I was talking with a newsagent last week who was keen for a bill payment option for newsagents even after the financial collapse some years ago of Bill Express. I was surprised as I have considered that over the counter bill payment is dead, not only in newsagencies but everywhere. Sure there are some who prefer to pay bills in cash but that number is declining from what I understand talking to people within Australia Post.
The infrastructure cost, not IT wise but cash handling wise, is too expensive for there to be any money to be made even if there was upside from a customer interest perspective.
The cost and infrastructure issues aside, as a retailer I question the cost to the business of the disruption of a bill payment transaction compared to the traditional newsagency transaction.
Newsagents hanging on to the possibility of a bill payment solution need to let go. Some still hang on to the promises made by a newsagency software company in the 1990s about their bill payment solution and their million dollar data centre. Smoke and mirrors as I said at the time.
Hmm … now that I have written this I bet there is an announcement showing I am wrong. If this happens so be it.
i still get one customer every now and then coming in wanting to pay there bills here (one just yesterday)
I think they get confused with the newsagents that have an aus post in store
We too have the occassional enquiry for bill payments but I would guess only 10-20% of the enquiries we received a couple of years ago. With so many different ways to pay bills now it is a dying market and was probably on the verge of decline even when Bill Express bagan.
We need to shore up what we do now now and look forwards to new opportunities, not passed missed ones that have shrinking life in them anyway.
It probably depends upon where your located. We’ve had a very significant increase in over the counter bill payments in my post office section over the last 12 months. Best of all you often find that there’s multiple payment transactions made at the same time which is great since they are a very quick item to process for reasonable return.
I would need to dig up the AP stats on it but I don’t think the decline was as great overall as some standard newsagency lines have experienced.
Again, probably very much a situational/location based thing.
Paul thats true of us to. We certainly have growth. The massive upswing in parcel traffic seems to have made people more aware of the full suite of LPO services. Also we operate in a community where many people simply prefer to come in do various errands as part of their day. They have computers at home but also appreciate the personal contact. As long as we keep the service up and make people feel welcome they will always pop in just to see what we have on the shelves.
As an ex LPO operator I’m pleased that it still works for you. In the twoLPO’s we owned over nearly 20 years banking was also a very strong part of the business, is that still the case?
Yep, definately Brendan !
I’ve just had a local bank branch near me announce its closure and the local paper actually ran a story about it in which they very nicely pointed out that we did agency banking for that particular bank. Nice to get get some free advertising and we’re already seeing a slight increase as a result of this. Once the bank closes we should see some more, hopefully also with some knock on in the newsagency side of things too !
Did a quick dig this arvo and I think AP reports counter bill payments dropping by about 3% last year. I think we’re currently running at a 68% increase in bill payments to this point last financial year. I’ve had one month with over a 100% increase to the same month in the previous year.
We do have alot of older people in the area but we do also have a quite a few younger people who use the service. The demographic for its use isn’t as lopsided as you would tend to think.
I agree with Kevin regarding the parcel upswing making people alot more aware of Aus Post services. At a guess I think part of it is that parcels tend to bring people into the counter to post, whereas letter are often just popped in the mailboxes as people generally new the rated stamp value to be placed on them.
For the July – Sept quarter I saw a 3% revenue growth in my newsagency section and a 12.7% revenue growth in my post section (though part of this is due to a particular business customer who wont necessarily do this volume every quarter/month).
I’m not sure what Newsagents were getting paid per transaction through Bill Express but I’m guessing it isn’t the same as the AP transaction payments if Mark is intimating it wasn’t worth it. That would certainly make them less appealing to some.
Paul 50 cents and out of that came infrastructure costs. Australia Post has a monopoly on volume. Without volume newsagents could not make a network pay.
That’s also a very significantly lower transactional payment than what AP pays us for most, if not all of the billpay@post transactions. As you’ve pointed out it doesn’t hurt either that the AP infrastructure charges to LPOs aren’t serviced by this single stream of income which I would have thought was the biggest downfall of a single service network like the Bill Express one.