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Newsagent representation

Newsagents being pursued to sign up for new Hubbed connect service

Several newsagents have told me they have been contacted many times by their association encouraging them to consider the new Hubbed service.  An email I received from NANA on July 9 reads as an endorsement of Hubbed by the ANF and NANA:

NANA and the ANF would like to invite members to attend one of our information sessions we will be holding at our QLD office in Zillmere.

These sessions will provide you with the opportunity to learn all about the new CONNECT system which is now being offered to member Newsagents nationwide.

This is a fantastic opportunity for newsagents to see how they could grow their businesses and revolutionise the way that consumers transact in retail environments.

We have shipped a Hubbed CONNECT machine for you to touch, feel and experience.

The email included:

There has been a great deal of interest from members in the Hubbed “CONNECT” system for newsagents and the exciting news is that this great opportunity will roll out in QLD starting in August 2013.

As I noted, this email reads as an endorsement. That the information sessions are being held at association offices also suggests endorsement.

Here are questions I’d want answered before contemplating Hubbed further:

  1. What is the nature of the relationship between Hubbed and any of the newsagent associations or anyone connected with the associations?
  2. Specifically, is there any money or other benefit whatsoever flowing from Hubbed to any of the associations and if so on what basis?
  3. What due diligence has been undertaken on the Hubbed business model?
  4. What due diligence has been undertaken on the proposed Hubbed contracts?
  5. Have all the claims made by and about Hubbed to newsagents been investigated?
  6. Is the ANF, NANA, QNF or any other association endorsing Hubbed and if so why and if not why?
  7. Has the ANF, QNF, NANA or any association promoting these sessions considered what of the Hubbed services are already available in newsagencies?

I was recently at the Tasmanian Newsagent of the Year Awards dinner in my capacity as owner of Tower Systems to present the Retail Newsagent of the Year Award. As an award presented I was given a few minutes too speak at the dinner. I took this to mean two or three minutes. That’s all I and all bar one other award presenter took. The CEO of Hubbed took twenty minutes and launched into a sales pitch. While it was the wrong place and wrong time for this, it gave me an insight into their services.

From what I can tell Hubbed is not offering anything significantly different to what newsagents have FREE access to today through ePay and Touch Networks. My understanding is that Hubbed will cost newsagents $7 a day or $17 a day depending on the level of service they choose. That’s a lot of money compared to the free services available already.

It could be that I am missing something but I don’t see Hubbed as generating considerable new traffic. It’s an agency service and newsagents make money by providing services at the counter. Retail is moving away from the counter. Newsagents, in today’s retail environment, can make more money on the shop floor by being engaged retailers.

Investing $2,500 (less than $7 a day) in stock of new product lines, a newsagent could expect to make at least $7,500 gross profit over a year based on average stock turn and margin. They would have established their business as a destination business in a new product category and that should see at least some customers returning for additional purchases. Some of the new traffic should also generate revenue from other parts of the newsagency.

My focus on the future is on generating new traffic from new product categories, non agency, non commission product categories. I’m confident I will make more money by exerting control over what I choose to sell and the price I choose to sell it at. Check out the Newsagency of the Future video for more of my thoughts on this.

I don’t know enough about Hubbed to tell newsagents what to do nor is it my place. I have written this post to raise questions, to ensure that newsagents considering signing up for Hubbed are fully informed, more informed than covered in communication from the associations.

Newsagent associations have no place being involved in providing or endorsing any commercial services. They ought to focus 100% on policy and get that right.

Every time an association endorses or promotes in any way a business it has any commercial relationship with it should disclose the interest.

The last service the ANF wholeheartedly endorsed and promoted was Bill Express, in 2003. As newsagents later discovered, the only due diligence undertaken by the ANF  related to advice from their lawyers about ANF Director matters and not Bill Express or the Bill Express related contracts. Newsagents lost millions of dollars.

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Newsagency challenges

VANA is more marketing group than newsagent association

The VANA owned N-Stock is now promoting ink, just as you’d expect to see from a newsagency marketing group or a newsagency supplier.  VANA and associations partnering with N-Stock  is doing this at a time when they are asking the marketing groups and newsagency suppliers to help fund association activities. The associations supporting N-Stock can’t have it both ways – it can’t offer marketing group and or supplier products and services and expect other marketing groups to give it money for it to invest in developing its own marketing group services.

Association Directors supporting N-Stock need to sort our whether they are an industry association fearlessly and independently serving newsagent members first or a marketing group or a supplier,  a commercial entity. It’s a choice that needs to be made. They can’t have it both ways.

Newsagent suppliers need to consider what they are supporting, whether they are supporting a competitor.

Now before any VANA director calls to complain about what I have said and to question my support for industry associations I’d say – man up, look at this as a supplier and consider your position in commercial terms. You can’t look at what you are doing as an association. That’s my point.

Footnote: In doing this VANA’s N-Stock is using the latest version of the industry owned N – I wonder if they are paying a royalty for that.

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Newsagency challenges

Why GNS matters to newsagents

OfficeMax and Staples (formerly Corporate Express) continue to pitch to newsagents, chasing wholesale stationery sales. Both businesses are US owned. Both businesses also sell direct to the customers or newsagents. Strengthen them and you strengthen your competition.

It doesn’t make sense to me that newsagents would support OfficeMax or Staples. They are our competition. Strengthen them and you strengthen your competition.

While GNS can be challenging, it is a business in the middle of transformative action. It’s different today than a year ago and will be even more different in a year’s time.

Here’s why I think GNS matters and why newsagents should support it.

  1. GNS is newsagent owned. Our support for GNS shows our support for the one commercially unifying proposition in the channel. If we can’t support a wholesaler we own what hope is there for the channel? For some newsagents, their shares are worth more than their newsagency business.
  2. GNS is local. It’s an Australian business, employing Australian people and feeding many Australian families. Like Australian newsagencies.
  3. GNS is a newsagency business. There is excellent newsagency specific knowledge within GNS. This helps us – if we allow it.
  4. GNS comes to us. Through state based reps and a national round of trade shows GNS comes to us to our back door to our businesses.
  5. GNS helps newsagents. Through in-store expert advice, GNS can help you re-plan and reinvent your stationery offer.
  6. GNS is listening. The changes in the business over the last year or so have been driven, in part, by newsagent engagement. Try telling a US conglomerate what to do!

Newsagents have a choice where they source stationery. Those who support GNS support the newsagency channel. Those who support the US companies are, in my view, shortsighted and selfish – they are not supporting the newsagency channel.

I’ve written this of my own accord and without encouragement from or knowledge of anyone in or involved with GNS.

I have written this because of a catalogue I received last week from one newsagent, an OfficeMax catalogue rebranded for their franchise / marketing group. Newsagents pitching this can’t, at the same time, saying to their local shoppers support us as we’re an Australian business. Okay, they can because their newsagency is Australian owned. However – this same business prefers to support a US stationery wholesaler over the Australian, newsagent owned, stationery wholesaler.

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Newsagency challenges

Survey reveals level of newsagent unhappiness with mobile phone recharge commission

The results from my quick phone recharge survey are in and while one could reasonably argue my survey questions were leading, the results from 137 participants make sobering reading for Optus, Vodafone and Telstra.

I hope the telcos take time to read what newsagents think and what they want. They would be ill-advised to ignore the results.

Newsagents want a better deal when it comes to phone recharge.  100% of respondents said they were unhappy.

Newsagents think the telcos treat them unfairly.  99.3% said they felt unfairly treated.

Newsagents are prepared to walk away from from offering the slim margin service unless margin improves. 31.1% say they plan to move away from selling mobile phone recharge / top-up.

Newsagents want to make more money from mobile phone recharge.   18.2% said they want 8% commission minimum, 28.4% said they want 9% – 10%, 19.3% said they want 11% – 14%, 29.5% want 15% to 19% and 4.5% want 20%.

Click here for a full copy of the survey results and see for yourself.

The question is, are the telcos listening? Will they show that their words of support for newsagents are real or will they show them as hollow?

The only parties the telcos need to deal with are newsagents and their commercial representatives. I’m told they are talking with associations. This makes no sense as the associations have no direct commercial relationship with newsagents. The associations are not marketing groups, franchisors or managing any levers with which to encourage newsagent engagement.

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Newsagency challenges

Are newsagency suppliers not up for a debate?

While I applaud News Limited for commenting on my recent blog posts here about their move to add a 80 cent surcharge to each copy of The Advertiser they deliver to select parts of regional South Australia, their comments reinforce a view that newsagent suppliers don’t like it when newsagents publicly disagree with them.

I regularly hear about suppliers disagreeing with something I have written here. I’m often told by someone inside the supplier’s business. When I suggest they comment publicly the response is often – they don’t want to legitimise your blog post.

We, newsagents and suppliers, need to be able to disagree and debate publicly for it is only through robust honest discourse that we can have a hope of finding some fair and just common ground.

Newsagents and suppliers don’t have to like each other, we don’t have to be friends. We need to respect each other and be fair in our dealings with each other.

Hiding debate, keeping it confidential, stifling it or restricting it to behind the back carping only serves the person or business engaged in that.

While I don’t care what people think of what I write, hearing about complaints behind my back makes me sad as that very act is a demonstration of a lack of interest in engaging on the topic.

Newsagent suppliers genuinely interested in the future of our channel can show this by welcoming debate with newsagents and engaging in public debate and discussion respectfully, seeking genuine common ground.

News has at least commented here and for that they deserve credit. That they have ignored the core issues and have used their comments to spin the issues is frustrating and does not serve their cause well.

All this leaves me with the question – do newsagency suppliers not want to publicly debate key issues with us?

NOTE: Any supplier is welcome to comment here at any time. Once the first comment is made all future comments are unmoderated.

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Newsagency challenges

Fairfax to take newspaper home delivery customers from Tasmanian newsagents

Representatives of The Examiner, a Fairfax owned daily newspaper serving Northern Tasmania, started meeting with newsagents four weeks ago to advise them that they, Fairfax, would be taking control of home delivery customer management.

Newsagents were shocked, it was the first they had heard of this move. Up until now, newsagents have managed all aspects of home delivery of The Examiner – customer billing, payment, stops, starts, run management.

I’ve been told that ANF was advised by Fairfax of the move in November last year. It has also been put to newsagents that the ANF ‘ticket off’ (approved?) the move back then.  Newsagents I have spoken with want to know why the ANF kept this news from them for four months.

UPDATE (1:15PM) The ANF has advised that they first heard of this in January and even then in extremely vague terms. They did not and have not ‘ticked off’ the Fairfax plans. I note that my original information came from someone told by fairfax. the ANF has written to Fairfax to correct this misinformation.

The Fairfax pitch is that they will take charge of the customers, manage all aspects of the account, promote subscriptions and promote an associated digital offer.  This appears likely to lead to a lower level of remuneration for newsagents.

Fairfax is offering nothing for the effective take over of the customers, many of whom have been acquired directly, through the hard work of newsagents.

Fairfax representatives have apparently said that they will give customers the option of paying for home delivery at the post office. Really?  I’d be shocked if they did this. there is a perfectly good retail network in place today – newsagents.

Fairfax is also planning to require all customers to pay in advance. They are apparently offering customers a voucher to sweeten this move.

As recently as five years ago The Examiner purchased territories off newsagents. Back then, the company considered the home delivery customers acquired by the newsagents had a goodwill value. This latest move could be seen as takeover by stealth. This is one of the concerns of newsagents – what happens to their goodwill?

The ANF is getting legal advice in Tasmania. This feels too little of a response too late. I’d prefer legal advice from those with national experience in this space, experience in dealing with publishers. This legal advice ought to have been sought in immediately Fairfax advised the ANF of their intentions.

UPDATE: (1:15PM) Based on what the ANF has advised their timeliness in getting a legal response has been good.

The Examiner prints between 30,000 and 35,000 copies a day. This low number makes me wonder about the viability of the print edition. Okay, as a regional newspaper the economics are different and a lower print run can be more profitable in this situation than in a capital city. Still, 30,000 to 35,000 copies is low. I wonder if the Fairfax move is to prepare the business for a switch to digital only or, at the very least, to reduce print days. They can’t easily do this unless they own the customers. Currently, the don’t own the customers.

I was in Launceston yesterday and spoke directly with several newsagents affected. Outside of their concerns about losing the customer accounts asset of their business and therefore significant goodwill, they explained the nature of their customers and an expectation that a decent percentage would not want the details held by their local business being handed to a national business.

Some said they’d expect to lose at least 10% of home delivery customers because of the move of account ownership from the local business to Fairfax.

Some said they expect Fairfax would lose more customers by requiring payment in advance.

These issues could have been fully canvassed through a more open consultation. As it has been done, the newsagents involved are stressed at the late notice grab for an important and valuable part of their business.

What is happening with newsagents in Northern Tasmania ought to concern all newsagents. Some of our own are being treated with disrespect and unfairly. They have been let down by their association.  Hopefully this blog post leads to more active engagement by all to treat newsagents fairly.

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magazine distribution

QNF set to merge with ANF

Nine years after it was first proposed by the ANF, the QNF has today announced the calling of a Special General Meeting to vote on the merging of the QNF with the ANF, as a division of the national association.

This is good move, one Victoria and NSW/ACT should follow. Newsagents spend too much money on disconnected and conflicted representation.

Why didn’t this happen nine years ago?  Egos got in the way.

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Newsagent representation

Associations as supplier mouthpieces

It is interesting to see that Associations continue to be used by newspaper publishers to promote their changes – Fairfax this week as the tabloid editions of the SMH and Age approach and News Limited promoting thier advertiser (BMW) driven Sunday delivery of The Australian. each time an association publishes press released from the publishers they do themselves a disservice. Their members are newsagents. Everything they publish and do should be solely for their members and reflecting the collective member position.

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Newsagent representation

Is it time newsagents ceased as directors of newsagent-owned enterprises?

Newsagents sit on the boards of various businesses supplying newsagents including stationery wholesalers and associations. While I am sure they discharge their duties to the best of their ability, it is appropriate to consider whether newsagents are the best directors of these business enterprises.

Newsagent owned businesses, and associations conducting commercial activity to newsagents, operate in a commercial world quite different to a newsagency – distribution or retail. This is why I question why newsagents make the best directors.

Directors are usually paid fees for their time. Are they worth it ? Are their decisions adding value to the businesses? Are the boards they sit on performing well? Would they get a gig on the board of a competitor business?

I know from my own experience on the ANF board in 2003/04 that newsagents bring personal baggage to the boardroom table. I saw a lack of commercial savvy and a disinterest in due diligence and transparency.  Bill Express is a perfect example of a bad decision by directors ill-equipped to make the decision. Before I resigned I expressed concern at the excess of the ANF Board meeting bar tab – a 45 minute fight ensued which I lost. They spent more time arguing about this than matters of serious commercial consequence for newsagents.

I have other stories I could share of my own and from others. If only newsagents knew.

Boards ought to be focused on big picture issues, setting direction and holding the employees of the organisations to account. Too often that is not the case, giving the competitors a free kick and wasting member and shareholder funds along the way.

These newsagent owned commercial enterprises collectively turn over well over $100 million a year.

Isn’t it time we populated the boards with quality commercial directors as competitors of these businesses do?

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Ethics

Hello Chris Bowen, welcome to small business

We have a new Minister for Small Business in the federal government from today. Check out Chris Bowen on Wikipedia and at his own website.

Sadly, like many small business ministers from both sides of politics before him, Chris has no hands-on small business experience.

Political parties need to understand that one way they can engage small businesses is to appoint a minister with real-life small business experience. They also need to appoint someone with the time necessary to do the portfolio justice.

If small business is as important as politicians say they they can demonstrate this with an appropriately skilled minister who has enough time in their schedule and a sufficiently strong voice to represent what we keep being told is a vital part of the Australian economy.

In this situation, where the minister has no small business experience, I’d like to see his time invested in genuinely connecting with small businesses, on the shop floor, in the back room and engaging in a practically way that leaves a meaningful impression of the challenges of small business.

For example, I would love Chris Bowen, our new minister for small business to:

  1. Understand the damage the government-owned and protected Australia Post retail shops does to our small business newsagencies every day.
  2. Understand cost to us of the protected banking system in terms of exorbitant transactional fees and unfair terms for small businesses.
  3. See and feel the competitive pressure from the supermarket duopoly.
  4. Realise the high cost of retail space in Australia compared to elsewhere in the world.
  5. Understand the cost of penalty rates we have to pay when there is no penalty to the employee for working the hours they prefer.
  6. See the inflexibility of some aspects Fairwork.
  7. Learn why many of us do what we do and would probably not choose any other business.
  8. See the impact we have and value we bring to our local communities.
  9. Understand why small and independent retailers are important to the country economically, socially and environmentally.

I am sending a letter to Chris Bowen welcoming him and covering these points.

Newsagencies provide an excellent place for any politician to learn about and understand small business. A week in our businesses could help them meet more local constituents than they would meet in a week of door knocking.

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Australia Post

Should retail newsagents join or create a retail-specific industry association

Given the clear split of distribution from retail being driven by a range of changes including News Limited’s T2020 project, we are approaching a time where distribution and retail newsagents could be better served by different associations.

With more retail newsagents being the customers of distribution newsagents it would be inappropriate for an association to serve both parties.  Further, the needs distribution and retail newsagents have of their association are different.

These are issues the associations themselves ought to have been considering.

My own experience is that need of retail newsagents are better served through a more retail focused association.

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Newsagent representation

ANF to establish a branch in WA, severs ties with WAANA

In an not unexpected move, the ANF has terminated its relationship with WAANA, the state newsagent association inWestern Australia.

WAANA has been struggling financially since it lost its brokerage business. regulars here would know that I think it is time newsagents had one single association to ensure a single and consistent approach to national issues. Such a move nationally could considerably cut the cost of newsagent association representation. It could also remove local politics which has dogged state associations for decades.

The WA move is not part of any national push. Here is the information released yesterday by ANF CEO Alf Maccioni.

Since becoming the CEO of the ANF my core focus has been unity to ensure that all newsagents benefit from the strength of national representation. The ANF has been working closely with QNF, NANA, VANA, and the ANF Branches to share our resources, ideas and address the changes that are happening in our industry to create a better future for all.

In WA, we have had a number of challenges working with WANA.

The ANF Board has decided after extensive debate that we can best serve the newsagents of Western Australia by re-establishing a WA Branch. I want to stress how difficult a decision this has been to decide to go back into WA, but our ultimate aim is, and will always be, to assist the Newsagents nationally and locally.

We have sent WANA a termination letter today acknowledging their repudiation of the agreement through non-payment.

We have been in close contact with all Association CEO’s and Chairs including WANA over the last 6 months to attempt alternate resolutions without success.

Adam, Colin and I are heading over to WA to meet with the relevant industry partners and newsagents. We want to explain our actions to them all face to face. We will be recruiting a WA membership manager who will be located at the GNS office. This person will report directly to Colin and Colin will be visiting WA on a regular basis ensuring that the agents concerns are met.

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Newsagent representation

Talking penalty rates with the Liberal Party

I was fortunate to be one of twelve at an Australian Retailers Association lunch with Senator Eric Abetz, Shadow Minister for Employment and Workplace Relations, yesterday. The lunch was held under the Chatham House Rule and so I can’t go into the detail of what was discussed. that said, it was terrific to have another opportunity to talk directly with a federal politician about newsagents and some of the challenges we face that those in Canberra can influence.

The hot topic was penalty rates. Plenty of the retailers around the table representing footware, music, bakery and services shared the concerns of newsagents about the cost of labour on our businesses on Sundays in this 24/7 world – a world government had helped create.

The more politicians who hear stories about challenges newsagents face the better.

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Newsagent representation

Where is this talked about unity for newsagents?

For more than ten years newsagent associations fought each other, often viciously, over the issue of unity of representation.  There was a sigh of relief when unity was announced by the various associations.

It appears to me that the announced unity is not the unity newsagents wanted.

Today, newsagents face the most significant national issue on which retail newsagents and distribution newsagents should be represented by a single national voice. Instead, the major state associations are running the issue with different messages and via different means.

This is a missed opportunity for newsagents.

Whereas in the past newspaper contract matters were state-based, as that is how publishers handled them, today, they are national – the publishers have made them so.

Look at NANA, VANA and the QNF: they are each running T2020 as a state issue. T2020 is national. It should be run nationally for newsagents by the ANF. These state associations ought to have asked the ANF to run it months ago and they ought to have resourced the ANF to run it.

The best association is one that represents its members on issues of policy and direction. Running off at a tangent investing in and setting up businesses and funding legal fights has been shown for many years to be a waste of association resources.

If the fat were cut from the various newsagent associations and a single national body established to be a true association, I am sure more newsagents would engage.  The conflicting agendas between the state associations misrepresent the needs of today’s newsagents.

Our channel is over-governed for its size. Unless it establishes more efficient, modern-day and genuinely unified representation, the various voices of the various associations will continue to be ineffective for the newsagents they claim to represent.

The announcements of unity from a year or so ago appear to have been hollow words. When newsagents need consistent national representation, too much time and money is being spent on local approaches.

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Newsagent representation

A newsagent has never heard of Quarterly Essay?

Ever since the David Marr report about Tony Abbott in the latest issue of Quarterly Essay made the news this week we have had the title in prominent display with newspapers. We will sell out of the initial allocation and have ordered more stock.

We made a sale today to a customer who had come to us after another newsagent had told her they had not heard of the title. While I am thrilled we won the business, I am disappointed to be connected to someone who did not even take the time to provide even basic customer service.

This story represents the weakness of our shingle, that our business is tied to another providing such poor customer service. Businesses with the shingle are only as good as the worst operator. We let ourselves down yet we ignore this and complain about our suppliers as the cause.

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Newsagency management

Have newsagent associations been wrong-footed on the News T2020 announcement?

Ann Nugent CEO of the Queensland Newsagents’ Federation was quoted in a report in The Australian Financial Review yesterday as being shocked by the announcement and that the QNF expected a consolidated run to be 2,000 papers a day and not the announced target of 10,000.

I am shocked that the QNF is shocked. Their expectation of a new distribution size of 2,000 demonstrates a lack of understanding of the economics of newspaper distribution, an ignorance of consolidation that has occurred elsewhere and a disconnect with what publishers have been saying on this topic.

No association should be shocked by the T2020 announcement. For them to say so would demonstrate, in my view, poor leadership.

The QNF quote, if accurate, encourages me to renew my call for the ANF to take control of T2020 on a national basis with a properly funded project office established to serve the needs of all newsagents. This is not something to stuff up, it is not something to leave in the hands of people clearly unable to lead newsagents.

Now more than ever the newsagency channel needs strong unambiguous leadership. Newsagents will get the leadership they want since the associations are servants of their members.

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Newsagent representation

Newsagents need to take time to digest newspaper distribution changes details

Newsagents are understandably concerned about the impact of the newspaper distribution changes released at 10am today. Their concerns have been heightened by poor communication about the coming changes over the last two years … poor communication from News and state based newsagent associations.

Today’s announcement is an opportunity to start again, to reset if you will. It is the first time newsagents have had direct access to considerable information from News Limited on their plans.

I urge newsagents to take their time to read all of the material and consider their own business goals.

While News will accept newsagents being retailers and distributors, newsagents do need to make a decision to be one or the other in my view – in the city and major regional locations at least.  In the country it’s a different story.  This is where the News approach will provide information to help determine the best approach further away from large population centres.

I have read the News Limited documents. Regulars here would know I support distribution consolidation.  Check out a proposal I outlined in 2005: here.

The restructuring of distribution has been long overdue.  Newsagent data, association data and publisher data for close to ten years has shown that this is necessary.

While News could have solved the issue by giving existing newsagents more money that would not have been a solution. Indeed, it would have rewarded the inefficient system we, all of us involved for many decades, have allowed to exist.

There are plenty of newsagents who saw this coming and started consolidating years ago, some have more than 10,000 deliveries today. Kudos to their entrepreneurship.  This is business pure and simple.

So, something had to give.  News looking at the print model made the decision and has now announced a plan.  This plan will proceed.  Yes, it makes it clear that existing territories have no goodwill value. It also makes it clear that new territories will only have goodwill value in the context of a five year agreement.

This is a new paradigm for newsagents.  There has been enough information in the marketplace for the last few years to see this coming.

I am worried that too many will get caught in the loss of goodwill for the current business, the need to bid for a territory and or the need to run a distribution business of a scale fare greater than the traditional newsagency distribution business today.  Worrying about these things would be a waste of time.

Newsagent attention and association attention should be focused on the how and not the what and why.

As this is a national issue, the ANF ought to establish a national office staffed with an accountant skilled in business planning, a business planner / manager / mentor and an overall project manager as leader.  This team should be put at the disposal of newsagents first in the three Queensland regions and then elsewhere as News rolls the changes out.  I have shared ideas with the ANF on how this could be partially funded.

Newsagents should assist in funding the ANF establishing this national office tasked with running this issue on behalf of newsagents and providing advice, assistance and support for newsagents directly affected.  The states should also support it and stop trying to use this issue at a state level.

Why is this not a state issue? News is moving nationally.  For the first time the company is operating outside its traditional silos. If News can operate nationally the only option for newsagents is to take a national approach.

By establishing a national office newsagents can deliver organisational efficiency to match the operational efficiency News is looking to achieve through the distribution changes. Yes, the News announcement today is as much an opportunity for how newsagents organise their own representation as it is about restructuring newspaper distribution.

I urge newsagents to read all the documents and to consider the information in the context of a business plan.

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Newsagency management

Odd timing of News Limited statement at VANA awards dinner

Newsagency awards dinners should be relaxing events with the focus solely on the award nominees and recipients. On this one night of the year, nothing else should matter, nothing else should pull focus from the newsagents to be recognised.

Unfortunately, the VANA awards dinner on Saturday for a while was like a newsagents meeting with a couple of business presentations. The awards dinner was the wrong forum and the content not as noticed as a result.

Stephen Kaye, Circulation Director of News Limited’s Herald and Weekly Times delivered a speech about changes to the newspaper distribution model. He started by criticising talk in some quarters that News Limited was in crisis. Um, Stephan, that comment was directed at me and a blog post I published on February 21. Immediately after the post News used several channels to any the claim, they used newsagency associations to put out their spin. I’ve not officially heard from News Limited. I stand by what I said including this…

There is a crisis gripping News Limited on the future of newspaper home delivery in Australia.  My understanding is that there is disagreement between circulation executives in some News Limited state offices and their bosses at Holt Street in Sydney on the future model of newspaper home delivery and whether newsagents are part of the model.

The crisis in had its genesis in 2009 when somewhere between 100 and 300 newsagents handed their newspaper home delivery businesses back to News, claiming that they were not financially viable.

I didn’t make it up. People in News said it to me.

Why Stephen Kaye felt he needed to comment on this at the VANA awards dinner months after I made the statement is beyond me. Odd.

But Stephen was just starting his speech – he went on to tell newsagents that change was coming and that it would start in Queensland where more newsagents have handed their runs back. Reading between the lines, one could take Stephen’s words to suggest that there is a crisis in Queensland.

I wish I had been able to take notes as the speech had plenty of information which newsagents would find valuable, information they would want to reflect on away from an awards dinner environment.

In his speech, Stephen Kaye said that Victorian newsagents are not waiting for the News Limited changes in Queensland to come to Victoria. He observed than some Victorian changers were not what News Limited wanted. Hang on, News Limited has been at this change thing for close to three years, watching what is happening in Victoria among newsagents and he says that some of the changes newsagents have been leading may not be what News Limited wants. That’s odd.

Are newsagents is a master servant relationship or is this the era of deregulation.

All newsagents want is contracts so that they can go about commercially structuring themselves as they consider mot appropriate.  It looks to me like News is trying to control too much of the operation. This is not what one should see in a deregulated marketplace.

If I was running VANA I’d ask for a copy of Stephen Kaye’s speech so it could be published to all newsagents. It contains information all newsagents need to hear. I would also bring into the open for all newsagents as a matter of urgency open discussion about what is known of the News Limited plans. I’d actively engage with South Australian newsagents who have gone through aspects of the News Limited plans already. Their experiences would be invaluable despite what some in News might say. South Australian newsagents have a lot to share with their eastern seaboard counterparts.

While I disagree with their process, I agree with the overall goal of what News Limited is working on. The problem for newsagents is that the company is pursuing considerable change in its relationship with newsagents while at the same time finally addressing the state based silo management style in which it has operated for decades. News in a year or two will look very different to the company we know today.

I suspect the scope of change facing newsagents is far more than any but a small few expect.

News needs to stop jumping at shadows and trying to discredit anyone they think is challenging their position.

The VANA awards dinner was good. I appreciated the opportunity to catch up with plenty of newsagents as I did in Hobart a week earlier. Brisbane next week…

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Newsagency challenges

At VANA awards dinner tonight

I’ll be at the VANA awards dinner tonight representing my newsagency software company Tower Systems – a sponsor. We sponsored the Tasmanian awards last weekend in Tasmania. It is frustrating that Tower appears to be the only newsagency software company investing money in the channel in this and other ways. I wish other newsagency software companies would show their support for newsagents. Alternatively, associations could cut off those who do not support them. You can’t have it both ways.

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Newsagent representation

Time to overhaul newsagency industry awards

The process of nominating and deciding newsagent awards needs to be overhauled. We owe it to ourselves to engage in a world’s best practice approach.  It is wrong that suppliers who are sponsors nominate newsagents. It is equally wrong that suppliers participate in voting for winners.

I say this as a past and present sponsor of newsagency industry awards.

The result of the closed approach has resulted, occasionally in the past, in the best newsagents in a state or territory being overlooked despite having the best retail business or best distribution business.

All of us who support and participate in the awards at the state and national levels owe it to the future of the newsagency channel to push for change.  We need to hold up the very best newsagents who are called the best because they are the best.

For me, the starting point of assessing the best can be found in year on year business performance data.  Let’s reward newsagents who are growing their businesses beyond the average.  Business numbers are more important than a slick awards submission. Indeed, I don’t think there should be a submission other than business performance data for the data will tell the story of leadership.

Performance data is on my mind because I get to see it regularly through my benchmark studies.

My newsagency software company was ranked 14th in the BRW Fast 100 Awards around eleven years ago. That same year I was a runner up in the Ernst and Young Entrepreneur of the Year and ranked in the top 25 in the Deloittes Tech Top 25. In each case the assessment was based on business facts with no pitch made from the business itself. The data, the business performance results, were what got you into consideration.

I don’t write this to offend any past winners or those who will win this year. Rather I write this wanting us to break out of an awards model created back in the days of regulation and protection. We’re in a very competitive retail world and our awards should reflect competition.

While suppliers could support the prizes, I think it is time for them (us) to take a back seat in deciding who wins.

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Newsagency management

Why it’s important for newsagents to get on Twitter

Further to my post last week calling for newsagents to join the Twitter Army, I have been asked why this is important.  Here’s my explanation…

Twitter is like a street corner from decades ago where someone on a soapbox could speak about anything and get some sort of audience. It is a place for you to have your say.  It is also a place where you can get a message directly to someone. Along the way, anyone on Twitter can see what you say. You can also respond to the tweets of others – I’ve responded a few times to @RupertMurdoch.

You can see my tweets here.

I think that Twitter offers Australian newsagents an excellent opportunity to get attention on issues important to us as a channel. Hence my call for newsagents to sign up to Twitter and to email me at mark@towersystems.com.au their details.

I plan to occasionally email all newsagents with a Twitter account with a suggestion to tweet on a topic using a common hashtag. A hashtag is a way of connecting tweets from multiple people. Whether people actually tweet is up to them.

Each tweet is seen by those who follow you. It also comes up when people search tweets of just read recent tweets.

Your followers will be people who are interested in what you have to say. Most of your followers will be people you have never met. If they like a tweet they may re-tweet this to their followers. See the snowball effect.

Think about the Bill Shorten whack against newsagents a couple of weeks ago.  A hundred or more newsagents tweeting about this could have got us on the top tweets at the time and this could have got the story on the radar of reporters and they could have confronted Shorten.

By organising ourselves in this way we create a digital megaphone for newsagents.

I think that newsagency businesses are relevant to Australia not only for the local and community service we provide but also for the our role in the Australian narrative. Our businesses are quintessentially Australian. We need to reflect this by talking more about ourselves and what we think as a channel.

If we have a strong enough collecting voice on Twitter we could possibly influence on issues on which we might otherwise not be heard.

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Newsagency management

I am not involved in the NSW newsagent meetings

An email has been circulated in NSW this week with a document attached which I wrote to help newsagents to trade through tough times. The email was encouraging newsagents to attend a meeting organised by NANA to look at some issues they are concerned about.

I am not involved in this or any related meeting.  I don’t endorse the meeting or any of the topics being discussed.

I was not consulted before my document was sent out. The version of my document appears to have been reformatted from the original.

My document should not have been sent without explanation from me as to its intent.  It is part of a package of information I have prepared to assist newsagents to improve their businesses. I didn’t write it with any political agenda in mind or for any political purpose in our channel.

I’ll help any newsagent doing it tough. But they have to want to help themselves. This starts with being accountable for your position and continues with focussing on driving business efficiency and decision quality and evolving the business to serve today’s needs and not yesterday’s history.

It would be a mistake to think that others need to fix out situation. If we are doing it tough we have to fix it ourselves. We have to be selfish about our businesses. We have to run our businesses for profit today and not in the hope of what someone might be encouraged to pay tomorrow.

Why am I writing about this here? I have received calls from NSW newsagents asking about my involvement in the meetings. ass I noted, I am not involved, I was not consulted.

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Newsagent representation

Newsagents scrambling to avoid the XchangeIT penalty

XchangeIT has written to newsagents who have consistently failed their timeliness, quality and or other criteria for sending magazine sales data from their businesses.  This action was first forecast over a year ago with regular reminders published since.

A flaw has been discovered in the timeliness criteria which XchangeIT has agreed to review.  This is where a newsagent may run their end of shift process prior to the end of the day, for sound operational reasons, and have some trading on that date before closing the business for the day.

Colleagues at my newsagency software company Tower Systems are navigating this gap in how XchangeIT expects newsagents to operate their businesses versus how some newsagents do operate their businesses.  The gap means that some newsagents who do send data recording all sales are set to be penalised because sales data for a day could be split across two sales files.

Immediately on being informed of the situation XchangeIT agreed to investigate.

In the meantime, I urge newsagents to treat the issue seriously and review their EDI related processes to avoid the XchangeIT penalty.

Footnote: if only magazine distributors would accept penalties for consistently poor performance as they are now imposing on newsagents through their XchangeIT operation.  The fines would cripple them.  Double standards are on show here.

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Newsagent representation

EPAL retreats on EFTPOS feek hike position

As I have been writing here for some time, EFTPOS fees are set to increase from October thanks to a decision by EPAL, the organisation created by the Reserve Bank and controlled by the major banks plus Coles and Woolworths.  Oh, and I have noted that Coles and Woolowrths are set to not face any fee hike. Why the Reserve Bank would think it is smart to put the big banks and Coles and Woolworths in charge of the cookie jar given their addiction is beyond me.  What is even more shocking is that no one in the government is prepared to reasonable engage on this as an issue of concern for small business.

Anyway, I digress.

Yesterday, it was reported that EPAL has changed its position on the impact of its EFTPOS fee pricing decision.  Here is what EPAL had said:

Australian consumers should not face new charges to eftpos interchange fees.

Yesterday, the Australian Financial Review reported (page 48) EPAL as saying:

It is therefore premature to state with certainty what impact the planned changes will have on retailers or then upon their consumers.

Click here to read the full EPAL press release containing this quote.  Not that it says much.  It’s a kind of a cover your backside press release, as if they know what is coming.

I suspect that the EPAL Board, controlled by the big banks plus Coles and Woolworths and realised that the big banks will pass on increased fees and that retailers will either have to either suck these up or pass them on.  With the current retail challenges, it’s far less likely that retailers would have the capacity to suck up the EPAL / Bank drives fee increases.

This back down by EPAL is considerable given the battle they have waged over recent months against anyone who has criticised their new fee regime.  They have successfully nobbled politicians based on the responses I have seen from local members who have been queried by newsagents about the new interchange fees.

It is not too late for newsagents to engage on this issue.  The ANF and a small group of newsagents have.  If only more newsagents would.

For background on this issue and a copy of a letter from the ANF which you can use, please click here.

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EFTPOS fees
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