Several newsagents have told me they have been contacted many times by their association encouraging them to consider the new Hubbed service. An email I received from NANA on July 9 reads as an endorsement of Hubbed by the ANF and NANA:
NANA and the ANF would like to invite members to attend one of our information sessions we will be holding at our QLD office in Zillmere.
These sessions will provide you with the opportunity to learn all about the new CONNECT system which is now being offered to member Newsagents nationwide.
This is a fantastic opportunity for newsagents to see how they could grow their businesses and revolutionise the way that consumers transact in retail environments.
We have shipped a Hubbed CONNECT machine for you to touch, feel and experience.
The email included:
There has been a great deal of interest from members in the Hubbed “CONNECT” system for newsagents and the exciting news is that this great opportunity will roll out in QLD starting in August 2013.
As I noted, this email reads as an endorsement. That the information sessions are being held at association offices also suggests endorsement.
Here are questions I’d want answered before contemplating Hubbed further:
- What is the nature of the relationship between Hubbed and any of the newsagent associations or anyone connected with the associations?
- Specifically, is there any money or other benefit whatsoever flowing from Hubbed to any of the associations and if so on what basis?
- What due diligence has been undertaken on the Hubbed business model?
- What due diligence has been undertaken on the proposed Hubbed contracts?
- Have all the claims made by and about Hubbed to newsagents been investigated?
- Is the ANF, NANA, QNF or any other association endorsing Hubbed and if so why and if not why?
- Has the ANF, QNF, NANA or any association promoting these sessions considered what of the Hubbed services are already available in newsagencies?
I was recently at the Tasmanian Newsagent of the Year Awards dinner in my capacity as owner of Tower Systems to present the Retail Newsagent of the Year Award. As an award presented I was given a few minutes too speak at the dinner. I took this to mean two or three minutes. That’s all I and all bar one other award presenter took. The CEO of Hubbed took twenty minutes and launched into a sales pitch. While it was the wrong place and wrong time for this, it gave me an insight into their services.
From what I can tell Hubbed is not offering anything significantly different to what newsagents have FREE access to today through ePay and Touch Networks. My understanding is that Hubbed will cost newsagents $7 a day or $17 a day depending on the level of service they choose. That’s a lot of money compared to the free services available already.
It could be that I am missing something but I don’t see Hubbed as generating considerable new traffic. It’s an agency service and newsagents make money by providing services at the counter. Retail is moving away from the counter. Newsagents, in today’s retail environment, can make more money on the shop floor by being engaged retailers.
Investing $2,500 (less than $7 a day) in stock of new product lines, a newsagent could expect to make at least $7,500 gross profit over a year based on average stock turn and margin. They would have established their business as a destination business in a new product category and that should see at least some customers returning for additional purchases. Some of the new traffic should also generate revenue from other parts of the newsagency.
My focus on the future is on generating new traffic from new product categories, non agency, non commission product categories. I’m confident I will make more money by exerting control over what I choose to sell and the price I choose to sell it at. Check out the Newsagency of the Future video for more of my thoughts on this.
I don’t know enough about Hubbed to tell newsagents what to do nor is it my place. I have written this post to raise questions, to ensure that newsagents considering signing up for Hubbed are fully informed, more informed than covered in communication from the associations.
Newsagent associations have no place being involved in providing or endorsing any commercial services. They ought to focus 100% on policy and get that right.
Every time an association endorses or promotes in any way a business it has any commercial relationship with it should disclose the interest.
The last service the ANF wholeheartedly endorsed and promoted was Bill Express, in 2003. As newsagents later discovered, the only due diligence undertaken by the ANF related to advice from their lawyers about ANF Director matters and not Bill Express or the Bill Express related contracts. Newsagents lost millions of dollars.
We looked at hubbed lite. You get gift cards,a parcel service, and bill payment all for $7 Per Day. We are already doing gift cards for free so got that covered. We are doing nparcel which will expand to outbound services eventually. So will have that covered. The bill payment function you get 50c for each payment. Do I want an elderly person at my counter taking up my valuable time for 50c? By the time they take the bill out of their bag, find the money, then put everything back in the bag I estimate at least 5 minutes. Just look at the queues at Australia post. Do I want that? For 50c? No. It couldn’t pay it’s way including staffing cost.
A payment of only 50c per bill, send them to the Post Office to use the Australia Post EFTPOS System.
Why no response from NANA Chiang Liam?
Amanda I hope someone does answer the questions as it’s the best way to refute or at least challenge what I am asking.
Hi Mark and Newsagents,
Sorry for the delay in responding. NANA has been very busy on a series of fronts (see http://www.nana.com.au).
While NANA does not have any commercial interests in or with HUBBED except allowing them to promote themselves via our communications platforms, NANA did broadcast the information session(s) about HUBBED because it was of interest to Newsagents.
NANA is finally receiving its first and full briefing today (29 July 2013) from HUBBED, following which we will share with NANA Members via NANA’s own information sessions and platforms as previously broadcast.
In the meantime, NANA has also been advising NANA Members to be cautious of the contracts only because NANA has not seen nor analysed them. HUBBED is aware of NANA’s advice to Members.
Notwithstanding, HUBBED in principle appears to be an exciting and positive platform that can add value to Newsagents.
I trust this helps you and other Newsagents. Please feel free to contact NANA on (02) 9744 0400 or nana@nana.com.au should you require any further information/clarification.
Hubbed is obviously not national – we haven’t heard of it in SA – all the more reason to be very cautious – I well remember Bill Express – it was a total debacle for newsagents.
Well blow me down Chiang now you say you know little or nothing about this thing you have been tell us to get on board with for weeks. Cart before the horse I think. You should have done all this BEFORE you started spending my money promoting something you know nothing about.
I’m not a member of NANA, however, when an association allows a company to promote themselves via their communications platforms, then that us saying to their members, this is solid, this is good, this has been checked out.
I am shocked that NANA, QNF and ANF are permitting this ESPECIALLY after the Bill Express saga.
Seems to be a case of who you know ….
Markm
why can’t your software handle bill payment. Say scan in bill data collect cash and write data to file. Once a day visit a bank and upload data. Sounds simple I think.
I’m with Clive on this one – even if its in our software 50c or $1 for the time taken to process a bill, just not worth it.
We are already busy with home delivery and lotto, don’t need another low margin high staffing service.
Thanks, but no thanks.
Peter bill payment required biller engagement. That’s dead in the water. You can today offer the type of approach proposed by Hubbed if I understand it right and you can do it without paying them for it.
Bill payment is dead in newsagencies and has been for years. It disrupts our focus on more valuable work that’s better for our future. There is no future in agency business.
Chiang I am corcerned by your response. The associations have endorsed Hubbed by actively promoting Hubbed. That you have done this before knowing the detail is a dereliction of your duty. You should not have given any support for Hubbed in any form without thorough due diligence of the Hubbed offer or a thorough assessment of what’s already in newsagencies through businesses like Touch and ePay.
Mark,
I will agree with you here I just wanted to ask the question and if I did want to do it I could now but it is not worth it for effort involved.
Yes I understand Peter. Back in 1997 when I first got involved in bill payment the opportunities were considerable. With Bill Express, too they were considerable if we strip away their financing model. Since around 2008, however, over the counter bill payment has been dead in the water primarily because of the cost of getting the cash from the retailer to the biller in and each step along the way making a fair margin.
The more recent challenge for newsagents is the question over where we make our money in the long term. I don;t think it will be through agency business.
thank you Chiang for making a comment on this blog about the NANA position on this issue.
I agree with marks comment (#12) but please keep coming back to this blog and commenting from NANA. it gives us insight into the NANA position.
cannot imagine another agency line that would be compelling enough for me to take up. don’t feed me crap about bringing in foot traffic, either it pays its way as a stand alone or I don’t want to know about it.