Top Gear powers on
It was good to see the latest issue of Top Gear
The business end of Father’s Day
We are now at the business end of Father’s Day, the last week when somewhere between 60% and 90% of Father’s Day purchases are made. We have a story across the front of the shop as well as deep inside across a variety of product categories – cards, gifts, confectioners, lotteries, magazines, books and stationery.
The photo does not capture the full range. To some it may look a little hodge podge. It does look much better in person.
We have sought to demonstrate the range we offer as well as the value of our offer. Father’s Day is no Mother’s Day when it comes to card and related sales. Our in-store efforts are working against that, hence our full-throated display.
Sales are already excellent, showing that going early with a season can work very well, even for Father’s Day.
More Intralot success
Here is proof of local effort paying off. Our Intralot Lucky Bingo syndicate sold out Friday. This is the first time it has sold out. Sure it took a few weeks to build a following. So did the Wednesday Tattslotto syndicate when we started that. All it takes is some local marketing effort. This is where we as retailers have a resonsibility to build the Intralot story in-store. We will watch when this syndicate sells out and start another. This will build with small steps.
OH&S issues with newspaper delivery
Respected ergonomist David Nery published a report into OH&S issues surrounding the handling of newspapers. The study was undertaken at in South Australia the request of the ANF. Click here for a copy of the report. While based on the Sputh Australian experience, this report provides an insight which all distribution newsagents will find valuable.
I have had the report since mid 2006. The ANF asked me to to publish the report as they were involved in negotiations with publishers about the report’s findings. I think enough time has passed for me to publish the report here.
There is no territory
Newsagents still talk of territories and complain when a newsagent or other small retail business offering similar product moves too close to their business.
We ought to embrace competition for it is out of robust competition that fight harder and smarter for our own businesses.
Another business will not stop competing just because a newsagent asks – they are likely to fight harder to prove the competition point.
There is no better illustration of the benefits of competition than
The image on the left is of a flyer a group of the traders have produced. They are happy to be listed next to each other even though they compete. Visit the businesses at lunchtime and you soon see that while they all offer food, each has a different take. Such are the benefits of competition.
The mindset of these traders is the mindset we newsagents need when it comes to small business competitors. I am not talking here about the majors like Government Owned Australia Post outlets getting into our categories – that is a whole different issue.
If an independent stationery outlet opens near us, we need to respond in our own in-store offer. Likewise a card outlet. I have done this to myself at Forest Hill with our Sophie Randall card shop in the same centre as a newsagency I own. Both have had a very good year. Despite the competition, the newsagency has experienced excellent growth in card sales.
If you find yourself near Brighton in Melbourne around lunchtime, check out Martin Street and see the value of robust competition. The food and the coffee is worth the visit – in several of the stores.
The best counter offers
The small range of Darrell Lea confectionery and the colourful pads from For Arts Sake are proving to be the best counter offer at our Forest Hill store. While we have short-term feature product on the counter proper, these two rows of products are consistent performers. They have good price points and are easily understood – critical in a counter offer where a customer will take a few seconds to add to what they are already buying. The success of the Darrell Lea and For Arts Sake products keep them at the counter longer than anything else.
Promoting Father’s Day in NZ
This is a photo of a window display at a Whitcoulls shop I saw in
Inside this store they had many A4 posters promoting a card offer – a free greeting card when you spend more than $40.00. Given that books around for almost half the floors pace in-store I suspect this is more about driving that category than cards. Whitcoulls certainly appear keen to use greeting cards as the discount mechanism to drive business based on the stores I saw yesterday.
Kenny’s Cardiology opens in NZ
I was in
The Whitcoulls (magazines, books, stationery, cards, calendars etc) right next to Kenny’s was responding to the new competitor with a 50% off call cards pitch. While I am sure they have their reasons, the signage looked a bit desperate.
Productivity Commission report released
The Market for Retail Tenancy Leases in Australia, released by the Federal Government’s Productivity Commission earlier this week is the result of the Inquiry earlier this year. Newsagents were represented at this by NANA, the ANF (under old leadership), Several individual newsagents and myself as a representative of newsXpress.
Given the terms of reference of the inquiry, the recommendations are useful. I hope that they lead to action by Federal and State Governments.
The absolute key for newsagents in any lease negotiation is to have a business the landlord is very keen to keep or to bring to their centre.
Lateline discusses newspapers
Newsagents are sure to find the video of a discussion on ABC’s Lateline last night between Eric Beecher, publisher of Crikey and former editor of the Sydney Morning Herald, and Richard Ackland, Sydney Morning Herald Columnist, on the future of journalism most interesting.
The future of newspapers
Eric Beecher, publisher of Crikey, and former editor of the Sydney Morning Herald, makes sense in his call for government investment in quality journalism.
While many newsagents may not care about the quality of newspapers, I see this as being an important issue for our channel. For more than 100 years we have been the specialists. Our specialisation has been developed around newspapers. Newspapers have been key to driving traffic to our doors. If newspapers soften and become even more about lifestyle than news, publishers are less likely to rely on specialist retailers to support the category.
One way we can reinforce our commitment to newspapers, beyond the marketing tips I published here a week back, is to embrace a broader specialist newspaper offer. By extending our range of foreign language newspapers we can tap into a growth segment of the newspaper category. In my recent sales benchmark study, foreign newspaper delivered double digit growth in many newsagencies – counter to the trend for capital city dailies. At our Forest Hill store they account for between 8% and 10% of total newspaper sales.
Another specialisation opportunity is around demographic specific newspapers. For example at our Forest Hill store we are proud supporters of the Melbourne Observer newspaper. This weekly generates sales of between 50 and 100 copies. Customers are as loyal as foreign language newspaper customers.
In these two examples, while we are not generating the volume of the capital city daily, we are serving a loyal constituency and thereby diluting the impact of any fall in sales of the dailies.
There are many conflicting views among commentators about the future of newspapers. A common view is that being local is key to the future. I see foreign language newspapers and titles like the Melbourne Observer fitting the local model. It is not difficult or expensive for newsagents to chase opportunities like these.
Successful sound cards
We are enjoying good success with these sound cards from Skansen. The stock turn we have achieved is double the usual stock turn for cards in our store and more than double for cards in newsagencies nationally. Other stores offering the same product nearby has not been a barrier.
These cards help add to the theatre of retail – it is good to hear the song play when a customer browses a card.
One customer on Wednesday highlighted another benefit of these cards. She was buying a birthday card for her brother who is blind. She was thrilled to find a sound card.
Australia Post expensive for ink
I should be grumpy at Australia Post continuing to ignore the provisions of the Act under which it operates – the latest catalogue shows the Government owned organisation selling items way outside its charter. What chess sets and BBQ sets have to do with a postal service is beyond me. As I said, I should be grumpy, but I am not. In this catalogue they have a page devoted to ink. All but two of the items they sell are more expensive than our price. This means I can point to the Government owned post office opposite my newsagency at Forest Hill as being expensive and out of touch on price. Even with our lower prices our margins are healthy. Either the Australia Post buyer has not done well or the organisation is too greedy. Either way, they have positioned themselves as expensive when it comes to ink and toner.
Celebrating Live to Ride
I almost missed this. Live to Ride, the magazine for lovers and riders of the great Harley-Davidson motorcycles is 20 years old with its latest issue which came in Wednesday. This special collectors edition commemorates this milestone. Any specialist magazine reaching 20 years of continuous publishing is something to celebrate and feature in-store. Well done Live to Ride!
Age staff passionate about their masthead
“Age staff are passionate about their masthead and their readers, and are disappointed that the managers of the company appear willing to sacrifice quality journalism for the sake of the bottom line.” Michael Bachelard, Senior Journalist with The Age, quoted by the Herald Sun in a story about the decision by Age journalists to strike tomorrow.
Age staff should not be disappointed. There has been evidence for at least two years of the managers sacrificing quality for the sake of the bottom line. One only has to look at their selling of ad space to cover editorial content and their own masthead for this evidence. Maybe the Age journalists only realised when their jobs were put on the line. the reality is that their jobs were on the line the first time a headline or story was covered with one of those post it ads I have gone on about here for two years.
Bill Express money returned
I have been contacted by three more newsagents over the last 24 hours who have each had three months of Bill Express equipment payments refunded following the inform,ation published here. In two cases they escalated the matter away from their bank and to the Ombudsman as I suggested. That one action made their bank realise they were the customer.
It is good to see banks acknowledge a mistake and fix this by returning money to the customer. This should encourage other newsagents who are yet to fight for their rights on the Bill Express front.
The new beauty magazine
Primped is the latest Australian title to launch in the Australian beauty market. But you will not see this new title in newsagencies. In fact, you will not see Primped in any retail outlet. It is an online site and it is free. It is from Michael Hannan’s Independent Digital Media. Hannan owned federal Publishing before that was sold to News Limited last year.
What is happening here with Primped and hundreds of other online titles is real. It will impact on our businesses. Newsagents and some association Directors can continue to ignore this (to our peril) or we can sieze the opportunity and chase a bright future. It all comes down to how we react to change. Now is the time for us to invest in our businesses, individually and collectively.
Welcome back Pink Ribbon magazine
I am glad that newsagents are the distribution point for the Pink magazine published for the National Breast Cancer Foundation. Pink is provided free with the latest issue of Australian Women’s Weekly at any participating newsagency – while stocks last. We are promoting AWW and Pink this at our front counter – the best spot in the house. Using the pink flyer as wallpaper makes AWW itself stand out while featuring the Pink offer at the same time.
With the Olympic feature on the cover and the free Pink magazine we expect this month’s AWW to be a mighty success.
On Pink, newsagents were the first distribution point years ago and then lost this because of a commercail deal. We had to turn many away who came asking for the magazine last year. I am glad we have it back and that the NBCF supporting the newsagent connection on their website.
It is important that newsagents get right behind Pink. Our practical support demonstrates appreciation for their commitment to our channel.
2009 recycled paper diaries
The Enviro range from Debden is the other 2009 diary range of note we have in store right now. Produced on recycled paper, this range is fashionable and sustainable. As with my previous post, it will be important for us to ensure that our teams know about the back story for these diaries.
Speaking of diaries, even though we do not have our full 2009 range out yet, sales are good – showing that August is not too early to be selling 2009 dated diaries.
Carbon neutral diaries
I am pleased we have the Debden Kyoto range of diaries in stock. These carbon neutral 2009 diaries will appeal to our customers. That we have them in-stock demonstrates that we have taken care to offer an environmentally friendly product. Printed on recycled paper, these diaries are sure to be a hit this diary season. Product knowledge is the key with the Kyoto range – ensuring that every team members understands what this range stands for and why that is important.
Driving stationery sales
In the sales benchmark report I released a week ago, I outlined some ideas for addressing the decline in stationery sales. I have added to that list to provide newsagents ideas worth considering. Our stationery sales ought to be growing, not declining. From what I can see we let ourselves down. We don’t understand the key measurements of stock turn and return on investment. We are happy to leave stock sitting on the shelves and underperforming for too long. This lack of attention to the department rives customers elsewhere. Here are some suggestions:
- Make a decision as to what you stand for when it comes to stationery. If you stand for quality, buy accordingly. If you stand for price, buy accordingly. From what I see, our best opportunity is to stand for convenience. This means trusted brands are a fair price.
- Ask your staff what they think you stand for in stationery.
- If you or any of your staff cannot say what you stand for quickly then you’re in trouble. If you don’t know then your shop will reflect this and customers will see it.
- The convenience pitch is, in my view, more closely aligned with how consumers would see newsagents.
- Print a report of when an item last sold. If it has not sold in six months and if the sales for the previous six months were less than the value of the stock on hand quit the item. Be ruthless – get it out now!
- Have a massive sale to quit this dead stock. Getting, say, ten cents in the dollar is better than getting nothing from stock which is otherwise not selling.
- Draw a layout of the stationery department as it is today, marking off key categories. Note down the annual revenue by category. Inf you can work it out, note the profit generated by each area – if you cannot do this, ask yourself why.
- Create a new layout based on how you think the stationery department should look – based on your business plan.
- Take every stationery item off, clean the shelves, clean the stock and put it back up, blocking by brand as you go.
- In rebuilding stationery, embrace change. Range for the customer you want. This is likely to be different to the customer you thought you had.
- Create an in-store promotional calendar, ensure you have a feature, large or small, on stationery at the counter and or at the front of the shop each week.
- Choose stationery items to feature in other categories – pens with crossword magazines, paper near ink, a hot deal next to newspapers etc. If people will not visit your stationery department, take the stationery department to them.
The shopfit challenge
We opened our fourth Sophie Randall store yesterday at 211 Toorak Road, Toorak. This store presented some real design challenges – it is only 60 square metres, round in shape, street fronted and has a column in the middle of the space.
Our first two designs fought against the odd shape. It was only after we embraced the circular shape that we came up with the fan approach for cards.
We have grouped card giving occasions by modules and even thought we have only been open a day, customers appear to like this approach.
The learnings from making the Sophie model fit into a smaller space will now be applied to our other stores. These retrofit changes will also include finessing of our corporate image in the windows and new fixturing for our feature cards.
As we have done for all of our Sophie stores, we used Zone Design out of Melbourne. They are innovative and deliver a good outcome.
Free scrapbooking content online
Digital Scrapbooking magazine is a reminder that more of what we sell is moving online. People will need less of the bits and pieces we sell for scrapbook albums. They will also need less of the physical scrapbook magazines. I am not sure why we need a magazine on digital scrapbooking. Check out Scraps of mind, Digital scrapbook place, Free digi scrapbooking and Mandy’s Digital Scrapbooking Blog to name just a few of the hundreds of blogs which provide free access to information and tutorials on digital scrapbooking. We need to watch our magazine categories carefully and push back on distributors slow to protect us from categories which are fading.
Business discussion for newsagents
Tower Systems is hosting a free online business discussion for newsagents at 2:30 next Tuesday, September 2. All you will need to participate is access to a computer with broadband and a phone for as toll free call for the audio. This will be an interactive discussion around the state of newsagency retail and the ideas which people participating find work for them. To book, please email bookings@towersystems.com.au. There are only 15 places available for this discussion.