The new annual access pricing announced by XchangeIT, the company owned by the three magazine distributors and through which newsagents receive electronic invoice data and provide sales data, at the QNF conference yesterday of $695 for users of the POS Solutions DOS software, $895 for non compliant newsagents and $495 for compliant newsagents is a step in the right direction but not far enough if they want to drive compliance among newsagents. Access for compliant newsagents should be free or, at least, token in cost. Only this will focus the minds of newsagents on the value of compliance. It is important to demonstrate the value to the channel of the many newsagents committed to efficiency and the cost of those who are not.
I am currently paying $401.50. I am compliant in every aspect required – receiving EDI, scanning all sales, scanning all returns via EDI. I thought by being compliant, I am helping the channel (and myself) be more efficient, thus saving money. Now, I am supposed to pay an extra $100?
I was expecting XchangeIT would reward compliant newsagents by reducing the fees. Obviously, I am living in a dream.
Once again we are treated poorly by our ‘partners’. We pay extra for the same service we have had previously, when in reality we should not have to pay a cent. We are being gouged as usual.
The data provided by us is used to refine the distributor’s business outcomes, meanwhile NDD & NDC will not accept EDI Supplementary Returns because it is not in the interest of their cashflow. I was assured by Niall Murphy at the ACP Connections Conference in 2007 that as soon as the IT solution was in place all returns would be accepted via EDI. This was patently not true as GG have been able to do it for 18 months or more.
These companies wonder why we treat them with disdain.
On a point of correction regarding the pricing, which you have stated incorrectly on your blog.
I thought there may be confusion around EX-GST and INC-GST, and my slide was EX-GST.
Regardless, the numbers you quote are still incorrect so I trust this clears any confusion:
$365 = $401.50 INC-GST (This is the current price)
$400 = $440 inc GST (This is the new Fully Compliant price)
$600 = $660 inc GST (This is the POS-Dos price)
$850 = $935 inc GST (This is the Sales Data unavailable price).
On the point of “token in cost” I would have thought that, under the new pricing,
$1.10 a day for Compliant users in a 365-day year was pretty much “token”.
Additionally, I respectfully submit, again, that VALUE is what we are driving for, and a Newsagent’s ROI on $1.10 a day is unequivocal.
Chris
Chris, Thanks for publishing the right numbers. I’m sorry I got it wrong.
Given the value of the sales data, compliant newsagents should get access for free or $1.00 a year as this is the only pricing whcih reflects their costs of compliance. If you do this you will drive compliance.
So newsagents that use more features of the program get to pay less.
Distribution Newsagents who cannot provide scanned sales data through no fault of our own get the shaft.
To me this issue of Compliance seems really to mean Newsagents providing their sales data through their respective POS systems. Whilst POS providers will readily publish their compliance to increase their functionality and sales, the real issue here is what exactly are Newsagents being forced to provide. Will all Newsagents confidential sales information be extracted and given to exchange IT. Is this extraction done on a Trust basis with Exchage IT, and do Newsagents realize that every business detail associated by their sales information profiles them in so many ways. Could one day the trust of the data keeper be broken by buyers brokers receiving information on business X Y or Z in determining the saleable value of that Newsagent, given all their sales data has been extracted quietly from their POS systems over many years.
Whilst data today is actually supposed to support returns, where is the contractual protection to the Newsagent confirming exactly what information they agree to being extracted from their private business system…and guess what if you do not wish to give all your sales data to a business your organization or association helped fund, then you pay more…something does not sound quiet right about this…and confidentiality issues for Newsagents personal business data is THE BIGGEST ISSUE. I suspect this could be the subject of litigation in time to come…why do we do this to ourselves…Exchange IT is great in providing information and processing magazines, but where do we control what they take from us. This is the concern that no one has really addressed and as business people we need more than trust us.
A good point sa_paperboy – thank you. And, to clear a possible misunderstanding, NBS Palace delivery/distribution only agents are at the $400 pricing level. Plus, the developer expects to deliver a scanned sales data capability within 6 months, which also means you are unlikely to be charged any more than your $400 subscription rate. Good news!
Chris
Steve, more misunderstanding, I’m afraid, and I’ll try to respond as succinctly as possible:
First, XchangeIT only gets the data that related to the newsagent’s EDI partners – currently 3 mag distis and one gift card disti. XchangeIT does NOT get all sales data, nor does any disti..
Therefore, the “biggest issue” of “personal business data” is actually not an issue – we do not get all your business data.
Second, each applicable data set is given to the applicable disti.. It is NOT given to anyone else. That is in the Agreement, and the updated Agreement will be published on our web site when it is ready, the same as the original Agreement is currently on the old website. In the original Agreement see preamble, second para, as well as Clause 2. Therefore, the “Trust” basis to which you refer is embodied in a contract, so you are protected.
Third, one of the reasons XchangeIT exists as an EDI system is for YOUR efficiency, which translates to less time spent in your back office getting goods ready for sale, as well as to faster credit on Returns, which translates to better Cash Flow management for you. Using XchangeIT’s central EDI facility means you do not have to strike up a contract with each disti, then have your POS vendor modify their system each time for each distis specifications, then test them to be sure they work, then implement them each one at a time, probably using different procedures.
Another reason XchangeIT works in your favour is that our system is designed not to collect your data. It is designed to do a level one check for data integrity, then flick your data to the right disti, at the right time, in a confidential, protected manner, and in a format they can make constructive use of.
I hope this helps clarify the misunderstanding.
Chris
Thanks for clearing that up Chris
Chris
Thanks and that makes things more acceptable, but information protection is just as significant to me as are the processing efficiency gains.
Steve
Steve,
I have been sending my magazine sales data back to the distributors for a long time. I have seen efficiencies in the magazine supplies for my stores because of this. I would prove with the store I recently purchased (14 months ago) in Darra, where they were not using EDI and were suffering magazine over supplies (like many others). The previous owner, like most, they would just accept it and store it in their draws. Within 6 months of operating with EDI, we had poor magazines automatically reduced with performing magazines automatically increased. WE DO NOT USE NETONLINE NOR GORDON GOTCH’s website to make the changes.
As each title’s sales go up, supplies go up. As each go down, supplies go down.
Chris,
I think you have misunderstood my comment about the fees.
I do not question the VALUE in XchangeIT. I for one have been a big supporter of it. Many newsagents and others in the industry know this. I don’t mind spending $440 if I had to in order to save countless hours.
My understanding is that the distributors own XchangeIT and had been developed to provide a means for all parties to be efficient in supplies. Newsagents sell more = less handling by distributors = publishers make more profit.
I share the view with many others, that it should be free for those that are compliant since it is these newsagents that are contributing to the cost reduction of the current model. Why should we (compliant newsagents) have to fund this technology when we are the ones increasing efficiency?
Your statement at the QNF conference for the fees goes to the improvement of XchangeIT. No problems about that. Shouldn’t that fee come from the distributors and non-compliant newsagents? After all, isn’t it in the distributors interest to improve any inefficiencies? Shouldn’t non-compliant newsagents be penalised for inefficiencies due to their inaction? Why are compliant newsagents still being penalised for being efficient?
Luke,
I agree. Xchange it should be free for compliant newsagents. This would adequately reflect the value of sales data being shared with suppliers.
It should be noted that in other industries, sales data has a price place upon it. In this industry, distributors demand this asset for free.
I am pleased that XchangeIT is reading these comments. The more they hear from newsagents about what will drive compliance the better.
I think it’s great that not only is Chris reading but is also contributing. He has cleared some misapprehensions and demonnstrated more clearly than most that he is interested! I wish all participants in the chain were as passionate.
Thanks Chris, great accent too!