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Ethics

News Corp. makes it so difficult to cancel a subscription to The Australian that some are bound to give up

A couple of weeks ago I signed up for a digital subscription to The Australian because there was a story I wanted to read and I figured $4.00 was okay since I could cancel.

Two days ago I decided to cancel, before the end of the initial $4 period offer. I figured I’d go to the New Corp. website for The Australian, login to my account, click cancel, and be done. No, not so easy. In fact, it was hard, messy and slow, close to impossible.

News Corp puts up a ton of barriers on The Australian website, demonstrating a clear disinterest in even basic customer service.

I went to my account on their website, clicked manage my subscription, clicked cancel and the website provided a phone number. I thought that’s odd, I must be able to cancel without speaking to anyone. Anyway, I clicked chat, and here’s how that went.

So, I called, navigated their phone system, and eventually got to speak with someone. They were courteous, but not keen for me to go. I had to repeat I want to cancel several times before they agreed to take that step for me – but not before they wanted to know why I wanted to cancel and not before they pitched an offer for me to stay, two weeks free I think.

That phone call took between 5 and 7 minutes, all for a subscription that is cents a day. I wondered how many people would stay with the company going through that. It must be enough for them to have this commercial business model of barriers in place making it so hard and time consuming and threatening almost to cancel.

My customer experience with News Corp was frustrating, time consuming, off-putting. While the person I spoke to was courteous, it should not take me asking multiple times to cancel. The experience was bad enough that I won’t sign up again, even if I am desperate to read an article. Cancelling took too long, their obsession with wanting to know why even though I said it was none of their business was rude, confronting.

I get that I am not a natural News Corp customer – I think they negatively impact our democracy given the political lobbying campaigns they run dressed up as news under their mastheads – but I was a customer for a brief while and the process of ending that was appalling, so much so that I want to tell others considering subscribing with News Corp – don’t as they make it way to hard to leave them … appalling customer service.

The thing about online is that people was a frictionless experience, smooth, enjoyable. The News Corp experience was anything but. For a company that shouts everyday at some politicians and everyday people – telling us what to think, how to behave, they could do well to focus inwards and yell at themselves. Their online house needs to be improved.

On a scale of 0 to 5 rating the News Corp online subscription cancellation experience where 0 is appalling and 5 is excellent, I’d give it a .5 – primarily because the website did not crash at least and their phone system did not auto hang up on me.

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Ethics

Fringe conspiracy theory packaged as news on today’s Herald Sun front page

Today’s Herald Sun front page story is a disgrace in my view. Here they are going oxygen to a fringe conspiracy theory about Dan Andrews and ignoring the extraordinary and explosive evidence at the Robodebt Royal Commission last week. The former is political interference and the latter is actual news.

It shames me to play a role is making this trash available.

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Ethics

What did the $160M Powerball jackpot mean for lottery app downloads?

Lottery app downloads are an indicator of interest in the purchase of lottery tickets online rather than over the counter, in-store.

I am grateful to have received this graph via Taylor Collison. It plots app downloads for The Lott, OZ Lotteries, LotteryWest, Lottoland and The Lottery Office.

Almost all achieved significant growth on downloads with The Lott and OzLotteries being the big winners. The Lott accounts for 66% of the 290,000 downloads in the month of October.

It will be interesting to see the percentage of online versus in-store revenue once The Lott publishes those figures. As we have seen, the growth in online far outstrips anything achieved in-store. I would also like to see the volume of returning business from online customers. In fact, that information would be fascinating and useful.

It makes sense that people choose convenience. When you turn on the news and see lines on people snaking out of retail businesses under the pump to deal with jackpot sales it makes sense that people look for an easier way to purchase. And while video and images of lines of people make for stories, the reality is people were served quickly and efficiently, and helpfully with so many first-time and infrequent Powerball shoppers asking questions.

I know many newsagents thrilled with the revenue boost from the recent Powerball $160M jackpot. The boost in commission this far out from Christmas was welcome, and appreciated. Plus, I;’m tole, there was a boost in other sales because of the increase in foot traffic. Of course, the smart retailers with a good in-store configuration and tactical placement of impulse purchase opportunities did best from this.

I remain frustrated that The Lott continues to require so much of retailers in the knowledge of on-going migration from in-store purchase. A fairer approach would provide retailers with more freedom and less requirement to be a billboard for what is a growing online business. This freedom could strengthen these lottery agent businesses and thereby make them more valuable to The Lott into the future.

This is such an easy thing for The Lott to fix. A discrete trial would, I suspect, reveal to them that offering retailers more freedom to use currently The Lott designated space would have no negative impact on lottery ticket sales.

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Ethics

Kudos (for the most part) to Mitsubishi Pencil Australia for their plastic-free initiative

This announcement is good. It offers newsagents stocking these products a good story to share.

That said, it is frustrating that they launched this first with Officeworks – way to show small business retailers how little they mean to you Mitsubishi.

The uni-ball brand is regarded around the world for its high-quality writing instruments.

At Mitsubishi Pencil Australia are now focusing our efforts on the company’s sustainability efforts with the uni-ball range at the forefront of our campaign to reduce the use of single-use plastics.

From November 1st 2022, we will be rolling out single use plastic packaging across our hang-sell range.

Our new packaging marks a change in Australia, moving from plastic blister cards to 100% plastic-free packaging. The new packaging is currently available at Officeworks stores and will begin to be rolled out across all channels from November 2022.

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Ethics

We saved your business. If it wasn’t for us, you’d have been closed during Covid

This was the pitch put to me aggressively today by a sales person representing a fledgling body that claims to be a national association.

I think they were aggressive because I said no thanks to their email pitch, which came after an unscheduled visit to one of my shops.

The sales person really did say

We saved your business. If it wasn’t for us, you’d have been closed during Covid.

They said it was their lobbying that got newsagents declared essential.

The claim denies the work done by ALNA and many many others, including me. I lobbied state and federal ministers, but I claim no success for newsagents being declared essential. I ultimately think it was the lobbying of the newspaper publishers who had the biggest sway.

While the emotive claim, We saved your business. If it wasn’t for us, you’d have been closed during Covid, was sales bluster, it was offensive and inaccurate. That it was said shames the organisation this person represents.

The sales pitch was not only wilfully ignorant in my opinion, it felt scammy, claims of benefits without evidence supporting the claims. For example, there was a claim about eftpos fees. No details provided. rather, an ignorant request – Please send me a copy of your merchant agreement and I will organise a comparison report for you.

If I was running an association, I’d focus on representative related outcomes, like commission on magazines, newspapers and lotteries. Focussing on commercial deals, like eftpos, is what marketing groups do. As my own group, newsXpress,  has pitched, it introduced least cost routing to the channel years ago and saves an average newsagency thousands a year.

But, hey, this person can pitch what they like I guess. The only explanation I can come up with for their pressure driven approach is if they are on commission. I don’t know how they are paid. I hope commission is not involved as I don’t think associations would be well served being represented by commission sales reps.

How people sell is a reflection on their organisation, as history has shown in the Australian newsagency channel. The issue for me is the cost to people who may be duped along the way.

I am not naming the person or group they represent here because I don’t want them suing me.

I have written this blog post to warn newsagents to ask for evidence when any sales person makes a claim, and only accept claims for which they have and share this evidence, and to know that a claim to have saved the channel through Covid is false and misleading.

On the matter of saving businesses: newsagents saved their businesses during Covid, by serving their local communities.

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Ethics

Scots College students accused of using counterfeit $50 notes

news.com.au reports:

Scots College students allegedly use counterfeit cash at Double Bay shops
Students from an expensive Sydney private school have landed in hot water after a shop owner accused them of a low act.
Christopher Harris
October 20, 2022 – 7:08AM

Students from one of Sydney’s most expensive private schools have been caught on camera using counterfeit $50 notes in a bid to swindle an eastern suburbs newsagent out of $100.
Despite initially getting away with the alleged crime at Double Bay Newsagency, one student from the $40,000 a year Scots College returned just two days later in a bid to try the same scam again, Daily Telegraph reported.

Video of the original alleged fraud shows three students at the counter of the newsagency as one buys a pen. A second student in a blue shirt asks to swap four $50 notes for two $100 notes and appears nervous as he fumbles in his wallet for the cash.

Nine news also covered the story:

Some mentions of the story label it a prank while others label it a serious crime.

If I had evidence of anyone passing counterfeit currency in my shop, I’d report it to the police with the expectation of a thorough investigation and charges brought based on evidence, regardless of their social connections or the school they attend if they are a student.

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Ethics

The challenge of illicit tobacco in Australia

Talking with a newsagent the other day I was surprised at the extent of illicit tobacco products available at retail, impacting sales of those with legal tobacco products.

I mentioned this to someone outside our channel but who has tobacco products and they said the illicit route was the only way to make money. Hmm…

The ATO provides a pathway for reporting illicit tobacco: making a tip off.

How to report

It only takes a few minutes to make a tip-off and you can remain anonymous. If you know or suspect phoenix, tax evasion or shadow economy activity report it by:

  • completing the tip-off form (the form is also available in the Help & support section in the ATO app)
  • phoning us on 1800 060 062
  • lodging an unpaid super enquiry about your employer (but not about another business)
  • writing to us – mark all letters ‘in confidence’ and post to

    Australian Taxation Office
    Tax Integrity Centre
    Locked Bag 6050
    DANDENONG  VIC  3175

If you prefer to speak to us in a language other than English, phone the Translating and Interpreting Service (TIS) on 13 14 50 for help with your call.

Tax professionals can provide information by calling 13 72 86 (Fast Key Code 3 4).

Remember to make note of the reference number when you submit your tip-off form. You will need to quote it if you want to add any information later. You can make a tip-off in other languages.

There is also this infographic at the ATO website:

I understand the frustration some feel at time spent making reports like these. The thing is, the more reports the greater the engagement by those in a position to enforce. That’s got to be the hope at least.

Footnote: I haven’t sold tobacco products in my shops since 1997 when we quit cigarettes too create a more family-focussed shop.

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Ethics

Is the Optus data breach a big business problem?

Optus collected personal data from people, and, it appears, kept it long after the need for the data passed. Worse, if reports are accurate, Optus kinda left the data on the kitchen table with the back door open and the light on.

This is data requested initially from customers to check identity.  I’d like to know the government regulations / legislation requiring this identity check data to be stored.

The whole mess feels to me like a big business problem: overreach on data collection, no housekeeping to identify and securely delete data no longer required, poor data structure on data storage making theft of a useable batch easy, and inadequate protection of data required to be kept on-hand.

In my experience of decades working in software development, in government (CSIRO), big business (banks and mining) and in small business (Tower Systems), it’s the big business systems where problems like we have been reading about from Optus thrive.

In big business there are big IT teams, lots of stakeholders, lots of committees, lots of fingers. These are all very removed from the people personally responsible. In fact, who is personally responsible in a business the size of Optus: the CEO?, senior management?, the Board?, the Shareholders? … who knows.

In small business, if I ask a customer for an ID check for some reason, they show me their licence or passport and then return it to their bag or wallet. I don’t copy it. I don’t enter their details in my computer system. I don’t keep it longer than I need.

If I screw up and leave personal details of a customer out for anyone else to see or take, I am responsible. I know it. My customers know it.

Okay, it’s maybe not the best example. But, actually, it is. In small business we tend to be lean, and efficient, taking action necessary to get the job done. We, well I know in my own small business situations, I and those work work with me tend to not hoard things, we tend to not hoard data, and we respect value, and security. We use our safe for that, and we do not leave the door open or pass out the combination.

Small business owners are closer to their customers in a practical sense and in everyday life. We understand them and  respect them because our customers are us, or at least like us.

In big business, customers are numbers, pieces of data, and, too often in big business, data, especially old data or data not part of today’s push to drive the share price up is not as mission critical and may therefore be left on the kitchen table with the back door open – because no one was watching, wondering, or worrying about and for those who provided the data.

So, yeah, I read the Optus situation as a big business problem. Until there are share price impacting consequences for what has happened we should expect more events like we have seen in the last week.

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Ethics

Hey, Are Direct, it’s about time you offered newsagents scan-based trading

Supermarkets have had scan-based trading for years with magazines, from back in the days on the now defunct Gordon and Gotch, then to Ovato, and now to Are Direct.

Scan-based trading is where retailers pay the magazine distributor for what is sold. That’s it.

The distributor / publisher carries the cost of shrinkage (theft, damage) etc.

The retailer makes margin from what they sell. They do not have margin ‘stolen’ by theft, or damage or failed supply … and I include damage and failed supply because the Are Direct process for handling claims by newsagents is a mess, time consuming, starting with the assumption the newsagent is wrong. Indeed, it is so bad that plenty of newsagents don’t even lodge a credit claim.

Scan-based trading is unfair in that newsagents don’t have access to it while their competitors do. This provides them an unfair advantage, facilitated by the magazine Are Direct and magazine publishers.

It’s unfortunate that Are Media spends on the old-school display competitions and similar yet fails to deal with the unfairness at the core of the magazine distribution model to newsagents.

The magazine distribution ‘experts’ at Are Direct will say it’s a data issue, that newsagents cannot provide the same accurate sales data flowing from supermarkets. This was nonsense when put 10 years ago, it is nonsense today. I say that as the owner of the newsagency software company serving more newsagents than. any other with newsagents icy software.

I tell you what … turn on scan-based trading for newsagents with accurate data and even more newsagents would achieve the desired accuracy.

This is an easy step for Are Direct to take, a fair step, a socially responsible step and pro small business retail step.

Look at a local newsagency competing with a major supermarket a couple of doors away. When it comes to magazines, the supermarket has a better deal, they make more money and save more time from how they are dealt with by Are Direct than the local small business newsagent.

Every single person at Are Media who is in contact with newsagents needs to understand this, they need to understand the unfairness of the situation as in related to newsagents.

Turn on scan-based trading for newsagents and create a fairer model for our channel, show your support for us in a practical way, show us some respect. 

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Ethics

Columbia Journalism Review on Murdoch: Does Murdoch make the political weather or follow it? Yes.

This piece by John Allsop in the Columbia Journalism Review is a must-read for anyone interested in news, especially in Australia with the dominance of the Murdoch outlets. The headline is smart, and to me, true.

Does Murdoch make the political weather or follow it? Yes.

Any analysis of Murdoch influence interests me as we sell their products, which are a cause for plenty of conversation in the business. I think there has been a shift in Australia. Whereas 5 or so years ago the majority regarded Murdoch papers as sources of news, the majority today regard them as opinionated entertainment. Hopefully, their influence is waning here.

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Ethics

The supplier offer of cash in return for a long term agreement may not be good for your business

I was talking to a newsagent yesterday about their card situation. Their card sales are down 11.5% in 2022 so far compared to 2019 (pre Covid). They have seen me talk of double digit growth in newsagencies over the same period and wanted some advice.

They are half way through a contract with their card company. Because of the up-front money they received from the card company, it was called an advance on the projected rebate, they are locked in.

The problem for them is that the cards are not doing as well as projected in their newsagency. This means they are falling behind, which means the contract will likely need to be extended, unless they pay back the advance plus some costs associated with it.

They took the cash up front offer from the card company because they wanted extra working capital. It was pitched to them as an interest free loan and while it does not have a traditional interest component, the card performance has a cost that is, l in my opinion, higher than interest.

The cards this newsagency needs are card that perform well. That is not what they have, and they are locked in, which is distressing for them. Looking at their data at a pocket level, more than half the pockets are seriously under performing.

Newsagents beware.

The offer of cash up front for a long term contract may not be in your best interests, no matter how much you want / need that cash.

Of course there are some on the card supplier side who will talk the opportunity up and pitch it as a partnership designed to help you. What they want, the only thing they want, is a rooftop locked in. It’s what they sell you that matters and while they do want you to sell cards, having you locked in is even more important. Shock, horror: their interests are likely not aligned with yours.

There are many factors that determine card performance in a newsagency. Range is one. Newsagent engagement is another. Out of store marketing is another. Data based decisions is another. These decisions and engagements are best done on the basis of business and not because of a financial handcuff.

Back in 1996 when I bought my first newsagency I did accept card company money I return for a card supply agreement. Today, no matter the circumstances, I’d not agree to such an arrangement as I cannot see any benefit for the business.

The newsagent I spoke with on the weekend does have some avenues they can explore if they can prove that the agreement provided by the card company is holding their business back. Making their case in a small business claims forum would rely on their card sales data and them being able to show that it is worse than newsagents in similar socio-economic situation with cards from another supplier. If they were able to make that case, the agreement could be re-cast by the member hearing such a case, to make them more equitable for the newsagent. However, I suspect that the card company may agree to a resolution through mediation as they would not want the matter publicly aired.

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Ethics

Appalling editorial decision by the Sydney Morning Herald in seeking to out Rebel Wilson

So, it was an abundance of caution and respect that this media outlet emailed Rebel Wilson’s representatives on Thursday morning, giving her two days to comment on her new relationship with another woman, LA leisure wear designer Ramona Agruma, before publishing a single word.

Big mistake. Wilson opted to gazump the story, posting about her new “Disney Princess” on Instagram early Friday morning, the same platform she had previously used to brag about her handsome ex-boyfriend, wealthy American beer baron Jacob Busch.

This ‘story‘ in The Sydney Morning Herald reflects, in my opinion, poorly on the editorial decisions of the newspaper.

They are upset that Rebel Wilson decided to come out, ahead of their story. While we will never know if Rebel would have made the announcement as and when she did, what we do know is that the enquiry from the SMH and their advice they would run the story preceded it.

In the SMH story they try and justify their behaviour.

Considering how bitterly Wilson had complained about poor journalism standards when she successfully sued Woman’s Day for defamation, her choice to ignore our discreet, genuine and honest queries was, in our view, underwhelming.

This, in a story that reflects poor journalism, poor editorial decisions and reads like bullying.

No news outlet, no person has the right to out anyone. It is no one else’s business until the person or people directly involved decide. When it is done it is hurtful, harmful and, too often, dangerous.

There is no newsworthiness in Rebel Wilson’s personal life, unless your business model is predicated on making money off of gossip.

The story in the SMH makes them the story, their editorial choices and how they treat gay people, threaten them, bully them. That’s how I see it. And, yes, I have a vested interest in that it happened to me years ago, not in the SMH or any newspaper, but my agency was taken from me by gossips and others.

How the SMH has handled the story could impact others in the closet, famous or not as it shows anyone that outing someone is okay and that pressuring them about their sexuality is okay. It is not okay to out someone and it is not okay to pressure someone to come out.

The SMH has diminished itself through its behaviour on this. The masthead owes an apology to Rebel Wilson.

Why does this matter here? We sell this stuff and some days I hate that I do.

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Ethics

Advice for suppliers pitching to local small business retailers

Do you have any idea how many pitches a retailer gets from suppliers every day?

Many, too many, every day. And, what makes it worse is that there is a sameness to the pitches – over written, loaded with claims and rarely tuned to my local business needs. Most emails or calls or visits come from a place of selfishness, based on what they need. A better approach would be them thinking first how can they help, how can they add value to your business without you having to commit?

There is too much lazy communication. And, I say this as a retailer and a supplier to retailers. I have made the mistake of sending emails and letters that were selfish. When I switched my approach to add value, or at least try and genuinely add value, sales surged. It built trust. Giving away knowledge that any retailer could use without having to spend anything is key to this.

So, what matters to retailers, what does a supplier need to do to get their attention?

In my opinion – I say that deliberately since every retailer will have their own views on this – here is how a supplier can get my attention:

  • Be clear and efficient in communication. Don’t over write, don’t wrap your pitch in fluff.
  • Be factual. Give me data, which can be fact-checked, that shows the value of the pitch to my business. For example, what Google search data is there to indicate shopper interest in the products or the product categories?
  • Be helpful. Explain what you provide beyond inventory that could be helpful: images, social media collateral, product descriptions, electronic invoices.
  • Be focussed. Sending me a link to your catalogue is hilarious. Sure, I have an hour to click your link, probably apply for a password if you are really bad at your job, and trawl through pagers looking for what I am not sure. The fewer keystrokes I have to click to engage with you the better.
  • Have stock. Suppliers selling in advance of having stock only to find not everything arrives is a waste of our time.

I am in business to sell product as this is what enables me to pay rent, wages, overheads and myself. Anything that you send my or pitch to me that does not obviously support my needs is a waste of my time.

Thinking about this, sell price, margin and stock turn are all factors. I am keen for products that leverage all three. A supplier pitching a product at a discount has me wary, regardless of the extent of the discount. Cheap product is useless unless it sells, and, ideally, faster than usual.

For too long, our channel has been pitched to through old-school approaches. Covid, thankfully, has shown that we can thrive without some of these. The future is ahead of us, not back in those past ways. Smart suppliers have learned through Covid, they have found ways to pitch efficiently and effectively, to cut through and deliver to retailers what retailers want / need. Fewer rep visits. fewer cold calls. Fewer bland emails.

When I am buying today I preference:

  • Genuinely Australian made.
  • Immediately available.
  • Free samples for products that sell more easily if there are samples for customers.
  • Ranges that tell a story.
  • Ranges I can leverage to find new shoppers.

Here are some other points related to this discussion about supplier engagement with local retailers …

You are not entitled.

I appreciate that may came off as offensive. That’s not my intent. But, it is true. We owe you nothing, regardless of your connection to our business. Any supplier is only as valuable as their last product supply.

No thanks.

That’s the best default response to every supplier pitch. Start with no. make them work for it. make them work harder to get their inventory into your shop.

Start with no and encourage them to make a business case.

You don’t have an appointment.

That alone should have you showing any drop-in the door. The moment you agree to meet with a drop-in rep weakens your position. The more we make the point that drop-ins are not welcome the better they will treat us.

A coffee, a beer or lunch are irrelevant to what you should stock.

There are plenty of old-school suppliers who think buying you a coffee or a beer or more is the best way to get you to bu from them.  I’m in business for business reasons, not social reasons. Let’s stay focussed on business, and is good social times flow, great – but let’s not lead with that.

Buying space.

Some suppliers seek to guarantee engagement by paying for shelf space or fixtures. Too often, this does not serve the retailer well. While a supplier funding a nice looking fixture or covering the lease cost of some space may feel like a good move for cash flow, it is only a good move if the inventory they please there turns well, better than what you could do yourself. This type of funding comes at a cost to the business.

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Ethics

UK partworks publisher Eaglemoss ditches Aussie newsagents after years of loyal service for a paltry margin

UK artworks publisher Eaglemoss has decided to supply the Doctor Who part series from issue 201 on direct to customers in Australia. The decision was announced in a letter to collectors.

Eaglemoss has not written to newsagents thanking them for their years of loyal service.

I reached out to the company through a couple of social media platforms querying the decision and received no response.

Eaglemoss has consistently failed to provide newsagents reasonable supply of artworks titles, so I wonder how they will go at providing their direct customers with product. Given their lacklustre customer service, I wonder how Australian subscribers will fare. There is no evidence to suggest it will go well.

It is disappointing the artworks experts at Are Direct were unable to retain previous distribution arrangements for newsagents. I wonder what their take is on the decision? Maybe I missed an announcement from them on this.

Is this the end of artworks in Australian newsagencies? It’s hard to say. But, the future is not bright. That won’t bother plenty who gave up on artworks after years and years of supply failures and the ever present competiton of sweet direct subscription deals.

To some us, however, artworks have been terrific traffic generators that we have sought to leverage into other opportunities. I have written about this plenty of times here. While their value has waned in the years since the closure of the Bissett business, a good part series was one I’d always engage with – primarily because of the TV campaign that specifically tagged our channel. It was the one time we were exclusively named in a TVC.

But back to Eaglemoss and their decision to ditch local Aussie newsagents as the retailers of the Doctor Who part series. Shame on them for their treatment of Aussie newsagents. We deserve better from them. Their Australian collectors deserve better from them.

It will be interesting to see how this plays out.

Of course, this decision plays into a narrative about magazines, which is challenging to avoid. The problem is, we have big business vested interests who are unlikely to engage in genuinely transparent dialogue on the topic.

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Ethics

What’s the value of newspaper advertising?

Clive Palmer is reported to have spent close to $100 million on advertising during the federal election campaign with a significant chunk of that spent on newspaper ads.

If seats in parliament was the goal, the advertising failed.

While we could critique the ads as being the cause of the failure, the issue could also be the medium.

Is newspaper advertising as valuable as it once was?

We already know newspapers are not as valuable for the once rivers of gold real estate, employment and car advertising.

I am sure people far more skilled than me will dissect the Palmer ad spend and consider what it may indicate for newspapers and their publishers.

I’d be particularly interested in scholarly assessment of the Palmer spend coupled with the clear bias of News Corp in its propaganda type coverage supporting the Coalition parties and negatively covering Labor, and their even more negative coverage of the independents.

From a newsagent perspective, we are part of the distribution channel for print newspapers. The topic should interest us in the context of the role of newspapers in our future. I think this election showed us that newspapers, particularly the News Corp newspapers, are not as important or influential as they have been.

Will this 2022 federal election be something we look back on in the future as a point in time where the value the medium was significantly diluted because the actions of some newspaper publishers demonstrated disrespect for what was once a valued moral authority.

I know of a couple of newsagents who recently moved newspapers from the front of the shop to the rear because of election coverage in their main daily newspaper.

After writing this I caught up with the latest Media Watch …

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Ethics

We need better reporting of federal election debate over the minimum wage

You’d think it’s the end of the world as we know it if there is a $1.00 an hour increase to the minimum wage based on the ‘news’ coverage of this debate. Across a range of media outlets business lobbyists, conservative politicians, retailer representatives and some retailers themselves have been saying how awful such an increase would be.

Yesterday, on ABC radio Melbourne and 3AW there were retailers saying products had gone up 200% and 300% and other costs had gone up and a $1.00 an hour wage increase would eat into margin.

Gee, I wish there was fact checking of these claims.

And, I wish there was more comprehensive questioning.

And, if there is a case, it would be good for transparency around the details.

Pretty much every retailer I know has has signed a lease agreeing to an annual 5% increase in rent, sometimes more. That’s right, they contracted this 5% rent increase to be annual.

So, here’s my question? If people make a business, as so many retailers say, why would there be any hesitation on a 5% increase in pay for people … for without them, there may be no business.

Like, why agree to an annual locked-in 5% increase in rent costs but not labour?

A business on a knife edge that goes under for a $38.00 increase in the cost of an employee for 38 hours in a week is a business with a problem anyway.

People on the minimum wage are likely to spend what they earn. That helps the economy. That $1 an hour is beneficial for the economy.

We need smarter journalists who ask more thoughtful questions and who challenge selfishness. I want to hear the retailers asked about paying more rent every year and how they justify this while not wanting to pay their valued employees more every year.

It would be good to sit with a retailer who says they cannot afford the extra $1 an hour and unpack their business numbers from P&L back through inventory data, roster decisions … all decisions that gets the business to the point where $1 an hour is not affordable.

Sure, I want my business costs to fall. And, sure, I want to make more money. The reality is that we are all participants in this one economy. Constant squeezing that the bottom end is bad for those being squeezed, the economy and society. We should care about that.

As for the claims about products costing more. Some do cost more. But they cost more for everyone. There are smart ways to deal with product cost increases. It is lazy to complain. It is appalling to suggest that because of those cost increases you should not pay your employees more.

I appreciate my take will upset some. That’s not my intention. I want an intelligent discussion about wages and business costs, so that all participants understand the facts and, hopefully, through this better understand more sides of the debate on wages.

But, let’s think for a moment, how could small business retailers respond to a $1 an hour increase in labour cost?

The best response is to engage with it on the shop floor. Here are my suggestions:

  • Make sure everyone working in your business understands the numbers: where you make  money and where you do not make money. Yes, this means being open on the business numbers. A couple of decades ago there was a movement led by the awesome Jack Stack, Open Book Management, it helped turn plenty of businesses around. The more those working in the business understand the numbers the more likely they will work with you.
  • Show the connection between what the business makes and what they make or could make through more hours or, even, a bonus(!!).
  • Set goals for the business and people in the business who can make a difference to the business performance.
  • Make decisions based on evidence for its is these decisions that make local retail shops more money than gut decisions.
  • Drive your overall business GP. The higher that is the more you are insulated from increases in your two biggest cost areas: labour and occupancy.
  • Think about each decision through the prism of: does this position me better to deal with rising costs, including rising wages costs.
  • Turn around and look back into your business for it is likely there are things you can do right now to improve your position. Here is the most easy move: look at inventory you have on the shelves that has not sold in 6 months or more. It’s dead stock. Dead cash, unless you sell it for something. Mine your business data and find opportunities like this.

I could go on. If a $1 an hour increase in labour cost bothers you, confront it as a business opportunity rather than a pure negative. It’s a door opening opportunity I think.

It frustrates me that the wages debate is a debate, with sides. All of us in business benefit if more people in the economy, our economy, have more money to spend, especially if they are in the cohort likely to spend money. If we could all talk about this without taking firm sides we’d have a better opportunity of navigating a path forward we are all happy with.

23 likes
Ethics

Herald Sun shows itself as political lobby mouthpiece, again

This political claim in the headline published by the Herald Sun is misleading in may opinion.

The decision to change the game was driven by the lottery businesses from what I understand. That is where it initiated, which does not make it a tax drive.

The Herald Sun ‘report’ feels like it is designed to make the Victorian government look bad. It could also anger lottery customers, which could impact sales, and hurt newsagents.

It’s a non story other than that OzLotto is changing in the hope of, from what I understand, of driving more jackpots, which are expected to drive more sales.

News Corp does run a range of lines across its Australian platforms about tax. What they should disclose at the bottom of every article is the amount of company tax paid in Australia by the company and the percentage of gross revenue this is. Michael West covers this and recently shared:

Murdoch’s News Australia Holdings paid nothing for the seventh year on the trot, despite $1.7bn in income, and Foxtel – as reported here – has been conveniently and slyly “disappeared” offshore to the secrecy jurisdiction of Delaware amid rumours of a sharemarket float.

My point is this media company often shouts about tax, especially as it related to the Labor side of politics, while not reporting on its own decisions and actions relating to its tax contribution to Australian society.

10 likes
Ethics

Must read: Paper cuts: Why daily newspaper deliveries have become a lottery

The Citizen (A PUBLICATION OF THE CENTRE FOR ADVANCING JOURNALISM, UNIVERSITY OF MELBOURNE) has published a terrific report into the actions of News Corp. and Nine Media in removing newspaper home delivery from local small business newsagents and putting it under the control of a faceless, contactless mess of an organisation.

I am grateful to Petra Stock for the time she took to understand the issues and speak with some directly impacted. Her reporting on the impact on local family-owned Lygon Media speaks volumes to the disinterest in the offices of News Corp. and Nine Media in delivering a local service for local newspaper readers.

Lygon Media Distributors – a newspaper distribution business co-owned by Fabian Pizzica – made its final delivery run on Sunday, 27 March. Mr Pizzica has been selling or delivering newspapers since 1989, working from age 18 in his father’s Lygon Street newsagent.

In the mid ‘90s, brothers Fabian and Nick joined forces with cousins Robert and Pat (who has since passed away) to form the newspaper distribution arm of the business.

From a few suburban paper runs they grew Lygon Media into a service that stretched from the northern suburbs down to Docklands and Port Melbourne and delivered around 15,000 papers a day.

Lygon Media Distributors closed after newspaper distribution changes. Photo: Petra Stock

Until recently, the family-owned company was one of eight-to-10 remaining larger newspaper distributors, which alongside around 100 smaller newsagents, delivered daily papers around greater Melbourne.

As one of the larger operators, Mr Pizzica says Lygon Media had hoped to win a contract under the new model when News Corp invited tenders last year.

“We were out there buying up territories, increasing the volume. We were spending money and borrowing money to buy more territories, thinking that we’d be big enough for [News Corp] to look favourably on us,” Mr Pizzica says.

But their efforts didn’t deliver a contract. Now, he says, he’s out of a job and the business “isn’t worth anything and we have to pay off debt”.

We’ve all seen, and heard, how upset newspaper customers are with the poor service being provided by the News Corp and Nine Media controlled newspaper home delivery, which can only lead to reduced sales for print editions of their mastheads.

The report by The Citizen provides timely and appreciated coverage.

Personally, I am so lucky to have sold my home delivery runs in 2006, back when they had a good value. But through my newsagency software company, I speak daily with newsagents who did not or could not do this, newsagents who have had tens of thousands, and more, in goodwill ripped from them by the changes to newspaper distribution. This all started in the newsagency channel more than. 20 years ago. Those representing newsagents at the time have plenty to answer for enemy opinion.

15 likes
Ethics

Jellycat takes Kmart to court

UK plush maker Jellycat has taken Kmart to court reports The New Daily.

Jellycat alleges Kmart’s customers have been misled or deceived into believing Kmart’s plushies are genuine and reputable Jellycat toys because they have similar features.

Jellycat wants the federal court to issue an injunction forcing Kmart to stop selling the toys and to pay damages to compensate the company.

Jellycat is a big brand in Australia with 104,000 searches here every month. Jellycat bunny, the character at the centre of the federal court claim, is searched 5,400 times a month in Australia, indicating it to be a very popular searched-for plush item. But wait, there’s more. There are 830 variations of the Jellycat bunny search in Australia, resulting in 21,500 actual searches a month by people in Australia.

As plenty of newsagents enjoy terrific success with Jellycat, including my own shops, this will be a case to watch. I have linked to The New Daily story on our shop Facebook pages and noted that we only sell authentic Jellycat, sourced from Jellycat.

3 likes
Ethics

Desperate plush offer to try and move stock

A local plush importer with product that looks very similar to major brand, category leading product is offering heavily discounted product. This is hitting retail at less than half the price of the established leading brand, and driving some confusion for shoppers and frustration for nearby retailers.

While suppliers need to do what they need to do to move stock, retailers in a well established and commercially lucrative category niche notice this and will remember it when ordering in the future.

There is little shopper loyalty to be found in business won solely on price.

I first noticed this situation when contacted by a couple of retailers who were frustrated that what to them looked like knock-off product was pitched nearby, challenging their $45,000 a year revenue from this category. Once they realised the supplier behind the move and that they purchased other product from them in a different category, they made some decisions.

I get that suppliers with an overstock situation need to move stock. This situation, however, feels different, even targeted against a competing brand.

4 likes
Ethics

This ABC story about Pearcedale Hardware is a must-read story for all small business retailers and every Australian who cares about or relies on small business retail

Pearcedale Hardware is closing today and the ABC has published a deep-dive into why:

The cost of doing business

Published

For many residents in the quiet township of Pearcedale, the local shops are the heart of the community.

On this weekday, the complex an hour’s drive south-east of Melbourne is beating strong.

Shoppers exchange cheerios across the car park and small talk about the impending rain as they bustle, car keys in hand, between the 13 shops.

…

The shop was their retirement plan. They hoped to rebrand it and work towards selling it, believing they could get a few hundred thousand dollars.

But they say things began to look shaky when their lease lapsed in 2019, and the owners wouldn’t sign a new agreement with them.

They were on a month-by-month arrangement, when in May this year their property agent emailed them a new leasing agreement.

“[I was in] disbelief. I couldn’t believe what they were asking,” Adrian says.

The landowners were tripling the rent — from $29,687 a year to $88,638 a year.

Be sure to read the whole story.

There are many good landlords out there who go above and beyond for their small business tenants. There are also plenty of landlords who suck.

This story is a reminder that we small business retailers sign our leases, accepting the terms and conditions, accepting the risk.

When a lease goes to month-to-month, that’s what it is. We need to manage our business with that expectation and do our own planning, rather than relying on a decision from the landlord.

I appreciate it can be difficult and challenging. But, it’s best we expect the worst and plan for it, to protect ourselves and our business as much as we can … because, too many landlords do suck.

Retail is fundamentally changing in ways we can see and, more importantly, in ways we cannot see. We have to be as far ahead of that curve of change as we can be. This means disrupting your own businesses.  Running a shop with one prime source of income (the shop) is an out of date model. we seen to diversify as to what people buy, how they buy and the locations they buy from in the retail world today. This approach spreads the risk.

Back in the day, opening the front door of your local shop was the key marketing activity. Not now. Not for many years.

I have been in the situation of the folks at Pearcedale Hardware, facing a massive rent hike. I said no thanks. I am lucky to have a diverse business such that closing one shop would not hurt too much. But … I evolved the business to be that, to not rely  on one location.

I appreciate many local small business retailers don’t feel they can do that due to capital, local situation or other factors. But, there are ways to insulate your business from the impact of a massive rent hike. The time to seek those ways out is long before you need to … and that is the core point I’d make today.

15 likes
Ethics

As retailers we have a trust obligation to our customers

There is a newsagent who has access to limited edition product sold to them on the basis that they place it in-store for customers to purchase but who, instead, places the product almost immediately in eBay, selling for two and three times the retail price.

I understand the appeal of making two or three times the gross profit, yes it really is that much. I do not understand the breach of supplier terms and the breach of trust with shoppers.

We will find out soon enough if their behaviour negatively impacts their own businesses or other newsagents who also purchase from the supplier. Yes, that is the risk here, that all newsagents are lumped together and judged based on the actions of one.

The value of limited edition product is the foot traffic it can attract and the joy of shoppers able to purchase it from you. This is more valuable long term than the repyutational damage that will come if you keep the product and sell it yourself for two or three times retail.

8 likes
Ethics
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