Author: Mark Fletcher

A fax from the Administrators of Bill Express to newsagents this afternoon has some interesting points:

The Bill Express network/platform has been maintained/supported with the assistance of an unrelated group of companies, the Technology Business group of companies. While the Technology Business companies maybe structured to be unrelated, one only has to look at the ownership and operational structure to see that they are related. Certainly newsagents signing agreements years ago with Bill Express and Technology Business International would have seen the two as related.

The Technology Business Group purport to own the servers/terminals utilised to deliver the Bill Express network/platform. The Administrators are currently investigating this assertion by the TB Group. TB Group’s purported ownership of the operation of the infrastructure restricts Bill Express from accessing the relevant servers and/or terminals. I wonder if this can get messier?

A number of companies in the TB group were placed in Administration and the Administrators of Bill Express were informed that all relevant staff who have the knowledge and skill to effect the Bill Express network/platform were terminated. How can you effect a fire sale when the people who understand and operate the assets are no longer available?

Newsagents are starting to remove Bill Express equipment from under their counters. The Administrators will need to provide advice on what they ought to do with this.

The ANZ bank has confirmed the terms of the eftpos terminals provided to Bill Express newsagents today:

• There is no contract for the first three months.
• Newsagents do not have an obligation to continue with the terminal after the three months.
• After the first three months, the monthly fee will be $29.95.
• The credit card and debit card fees will b those offered under the previous Bill Express arrangement.

The benefit of the ANZ terminal is that newsagents have something which they can use right away while they assess what is right for their business long term.

Maybe now the ANF will back off talking down the ANZ gesture of sending terminals to Bill Express newsagents.

Not surprisingly, more companies in the Bill Express stable had administrators appointed yesterday.  Pod TV Pty Ltd, Xip media Pty Ltd, both companies associated with the much lauded in-store advertising screens, both had administrators appointed yesterday.

On April 28, Swish Group (ASX code – SWG) announced a deal to take over management of the Bill Express in-store advertising screeens.  The ASX announcement specifically names Bill express Limited subsidiary Xip media Pty Ltd. Curiously, no announcement about this relationship has been made since by SWG to the ASX and newsagents have not heard anything from SWG.  In February, Bill Express withdrew the $210 a month it was paying newsagents to compensate for the advertising they were running on the in-store screens.

Mobile EFT Pty Ltd, Mobile EFT Plus Pty Ltd and Cheque2Cash Pty Ltd also had administrators appointed yesterday.  These are also companies in the Bill Express stable.

Mi-Systems Pty Ltd, Technology Business Holdings Pty Ltd and Technology Business Systems Pty Ltd appear to be unaffected at the moment by the troubles besetting their associated businesses.  As I blogged on June 28, Technology Business Holdings is key to the technology business tree.  This company, like so many in the Bill Express mix, appears to be controlled by Sandro di Donato.

We faxed two pages of advice to newsagents yesterday answering questions about the wash up of Bill Express entering administration.

This advice addresses the most common questions we have been asked in hundreds of calls over the last two days.  Newsagents with more questions are welcome to call on 03 9524 8000 or on 0418 321 338.

Express Payroll Solutions Pty Ltd and Technology Call Centre Pty Ltd had administrators appointed yesterday.  Both employed people who provided services to Bill Express.  As I blogged yesterday, my understanding is that employees were let go without being paid entitlements including salary payments for time worked this week.

Regardless of what we newsagents think of Bill Express and the situation they have left for newsagents, employees losing their jobs without entitlements means tough times for some families.

I have been told that an ANF staffer has called some newsagents today and told them to NOT install the eftpos terminals sent by the ANZ bank. This, on the back of ANF email communication to newsagents today advising newsagents to approach the ANZ terminal offer with caution could look to some like a call for a collecive boycott.

For five years the ANF offered robust endorsement of the ANZ eftpos arrangements. Late last year when considerably better rates were available for newsagents elsewhere, the ANF continued its support of the ANZ. Now that now the ANF no longer has a financial relationship tied to the ANZ it is saying the their rates are not competitive.

I would have thought that an association would always recommend what is bets for memebrs rather than what is best for it. It is this pursuit of its oiwn commercail interests over the commercail interests of members which created the problem for the ANF in this Bill Express mess.

As for the possible collective boycott, wise counsel to the ANF would be that they get the loose mouthed staffer to stop telling newsagents to boycott the ANZ.

Most staff working at Bill Express Eaglemont headquarters were terminated today I’m told. The only exceptions were those working on the APN call centre.

The people let go work for service companies associated with Bill Express, companies controlled on paper by Sandro di Donato. It appears they will be treated the same way as the employees of Loyalty Direct as I blogged here in May – no benefits

I’m told that the Liquidator would not promise and salaries or termination benefits and that General Employee Entitlements and Redundancy Scheme (GEERS), information was passed to all staff.

As was done with Loyalty Direct, several key staff are probably going to be offered personal contracts while the company looks at what it can rescue from the mess.

The nature of the technology behind Bill Express that it cannot hold together operationally with the key technical team now let go from the business.

The Australian Newsagents’ Federation has let newsagents down with this announcement to the press about Bill Express.  here is some of what the press release says:

Newsagents today are dealing with the fallout of the collapse of Bill Express after news of their decision to enter voluntary administration.

The Bill Express electronic platform provided over 3500 newsagents nationally with the ability to process bill payment, mobile phone recharge, calling cards, prepaid credit cards and other products and services.

Bill Express’ decision to enter voluntary administration means many newsagents may not be able to process bills and phone recharges in the usual way.   …

“While this may have a major financial impact on the newsagent network, newsagents will be working to ensure the effect on the consumer is minimised where possible,” MacAskill said.

The ANF and newsagents have been working together to source alternative EFTPOS facilities with electronic mobile recharge and value added services from other providers.

In the meantime, newsagents nationally are stocking up on physical mobile recharge cards in the event that electronic mobile recharge is not available, although an alternative bill payment platform has yet to be found.

Rather than talking down newsagents, the ANF would have been smarter in talking up the considerable preparations newsagents have undertaken in preparation for Bill Express to go down.   For at least 1,000 of the 3,500 Bill Express newsagents it is business as usual.  Why would the ANF not mention this?

Newsagents have alternative eftpos, mobile phone rehcarge and phonecard supply available now.  the ANF holds back from talking about most arrangements since it does not make any money from them.

The ANF needs to decide if it is to be an association representing members or a commercial player chasing profit.  It is the pursuit of the latter which got it into the Bill Express mess in the first place.

Overwhelmed with calls from newsagents about switching from ANZ merchant services to the St.George arrangements I negotiated, St.George has created a team in the Melbourne office. The new exclusive contact number for our arrangements is 1300 731 723.

Newsagents do not need to be an ANF member to access the rates I have negotiated. The ANF will not make any commission from the arrangement. Nor do I.

The St.George terminal fee is less than half the ANZ fee.

A news story on the ABC website today has some unfortunate misinformation attributed to the Australian Newsagents’ Federation.

Around 3,500 newsagents across the nation can no longer process bill payments, electronic mobile phone recharge PINs, and the Bill Express-owned Bopo pre-paid credit cards.

The ANF says a replacement system is yet to be found.

Chief executive Don MacAskill says some family-operated newsagencies will struggle

“There is no doubt that this is going to have serious ramifications on newsagents’ business,” he said.

Mr MacAskill says newsagents have no choice but to continue paying around $500 a month for computer software made redundant by the demise of Bill Express.

Many newsagents can process mobile phone top up and sell other electronic voucher product.

When the ANF says a replacement is yet to be found, it means that a replacement from which the ANF can profit is yet to be found.  The ANF made at least $200,000 a year from Bill Express.

In any statement about Bill Express, the ANF needs to disclose that it was a commercial partner of Bill Express and for a considerable fee it promoted Bill Express to newsagents.  The ANF is right to say “this is going to have serious ramifications”.

The ANF ought to know that newsagents have been receiving legal advice which contradicts its statement regarding the lease of the Bill Express equipment.

The ANZ Bank is said to be shipping thousands of terminals to newsagents and other retailers in the wake of shutdown of the Bill Express network today. This is a late move by the bank which has watched as various players have chipped away at their merchant services footprint across the Bill Express network. I’m told the new terminals will start arriving today and and that the bank has waived the usual monthly fee for three months.

As announced to the ASX late yesterday, the ANZ has an interest in 13.2% of shares in Bill Express.

Meanwhile, OnQ, 37.62% shareholder in Bill Express has announced that it will make a statement to the market about its future today. I’d expect it to follow in the footsteps of Bill Express.

The other public company to watch is ETT. Bill Express owns 43.44% of shares in this business which is currently voluntarily suspended from trading.

The phones have rung hot since around 11am today when it became clear that Bill Express was starting to implode.  Newsagents suppliers and media outlets wanted to talk about what happened to Bill Express and what the next steps might be.  There are several parties I really feel for as a result of the shutdown of the Bill Express / Dialtime network today:

• Suppliers relying on the network for income.  Some of the phonecard companies and other electronic voucher products relied in the Bill Express / Dialtime network for significant revenue.  To have cashflow this cut off immediately will hurt until they make alternative retail network arrangements.
• Newsagents yet to make other arrangements.  Despite the warnings, more than 2,500 newsagents do not not have alternative arrangements in place.  This will cost between 5% and 15% of revenue depending on the business and will take several weeks to fully replace with alternative arrangements.
• Consumers who have relied in Bill Express / Dialtime outlets for mobile phone top up, convenient bill payment or even BOPO visa recharge are left hanging.  In rural areas this will, hit hard.

There is no doubt Bill Express and relates entities  OnQ and ETT will be in the news for a while to come as their future is finally resolved.  In the meantime, many small businesses and consumers will be affected in personal ways, beyond the shareholder and major supplier losses which will dominate the news stories.  The nature of the Bill Express business is such that there will be many personal stories emerge over the coming weeks.  These are stories I’d like to hear.

Given the news from Bill Express today, we have been swamped with calls about alternatives. To help newsagents navigate the eziPass option I have prepared the information below.

EZIPASS, A BILL EXPRESS ALTERNATIVE. Newsagents looking for an alternative to Bill Express are encouraged to consider eziPass. Using eziPass, newsagents can easily sell: Visa Prepaid (BOPO alternative), mobile phone recharge, phonecards, magazine subscriptions, NSW fishing licences, CityLink top up and tourism tickets. eziPass does not currently offer a Bill Payment alternative nor does it offer Optus or Vodafone recharge.

MORE THAN 700 NEWSAGENTS USE EZIPASS. Just eight months old, more than 700 newsagents have signed up with eziPass.

HOW EZIPASS WORKS. eziPass is software which runs on any Windows based computer connected to the Internet and with a thermal receipt printer attached. If a customer asks for, say, a Telstra $30 recharge, you select this from a menu, confirm that this is the product you want and the voucher is printed. As the name says, easy! Because eziPass is PC based, you can run this on as many computers as you wish.

EZIPASS IS FREE. eziPass is free for all newsagents. Tower Systems provides telephone support for free as well.

HOW TO SIGN UP FOR EZIPASS. Go to www.ezipass.com.au and click on retailer sign up. Three are three forms to complete:

1. Complete the eziPass sign up form and fax this to 03 9524 8099.
2. Complete the SCX Visa Prepaid Signup Pack and fax this to 1300 650 843.
3. Complete the Access phonecards Signup Form and fax this to 07 5526 9737.
4. Email support@towersystems.com.au and when you have submitted these forms – we will track your applications with each of the companies for you. Please include your business name and contact number in the email.

WHAT HAPPENS ONCE YOU SIGN UP FOR EZIPASS. The various forms are processed and we send you a CD by Express Post. Under separate cover, for security reasons, we send you your password. You can start using eziPass once the three suppliers have processed your applications. This could take up to two weeks. However, we are working with each to fast track applications and get you running ASAP.

RECOMMENDED EFTPOS ARRANGEMENTS. For Eftpos facilities we recommend are those from St.George/Bank SA. Call 1300 768 975, tell them you are a Tower newsagent. If they say you need to be an ANF member, please let me know on 0418 321 338. You do not need to be an ANF member. They may try and sign up for mobile recharge. We recommend against this as it probably involved a long term contract through ePay.

AUSSIE PHONE CARDS – 30% COMMISSION FOR EZIPASS NEWSAGENTS.We have negotiated a 30% commission on Aussie phonecards for eziPass newsagents – this is 50% more than commission on other phonecards. Aussie offers good quality lines and no surcharges. Some cards, for example, have a charge per day regardless of whether you call.

EZIPASS CONTACTS: Technical support: 03 9524 8000 or by email at support@towersystems.com.au. For other queries please call Mark Fletcher on 0418 321 338 or Andrew Halpern 03 9524 8040.

Bill Express announced to the ASX at 1:41pm today that the Directors have resolved to appoint administrators to the company today.

Of the 3,600 newsagents using Bill Express I’d estimate than at least 2,500 are as of today without mobile phone recharge, phonecards and other products and services offered by Bill Express. Most of these newsagents continue to have $495 a month (plus GST) taken from their account by a company associated with Bill Express.

The tragedy is that newsagents stumped up close to $90 million in capital for Bill Express in the form of leases for equipment. It is these leases for now useless equipment, which unlocked the millions for the company, which newsagents have been left with. The wash up will make interesting reading but do little to help newsagents who will carry a huge financial burden.

The ANF, the newsagent’s own national association, robustly promoted Bill Express to newsagents and profited handsomely from this arrangement. The association has all but washed its hands of Bill Express as soon as revenue from the company dried up. I’d expect newsagents to quit the ANF over this.

Bill Express has just advised all retailers to suspend selling products or accepting Bill Payment through its facilities. here is the text of the announcement:

Bill Express advises that due to its current circumstances we request that you suspend vending all prepaid products, processing any bill payment transactions or taking any bopo card top-ups until further notice.

I have been told that Bill Express appointed an Administrator last night and that they have eight weeks to find a buyer for the business.  While I have been unable to confirm this report, I note that Bill Express has announced to the ASX this morning that the Al Othman group has withdrawn its recapitalisation proposal.  This was the only white knight at the Bill Express table.  I expect that this afternoon’s announcement will be regarding Administration.