Author: Mark Fletcher

By backup, I mean do you take a copy of your business to an external drive, a USB stick or some other device for safe keeping? Or, do you have a cloud backup facility whereby a perpetual offsite backup us undertaken?

Attacks on computers are increasing. These can range from a attack that corrupts data through to an attack that denies you access to the computer until you pay a ransom.

Not backing up every day is stupid. The cost of cover from this could be thousands in terms of IT expert fees or even more if you are looking to sell your business in the next year and do not have current business performance data on which to set a price.

I heard of a newsagent who paid $5,000 to recover business data from two weeks prior to when they were attacked. That could have been avoided had they followed basic backup advice.

Oh, and if you are backing up every day, have it checked to make sure you are actually backing up.

Not backing up and not checking your backups is like leaving the front door of the shop unlocked and the light on.

If you offer a parcel pickup service in your newsagency I urge you to ensure you have the space, resources and business processes in place to provide a good customer experience.

Customers only visiting the newsagency to collect a parcel will expect quick, knowledgable service. If they do not get this they will most likely want to complain.

There is good anecdotal evidence that online shoppers embrace opportunities to complain. E-commerce sites and social media make complaining easy through feedback, ratings, reviews and in other ways.

A poor parcel pickup experience is something online shoppers will complain about. They are empowered because of the ease with which they can complain online – often not to those who could address their complaint.

I have been contacted by newsagents with parcel pickup services seeking advice on how to deal with complaints against them. I have been contacted through this blog by shoppers who want to tell their story of poor parcel pickup service fro newsagency businesses. I have been contacted by parcel service businesses asking how to get newsagents to provide better service.

The parcel collection customer they wants…

1. Easy access to the pick-up business.
2. Fast service once inside.
3. Straightforward processes.
4. Security for their parcels.

The most common complaint I have heard relates to speed of service in the business. While they are happy to wait, they want to be served in sequence. They do not want to be told to wait until other customers are served.

Here is an example of a complaint from a parcel collection customer, in their own words, about there experience:

The lady that works at the newsagent would not give me my parcel at the store she wanted to to serve the other two customers there and told me to wait even tho I was waiting first anyways after she kept serving the other customers I said are u gonna serve me now and then she went off her head yelling at me and even her husband told her to be quiet, I’m not happy at all with the service cos she wanted me to wait till she serves the whole store then I’ll get my stuff.

This is a common complaint.

Anytime someone approaches me about a parcel collection service issue I suggest they deal with the retailer as they are likely to have more leverage. I also suggest they contact the parcel service business connected with the newsagency business as they, too, are likely to have more leverage.

Parcel collection can be challenging for retailers. You should only take it on if you are prepared for the challenges and prepared to provide the level of service customers expect.

Small business retailers, including newsagents, get understandably upset when they see products they ordered from a rep who visited in another shop near to theirs. Their preference is that suppliers do not do this.

It makes sense in a small town for there to be product differentiation between local retailers.

Today, however, I want to unpack the supplier rep cost base so you can think about why it might happen.

A rep on the road has a cost to the business of around $100,000 made up of salary, maintained vehicle, on-costs such as work cover, insurance and related as well as any incentive for performance.

A rep is on the road, on average, forty weeks of the year allowing for annual leave, other leave, training, meetings and times when retailers don’t want to see any reps. While the 40 is a generous number, let’s go with it.

Forty weeks is 200 working days, or 1,400 working hours after allowing for breaks.

A rep needs to earn at least $71.42 in gross profit per work hour to cover their costs to the business let alone other business costs.

However, reps and suppliers tell me that rep travel time accounts for around 30% of work hours. This takes the work hours in a year to 980. At 980 work hours a year, a rep needs to earn $102.05 in GP to cover just their cost to the business.

The reality is, given business overheads, the cost of a warehouse, marketing and other costs, a rep would need to earn between three and five times this in GP to cover the business costs.

What I have written above is based on discussions with wholesalers in a range of retail channels including one wholesale business owner who took their ten full-time reps off the road and went to a purely online model of service after doing a deep dive into the costs their business model.

Given the slim margins in wholesale, usually considerably less than in retail, I can see a rep needing to write between $2,500 and $5,000 a day in wholesale business to cover their costs and the business costs.

The objective of this post today is to have you consider these numbers next time you see a rep in your shop. Consider what they have to make and how they might go about making that.

While it does not justify them selling to a nearby competitor, it may explain why it happens.

With more wholesalers moving to an online only model, there is an opportunity to purchase from this type of business, one less livelily to walk a few steps up or down the street to sell to a competitor what they just sold to you. It is not the answer, but it could be one answer.

Next time you get angry about a supplier selling to a competitor, think about their business and what you think they could do differently to benefit your business and their business without causing the anger it has caused. Talk to them. That conversation could benefit both businesses.