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

Perfect end to a long day

The annual ACP Connections conference ended with a 70s themed dinner and party last night at The Park Hyatt in Melbourne. From early in the evening the dance floor was packed with newsagents, decked out in full 1970s gear. Newsagents were having a good time … I mean really having a good time and not faking it as often happens at awards dinners.

I’ve been to many Connections conference dinners and this was the best. It was an excellent theme, a good theme, on a good day for relaxing and unwinding.

What made the night was that formalities were kept to a minimum.  Successful newsagents were recognised, wonderful food was eaten and too many wigs were worn and plenty of dodgy moves were strutted on the dance floor.

A fitting end to a day of extraordinary change for newsagents.

Kudos to Nextra Chermside for taking out the ACP newsagent of the year on top of the ANF newsagent of the year.

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Newsagency management

If you work in a newsagency and are under paid, call FWA

If you work in a newsagency and are not being paid the award rate you should approach the business owner.  If they do not address the issue, report the matter to Fair Work Australia.

I received a call yesterday from a newsagency employee being paid seven dollars an hour less than they should be paid.  I refused to call the newsagent on their behalf. The newsagent must know what they are doing, the under payment is too great for them not to.

I hope the employee does call FWA. This is the only way to deal with employers who underpay and refuse to address the matter.

While the vast majority of newsagents pay according the award, a small number are selfish enough to act in a way that puts a cloud over the rest of us.

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Newsagency management

Newsagents need to take time to digest newspaper distribution changes details

Newsagents are understandably concerned about the impact of the newspaper distribution changes released at 10am today. Their concerns have been heightened by poor communication about the coming changes over the last two years … poor communication from News and state based newsagent associations.

Today’s announcement is an opportunity to start again, to reset if you will. It is the first time newsagents have had direct access to considerable information from News Limited on their plans.

I urge newsagents to take their time to read all of the material and consider their own business goals.

While News will accept newsagents being retailers and distributors, newsagents do need to make a decision to be one or the other in my view – in the city and major regional locations at least.  In the country it’s a different story.  This is where the News approach will provide information to help determine the best approach further away from large population centres.

I have read the News Limited documents. Regulars here would know I support distribution consolidation.  Check out a proposal I outlined in 2005: here.

The restructuring of distribution has been long overdue.  Newsagent data, association data and publisher data for close to ten years has shown that this is necessary.

While News could have solved the issue by giving existing newsagents more money that would not have been a solution. Indeed, it would have rewarded the inefficient system we, all of us involved for many decades, have allowed to exist.

There are plenty of newsagents who saw this coming and started consolidating years ago, some have more than 10,000 deliveries today. Kudos to their entrepreneurship.  This is business pure and simple.

So, something had to give.  News looking at the print model made the decision and has now announced a plan.  This plan will proceed.  Yes, it makes it clear that existing territories have no goodwill value. It also makes it clear that new territories will only have goodwill value in the context of a five year agreement.

This is a new paradigm for newsagents.  There has been enough information in the marketplace for the last few years to see this coming.

I am worried that too many will get caught in the loss of goodwill for the current business, the need to bid for a territory and or the need to run a distribution business of a scale fare greater than the traditional newsagency distribution business today.  Worrying about these things would be a waste of time.

Newsagent attention and association attention should be focused on the how and not the what and why.

As this is a national issue, the ANF ought to establish a national office staffed with an accountant skilled in business planning, a business planner / manager / mentor and an overall project manager as leader.  This team should be put at the disposal of newsagents first in the three Queensland regions and then elsewhere as News rolls the changes out.  I have shared ideas with the ANF on how this could be partially funded.

Newsagents should assist in funding the ANF establishing this national office tasked with running this issue on behalf of newsagents and providing advice, assistance and support for newsagents directly affected.  The states should also support it and stop trying to use this issue at a state level.

Why is this not a state issue? News is moving nationally.  For the first time the company is operating outside its traditional silos. If News can operate nationally the only option for newsagents is to take a national approach.

By establishing a national office newsagents can deliver organisational efficiency to match the operational efficiency News is looking to achieve through the distribution changes. Yes, the News announcement today is as much an opportunity for how newsagents organise their own representation as it is about restructuring newspaper distribution.

I urge newsagents to read all the documents and to consider the information in the context of a business plan.

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Newsagency management

A big day for newsagents and newspaper distribution in Australia

Today at 10am, newsagents will get to read more about changes in the newspaper distribution model. At 10am, News Limited announces the changes being delivered through the T2020 project. Click here to see the FAQs document from News.

While the changes most immediately affect retail and distribution newsagents in three regions in Queensland, newsagents in other states, except for South Australia, will eventually be affected.

What will be announced today by News Limited are the goals and processes of the restructure of newspaper distribution. Newsagents will read about the target distribution territory size and the process involved in expressing interest in and ultimately bidding for the right to handle newspaper distribution in a territory.

The new newspaper distribution remuneration model – fee for service – along with the new model based around scale (and operational efficiency) represents the most significant change in newspaper distribution in living memory. While we can argue about the time this has taken and complain about the misinformation along the way, we need to focus on the announcement itself for this will be what really matters to newsagents.

News Limited will lay out a process through which distribution newsagents can engage in a contract which provides certainty for a fixed period of time. At the heart of the contract is the desire for newsagents to have a business model which enables them to be profitable.  With so many newsagents operating unprofitable distribution businesses, a newsagent profit focused goal from a newspaper publisher is welcome.

The newsagents who will be the first affected by the changes, those in the three areas in Queensland, have been briefed in a series of face to face meetings with News Limited executives.  This in itself is a sign of good faith by the company – having senior management face to face in newsagencies talking with newsagents directly affected.  The approach News is taking in these trial regions is one of active consultation with a view to tweaking the process based on feedback.

The approach News is taking reflects learnings from what the company delivered in South Australia a few years ago.

Newspaper distribution restructure activity beyond the three Queensland regions will not to be looked at until 2013. While this will frustrate some, it’s a good move as it enables thorough analysis of the Queensland trials.

I have been briefed on the changes as have the industry associations.  The process makes sense to me. The goals are good for newsagents and necessary for News.  Yes, some newsagents will be unhappy at losing their distribution businesses. This has been in prospect for several years now. Those with a view to the future have had an opportunity to sell up.

There will be some who paid too much to purchase their distribution businesses. I wish there was an easy answer here.  There is not other than to wonder what advise was provided at the time of purchase and what due diligence was undertaken.

Today is the beginning of a new era. I urge newsagents to engage with the process and to consider carefully the business decisions they will need to make.

The most important role newsagent associations can play in all this is to be an association, working with newsagents on business plans, budgeting and the tender process. I say this because I worry than some may prefer to play a commercial role while neglecting their real role.

From a personal perspective, through my newsagency software company I’ve been involved with many territory consolidations from small to the largest in Australia. As an indication of what I see for the future, I have signed off a significant investment by my company in software enhancements to get to the next level of newspaper distribution management facilities newsagents will need in 2013 and beyond. These changes will be delivered to newsagents at no cost.

The Australian has the story on page 28 today.

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Newsagency challenges

Selling Feast magazine

Newsagents should check out the latest TV commercial for Feast magazine.  Like any good ad for a magazine it pitches what’s special about this issue. Knowing this can help us in our pitch to our customers.

Too often we are passive in selling magazines, expecting the titles to do this themselves by placement on the shelves. Knowing more about a title can help us guide shoppers.  Feast is one such magazine. I know customers I have introduced to the the title who have become regulars. They love it and the food journey it takes you on.

The latest issue of Feast is a real treat from the stunning cover shot (lemon tart!) to deep inside the magazine. It’s a title we should sell easily in that serious magazine shoppers still come to newsagents more so that supermarkets.  We should chase this business – with excellent product knowledge. Getting your staff to see the TVC is a good start. Next, check out the magazine.

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magazines

US magazine sales fall 10%

US magazine sales fell 10% in the sin months to June 30, 2012.  Businessweek reports:

The Audit Bureau of Circulations said Tuesday that overall circulation, including subscriptions, was just about flat from a year earlier. But single-copy sales, which are more closely watched — because publishers make more money from them— continued to fall. Subscriptions are typically sold at a discount so publishers can increase their circulation and attract advertisers.

The industry group said that single-copy sales at newsstands and other retailers totaled 26.4 million in the first six months of 2012. That’s down from 29.1 million in the same period last year.

Check out the media decoder blog at The New York Times on this … fascinating.

Our magazine model is quite different here with over the counter sales accounting for a greater proportion of overall sales.

While we talk about digital and generational change having an impact on magazine sales, the products themselves have an impact. This is especially true in the mass market. For example, Weight Watchers in the US (325,000 monthly sales) lost 28% of sales. The question has to be – is this indicative of  a problem with the product itself.

Publishers need to look at this for every title reporting sales decline. They have to ask whether they are putting out the best product possible.

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magazines

It’s tough when you are competing with your supplier

I was doing some research last night on the Mont Marte art supply range using their website to check out nearby stockists.  I searched using several postcodes and each time Art Shed Online in Moorabbin came up in the search results first, listed as a partner.

I decided to widen the search from some Victorian postcodes into New South Wales and Art Shed Online in Moorabbin came up again – even though I asked the Mont Marte website to search for outlets within 5km of each postcode I entered.

The reason for Art Shed Online is listed first in these searches is that it appears to be owned by Mont Marte. That’s the inference from the website setup details at least.

While I have no quarrel with Mont Marte selling direct, I would prefer their website to take a fairer approach in listing stockists. Putting their own outlet ahead of their customers is unfair.

Suppliers should put their customers first, ahead of any direct sales outlet they establish.

I like the Mont Marte offer. I don’t like how they manipulate the search results on their website and treat their customers as second class citizens.

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art supplies

How do you use stands provided by your suppliers?

Most newsagencies in Australia have at least one stand provided without cost by a supplier. I am talking here about stands not funded with an initial products purchase. No, the stands on my mind are those sent by suppliers for free, stands which usually have supplier branding on them.

Too often, newsagents do not police how the stands are used. Too often the stands end up carrying products from other suppliers. This presents the wrong message to shoppers and disrespects the investment made by suppliers.

If a stand can’t be used for the purpose intended by the supplier it should be removed from the shop floor in my view.

We need to be serious and respectful about things like this – from the top of our businesses down.

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magazines

New partwork: Dora the Explorer Little Cooks Collection

We are promoting the Dora the Explorer Little Cooks Collection partwork right at the front of the newsagency, to connect with shoppers in the centre.  We also have some stock in the body of the store.

We have taken the opportunity to promote Dora plush with the partwork product … no harm in chasing an extra sale and showing our business as offering added value to the Dora fan.

With a massive TV campaign starting yesterday, the opportunity for newsagents with this partwork is excellent. Now is the time for a prime position display.

Core to the partwork offer is the putaway opportunity. This is where newsagents beat supermarkets and why supermarkets should not be used by publishers for selling partworks.

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magazines

Extending the reach of the Diabetic Living brand

We have promoting the new Diabetic Living cookbook with this display on one of the columns facing the front of the business.  Diabetic Living is a popular brand for us.

I expect this cookbook to sell well – hence the prime location placement.

We also have the title located with our diabetic magazines, including Diabetic Living, as well as with our regular cookbook titles.

We are also promoting the title in an email campaign to shoppers this week as part of our external marketing.

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magazines

Melbourne airport rips travellers off

Please excuse an off topic rant.

I am sick of being ripped off by Melbourne Airport. If you park there for less than a day you pay for the hours you’re there.  If you are there more than a day you pay by the day.  So if you park for 25 hours you pay for two days. Crazy.

The only way they can get away with this is their monopoly position. I can’t think of other businesses with a rip-off pricing model like theirs.

The airport was built by and run by the government for decades. Since privatisation, the fees have steadily increased yet the amenity has not changed.  Indeed, it is now harder than ever to drive into the airport. So we are receiving poorer service and paying much more for it.

What is happening at Melbourne Airport is not only about travellers being ripped off with excessive fees. It’s also about the impact on productivity. Thanks to poor traffic management and poor management overall we travellers have to allow more time before a flight to get to the gate.  This costs us time and time costs money.

Governments are happy to sell public assets for the cash. The suffering public all too often pay long after the transaction is completed.  I preferred Tullamarine under government ownership.

There, I feel better now.

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Social responsibility

Be careful about newsagency lease advice

I was talking with a newsagent last week who made some business decisions based on the offer of free lease negotiation assistance.  The lease advice assistance did not work out and the business has been lost.

Negotiating a lease is tough.  It requires a professional fact-based approach with accurate business data at the core.

Since the landlord is in control and makes the ultimate decision, it is not possible for anyone to promise a certain outcome. The best that can be put is an offer to support the newsagent in making the pitch to the landlord. The best support is in the form of a professional proposal.

The key is for the newsagent to be involved at each step of the way, alongside the advisor, the person offering assistance.

Leaving the job to someone else entirely is a risky move as you don’t know what is being said or whether they have an agenda other than what you need for your business.

If you’ve been offered lease advice or assistance, be careful. Agree on a process that keeps you fully engaged and which has your business needs at the forefront.

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retail leases

Featuring crosswords

Check out the display promoting crossword titles created by the team at one of my stores.  Using the black and white crossword wallpaper, the titles themselves really stand out.

We specifically chose to feature titles connected with popular magazine mastheads.

The crossword section is immediately behind this display – hence our selection of this location.

If you want to see the display in more detail, click on the image.

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magazines

Promoting Grand Designs Australia magazine

We are promoting the latest issue of Grand Designs Australia with this display on the aisle-end, facing the front of the shop. With the launch issue selling so well for us we want to try and do even better with issue #2.

In addition to this display we have Grand Designs Australia featured in our home and living section of the magazine department.

The Grand Designs TV show continues to perform well, providing excellent brand support for the magazine.  The TV tie in is a reason we’ll keep the feature display up for two weeks.

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magazines

Promoting Home Beautiful

We are promoting the latest issue of Home Beautiful magazine with this display in-store – located on a column facing shoppers as they enter to grab impulse purchases.

While not a massive seller, Home Beautiful responds to feature support – like this type of display. We are also supporting the title in its usual location with home and living titles – with a half waterfall.

Our in-store creative team played with the collateral and created something a bit different for us with this display. I like it.

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magazines

Promoting Cosmopolitan

We are supporting the latest issue of Cosmopolitan magazine with this feature display and a waterfall in the usual location for the title.

We also have Cosmopolitan in an impulse display unit at the front of the business, facing into the shopping mall.

We’ll maintain the three positions for this week and pull back to two during the weekend given time pressure. This aisle end display will be replaced.

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magazines

Relocating ink to behind the counter

We are preparing for some major moves in our stationery department (range and location) and wanted (needed) to move ink. We have just reviewed sales and decided to consolidate at the same time.

We chose the counter so that ink could be part of an impulse purchase – over the counter promoted – drive. This is prime space and sales will have to increase as part of the move.

While we have some more work to do on placement, our top selling items are in place and ready.

My personal preference for years has been to have ink in the body of the shop so that customers can touch and browse the product. In this store we have moved it to the coubter because we need the wall space for our rejigged stationery department.

The stationery changes are being made as part of a gift and other products move in the business.

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Stationery

Challenging newsagency tradition

On the weekend we experimented with a different entrance to our magazine department. While it may not look like much in the photo, in store the change was significant.

I was keen for the change for the sake of change itself.

Magazine departments look the same around Australia. By placing the units at the front of each aisle on an angle I was trying to get customers looking at the department differently and noticing the feature titles in the front units more than usual.

While the move made it harder for older customers and those with movement challenges to enter the magazine aisles, there is no doubt that the more people saw the titles in the front units – placed on the angle.

Another reason for the change was for us to look at the magazine department differently.  We are planning on some major shop floor changes and we want to take a fresh approach to some core departments. Central to the changes is the need for us to break from traditional in several areas, to reflect the fundamental changes occurring in retail.

I am leaving up to the weekday team to decide whether they keep this change in place, move to something else or switch back. Since I am not there every day it’s not fair to force on them a change which be a challenge to a reasonable group of our customers.

 

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magazines

Promoting the VTAC guide

Another of my stores is promoting the VTAC guide at the counter. Since shoppers don’t come in looking for the title we figured we needed to place it where they could easily add it to the purchase. Our plan is to give it two weeks here and in this time move a chunk of the stock we have received. We have achieved a 28% sell through in the last week.  As I noted previously, the guide looks good this year, visually attractive.

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magazines

Sunday newsagency management tip: give your employees data

We should give our employees business data and see what they suggest or actually do with this. I think we sometimes get caught up in micro managing and ignore the opportunity to leverage the smart and committed people we have working for us.

Here is the data I’d suggest you share with employees in a structured way:

  • By employee by week (whichever is easier for you): revenue and number of sales. Be sure to divide this by hour worked as hourly sales is the real stat you want.
  • By week: number of sales. As above, be sure to divide this by hour worked.
  • By hour for a week: number of sales.
  • Sales by selected departments for the week.

Putting this on a whiteboard in the back office gives people a guide of how they are performing and how key departments in the business are performing.

Providing access to this data can guide your employees to be more competitive with themselves. It also makes you more disciplined about gathering and reporting the data. This will enhance your understanding of the the performance of the newsagency.

Accurate data access regularly is often the difference between a successful newsagency and one not so successful.

In sharing the data, what you really want is an employee to come to you with ideas for improving their numbers and the numbers for the business. This is gold when it happens. Listen to their ideas and give them a go.

Stop being secretive about the performance of your newsagency. Your employees want it to succeed as much as you.

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Newsagency management

It’s nice being a destination store

As the only retailer in our area with the 2013 One Direction calendar, we have customers coming to us specifically purchase this item. Plenty of these customers have been referred to us by friends and through social media.

Most One Direction calendar purchases include items they may have purchased at their local newsagency or the supermarket. I say this because the calendar is the destination item, it’s what brought them to us – yet their basket usually includes more items.

Every one of these sales is a reminder of the value of a point of different, a destination product or service others will talk about and through this generate more traffic for you.

Oh, and the shoppers coming in are all ages from grandparents to kids.

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Newsagency management

Targeting photocopy business

We’ve placed a simple magazine impulse unit next to our copier. Right now we are promoting the latest issue of Women’s Health in this location.

With around 80% of copies in a typical newsagency being copying alone in the sale, we need to do more to drive efficiency from this service.  We will try a few titles in this location and see what works best.

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magazines

The weekend pitch with papers

This weekend we have been promoting Better Homes and Gardens as well as the latest Donna Hay with newspapers. We look at what is with newspapers three times a week: Monday, Wednesday and Saturday (sometimes Friday). The goal is to make newspaper shoppers more valuable with impulse purchases.

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magazines