It was good to read yesterday of the change in approach by the federal government to the introduction of the Modern Award. By seeking to take the full five year implementation period, the government has slowed the introduction of higher costs for many retailers including newsagents.
The cost of labour is a challenge for newsagents because of the proportion of what we sell which is fixed margin business. The challenge is compounded by falling margins is some areas – mobile phone recharge is one recent example of this. The other compounding factor is falling margin in real terms for newspapers and other products where retail price changes are rare – where the price of the product does not adequately reflect a real cost of the item.
Smart newsagents are expanding their range to rely less on products over which they have inadequate control – such as gifts, stationery and in-store services.
It is interesting that apart from some articles in the Australian, that the MSM have yet to pick up on the fact that the new rules will cost. Costs need to be passed on. Increased prices fuel inflation and Interest Rates, there goes the ‘pay rise’.