I have made a submission through Touch to transurban pitching for an increase in commission for newsagents from the current 55 cent transaction fee. I was invited to make the submission following several emails to management on behalf of newsagents.
Here is part of what I wrote:
Newsagents pay around $23.00 an hour for employees in their businesses plus on-costs of around 15%, making an hourly labour cost of $26.45.
A Citylink top up transaction takes up to two minutes, resulting in a labour cost of 84 cents. Even if my estimate up up to two minutes is out by 50%, the cost is 42.41 cents.
On top of the labour cost is costs covering retail tenancy, IT infrastructure, insurance and other business overheads.
Then, there is the cost of transactions themselves, banking costs for cash and bank fees for electronic payment methods.
These are all factors impacting the cost of doing business, the cost of offering the Transurban top up service.
Finally, there is the opportunity cost. This is a consideration in a newsagency that has transitioned from the old-school loss-making agency model to the new style retail focused model. In the former the average overall business GP is 28% whereas in the latter the average overall GP is 45%. However, in the latter model you spend more time with customers selling items priced at $200.00 and more.
Hopefully my submission gets the attention of decision makers in Transurban and that they at least explore the commission they pay.
Newsagents deserve fair compensation for their efforts. The 55 cent compensation is not fair in my view.
Why my bigger picture view remains that our future is not in agency lines, I do understand many newsagents rely on these. hence my support for a better deal for them through representations such as these to Transurban.
I understand that City Link have also closed their payment offices on the the side of the freeways, so in terms of physical payments, Newsagents are all there is. Sounds like a sound negotiating position to me!!!