A blog on issues affecting Australia's newsagents, media and small business generally. More ...

Author: Mark

Newsagents could do better on XchangeIT compliance

While some in the newsagency channel like to talk down newsagents when it comes to compliance (as happened with this thread recently), the facts show that newsagents are doing quite well.

Of the 2,381 newsagents signed up for XchangeIT, 2,220 are eligible to be considered compliant as it cannot include POS Solutions DOS software and other packages which don’t meet the compliance standards.

The most recent assessment, two weeks ago, indicated that 89.9% of eligible newsagents, 1,996 in fact, were sending sales data. However, only 45% of eligible newsagents sending sales data day in day out on time and without fail and passing what XchangeIT calls their ITC’s – Integrity, Timeliness and Continuity. 55% of newsagents fail this.

This data was provided to me on Monday by XchangeIT.

The big challenge is around continuity. Continuity is about sending the files each day AND the content of the files – that today’s file fits ‘neatly’, in terms of sales quantities, with yesterday’s file and so on. It is essential that all files fit so that a whole of business view can be created. The most common reasons for failure of continuity are system setup or a failure to follow standard processes at the end of the trading day – both are easily fixed.

Newsagency software which meets the XchangeIT standards creates the sales files so that they meet the requirements. The challenges are around setup and execution at the store level.

While the 45% number is not ideal, that 89.9% are sending sales data indicates a better result than some writing here have recently suggested.

Newsagents should talk to their software provider to determine if they have their system setup in the appropriate way to meet industry standards. Each of us getting this right is good not only for our own business but for the newsagency channel as a whole.

Click here for a copy of overall compliance advice from Tower Systems. There is a series of EDI advice sheets on the Tower website with specific information about driving compliance to the XchangeIT standards – rely on these for the detail.

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magazine distribution

Appreciation from Better Homes and Gardens

bhg-cert.JPGWe like many newsagents received a certificate of appreciation from the Better Homes and Gardens team at Pacific Magazines. Congratulating us on our efforts for the title and the sales achieved.  This recognition is appreciated.  The certificate itself is something we can proudly display at the counter.  This is the type of thing customers will notice and comment on. It helps to differentiate our newsagency from others who have missed out on the certificate.  Thanks Pacific.

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magazines

Promoting Zoo and UFC

mag-ufczoo.JPGWe are promoting Zoo and UFC magazines side by side with a simple yet highly visible in-location display in our men’s magazine aisle given the joint promotion by ACP this week.  The display will run for the week or as long as we have stock – we have limited stock on both titles.

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magazines

Promoting UFC magazine

ufc-display.JPGHere is the display promoting UFC magazine created by the team at newsXpress Knox.

This display is on the lease line facing out into the shopping mall.

I like the use of this type of stand to draw attention to the product and with a pocket for stock.  It;s been used successfully most recently for Famous.

We will leave the UFC display in this location the at least first week and then maybe move it to the side -shoppers quickly get store blind.  We have a prize pack arriving on Wednesday with which we will further ‘beef’ up the display.

We also have UFC featured in with or sports magazines.

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magazines

North QLD Newsagents hit by freight hike

Cyclone Yasi is being blamed by freight company Followmont for a hike of up to 19% is freight charged levied against small business newsagents in North Queensland.  The increases are effective from today.

While Followmont has its own needs to consider, the price hike is an unfortunate kick in the guts for newsagents at a time when their resources could be better used in their businesses.  Click here to see the Followmont announcement.

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Newsagency challenges

UFC magazine looks like a winner

ufc.JPGI was fortunate to receive a preview copy of UFC magazine last week and have a good look through the launch issue.  UFC will have a broader appeal than I suspect many newsagents would think.  While the logical place for the title will be with sports magazines, I think it would also perform well in good impulse locations where it will be seen by a broader cross-section of shoppers.  we plan to co-locate the title: next to our top selling newspaper for a few days and then as the Magazine of the Week at the sales counter.  This is in addition to high profile launch activity with an aisle end display facing into the dance floor.  We will be offering one lucky customer a gift pack of UFC merchandise.

Any magazine launch is welcome.  The launch of UFC magazine is especially welcome given the extraordinary interest in the UFC franchise here and the planned spend by ACP in promoting the title.

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magazines

Moving the magazine display unit

bhgpromo.JPGThe small footprint impulse display unit we received for promoting Better Homes and Gardens is getting a fair work out in my newsagencies.  We keep moving it to hot spots around the shop rather than anchoring it in one location.  The stand is small enough to sit at the sales counter, next to the newspapers, at the front door or even next to any display on the dance floor.  By moving it every few days we can combat store blindness from customers and, hopefully, attract more impulse business.

I prefer display units which can be moved.  This way we can more easily present a fresh experience to regulars.

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magazines

More newsagents at Sydney Gift Fair

Yesterday saw even more newsagents at the Home & Giving fair at Homebush and the Gift Fair at Darling Harbour in Sydney.  This is terrific.  It feels like newsagent attendance numbers are significantly up on last year.  I will be interested to see if there is an impact on the traditional newsagency trade shows later in the year.

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Gifts

Trifecta of winners at Victorian awards

Congratulations to the winners at the Victorian Newsagent of the Year Awards announced last night in Melbourne.

  • Distribution Newsagent of the Year – Patterson Road News and Tatts
  • Retail Newsagent of the Year – Queenscliff Newsagency
  • Technology Newsagent of the Year – newsXpress Beechworth

These businesses are beacons in their respective communities, operated by newsagents deserving of the kudos and recognition each award brings.  They do the newsagency shingle proud.  Congratulations!

I’d encourage other Victorian newsagents to visit these businesses.  You won’t be disappointed.

I am proud to note that each of these businesses relies of software from my newsagency software company, Tower Systems.

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Newsagency management

Plenty of newsagents looking at gifts

I was at the Home & Giving Fair in Sydney all day yesterday.  This event is a major part of the three fair gift event on in Sydney over five days.  Home & Giving is twice the size this year.  It was terrific to see many newsagents at the event.  All were looking for new products to consider for their businesses, products which fit with existing customer traffic.

There were new newsagents as well as long term (20+ years) operators wandering the aisles looking at gifts, homewares, jewellery and personal items such as scarves.

While I could suggest this supplier or that, you really need to visit the fair to look at all the opportunities, touch and feel the product, compare the suppliers and consider what is right for your own business.  This is why I continue to advocate that newsagents should ensure they get to these fairs.

Some newsagents I met yesterday will spend four days across the three fairs in Sydney.  These newsagents make excellent money from the gift and homewares categories.

I was thrilled to meet people who visit this blog at the fair as well.  It’s a buzz when epople come up and introduce themselves as a regular reader and comment on what they get from this place.  Thank you!

I was at the fair partly to be on the Tower Systems stand.  There, I met with newsagents moving into gifts, owners of pure gift and homewares businesses as well as owners of card and gift businesses interested in migrating into newsagency lines.  The evidentpursuit of change was exhilarating.

Comparing the 2011 Home & Giving Fair attendees I met yesterday with those I met with a year ago, I would note that there is significantly more optimism today. From the newsagents there was no dwelling on negative stories … they were focused on a bright future.

Among the suppliers on the floor of the trade show, there are more new products and more new suppliers.  These are positive indicators for retailers including newsagents who are keen to embrace change in their businesses.

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Gifts

Promoting Caravan World magazine

mag-caravw.JPGCaravan World magazine is one of those titles which is not featured all that often in merchandising displays.  We are giving it some attention with an  in-location display this week.  All we have done is make a few copies of the cover and fan those our atop a double half waterfall of the title.  It’s a simple yet effective display.  People walking down this aisle will see this display half way down and, hopefully, browse the title.

We can’t promote all titles in high traffic front of shop locations.  these in-location displays are designed to make shopping the magazine aisles more interesting.

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magazines

Promoting the Herald Sun AFL fixture

hsfixture.JPGOur Knox team did a terrific job promoting the Herald Sun AFL fixture giveaway at the counter with prime positioning of the fixture and a sign promoting this.  We also promoted the AFL fixture across the counter in an up-sell offer.  In footy crazy Melbourne this has been a good campaign to run, especially on a Saturday.

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Newspapers

Misreporting on Supanews

Supanews is not part of the voluntary administration of RED Group.  While RED Group is a shareholder in the Supanews operation, the newsagency franchise businesses has, I am told, a separate commercial structure.  A check of the ASIC website this morning indicates that no Supanews business is currently in administration.

It is disappointing therefore to read and hear that some in our channel are saying that Supanews is in administration.

Of course, Supanews will be impacted one way or another by the administration of RED Group.  As to where this goes who knows?  In the meantime, those who report and commentate need to get their facts right.

Disclosure: My newsagency software company Tower Systems is a supplier to some Supanews stores.

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Newsagency challenges

How to lose customers Borders and A&R

The announcement yesterday that Borders and Angus & Robertson stores would require customers to spend double the value of gift cards for them to be able to use gift cards will be regarded as a serious misstep in their administration.

While the administrators have to make decisions based on what is right financially for the secured creditors, this must also include consideration of what is right for the future of the brands – if the business is turned around and comes our of administration or if they are to have a value in the event that they are ultimately sold.  I am especially concerned for the Angus & Robertson franchisees and the impact to their businesses of the decisions of the administrators.

Twitter, blogs and other online news and comment channels fired up yesterday on the news.  With every angry comment damage was done to the Borders and Angus & Robertson brands.

This story has a long way to go before we will know where it ends.

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Customer loyalty

Promoting marie claire beauty

mc-brandext.JPGWe are promoting the Priceline supported marie claire beauty brand extension with tactical placement in a full face display unit next to marie claire itself. We also have a pocket placed with our volume weekly titles – we cycle a range of titles through this high traffic weekly location with good success. I am pleased with the allocation by Pacific Magazines – it is respectful of the sell through of the parent title.  Too often brand extension supply quantities do not reasonable reflect sales of the parent title, leaving us with a cash flow challenge.

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magazines

Promoting Wheels magazine

wheels-feb16.JPGWe are promoting the latest issue of Wheels magazine with an aisle end display at the end of our men’s magazine aisle.  Like all of our magazine displays, you can purchase off the display – this is vital for in-store displays.

I am not a fan of billboards which shoppers can not purchase stock from yet I see this all too often in newsagencies.

We have allocated a week to the display as the space is in high demand.  If we are seeing sales, we have a secondary location where we can situate a smaller display.

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magazines

Why did Borders and Angus and Robertson fall into administration?

Journalists reporting the appointment yesterday of administrations to RED Group, the parent company of Borders, Angus and Robertson, Whitcoulls and Calendar Club, have been pointing to online sales as the cause.

I think that they have been too quick to feed off the line put about by publishers and others in the book space.

While I am no expert on the finances of RED Group, I suspect that the appointment of administrators came about because of debt levels, flat retail, the challenges of online book sales and, importantly, the impact of migration of print to digital.

The other factor is the challenges for the Borders brand.  The UK group closed in 2009.  The US group last year released the Kobo reader, three years after Amazon entered the space.  From 2007 until last year, Borders was not attracting revenue from the rapidly growing digital books business.  This is business which has been growing exponentially for the last three years.  In fact, growth in sales of digital books has taken off just the same way growth in the sale of digital music did around six years ago.

While I am no expert on the Borders business, I would speculate that the migration of sales from print to digital has been a bigger factor in the appointment of administrators to RED Group here in Australia and the filing of chapter 11 bankruptcy in the US of Borders over there.

The RED Group story is a story Australian newsagents ought to watch and study as it unfolds.  I am certain that in the analysis we will find insights which are useful to us as we contemplate what the newsagency of the future may look like.  I say contemplate as if newsagents are doing this.  Unfortunately, too many are not.

Newsagent continue to build shop fits which are suited to ten and more years ago, shop fits which are not flexible and with large fixed magazine departments. There are too many shop fits with fixed location and too big newspaper displays.  Too many newsagents operate loss making newspaper home delivery businesses.  Too many newsagents act as warehouses for stationery rather than buying on a just in time and more commercially viable basis.  In short, too many newsagents are not adapting to changed conditions.

Maybe RED Group in Australia and Borders will trade out of their situation.  That is, after all, the goal of chapter 11 in the US and administration here in Australia.

In the meantime, I hope that the news of yesterday is a wake up call to newsagents to look carefully at their business plans.  If they take the bait and believe that the problems are due to online sales of books they they will not do this.  If they accept that the problems for Borders and Angus and Robertson are, in part at least, caused by a migration from print to digital then they they will consider their future and revise their business plans as a result.

The potential for negative impact of print disruption on our channel is considerable.  Not planning could be a fatal business mistake.  Planning for it could uncover the best business opportunities for newsagents in decades. I think that the opportunities for our channel, or some in the channel at least, are excellent.

Footnote: From what I can tell looking at the ASIC website, the Supanews group is not currently affected by the RED Group issues.  However, media reports suggest otherwise.

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Media disruption

Featuring Better Homes and Gardens

bhg-feb11.JPGWe are promoting the current issue of Better Homes and Gardens for the with this in-location display.  This was put up on Wednesday and will run through the weekend.

Making a few copies of the cover and featuring the promotion of the free chicken cookbook creates a display which stands out in the magazine aisle.

As I have written many times previously, I often find this type of simple and home made display more commercially effective than the type of display which magazine publishers offer cash prizes for.  I am disappointed that publishers continue to reward newsagents for pretty displays rather than incremental business.

Rewards should be for incremental business alone. How we get there should not be a factor.

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magazines

The challenge of Vogue Collections 2011

vogue44.JPGWe received one copy of Vogue Collections 2011 making creating a display a challenge. The price is $44.95 and this heightens the challenge of what to do given the theft risk.  The answer is placement at the counter with the sign drawing attention to this being a SPECIAL EDITION.  Since counter space is premium, we will leave the title for a week and if there is no interest or comment we will most likely early return in time for this month’s cut off.

While I can understand the allocation of the title this is one time I would like to have received two or threee more copies and some collateral with which to chase sales.

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magazines

Borders Australia under administration

Ferrier Hodgson were appointed voluntary administrators of REDgroup Retail Pty Ltd reports the Sydney Morning Herald.  RED Group owns Borders, Angus & Robertson, Whitcoulls (in NZ) and Calendar Club.  Not sure of the impact on the Supanews business in which RED group is an investor as I understand it.

Meanwhile, Amazon UK has reportedly just announced free delivery to Australia.

What an amazing day for book retailing around the world!  Amazing in the sense of the combined effects of disruption to print, online sales, the knock effects of the GFC and the high Aussie dollar.

As I mentioned earlier today, anyone relying on print products in retail need to take notice.

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Book retailing

Borders US files for bankruptcy

US book retailer Borders has filed for bankruptcy protection and announced the closure of 200 stores.  On the back of the closure of Borders UK in 2009, the brand has taken a considerable hit. While the commentary is that a high level of debt is a key factor in this bankruptcy, the decline in book sales must also be a key factor.

Any retailer selling print related products has to be restructuring their business model ahead of serious sales decline and not after.

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Book retailing

Is Scanned Based Trading coming to Australia?

Some magazine retailers in the US have had Scanned Based Trading  for years.  It has been suggested to me that it may be switched on in Australia for one or two national retailers soon.  This would see them only pay for scanned magazine sales.

The benefits of Scanned Based Trading to participating retailers would be:

  • No returns.
  • No cost to the retail business of shrinkage.
  • No warehousing cost for magazine stock.
  • A reward for reliable business data.

I have discussed Scanned Based Trading with a number of publishers and while they say they are supportive, they refuse to be the first.

magazine publishers and distributors signing up to Scanned Based Trading would need to do this for newsagents as well as our competitors.  There would be no better encouragement for compliance with EDI standards and the financial and operation benefits of Scanned Based Trading.

The EDI standards followed by newsagents were established by the magazine distributors.  If the standards are cited as a barrier then the distributors need to address these.  If the quality of sales data is an issue then the distributors need to provide irrefutable evidence of this and it is an excuse which is rarely backed up by evidence.

Newsagents should want Scanned Based Trading as it means that publishers, newsagents and distributors are financially connected by magazines sold … as opposed to the current model where distributors are paid only for what they put on their trucks and the returns we send back.

I have had many discussions with representatives of publishers and distributors on the topic of Scanned Based Trading over many years – as the owner of a newsagency software company and even when I was on the ANF Board in 2004.  Today, in 2011,many newsagents are more prepared than ever to deliver on this opportunity.  The key is how we negotiate this opportunity.

From a software perspective, everything necessary is ready now.

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magazine distribution

Read this if you want to get into gifts

Newsagents wanting to get into gifts should consider getting to Sydney this weekend to the Gift Fair and the Home & Giving Fair.  Both fairs are excellent events packed with products which many newsagents already have good success with.

Take your time walking around the fair. Visit all venues.  If you are new to having a gift department, focus on products which work well together to provide you with a point of difference.

Don’t spend any money until the second day at least. Remember that you are not your customer and that your customers are probably not your colleague’s customers.

I’ll be at the Home & Giving Fair on Saturday on the Tower Systems stand and on Monday walking the halls of the Reed Gift Fair and at a catch up drinks on Monday night.

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Gifts