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

Hubbed

ANF responds to questions on Hubbed

Adam Joy, COO of the ANF, has responded to an email I sent him about correspondence relating to Hubbed he sent to a newsagent re Hubbed. In that correspondence Adam inferred that I was on the ANF board when to chose to go with Bill Express. I was not on the board then. I emailed Adam inviting him to revise what he had written. I also asked some questions about Hubbed.

Click here to see a response from the ANF to questions and my complaint about their letter to a newsagent.  I’ll post my original email to Adam as a comment to this post.

Here is the response I sent yesterday to Adam’s letter. This response needs to be read in-conjunction with Adam’s letter.

Adam,

Thanks for responding to my email.

You have inferred that I was on the ANF Board when the Bill Express decision was made. I was not. In fact, I joined months later. You need to advise who you have put about this mis-representation to.

In your letter you refer very selectively to the minutes of several ANF Board Meetings where Bill Express was discussed and use to build a narrative supporting your apparent claim that I supported Bill Express. The minutes in my year on the board were an inadequate representation of three days of meetings. Also, these minutes do not cover Executive Meeting discussions and other discussions. My position on Bill Express then and now is on the public record – a record which is counter to the narrative you have sought to pitch. You need to withdraw what you have written.

Now I will turn to the questions I raised and your response. For ease of comparison I will use the same numbering but not repeat my question or your response.

  1. I see no evidence of what I would call reasonable due diligence in your answer. You should have financial models at the core of this so newsagents can see the full costs and full opportunities. Your response does not indicate a rigorous process.
  2. The only business plan that matters to newsagents is their business plan. I would have expected the ANF to create business plans for each Hubbed offer so newsagents can see how it can play out.
  3. You say you have conducted retailed research on bill payment yet you have not published this. It would be useful to the ANF case that you publish this along with details of the newsagents you have worked with over the last six months on this issue. If your process is sound then the evidence will boost newsagent confidence.
  4. The ANF should have this information. You suggest its similar to a Point of Sale provider. No, it is not similar. Here, the ANF is a promoter. The obligation on the ANF is considerable yet to fails so far to step up. In terms of Point of Sale, each item in a package – which can be leased through any bank, finance company or other party – can be priced back to the individual item. With Hubbed this is not the case for some of the items. This is core due diligence the ANF ought to have undertaken for newsagents.
  5. I am told that newsagents querying what happens to Hubbed Premium hardware if they decide to not continue then Hubbed will find another location. I would have expected the ANF to require this to be covered in the contract and further that the lease for the equipment and the Hubbed business itself are one in the same.
  6. Yes there appear to be three different agreements. My view is that there should be one agreement so as to avoid a core issue with the Bill Express model. Further, I would have expected that thorough due diligence would have required that this be the case.
  7. Thanks for the response but I would have liked to see more detail.
  8. I am not challenging the integrity of anyone, just asking a question that needs to be asked. Attacking the question is unhelpful as it detracts from your answer.
  9. I would gave expected the ANF to be paid for the considerable amount of marketing support provided in your various media platforms and the time invested by your staff in promoting Hubbed to newsagents. I am not involved in any company operating in the space occupied by Hubbed.
  10. I have seen no information provided to demonstrate experience from the people behind Hubbed in the launch and running of a start up business in the consumer-facing services business at the core of the Hubbed offer.

I am happy to discuss Hubbed face to face. A public forum would be appropriate to demonstrate transparency. If the Hubbed model is good as you say it is newsagents will see that and embrace it. Your responses to my questions do not provide the detail and comfort I was seeking.

The ANF and Hubbed appear to not like being asked questions or challenged. If the offer is genuinely good and if the ANF has undertaken thorough due diligence on behalf of its members thorough scrutiny ought to be welcomed and result of good member up-take.

21 likes
Hubbed

Taking another look at the Hubbed Connect offer to newsagents

I have been asked to look at another contract offered by Hubbed to a newsagent considering the Connect Lite product. The contract I have seen is version 6.  The last one I saw was version 3.

While the ANF, the national newsagent association, should provide independent assessment and commentary on the Hubbed offer, it is unable to do so given its 5% shareholding in the Hubbed business and other apparent commercial ties with Hubbed. VANA and NANA, the Victorian and NSW/ACT state newsagent associations respectively, do not currently recommend Hubbed to their members.

While the latest version of the Hubbed contract addresses some of the questions I have raised, questions do remain:

  1. Territory. Hubbed has no restrictions on who they can sign to offer the service.
  2. Separate agreements. There is no one agreement to cover all matters, costs and obligations related to Hubbed. I see this as a considerable problem.
  3. Equipment. Newsagents must obtain the equipment Hubbed requires from Hubbed unless some other agreement is reached. The Hubbed Contract is provided with a Finance application form for Northern Finance but there is no indication as to the terms of the finance agreement. Newsagents are only given access to the “Final Leasing Agreement” once they return an executed Hubbed Contract. Why are not all agreements completed at the same time and why do they not all run for the same term?
  4. Financial Services. Newsagents taking on Hubbed are directed to use Moneytech Services to be able to use Hubbed.  The Moneytech is a third agreement that is apparently required.
  5. Sales target. The Contract and associated schedule 1 are less than clear on sales targets.
  6. Insurance. Newsagents need to take out insurance for parcels and equipment.
  7. Responsibilities of the agent. Newsagents have to erect signs if required by Hubbed – there does not appear to be an opportunity to negotiate on this. The price you charge is set by Hubbed and you cannot vary it. You have to notify the sale of your business 60 days in advance. You have to give 60 days notice if you plan to move your shop.
  8. Termination. While Hubbed or the agent can terminate the agreement at 90 days noticeI am told newsagents cannot terminate the equipment finance agreement.
  9. Financial guarantee. Part of the Hubbed agreement requires newsagents to provide a financial guarantee to the Hubbed Financial Partner.
  10. POS computer. Newsagents must provide access to a POS capable of connecting to the Hubbed control PC (schedule 1) but there is no explanation in the contract or elsewhere as to what this actually is.

Now I’ll turn to the business case for Connect Lite.  The Connect Lite services are listed in the contract (Schedule 3) as gift cards, parcels and bill payment. We have gift cards today and we can access parcels without cost. The only new service here is bill payment and from where I sit I see very little upside in Connect Lite from Hubbed – certainly not enough upside to set aside space in-store, relinquish control over key aspects of my business and commit $7 a day.

Schedule 3 lists parcel services but newsagents can access these today at no cost through the industry owned N Parcel and Parcel Point. Schedule 3 also lists advertising services. I can’t see any value in this for the newsagency business.

The decision faced by newsagents for Connect Lite is in excess of $7,500. This is how newsagents have to approach it – as a $7,500 decision. Will you make three or four times this back? Will you make more from the space and time allocation from this investment than you could by being a retailer and bringing in new products to drive more retail traffic to your business.

The folks at Hubbed and the ANF will probably  say that I am against their offer and am talking down their plan to help newsagents. The Hubbed offer as being put to newsagents today is incomplete. There is insufficient information with which to make an informed decision about its appropriateness for a newsagency.  The ANF conflict is profound. The Hubbed business model as currently pitched is flawed.

I remain concerned at the apparent lack of due diligence undertaken by the ANF and its Directors both into the Hubbed commercial offer to newsagents and the viability to the typical newsagency business of the Hubbed services and the underlying cost of offering these.

Newsagents could achieve a considerably better return by investing in their business as retailers and not as agents.

As I have noted previously, I’d like to see a public debate to test the business model and the newsagent contractual arrangements at the core of the model. If Hubbed is as good as the ANF Hubbed partnership says it is then it would emerge from the debate in a stronger position.  I would appreciate an opportunity to be proven wrong on this.

16 likes
Hubbed

VANA advises newsagents to not sign the Hubbed contract at this time

VANA yesterday advised Victorian newsagents that they should not sign the Hubbed contract at this time.  here is their announcement in full:

VANA’s position on Hubbed
By VANA News | September 13, 2013 | Nparcel Leave a comment

There has been much talk within the industry lately about the ANF’s endorsed company ‘Hubbed”. VANA also understands that the Hubbed team are visiting Victorian Newsagents to introduce the platform to them. As expected, VANA is receiving enquires from members as to our position and recommendation.

The VANA Board was given a presentation by Hubbed CEO David Mclean at our May Board meeting, and has also had many conversations with ANF CEO, Alf Maccioni in relation to the platform.

VANA received a copy of a Hubbed contract and VANA’s solicitors have given us a list of issues and concerns involving this. On Thursday 29th August, VANA met with the ANF to enquire about these issues and on Friday 30th, a list of issues was submitted to Hubbed CEO, David McLean. These questions have been answered and after further discussions, Hubbed has released another version of their contract.

VANA’s advice to Newsagents today is to not sign a Hubbed contract until the final version of the contract is available for all to see, understand and evaluate. Newsagents MUST seek their own professional advice on this contract if they wish to participate as the platform does commit newsagents to a contract term and at a monetary cost, amongst many other things.

VANA also has concerns over the ANF 5% shareholding in Hubbed and the ANF’s ability to have an influence in making sure newsagents are protected.

This issue will be discussed further at our next Board meeting. VANA will continue to update members if any more information comes to hand. If you have any questions in relation to this announcement, please contact The VANA team.

I have expressed some of these concerns here on August 20 and here on August 26. It is good to see newsagent associations doing what associations should do when a new business opportunity enters their marketplace. This is what members expect.

If the Hubbed offer is as good as Hubbed and the ANF say it is they will welcome the scrutiny.

27 likes
Hubbed

NANA suggests newsagents delay signing with Hubbed

Here’s an announcement from NANA published  yesterday in relation to Hubbed:

NANA suggests delay in signing
Hubbed contracts/agreements for now

The Newsagents Association of NSW & ACT (NANA) has received legal advice expressing concerns about the Hubbed contracts/agreements that NANA has received.

As NANA is legally not able to instruct NANA Members what to do, NANA is suggesting to NANA Members that they delay signing Hubbed’s contracts/agreements until Hubbed has made appropriate amendments.

Some of the key concerns that NANA has learned are:

their requirement to use insurer(s) approved by Hubbed for public and product liability insurance for Hubbed’s equipment at the Newsagent’s premises;
their exclusivity clause; and
their rental and service agreement that is independent of Hubbed.
Naturally, NANA urges NANA Members to use their own commercial judgement when considering Hubbed’s Connect Premium or Connect Lite.

From the outset, NANA remains very supportive of Hubbed’s offerings as it can significantly propel Newsagents into the lucrative parcel shipments business, bill payments, gift cards, and many other current and future products and service offerings.

Notwithstanding, NANA is firstly committed to ensuring that NANA Members’ business/commercial interests are protected. NANA will continue to update NANA Members of its progress with Hubbed in the coming days and weeks.

For any further information, NANA Members are welcome to contact the NANA office on (02) 9744 0400 or by e-mail at nana@nana.com.au.

Regulars here would know these topics are among the questions I raised here.

12 likes
Hubbed

ANF conflict on Hubbed extended

An email today from the ANF to members was solely about Hubbed, the agency business in which the ANF has a 5% share. The email underscores a conflict for the ANF as the national association representing newsagents. The email, essentially a promotional letter from Hubbed, indicates that Hubbed is relying on ANF staff:

We are taking on additional staff as we speak and also leaning heavily on our friends at the ANF to provide support in the roll out process so that we can effectively manage document receipt, installation, training and marketing.

There are other suppliers who provide the ANF with real dollars funding for conferences and award sponsorships who could want to lean on the ANF for staff support. Why is the ANF providing this to Hubbed and is such a tight relationship healthy for newsagent members and the channel more widely?

Just by asking these questions some will say, as they have done recently, that I am talking Hubbed down. I am not. rather I am seeking transparency for newsagents.

The ANF love affair with Hubbed must be challenged since the ANF is not doing this on behalf of members.  While there have been some answers to some of the questions I have raised, I am yet to see any evidence of reasonable due diligence on the Hubbed business model for newsagents.

As I have noted previously, I’d like to see a public debate to test the business model and the newsagent contractual arrangements at the core of the model. If Hubbed is as good as the ANF Hubbed partnership says it is then it would emerge from the debate in a stronger position.

As for the rest of the email – which was thin on specific detail, I am surprised they are rolling out Hubbed given the challenges some tell me of getting a consistent contract.

13 likes
Hubbed

ANF responds on Hubbed contract

The ANF sent a notice to members yesterday apparently in response to some of the questions I have raised. Their repsonse included:

Yesterday ANF CEO Alf Maccioni sat with David McLean from Hubbed to once again go through the CONNECT contract which is going out to newsagents. He asked a number of questions and suggested changes to the contract. The main cause of concern was a clause which made it seem like this was an exclusive agreement and that the newsagent had to ask permission from Hubbed to allow competing services. This clause has now been removed from the updated contract.

The ANF membership has a 5% stake in CONNECT to ensure the interests of newsagents are paramount and Hubbed will continually work with members to ensure that their questions are being answered. There is an extensive list of Q&As on the ANF website.

ANF CEO Alf Maccioni said he believed that the CONNECT suite of products will add a new dimension to the newsagency channel and will ultimately attract younger customers.

As previously stated, the ANF strongly recommends that all agents should also get independent legal advice on the CONNECT contract and any other contract in relation to their current business and personal circumstances. If for any reason you feel uncomfortable about signing or you are not sure if this system would work in your store then don’t sign.

I heard about this from an ANF member. The ANF, as with Hubbed, is welcome to respond here to the questions I have raised.

If the ANF thinks newsagents will believe that their 5% stake is to ensure the interests of newsagents are paramount and Hubbed will continually work with members to ensure that their questions are being answered then they must think we’re stupid.

21 likes
Hubbed

Does Hubbed prefer to attack the questioner rather than answer the questions?

A newsagent attending a recent Hubbed presentation promoted by and held at the ANF / QNF offices in Brisbane says that Hubbed CEO David McLean said that he had an intense dislike of me and intended to bring Mark Fletcher down. He is reported to have said that he has met me to discuss Hubbed.  I have never met with or spoken to David McLean.

While I don’t care what McLean thinks about me, newsagents would be better served and informed is he answered the questions about the Hubbed contract I have published and addressed the broader business questions I have raised.

That I publish my personal opinions here on this blog does not diminish the opinions nor restrict how they can respond.  I’d encourage McLean to respond to my questions as if they were put at a public forum since that’s what this place is – a public gathering place of newsagents. There are 1,300 visitors a day here.  Don’t think of it as a blog but rather a place where newsagents talk.  McLean is welcome to respond here as he would publicly at a Q&A session.

Alternatively, I’d welcome an opportunity to put my concerns about Hubbed to McLean and others in a public forum where newsagents can see the Q&A live.

Transparency is key. From what I have seen so far transparency is lacking in what Hubbed has put to newsagents.

That McLean is responding to my questions by attacking me should itself concern newsagents.  A more potent response from the company would be to answer the questions, thereby showing that concerns were unfounded. That would be a good outcome for Hubbed and for newsagents.

Newsagents have not yet been presented the complete commercial terms and therefore cannot make an informed decision as to what they are signing up for.

If the ANF was not a business partner of Hubbed it could ask the questions I am asking. If the ANF was not a business partner of Hubbed it could act as an association representing newsagents on this matter.

Newsagents have not been presented clean financial information to show how they will get a return on the Hubbed daily fees + the cost of the retail space used + the cost of labour.

Hubbed has not been specific about how it will drive new traffic for newsagents.

Hubbed has not, from what I am told, addressed in any detail how it will compete with the Australia Post self-serve kiosks.

Let me be clear and repeat what I have written previously – I don’t know if Hubbed is good or not as all of the information to make such an assessment is yet to be released.

What I do know is that Hubbed is an agency service. There are some newsagents who will want to remain agents. Those who want to be retailers are less likely to find the Hubbed agency offer appealing.

The people behind Hubbed should welcome scrutiny if their offer is as good as they say it is and they should attack those calling for scrutiny if what they offer does not stack up.

43 likes
Hubbed

Is Hubbed good for newsagents?

More and more newsagents are asking what I think about Hubbed. My answer is the same to all: do your homework, make sure you understand how it works, be certain it is right for your business before you sign anything and get every promise and commitment in writing.

I don’t know if Hubbed is good for newsagents because key information has not yet been made available. What I do know i that I will not, at this stage, be signing my newsagencies to Hubbed. I can put the $7 a day or $17 a day to more profitable use. Also, I see myself as a retailer and not an agent.

Hubbed is for agents who want others to generate traffic for them and who are happy to make a tiny amount from transactions.

Newsagents can’t rely on their industry association for guidance as it became conflicted when it accepted a 5% share in the Hubbed business. This is a mistake on the part of the ANF in my view.

At the Sydney GNS Market Fair the Hubbed people told newsagents to go to the Tower Systems stand and ask if the company will support Hubbed because POS Solutions is. (I own Tower Systems). Hubbed has never approached Tower. If they wanted to integrate to any newsagency software then they should approach this in the same way any supplier does and follow well established industry standards and not engage in juvenile trade show antics.

Ashley McGrath and David McLean from Hubbed reached out to me in January to talk about Hubbed before the launch. They sought my thoughts: We are shortly moving to pilot and, as an industry leader, I felt it would be worthwhile touching base and getting your thoughts on what we’re doing. Before engaging I wanted to know if they had a commercial relationship with the ANF. They refused to answer so I declined to meet. I wanted to understand whether newsagents were being represented by their association.

So, I’ve had no meeting with them and they have not approached me since. Yet here they are playing games talking about newsagency software integration when back in january they were adamant that such integration was not part of their plan.

All I have to go off is the contract offered by Hubbed to newsagents. Read my questions on the Hubbed contract for newsagents.

In terms of the business areas being pursued by Hubbed, I see bill payment as dead, especially the apparent approach being taken by Hubbed – the Australia Post offer seems far superior and more shopper friendly.  The Visa card offer exists already thanks to Touch and ePay. Parcel handling is available for no up front cost thanks to N Parcel (ANF owned) and Parcel Point. Subscriptions are available through Touch. Gift cards are available through several suppliers.

I don’t see enough traffic generating value for $7 or $17 a day. But to assess the cost one needs to add in the retail space (costing between $5.00 and $10.00 a day in a shopping centre) and the labour cost.

I am raising these questions here because the ANF has abandoned its responsibility to its members and all newsagents. It is not able to objectively ask questions that need to be asked so that newsagents are more informed.

Hubbed may be good. Right now there is not enough information. If they have something so good and so valuable maybe we should setup a debate which newsagents can attend for the issues I have raised here can be explored.

All I want is for newsagents to be fully informed before signing any contract.

So, is Hubbed good for newsagents? I don’t know and I don’t see how anyone can know based on the incomplete information out there right now.

Footnote: my questioning of Hubbed here is leading to some attacking me behind my back. Anyone doing this is more suspicious in my mind. Every question I have raised could have a reasonable answer. Attacking me and not answering the questions should raise alarm bells. I’ve been open about my questions. I wish answers we being provided in a similar open way.

34 likes
Hubbed

Questions in relation to the Hubbed contract offered to newsagents

Several newsagents have sent me the Preferred Agent Terms and Conditions for Hubbed for comment. It appears to be their contract.  In each case they asked me to look at the contract because of concerns about what happened years ago with the ANF endorsed and promoted Bill Express.

While I have business questions about the Hubbed offer are questions I have about the contract:

  1. Hubbed Competitor. The definition in the contract is broad and could change over time as Hubbed changes. Today, Touch Networks, N-Parcel, Parcel Point and even facilities in some newsagency software products could be considered competitors of Hubbed.
  2. Territory. The newsagent is restricted as to where they can offer the service. Hubbed has no restrictions on who they can sign to offer the service.
  3. Equipment. Newsagents must obtain the equipment Hubbed requires from Hubbed and this must be financed by a finance company approved by Hubbed.
  4. Financial Services. Newsagents taking on Hubbed are directed to use Moneytech Services to be able to use Hubbed.  The finance agreement appears to be separate to the Hubbed agreement. I have not been given a copy of a finance agreement.  If I remember correctly this was the case with Bill Express too.
  5. Sales target. Newsagents need to understand their target and the implications.
  6. Insurance. Newsagents neet to take out insurance for parcels and equipment.
  7. Responsibilities of the agent. Newsagents have to erect signs if required by Hubbed – there does not appear to be an opportunity to negotiate on this. The price you charge is set by Hubbed and you cannot vary it. You must get written approval from Hubbed to sell, promote or accept business from any competitor service. You have to notify the sale of your business 60 days in advance. You have to give 60 days notice if you plan to move your shop.
  8. Access. You have to notify your landlord that you’re taking on Hubbed.
  9. Fees. Hubbed may set off amounts payable.
  10. Access – termination. Newsagents agree that Hubbed can enter the premises without notice and remove equipment.
  11. Money. Hubbed and their agents get access to your bank account and you must authorise their direct withdrawal.
  12. Subcontracting. You authorise Hubbed subcontractors to have the same rights as Hubbed.  You can’t subcontract your own writes without written permission from Hubbed.
  13. Termination. While Hubbed or the agent can terminate the agreement at 90 days notice this would need to be considered in association with the finance agreement.  Termination fees apply and they are in schedule 5 – none of the agreement I have been given have a schedule 5.
  14. Financial guarantee. Part of the Hubbed agreement requires newsagents to provide a financial guarantee to the Hubbed Financial Partner.
  15. XchangeIT. In Schedule 4 newsagents are required to use something called the XchangeIT inventory management and payment system. Is this a new service or a mis-naming of XchangeIT?

While I am no expert, it seems to me that newsagents signing up for Hubbed will need to seek written permission to continue to offer Touch or ePay products as well as to offer Parcel Point or N Parcel. I would also be concerned about the future business opportunities that Hubbed may deny me from taking on given the tight no compete obligations in the contract.

More complete assessment of the Hubbed offer can only be undertaken in-conjunction with reading the finance agreement which I have not seen nor have newsagents I have spoken with.

It is not my intention to attack Hubbed. Rather, I have sought to document the concerns I would have with the Preferred Agent Terms and Conditions for Hubbed if they were presented to me for consideration. I’d like to think the ANF has read the contract with the same intent as me.

Hubbed may have answers that satisfy newsagents on these and other points. As with any contract newsagents are presented to sign, read it all carefully and ask questions about anything which concerns you or you do not understand. Get the answers in writing.

22 likes
Hubbed
  • 1
  • 2
Trending Articles

Fairfax changes approach to TV Guide, disrespects newsagents

Published on April 20, 2011

What do you think of the Powerball changes?

Published on February 16, 2018

IPS releases new magazine contracts

Published on June 21, 2011