information.

The ANCOL pitch seeks to make this a union matter. I’m told staff only recently joined the union with ANCOL paying three months of membership fees.

While I am critical of governments, federal and state, that put dollars ahead of support for small businesses and Australian businesses, I am also aware that some contract bids are lost because they are not the best bids. I’ve been told that is the case here. I don’t know as I have not seen the ANCOL bid or the other bids. If I was a South Australian newsagent I’d want to see the ANCOL bid before I decided whether to invest in the protest.

This campaign is problematic for SA newsagents in terms of cost and pitch. I know it’s concerning some in the state.

If it was up to me, I’d be questioning the value of the $100,000+ spend on lobbying. What if this same amount was spend on TV in the state promoting newsagents as the go to retailers. The result could be better, full margin, business for more newsagents as opposed to discounted government business for the wholesaler.

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Stationery

What do you to with bagged discount magazines?

I’d be interested to hear what newsagents do with these bagged discounted magazines from Bauer.  While I understand the publisher’s position is that they grow sales, I don’t see any evidence of that in the data.

I rely on our loyalty program to drive sales based on the reward for customer loyalty. It works – far better than these bagged magazines.

I’ve supported the bagged magazines over the years with placement with the main titles and promotion in discount locations. I don’t give them prime position as I don’t want to detract from full price sales. If I was compensated with full margin then I might.

What do other newsagents do with these bagged magazines?

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Bagged magazines

Promoting new look Gardening Australia

We’re promoting the new look Gardening Australia magazine with prime placement in with gardening magazines. While I don’t watch the show on TV I expect they will be promoting the new look of the magazine so it makes sense to promote this issue.

We are also giving Gardening Australia support to a second location in-store. It’s worth it as gardening magazine sales are up.

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magazines

SA newsagents spend over $100,000 lobbying on failed state govt. contract

South Australian newsagents, through ANCOL, are spending in excess of $100,000 to protest the failure of ANCOL’s bid to win a government contract. The spend is in the form of professional lobbying.  Yesterday in Adelaide there was a public protest as part of the campaign.

While the lobbying focuses on the politicians, some newsagents have said they would like to see the ACNOL bid document to assess for themselves if the business put forward an appropriate tender on their behalf.

There could be more to this story than what newsagents have been told.

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Stationery

Transport tickets inefficient for newsagents

I have been looking at agency line business for newsagents – lottery tickets, phone recharge, transport tickets, event tickets. Transport are the least efficient from what I can see. By least efficient, I mean in terms of other items purchased with them.

85% of transport ticket sales are the tickets and nothing else.

While it could be argued that this is the fault of newsagents, it could also be argued that the nature of the product is that it does ot lend itself to efficiency with other items being purchased at the same time.

It could also be argued that selling a ticket positions you to get the magazine, newspaper or card sale when that shopper wants any of those. I’d disagree with this based on my observations of transport ticket shoppers. They want the ticket and are unlikely to think of you for anything other than  the ticket.

There is a time management conflict newsagents need to consider as they evolve their businesses. Card, gift, toy and plush shoppers need more shop floor help than a bus or train ticket customer. One is about retail while the other is about being a counter based shop keeper.

Attracting a shopper because of your gift range is more likely to result in them remembering you than attracting someone to buy a transport ticket. It all comes down to how much you focus on and control your own future.

The question is whether newsagents are prepared to ditch tickets. This is a question about margin focused retail versus slim margin public service operation. It’s about focusing on what you bring to the business versus slim margin volume.

Successive Liberal and Labor state governments have shafted small business newsagents by cutting margin while allowing other contractors to reap huge financial rewards with new ticketing systems. So much for small business policy. Delivering fair compensation for offering what is a public service could have reinforced their small business credentials. What they have done is the opposite.

But back to the data. Currently, transport tickets are the least efficient products / services sold by newsagents.

My personal view is that volume for between 2% and 4% margin is not acceptable. I do not sell tickets in two of my three newsagencies.

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Newsagency management

A good newspaper day

The games played out in Canberra yesterday should make today a good day for newspaper sales. Those of us with newspapers away from the front of the store should consider co-locating the top titles with the best covers at the counter to grab impulse purchases.  It’s a news day like today that we could get the card, gift or magazine shopper adding a newspaper to the basket – a reversal of how things happened years ago.

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Newspapers

Pause before you renew that contract

A newsagent approached me last week for help with a five-year contract they signed a few months ago. They don’t want to continue the supplier relationship, saying they are not getting the services and business benefits that were promised.  The problem is this particular agreement – it is tight, leaving little room for the newsagent to end the relationship. Worse still, they are forced to not sign with a competitor for a year after the end of the contract. So, it’s a six year contract.

Their only course of action is to complain to the ACCC and seek mediation or legal action. Financially this is not an option.

This is a reminder to all newsagents faced with a long-term contract to sign. Take your time, make sure this is a relationship you really want.

It’s easier to leave a marriage than this agreement.

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Newsagency management

Latest Girlfriend gives us a status check on One Direction

We’re promoting the latest issue of Girlfriend magazine with a terrific aisle-end display. We also have it in prominent display in our women’s magazine aisle and with our One Direction products.

This is an important issue of Girlfriend magazine as provides us with an opportunity for us to check the current interest in One Direction. I’m keen to see if there is any dilution of interest.

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magazines

Think Fun range a welcome addition to a newsagency

We are filling our shelves with products purchased at the recent trade shows we have attended. One range we are particularly excited about from Think Fun. It’s a range of fun, educational toy products that represent their name … these products are FUN.

I’ve written recently about the importance of happy , fun and optimistic products. They present a good message to shoppers. It takes the pitch away from the price pitch that the majors tend to focus on.

Actually, thanks to our recent buying our newsagency feels very happy. Customers are noticing.

The other benefit of the Think Fun range is the margin. They will help us get to the above-average GP we want for our newsagency businesses. This is where marketing buying group is key to unlocking additional points a single store may not be able to access.

the average retail newsagency GP is 28% to 32%.  This does not cut it any more. We all need to be chasing 50%.  We need to chase this with net traffic generating products and not so much with products that rely on existing, often declining, traffic.

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Fun
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