Click here for the notice from the Herald and Weekly Times for details of the Great Australian Storybook Collection promotion that will launch in Victoria in a week. As with all these promotions, Tower Systems will help newsagents track stock and manage reconciliation.
The promotion coincides with a cover price increase, as is often the case from News Corp.
ALNA approached my software company to support its meeting in Perth later this month for newsagents and lottery agents to hear from WA Premier Hon Mark McGowan about his vision for the role of retailers in Lotterywest. As the only government owned lottery operation left in Australia and given its terrific community engagement program, Lotterywest has a valued role with WA newsagents.
I am glad to have been able to help support this ALNA facilitated meeting.
Here are some details:
The Australian Lottery & Newsagents’ Association (ALNA) is hosting the largest event WA has ever seen for WA Lottery Retailers to hear from WA Premier Hon Mark McGowan about his vision for the role of retailers in Lotterywest.
The event is being held in the Grand Ballroom of Crown Perth on Friday 28th July from 11.30am to 3.30pm.
In addition to WA Premier Hon Mark McGowan MLA, the event will also be attended by the WA Small Business Minister Hon Paul Papalia MLA.
Lottery Retailers can come and meet, enjoy lunch and listen
to the Premier and hear about some of the changes underway, as requested and lobbied for by the Australian Lottery & Newsagents’ Association (ALNA).
This wonderful event will provide all WA Lottery Retailers with the opportunity to show Premier McGowan the difference that his leadership has made to their businesses and their lives.
The event will be complimentary for all WA Lottery Retailers.
At a similar meeting earlier this year significant progress was made, which benefited retailers. While no obvious direct benefit flowed outside the state, I suspect Tatts watches WA engagement. Hopefully, they learn from a more co-operative approach.
The event is not a money marker for ALNA nor is it one for those involved in supporting it. It is an example of people and businesses engaged in the channel pulling together to support the channel.
I encourage all WA newsagents with lotteries in their business to attend.
If covers sell magazines then the latest issue of The Australian Women’s Weekly should sell out. It is beautiful and timely. We have it placed in several locations to make the most of the opportunity. The next few days are critical – I say this based on sales decay data showing close to 80% of sales in the first week.
These people visited one of my stores and engaged in inappropriate behaviour. If you know any of them, please email me at mark@towersystems.com.au. I would appreciate it. There was another woman with them, not dressed in black.
The most basic task magazine distributor Gordon and Gotch has serving newsagents and publishers is to accurately and ethically supply magazines based on sales data. I regularly receive evidence from newsagents of the company’s people or systems or both failing to do this.
The image shows the worsening situation regarding People’s Friend for one newsagency.
The graduation of supply suggests that the problem here is systemic rather than human error.
It looks to me like Gotch has stock it has to move, regardless of sales. I would love to be wrong but the evidence suggests I am not. There is no reason for the ramping up of supply as Gotch has done.
This action disadvantages newsagents. It makes them less competitive. It is unfair. Yet here we are in July 2017 with a post about an issue that I was writing about here back in 2005 when I started this blog.
Magazine publishers, we need your help.
It is action like this that causes newsagents to cut space for magazines, thereby forcing Gotch to cut the range of titles carried. I have written about newsagents doing this, and why, yet no one appears interested enough to fix the most fundamental problem: the continuing systematic oversupply by Gotch.
What happens here is that each oversupply has a cost to newsagents of labour, space and freight. All of these costs are borne from an acton over which the newsagent has absolutely no control.
There are not many businesses where poor (or deliberately harmful) supplier practices lead to significant loss making activity for the recipient business.
The newsagent who sent me this screen shot has good data, reliable data, provided on time. The actions of Gotch have nothing to do with recent returns notification changes. No, the actions here go to the core of magazine distribution, they reflect decades-long problems that are a blight on the newsagency channel, but not supermarkets it would appear.
That magazine publishers remain silent on this issue is appalling as their interests and newsagent interests are aligned. Only over the counter sales matter. Everything else is overhead to be kept as low as possible.
In the years since I published How to do a magazine relay in your newsagency plenty has changed. In this post I provide up to date advice.
Before you start the relay, consider the amount of space you want to allocate to magazines. Do not allocate space to fit what you are sent. Allocate space to make money.
Today, magazines are best located on a wall, ideally at the rear of the shop, such that can be seen from people walking past the shop. A simple MAGAZINES sign above works well.
This back of shop placement, with magazines owning the space can work well as a traffic driver. Where I have seen this move implemented it has not increased the decline in magazine sales.
Ideally you can fit all magazines on the back wall and eliminate all aisle use of magazines.
On to the relay.
The relay you do in your business is your relay. There is no right or wrong way. What I have written here is my opinion, which may be wrong for you.
There is also no end point to a relay. What you do today will need refining next week and the week after. So, do not over think what you want to do as that would be a waste of time.
The goal of the relay has to be to disrupt magazine traffic in pursuit of an increase in sales. What I mean is: change everything, upset customers and staff, sell more magazines as people discover titles they did not know you had.
PLANNING
Map out the wall, determine your zones shopper: garden, food, men, women, sports etc. The categories where I use less than one pocket per title are: special interest, British weeklies, food, comics and some craft segments.
Look at the percentage of sales delivered by each magazine category and look at sales trends for the categories. Tote up broad groups. For example the percentage of sales for women’s weeklies, women’s interests, crafts & hobbies, crosswords, home & lifestyle and food & wine. If your newsagency is like mine, this grouping will account for more than 50% of your magazine sales.
NOW, THE MAGAZINE RELAY
I suggest it is done by one person, an owner, working alone.
What I do in women’s is the same for the other zones I create. I do each zone separately and try and get into the head space of the shopper of the zone – using the most popular titles to act as beacons, or signposts, for the zone.
I am careful what I place next to top selling titles. This is a prime spot, next to the popular titles. Choose wisely. Choose titles that naturally fit next to the big titles, titles shoppers are likely to browse and purchase on impulse.
If I am not sure about where to put a title I put it aside and move on.
I take extra time with special interest and hobby titles. For example, I put railways and model railroad titles near each other but I am careful to ensure that they are separated as they appeal to two shoppers and only occasionally do you see titles from both segments in the same basket.
Within the zones I look for and respect specialisation. For example, within men’s lifestyle and sports I create a clean space for the quality serious fitness titles like Coach, Men’s Health and Men’s Fitness.
REVIEW, FEEDBACK, FOLLOW UP
You’re not done when you think you are done. Track sales, listen to your team and your customers. Tweak where you feel it is necessary.
Bring new issues to the fore. Continue to be engaged in how your magazine department looks.
Continue to look at your sales data. If there is no lift be open to further change.
FINAL WORDS
Doing a magazine relay can be like doing one of those kid’s puzzles – you move them around and around until you have the completed image. That image can look and feel like a work of art once you are done.
While some readying this will be tempted to say why bother, we only make 25%. Get the relay right and sales will increase without any extra capital investment and with a lower retail space allocation. That is a win in my view.
If you have made it this far, thanks for reading. Magazines really are a point of difference which we need to work harder at embracing – despite the challenges of the distribution system.
I’d be happy to answer questions or discuss magazine relays with anyone: mark@towersystems.com.au or 0418 321 338.
Over to you…
I am in the US and last night at 11:46pm, 2:46pm Melbourne time, an ad for The Lott (Tatts) came up when I was checking out Huffington Post. I am told they said they would stop promoting online only.
The harm to a retail business from employee theft can be far reaching, debilitating the business and those who work in it. The keys for moving on from the crime, because you must move on so the business has a future, starts with confronting the situation.
Too often I find newsagents who do not confront the situation. Too often they are angry, hit out in anger but do not deal with the matter such that it is resolved and they free themselves to move on.
Through my newsagency software company I have been engaged in helping newsagents deal with employee theft for many years. The practical advice I offer here on handling a discovered situation of employee theft is based on that work.
The goal is to offer straightforward steps to help you get through as it is on the other side of this where you can find the opportunity to move on from the feeling of violation that often accompanies employee theft in small business.
If you are nervous about meeting the person or their family, write down what you plan to say. Keep it short. To the facts. No emotion. Having a script prepared can be useful even if you do not read it.
If there is any risk of violence, do not have a meeting. Go straight to the police.
Time is of the essence here. The longer you know about the situation and the longer you do not act the less useful the outcome is likely to be.
If you are not sure what to do, contact me. I will help in any way I can.
I am not law enforcement, a lawyer or an investigator. The advice here is based on my own experiences in my retail shops and my work with other retailers.
A newsagent in Brisbane was asked to honour the price on this Woolworths coupon for News Corp. newspapers:
If News Corp. is behind this offer, shame on them for making Woolworths look cheap compared to the local small business newsagent who has the titles at full price.
It is galling that this $1 price is considerably lower than the cost price of the newspapers to newsagents.
It is easier for customers (or anyone) to complain in a way that hurts your business (and you) than ever before thanks to the megaphone of easily accessible social media.
Through local community groups on Facebook, category based groups and more it is easy for a negative story about your business to gain traction and spin out of control before you know about it.
It is a bit of a sport today to pile on. I have seen it happen plenty of times.
Often, people pile on without knowing the facts, because the original post does not accurately represent the facts and because they enjoy the sport of piling on without regard to the facts.
On social media today people often complain about situations that are not real. They often spin a story to suit their outrage. Simply challenging this is not enough. Indeed, it can make it worse.
Here is my advice of how to handle criticism of your business on social media:
Don’t rely only on this advice. Do more research to be prepared. Any business active on social media will experience the kind sof attack I describe here. Be prepared.
Do not ignore any negative post or comment about your business. Fight for your business and those who rely on it for income. But do so with care, respect and professionalism.
I hope all newsagents and all marketing groups get behind this newsagent exclusive promotion.
If your shop is pitching more than three key product categories at the sales counter you are probably using your counter space and not achieving the return you can achieve.
Ignore history. Push back on what you have always done. Go for a simpler and clearer message and expect better results.
Here is one focussed counter pitch we did with terrific success at pushing how shoppers saw our business.
Context can be everything if you expect an employee to embrace a change of direction, a new product mix or some other decision that is different to what the business has usually done.
My management tip today is to explain these decisions, provide a data context that encourages belief and support.
Get this right and you can anticipate greater support from within for the business decisions you make.
Why matters.
We are offering this one-shot Diana publication from Pacific Magazines as a pre-sell, prior to launch. This is something we have done many times before with one-shots, with terrific success. Given the broad appeal, still today, of Diana, a presell makes sense to me.
We are pitching the pre-sell ion this title online as well as in-store at the counter. Once we have the product next week we will pitch this at the counter too. Simple.
I encourage all newsagents to do this. It is an excellent opportunity to capture the sale and revenue prior to the goods arriving in-store.
Look at things like this as a race to get the cash. It is better people spend the money with you on this title. Jump on this and pitch a product that your competitors will only engage with once they have the product. Yes, it is a first mover advantage in your area if you jump on this idea.
Once you get the product in-store, be tactical rather than pretty. The cover will do the work for you in my view. The opportunities here are terrific.
I suspect this title will be a reminder of the value for our businesses of a smart and timely one-shot and how we newsagents can handle this better than other retailers. More please.
Through my software company I do work in a range of specialty retail niches. The newsagency channel is the only retail channel with an EDI platform owned by suppliers and for which retailers pay an access fee.
Having to pay to access XchangeIT disadvantages newsagents. It imposes a fee that newsagent competitors do not have to pay for similar type services from what I understand.
Suppliers benefit tremendously from EDI data flowing to and from newsagents. Newsagents should not be required to pay for this. It is time XchangeIT access was free for newsagents.
And while I am at it, it is time for XchangeIT services to be best practice rather than perpetuating out of date practices.
For the record, newsagents using software from Tower Systems are not forced too pay software support fees to retain access to XchangeIT. In my opinion it is wrong to force newsagents to have to pay a POS software co. to maintain such access.
Another newsagency business was hit overnight with a malware attack. They have been asked to pay money to regain access to their computers. They don’t have a current backup. The options for them are not good.
The no backup think is appalling business management.
The malware attack is also poor management as it could have been avoided.
Click here for a computer use policy that I recommend you ensure all employees read, understand and commit to. The steps needed for protection against a malware attack are simple.
I heard from a newsagent who was “told off” for moving newspapers away from near the entrance to the business to the rear of the business.
The newsagent made the move based on the return on floor space being achieved and based on the trajectory. I am aware of the numbers. The move was the right one in my opinion.
The newspaper publisher rep was having none of the logic. I am told there was a threat to pull newspapers from the business.
I am not aware of any decline in newspaper sales in a business that has moved newspapers from the front of the business to the rear. Without such evidence, any claim or demand from a newspaper publisher rep is without any evidentiary basis.
Here are five reasons why moving newspapers to the back of the shop can be a good move:
Newspaper publishers have no rights over where papers are in a business. I say this even if some have a contract with requirements. Good luck finding a court to uphold a requirement on a small business retailer that commercially harms the business.
Newspapers fit well at the back of the shop. Sales are not affected. Sure one or two complain – tell them the exercise would be good for them.
Newspapers play an important role in newsagencies. For this to continue we need to leverage ways that reduce operating costs – like publishers themselves have done in recent years in the running of their businesses. The best way for us to do this is to stop these low margin products from us making what we could make from front of store high value retail space.
I heard yesterday of a long standing newsagent supplier threatening a newsagent with legal action if they sought to break the relationship with the supplier.
The threat was made face to face, in the back of the shop, without witnesses, by the managing director of the supplier.
The newsagent was left shaking and fearful. They decided to continue in a relationship with the supplier because of the threat of legal action. They felt that was best for the business, to let the contract they have run its course, and have as little contact with the supplier as possible.
If what I have been told is true, the threat is something that could be reported to the police or at least challenged in court. However, I suspect the person making the threat knows the newsagent would not do this, I suspect they would know the newsagent does not have the resources to fight such a fight.
The newsagent knew the meeting was happening., They knew it would not be pleasant. My advice to them on hearing the story after the meeting was that they should have recorded the meeting for their own records and that they should have had someone else there as a witness.
If a supplier threatens you with legal action to force you to stay with them or to do things that you know will not help your business, consider calling their bluff. It could be that the last thing they want is their business put under the scrutiny of a court, where the would have to defend how they deal with you, what they provide you and explain the value of this for your business.
I understand the fear of court action. I suspect that is what this specific supplier preys on. I suspect they make the threats I am told they make because they know no newsagent will call their bluff and say okay, take us to court – get out of my office and take us to court.
I know of another supplier to newsagents who made a similar threat of legal action, but with less intimidation than the first story. In this second situation, the newsagent said, okay, if you think you have a case, take us to court. The supplier did not take them to court. I suspect the directors decided against this because of the possible can of worms such court action would have exposed about their business.
Bullying does not only happen in the school yard. Sadly, it happens in business, particularly in situations on inequity such as the two stories I have shared here.
Shame on any party threatening legal action against a newsagent to get the newsagent to stay in a relationship that is not commercially appropriate or valuable too their business.
If you have a story of such legal threat, consider calling phew bluff and consider sharing the story, discretely, with fellow newsagents. Tell the truth of what happened and what it caused you to do.
If nothing is done, these bullies continue to get away with it.
One of the challenges facing legacy product suppliers to the newsagency channel is the success many of us are having with new product suppliers.
It is only natural that newsagents, like other business people, prefer to invest in traffic, GP and, ultimately, bottom line P&L growth.
Therefore, newsagents are more likely to invest in products and infrastructure supporting products that fit the growth story. It is also why newsagents are less likely to invest in legacy products and the requirements of legacy product suppliers. It is why legacy suppliers struggle to get attention of newsagents.
The extent of transition in the newsagency channel is encouraging. Newsagents embracing new categories and through these new suppliers. It is leading to shop layout and fixture changes as well as technology changes as newsagents pitch new products and categories through their technology in ways that help attract new shoppers.
Our legacy suppliers who historically have relied on bully tactics and being required products are coming, slowly, to realise the new world, that their products are not as needed, that the expensive and anti-competitive processes are not appreciated by newsagents. Well, some at least. There are others who continue their ignorant bullying ways.
We are in a golden era of change in our channel. There are winners and losers. Market forces are at work, and this is a good thing.
When contemplating a request from any supplier, consider the new traffic, GP growth and bottom line benefits. If the request does not improve these then maybe ignore it. The suppliers of legacy products who handcuff you to anti-competitive processes may one day get the message.
The front page if today’s Daily Telegraph is nothing but political propaganda in my personal opinion. It pushes an agenda that has nothing to do with news of the day. The front page story is fantasy fiction, designed to rally readers to an opinion about the Labour party that News Corp. wants.
This is not journalism. It is not what newspaper publishers should put out. It is the pushing of an ignorant fear based agenda, something News worldwide has a track record for.
There are no facts in this piece.
This game by News Corp. is considered more important than key stories of the day, news stories.
It is typical for a selfish publisher that runs its agenda ahead of reporting the news, reporting the facts.
You only have to look at their coverage of the NBN over the years. The originally proposed NBN could have been the Snowy Mountains Scheme for our time. It would have delivered a productivity boost off of which plenty of companies could have thrives, It could have fostered start-ups that could have changed towns and cities.
Instead, this publisher ran a campaign that resulted in the junk NBN we have today, something that is holding our economy back.
Yes, these are my opinions. However, I have some experience with which to form the opinions and some knowledge of what has been done in some US states, New Zealand and Estonia. Experience running a software company that serves 3,500+ small business retail businesses that rely on fast and easy internet access.
Newspaper publishers should not run agendas.
Shame on politicians for pandering to them, to get to be part of the News Corp. agenda.
If I was a newsagent in NSW I suspect I would not offer the Daily Telegraph for sale today.
On The Age online:
On Facebook:
It would be easy for them to make their retail network part of they pitch, if they were so inclined. But, hey, the compete with you.
I visited a newsagency with Tatts last week that was forced to install two screens, even though financially the business could not justify the spend and Tatts could not provide any indication of the commercial value too the business of the spend.
Yesterday, I visited another newsagency that does, I estimate, at least four times the lottery turnover of the earlier business, yet they have been required by Tatts to install only one screen.
While the second business has less space, they do have room for two screens. Close to two thirds of GP for the business comes from Tatts.
There appears to be an inconsistency from Tatts in the screen requirement, one screen versus two screens.
If the trigger is revenue, the second business I mention should have two screens. If the trigger is commercial value to be gained from the screens, the second business I visited should have two screens. But they have one. And the business that could not afford two screens has them, and there is no evidence they offer value.
How Tatts has been able to get away with demanding small business retailers make capital investment in technology not involved in vending the product and without any documented business case is dreadful.
I continue to be glad I do not have Tatts in my businesses.
It is frustrating newsagents continue to be asked to hand out The House of Wellness ‘supplement’ with the Herald Sun when the publication is nothing but a glorified Chemist Warehouse ad platform. It feels nothing like a value-add supplement. Rather it wastes space and labour.
Click here for a copy of the new General Retail Award rates from Fairwork. It is important you take time to think about what you will do in your business about this. It is not as simple as applying the new rates, especially the lower penalty rates.
In March I wrote about why I will not apply the lower penalty rates in shops I own. In case you missed it, here is what I wrote then and stand by today:
Why I am not embracing the reduced Sunday penalty rates in my retail business
Here are my reasons for deciding to not embrace the Sunday penalty rates decision in my retail businesses:
- I value my employees. To pay them less as a result of the decision could suggest to them they are worth less. I have hated it when suppliers reduced margin or commission and argued then that they value me and my business less.
- I want to be competitive for good labour. Paying a competitive rate is key to this.
- The business reward. It is open to employees who are now told their pay will not be cut to return the favour to the business.
- Competition. A range of competitor business have made a similar announcement.
- While of economy fairness. While I agree with the decision, it should only be taken as a whole of economy review that fairly adjusts economic touch-points for all and not only salaried workers.
- Weighing everything up it is the right thing to do.
This is not a permanent decision. It is possible I will modify my position as the marketplace situation evolves. If I did and thereby embraced a saving in labour costs, I anticipate through would be invested in more hours.
All business owners need to reach their own conclusions on this matter. Unfortunately, as a country we are bereft of leadership on broader issues that should be confronted in any economic setting adjustment as has been done with Sunday penalty rates.
Think about what you feel is right for your business. This has to be a personal decision. The goal of this post is to encourage you to make your own decision, regardless of what the actual decision is.
I say make your own decision as there are implications for what you decide.
If, for example, you decide to not cut Sunday rates, there should be a benefit from employee engagement, as appreciation for your support. So, I would encourage discussion if this is your decision.
If, on the other hand, you decide to cut penalty rates, explain why this is important for the business and how that connects back to employees.
Unfortunately, this issue is highly politicised as a battle between classes. The reality in small business retail and small business generally is there is rarely a class. Indeed, employers often make much less than many in their workforce are paid.
Too many newsagents use software in their businesses as a glorified cash register. They track stock in, scale sales, scan returns and that is it. Rarely do they manage the business by the numbers.
Next time you scan an item being purchased at th counter, think why? Think about whether you actually use all the data being collected and cultivated.
My challenge today is that you actually use it.
I am prompted to write this because if data I see in a report from a retail business I know of. They have excellent data, that chronicles the steady decline of the business and shows no action to arrest the decline. This is a business that uses their software as a glorified cash register. What a waste.