$500 a day in revenue before opening the shop each day last week
We have booked more than $500 in revenue every day for the last seven days between when we closed the night before and opening the next morning. These are online sales. On three days, it was more than $1,000 in revenue.
Gross profit percentage for the products is, 50%.
There is no retain penance space cost as online uses existing retail space that is required anyway.
The labour cost is minimal with it being accounted through everyday roster management at the store.
While some purchases are click and collect, the majority ship to people who live hours, sometimes days, away.
I know that my shop is not alone in our channel achieving these numbers and more.
We are not yet where we know we can be. We think that, with little investment, we can easily double the results of this online business.
It is essential that every newsagency business has an online outlet and that this is not represented as an online newsagency. Those having the most success online play outside the confines, assumptions and history related to the channel.
Online revenue is there for the harvesting. Sure, it is hard work, but it can be done on a minimal budget. The most important investments are creativity and strategy.
There is what I’d describe as a dopamine hit when I open emails in the morning and see the online sales from overnight.
There are signs major landlords are scrambling to appeal to newsagents
Newsagents in two different large capital city shopping centres received revised offers from their respective landlords last week to entice them to stay in the centre.
In each case their lease was ending and the newsagents had advised they would not continue because of the high occupancy cost.
\For months the respective landlords said there was no room to move and then, at the last minute, they blocked and offered a substantially discounted offer.
What makes these cases different is that the discounted offer is a discount on base rent, not some manipulated pitch that enables the landlord to claim higher value for the space than what is actually paid.
If what I’m told Wass pitched last week is a trend, it would be good news for newsagents in shopping centres.
It is great to see a magazine publisher support newsagents
The publisher of the AFL Record has consistently promoted newsagents on social media through Covid. They have directly promoted our channel as the place to purchase their popular title.
I wish more magazine publishers would promote our channel direct directly and consistently.
Kudos SEN for your support of our small business channel with posts like this on twitter:
Your complete recap of @Richmond_FC’s glorious season. Available now at newsagents & through the club for just $10. @1116sen @AFLNation @craighutchy @hashbrowne @MichaelCWillson pic.twitter.com/nZ7ebHesxi
— AFL Record (@AFLrecord) October 30, 2020
And posts like this on Facebook:
Has an appeal lodged by an existing lottery retailer to Tabcorp or Tatts before them against a new lottery outlet ever succeeded
I heard from a newsagent last week of another appeal lost, with Tabcorp approving a new outlet nearby, another of the fuel outlets that run 24/7.
The newsagent is gutted. They lodged an excellent appeal. Their case was well made and backed by evidence. Their sales numbers are excellent.
Based on my knowledge of the situation, I expect that the new outlet will drive the existing outlet to investor time to maintain (or grow) lottery sales, meaning the new outlet increases operating costs for the existing outlet.
I see no sense in this particular decision. I have no confidence whatsoever that the folks at Tabcorp actually considered the appeal from the existing retailer.
Why Woo Commerce (WordPress) may not be a good website platform for newsagents
The website development side of my newsagency software company has developed websites for many retail businesses. It is a tech. partner for Shopify, Magento and WooCommerce.
While each platform serves a different need, Shopify is the widest used in the small business retail space by far. Magento is good for complex requirements, but maintenance of a Memento website will require a developer. Shopify can be maintained, modified and enhanced without web developer skills.
WooCommerce will require a developer for site maintenance. It also does not have as rich a support network as Shopify.
In our experience, small business retailers can achieve better, more cost effective, commercial outcomes with a Shopify website than a WooCommerce website.
I mention this today because in my experience local web developers are more likely to recommend the WooCommerce platform. I think they do this because it is better for them commercially in that web development is often their prime source of income. A Shopify website will not drive repeat business for them from a customer whereas a WooCommerce website is more likely to.
A newsagent I spoke to recently told me they were paying $9,000 for a WooCommerce website. That same site from my company would have cost $5,000, or even $2,500 if they contracted for it as a newsXpress member because of a half price deal at the time.
My point is shop around, ask a ton of questions. Be sure to understand on-going maintenance costs. If they say you can maintain the site yourself, ask them to show you how to change the look and feel, how to add a new web page, how to change categories. Being shown how to do this will, for most newsagents show them that a WooCommerce website platform is not the right fit for them.
I don’t have a vested stake in this in that the web team in my company is skilled in Magento, Woo and Shopify as well as the even more complex and technical native web development. That team has a full room of booked business already.
There are many Shopify website developers out there you should consider before a WooCommerce developer.
A challenge in this website space is that often it is a friend, or friend of a friend, or family member involved. They may have the best of intentions in recommending WooCommerce. For the reasons outlined already, WooCommerce is not a platform I recommend for retail newsagency website development.
Be careful. Do your research. Get all commitments in writing. If you are not sure, delay your decision.
If you have some software development skills, then Woo could be perfect for you to create your website yourself.
Having a diverse range of cards can be helpful
Customers are loving this card:
How does it feel to be open again?
On one day last week we counted How does it feel to be open again? asked of us more than. 50 times. Some who asked had been in plenty of time through lockdown, reminding us that retail sales counter conversation is often by rote and not expecting actual engagement.
The masks helped hide our responses.
Fighting for a local newspaper
Australian Story on ABC TV next Monday looks like a good story about a local newspaper in Broken Hill fighting for survival.
Fight for the Truth
Five hundred kilometres from the nearest capital city, the outback mining town of Broken Hill is fighting to save its only newspaper.For over a hundred years, the Barrier Truth has told the town’s stories, documented wars, droughts and the Depression, and recorded the lives and deaths of its citizens.
But when the pandemic struck, advertising revenue collapsed, forcing the newspaper to shut down.
Former Broken Hill resident and mining executive Robert Williamson heard about the community’s distress and raised enough money to restart the printing presses temporarily.
Now the newspaper’s union owners face a tough decision: should they sell their beloved paper to private interests?
Airs Monday November 9, 8pm (AEDT), on ABCTV and iview.
News Corp. Q1 FY 2021 results
The latest results posted by News Corp. speak to challenges for the company in the print space with newspaper revenue down 20% and the benefits leveraged by the company in the digital subscription space.
The results are worth a read by newsagents as they provides context for understanding the focus of the company – digital.
Lottoland is still promoting in Australia
Despite the federal government claiming it had fixed the situation, here is a marketing email from Lottoland received just now:
Magazine theft at Westfield Southland, VIC
Someone broke into the storage cage near our Southland newsagency in Victoria, when no one was around and before we open, cut open bundles of magazines delivered to us and stole almost all of our delivery that was due on sale yesterday morning.
We have the thief on camera doing this and removing a considerable value of stock.
We have reported the matter to the police and provided the security footage.
It’s clear from the evidence what they were doing and what they were looking for.
Given that the volume stock taken would only be of value to a retailer, we are considering putting the evidence in the public domain. It’s something we are discussing with the police.
I hope the police identify and catch the person involved. We will do everything possible to support them.
News Corp. and IGA giving away newspapers, again!
I have seen several IGA supermarkets promoting free News Corp. newspapers for shoppers who spend $20 or more in-store at the IGA.
One newsagent told me that in their situation, two doors away from an IGA running the promotion, they have seen News Corp. sales decline – they think because of the promotion.
I get that News Corp. does what it needs to do to achieve circulation / readership goals for ad revenue targets. I think the regularity of these deals speak to challenges for the company getting people to pay for its product.
What is a newspaper worth? Shop here and you pay $2.00. Shop at IGA for it’s free if you spend more than $20.00.
What diminishes the value of the newspaper product further in my opinion is the mechanic of the free paper at the IGA. The offer is not consistent. Sometimes it is offered while other times it is not. The wording is especially inconsistent.
That checkout counter offer of the free paper opens conversations about the papers and there is where brand damage can be delivered. Simply by offering a free News Corp. paper invites a response. Given the extent of growing negative feelings toward News Corp. in some locations this year, I would have thought that opening the door for sharing opinions was not ideal.
A quick check of Twitter shows plenty of people talking about the latest News Corp. giveaway, like this one:
My local IGA has a new deal :
if you spend $20 you get a free Murdoch ‘newspaper’, not one person took one!😂😂😂
and an elderly lady behind me said to her friend maybe I should grab one to line my kitty litter tray.
GOLD!!!#NewsCorpse— I Can’t Breathe #BlackLivesMatter (@KarolinaVoit) November 3, 2020
And this one:
Overheard at an IGA supermarket. Checkout staff. “You get a free newspaper as you’ve spent over $30”. Shopper. “I’d rather just have a free plastic bag”. @theheraldsun #NewsCorpse #cantgiveitaway
— onhold (@iratecaller) September 21, 2020
Yes, these types of deals have been around for years. That does not mean we should ignore them and consider the challenge they present to retail newsagents.
Oh, and some in News Corp. may say the free paper today could convert someone who goes on to purchase from the newsagent in the future. To this I would say, show me the evidence of this. Like the claims for trickle-down economics, I suspect it is wishful thinking not backed by evidence.
What if the most important stream of revenue for your business was cut off overnight?
Hundreds of Australian businesses yesterday discovered that China was blocking their exporting of products to that country. According to news reports, Australian wine, copper, barley, coal, sugar, timber and lobster are set to be banned from Friday.
This is dreadful news for the businesses, those who work for them and the communities that rely on them for income and purchases. The ramifications across Australia could be extraordinary.
Hearing the news of the move by China, I wondered – what would happen to your business if a key income stream was cut off overnight?
Would your business survive? Do you have a plan B? Can you move quickly enough to recover? Were you too exposed to and too reliant on the key revenue stream?
These are questions you can discuss with clarity with hindsight. Better still, they are questions you can discuss in advance.
I raise the questions today because considering them before you face the challenges being faced right now by Australian exporters of wine, copper, barley, coal, sugar, timber and lobster gives you the opportunity today to be less reliant on a single revenue stream.
I get that this can read as a ho-hum topic, something not worth worrying about today. However, I bet there are wine makers, sugar farmers and fishermen who several days ago would have thought the topic ho-hum too.
What if the most important revenue stream to your business was cut off overnight, without notice?
Actions I think anyone reading this could consider include:
- Assess income to understand the income category streams on which the business most relies and take immediate steps to broaden these.
- Assess income sources. In retail especially most income comes from a shop or physical presence. Broaden this, rely on more than the physical presence.
- Assess the importance of suppliers by looking at percentage of revenue attached to each and taking steps to broaden these.
- Look at your business finances and consider the impact if any supporting finance arrangement was removed overnight.
- Workshop with key people as to what it would mean if any supplier was cut off from you or if any product category or brand was overnight stripped from your business. Those participating in this need to challenge each other.
In terms of the situation that has emerged in China this week, we need to look at our reliance on product from China, especially is we rely on people connected with wine, copper, barley, coal, sugar, timber and lobster. For example, if we have customers who work in wine businesses that export to China. How will they feel purchasing product from us that are sourced from China when China has struck so hard at the core of their income source?
What has happened in China is a reason for us to take stock, look more carefully at our businesses, and ensure that we are better structured to trade through unexpected decisions by others.
A personal story: Decades ago, my software company developed software for radiology practices, managing patient accounts and reports on x-rays. I wrote a word processor to make it easier and faster for radiologists to write report. It was a hit, gaining terrific early sales. A year and a half in, an international x-ray film supplier offered radiology practices free software from the US if they contracted to buy their film for 5 years. Our sales stopped overnight. I decided then that my company would never rely on a single customer or a single channel for the majority of business. It’s why we are now in 12 specialty retail channels, why we only sell to sell business retailers and why we will not borrow to fund the business.
Footnote: I wrote this for newsXpress members, as part of on-going strategic planning advice for members of that retail community. I share it here because of the many communities in Australia today confronted by the challenge presented by China.
Be a card giver and learn more about the category
A newsagent colleague once said to me that they never give cards and don’t understand people who do.
It was funny at the time. Then, their card sales were falling and they had one less reference point for understanding why.
To me, a test of the card range I have in-store is how many cards I would happily purchase from my business. While there are, for sure, occasions when I will want a niche card that I am unlikely to stock, for everyday type purposes I should be able to buy from myself.
Of course, it starts with being a card giver. Be this person and shop in your own shop and it will influence decisions you make about your card range. My advice now to any newsagent who says to me that they are not a card giver is that they are missing out on valuable consumer research.
I guarantee that if you start buying cards from yourself and actually sending them you will seek to drive changes in your card range. This is good for your business as it engages you in card range decisions. Often, newsagents do not have themselves situated in this role.
It’s your retail space. You pay for the inventory. You bank the results of sales. It makes sense that you are in the driver’s seat for the best margin product category you have in the shop.
This past weekend I wanted a thank you card. I needed something that set a specific tone. I found the perfect card. The search revealed some changes that could broaden the reach of what we have. While I may have noticed the need had I been looking to buy a card, I suspect it is that I was looking as a customer that helped me see more.
if you are not a card giver, be a card giver and be open for what you learn from the experience.
GiftWrap tape tips for newsagents
Take a moment to check that you have your Scotch GiftWrap tape placed for success. But first, why Scotch? It is the most recognisable tape brand, by far, the most trusted. It is an easy sell, a mush-have for this time of year. You can maximise your Scotch GiftWrap tape success with multiple location placements in-store:
- At the sales counter.
- With roll wrap – several placements.
- With newspapers.
- On your tape wall.
Most purchases this time of the year will be by impulse, if you have positioned product to achieve this.
A couple of minutes on the shop floor can drive good returns.
Supermarket removes free newspapers and magazines from its shelves
In another move against print media in supermarkets, the UK Kroger group has removed free newspapers and magazines from its stores. Check out this report from earlier this year.
Kroger will be removing free newspapers from all of its stores, effective Oct. 15. Locally, those publications include The Memphis Flyer, Focus, Memphis Parent, Memphis Health & Fitness, and Best Times.
“We are removing the publication racks from our stores because more publications continue to shift to digital formats, resulting in less customers using the products,” said Teresa Dickerson, corporate affairs manager of Kroger’s Delta division.
Even so, the move may hurt local news organizations.
“It’s a huge blow to Health and Fitness because we move 20,000 magazines a month out of there,” said Amy Goode, the publisher of Health and Fitness.
Free publications rely on a paid advertising business model: Advertisers buy ads with certain assurances that their marketing messages will reach a certain number of customers. This is why having a reliable, wide-ranging distribution point such as Kroger is so important.
I say it is another blow because of moves announced earlier about a branch of Aldi getting out of newspapers.
7 principles to help local retail businesses through the Covid recession.
I get it, Australia is in a recession, a Covid recession brought on by the pandemic and responses to it here and overseas. Okay, some say we are out of recession already. Who really knows? To ma ny, the recession is real and present.
Relentlessly, media outlets overload us with recession stories, fuelling worry and anxiety and challenging consumer confidence.
It’s tempting to get drawn to the doom and gloom stories, to amplify the woe is me narrative.
Plenty of people in business, especially small business, prefer to look ahead, to focus on the other side of the recession as it is that view of what could be that motivates.
I think a back to basics approach is what is needed to get us through the recession. I think it’s right for our business, the retail shops I own and for the many local businesses I serve.
The back to basics guiding principles I share here are focussed on this, focussed on providing sure footing today and encouraging optimism for tomorrow.
This is not a list from which you choose what you like. My advice is that you do everything on this list, because together they provide the best chance of navigating the recession well.
- Nurture what makes the business moneyand fix or stop what does not make the business money. Leverage strengths. Fix or eliminate weaknesses.
- Embrace ways tobroaden the reach of the business.
- Makesafe decisions, decisions you know will work. For example, buy well. That is, buy what will sell easily, quickly.
- Embrace ways you canadd value to what you sell without spending more.
- Be frugal. Before every spending decision ask 2 questions: do we need this? Will this add value? Review every business expense. Cut those that do not add value.
- Your next step is in front of you. Look ahead, not behind. Talk up, not down.
- If you feel overwhelmed, take it one step at a time. Every day, do something that makes you happy.
When should you start? Now. But not alone. This is a whole of business project. Involve the whole team and embrace the 10 points at every opportunity.
How do I know these principles work? I’ve traded through two recessions, one country wide and the other sector wide. I’ve also traded through Covid with excellent results – because businesses I am connected with embraced these principles back in early March 2020.
Let’s take a moment to unpack principle #3, make safe decisions. Safe decisions are those you can bet on because they work every time. They may not be exciting, but they are safe. They may not be the best margin, but they are safe. Safe decisions are all about certainty, providing a small step that is stable. Put a few of those in a row and you feel better. Feeling better is key to helping you navigate the Covid recession.
While I understand the value of news, there may be value in consuming less news, staying away from the negative stories. Your success is the most important news right now.
How will UK newsagents fare in the second lockdown?
UK newsagents are classed as essential in the second lockdown announced by the UK Prime Minister.
Newsagents here in Victoria (Australia) where we have just come out of a second, 100+ day, lockdown, fared well. While traditional products like newspapers, magazines and lotteries did okay, it was in the gifts, toys, homewares and personal nourishment categories where the best growth was achieved – all higher margin categories than traditional newsagency product lines.
The newsagencies that had already transitioned and relied less on traditional did the best. They met the criteria for being essential but were able to serve customers in-store and, importantly, online, maximising the profitability of this time.
The average growth I have seen in sales data to the end of lockdown is year on year growth of 20% and more. What’s interesting is that in most cases there was no noticeable increase in shopper traffic. Visit efficiency spiked.
With the second UK lockdown impacting an important time for retailers, UK newsagents that trade outside of the traditional convenience approach will, in my view, do better. The success they experience will be enhanced in they are established online.
Again, in Victoria, I have seen some newsagencies grow online revenue from a 2% contribution of total revenue to 20%. Most online sales have been of higher margin items like jigsaws, games, toys, personal nourishment and gift hampers. I am grateful that many of us were well established in these categories prior to lockdown, enabling is to serve customers who could not get to other closed shops with these items.
If I was advising UK newsagents I would be saying that Covid is the opportunity to pivot, to re-cast the focus of the business. UK high streets are full of businesses competing in the convenience space. The majors will win that battle. There are better opportunities elsewhere. Right now is the best time to consider that.
The new Covid normal for retail
The Sunday Age yesterday had a story from Dominic Powell and Simon Johanson about retail and the new normal. It speaks about how retail has changed through Covid and that many changes will stick.
From smaller shops to major chains such as JB Hi-Fi and Coles, the exodus from Australia’s inner cities is just one of the many effects of the coronavirus pandemic shopkeepers fear could persist well beyond the six to 12 months until the world has its vaccine.
As the article notes, there is no doubt that the surge in online will continue.
Broader changes, like the rapid acceleration of online shopping, will be widespread and unstoppable. Retailers are already re-assessing their moribund bricks-and-mortar stores and spending millions on online platforms. “Omnichannel” (along with “resilience”) has been the jargon du jour for merchants through the recent corporate reporting season.
There is also no doubt, in my view, that the migration away from malls to the high street and regional, will continue, too.
Now, more than ever, being online with a beautiful, easily found, website is key. Further, selling what sells faster in-store is also key.
These are not things to put off. Newsagents have no choice but to review what they sell and to re-cast stock range based on this new normal and getting online to find shoppers far away from the business.
It’s a race, a race that is more even right now between large and small than in traditional retail. Small business retailers, like newsagents, acting now will still be relatively early at this. But … it takes creativity, commitment and smarts to be successful.
The article in The Age is a terrific read.
A reminder that newspaper publishers preference their needs ahead of editorial
It’s been a while since I posted a photo of these post-it note type stuck-on ads on the front of a newspaper.
There are problems with magazine delivery in some of Western Australia
The last few months have been particularly stressful for some newsagents in Western Australia due to problems with magazine delivery.
The issue is not magazines at all on the on-sale day. Sometimes, they come the next day and sometimes two days late.
This is a relatively new problem, something that has happened in the last few months.
Newsagents impacted are frustrated as their calls for help, they say, fell on deaf ears for many weeks. They think the issue has come about because of more cost-cutting.
I am writing about this today to draw attention to the problem, to ensure publishers know of the break in the magazine distribution system that is affecting some in Western Australia.
The good news is that Ovato advised a couple of days ago that they think the issue is resolved. We will see what Monday and the days that follow bring.
I hope it is resolved as the newsagents involved would appreciate less stress.
Strong Christmas card sales online
We have been selling boxed Christmas cards online since June as pre-orders. Once we had stock, we shifted to same-day postage.
Sales in June were good. Over the last month they have spiked.
What’s interesting is that sales have been terrific without a single cent spent on advertising. Getting icing on the cake revenue for products we carry in-store regardless is terrific and yet another reminder of the value of an online strategy.
We stared with boxed Christmas cards thinking that they would be an add on to another online purchase. While this does happen, we get more sales from people purchasing only cards, often 4 and more boxes at a time.
It is fascinating to see, and to learn from. We will be more engaged with this opportunity next year, and earlier, too.
Crossword titles remain the hero magazine category
Looking deeper into the newsagency sales benchmark data, in almost every store I have data for, crossword titles are in growth. In plenty of newsagencies, crosswords is the only magazine category In growth.
What’s interesting is that this continues excellent interest in crosswords fits with continued strong sales for jigsaws, diamond dots art, adult colouring, 3D puzzles and other maker kits. Put all these together and you have a wonderful story.
Indeed, I’ve seen regional businesses achieving between $1,500 and $5,00 a month, yes, I did type $5,000, in sales from crosswords / jigsaws / maker kits with the combined sales of these beating other product categories / segments.
This is an excellent example of a good news story for our channel this year. Good growth and, for most products in the segment, good margin. Maker kits, for example, can earn 65% GP.
Crosswords are the indicator category. See strong sales for them and you have a pathway forward for leveraging that traffic and attracting people crossword folks talk to about similar interest product. This is a great way to grow the business with no marketing spend.
newsXpress launches Creative Writing Competition
Newsagency marketing group newsXpress has launched a national creative writing competition seeking entries of short stories, poems and songs that relate, somehow, in some way, to the Aussie newsagency.
Two cash prizes of $1,000 each will be awarded, one for anyone aged up to and including 17 and the second for anyone aged more than 17.
Writers are invited to submit a short story, first person narrative, song or poem. Each entry is required to in some way reference a newsagency, either a specific business or the type of business generally.
The local newsagency is the quintessential Australian small business, and through Covid the newsagency channel proved it’s value as an essential service to local communities. We wanted to explore a way of celebrating that.
The idea of this competition is to encourage creative writing by Australians, to shine a light on local stories and through these reference in some way the local Aussie newsagency.
newsXpress is a collective of over 200 local family owned and run newsagency businesses across Australia, mainly rural and regional. Most shops in the group have transitioned from the traditional to be modern. newsXpress businesses showcase Australian made products that help Australians express themselves.
To me, this is a perfect newsagency marketing group activity. It is fresh, creative and not tied to shoppers spending money in the business. It fits with my view that sometimes the best way to get from A to B is to head for C. I like it too because there is no supplier connection, no outstretched arm asking for help.
newsXpress is funding this itself, including providing retailers with A1 colour posters.
Here is more information about the competition:
This competition is run by newsXpress Pty Ltd.
There are 2 prizes: one of $1,000 for entrant up to and including 17 years of age and one of $1,000 for an entrant more than 17 years of age. Each winner will receive a certificate.
TERMS.
- All entries are to be submitted by email to writing@newsxpress.com.au.
- Each entry is to include a first page with entrant name, age in years and months, email address, name of local newsXpress business if known (not mandatory) and the name of the piece.
- Each page of the entry is to have only the name of the piece.
- Entries to be an original, previously unpublished short story, a song, a poem or first person narrative. Maximum word length: 1,000.
- Page format is to be A4, font is to be arial, 12pt. No images. For short stories and first person narrative, double spaced please.
- Entries to be in PDF or Microsoft Word format or a format easily read by either.
- There is no limit on entries per person.
- There is no entry cost.
- Entries close at midnight December 11, 2020.
- Each entry must, in some way, reference a newsagency. We are not being prescriptive as to how central a newsagency is to the story, song or poem. We leave that up to the writer. But, we do want there to be a reference at some point to a newsagency, any newsagency.
- The decision of the judges will be final.
- The winner will be announced on the newsXpress Facebook page and elsewhere no later than January 30, 2021.
- newsXpress will publish the winning stories on its blog, crediting the writer.
- Once the competition is over, all entries will be destroyed.
- newsXpress will not share entrant details or use them in marketing.
A newsXpress local store may choose to offer a local prize or prizes for entries from their area. This will be entirely managed at that local store level by the local store.
Footnote: I am the Managing Director of newsXpress.