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

Typo Christmas cards under scrutiny

Cotton On, the owners of Typo, are looking into greeting card sourcing following reports about the use of prison labour. This, from the ABC News report:

A Chinese printing company accused of using prison labour to make Christmas cards sold at Tesco supermarkets in the United Kingdom is also a supplier to Australia’s Cotton On Group — a relationship the group is now investigating.

The forced labour allegations emerged after a six-year-old girl in London discovered an apparent plea for help written inside a Christmas card, which was made by the company Zhejiang Yunguang Printing and sold at the supermarket chain Tesco.

“We are foreign prisoners in Shanghai Qingpu Prison China. Forced to work against our will. Please help us and notify human rights organisation,” the note in the Christmas card said.

However, Zhejiang Yunguang Printing also manufactures products for the Cotton On Group, which owns a variety of retail brands across Australia, including Cotton On, Typo and Supre.

The Chinese company was named in Cotton On’s most recent official supplier list, and Zhejiang Yunguang Printing also claimed to make products for the Australian brand in a corporate video on its website.

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Ethics

News Corp and tax

Rupert Murdoch’s News Corp in Australia: sales over five years = $13.9 billion, tax over five years = zero. Source: this month’s ATO Transparency data for News Australia Holdings Pty Ltd.

A Tweet from the skilled business journalist Michael West.

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Ethics

Captions matter for cards, especially at Christmas

Obligation card shoppers like captions on cards they purchase to be targeted for the recipient. While more creative card shoppers, those more likely to buy blank cards and fully express themselves are less concerned about captions, the obligation card shoppers want it simple and clear, they want the caption they need.

With some Christmas ranges being reduced, obligation card shoppers have been less satisfied. I think this is a reason we see more newsagents ranging Christmas and other seasons from multiple cards companies.

The obligation card shopper is important in that a good seasonal experience that is satisfying for them and their recipient could be useful in getting them back in through the year.

We need more caption depth and less loading of the most popular captions in 2020.

Caption depth is a focus of some re-energised competitors outside the newsagency channel and that is a challenge we, and our card suppliers, need to step up to if we are to hold or grow our position in overall unit sales.

The card category is critical to our businesses for the net traffic delivered and the margin achieved.

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Greeting Cards

Woolworths and News Corp want people buying newspapers at Woolworths on the weekend

This coupon offers weekend newspapers at a discounted price at Woolworths outlets. The offer is available until March 31, 2020.

I doubt that Woolworths would be funding this promotional offer.

It makes other outlets look expensive. Either the newspaper is worth the cover price printed on it or not. Offering variable pricing based on where it is purchased is unfair.

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Newspapers

Sunday penalty rates in newsagencies

Newsagency businesses are covered by the General Retail Award. In the Award there is this coverage relating to Sunday penalty rates.

I mention this today as two employees of a newsagency (with which I have no connection) contacted me this week about their pay for Sundays. My answer to them was there same as I give every current or former newsagency asking abut pay – contact Fair Work and go through their process to determine if you have been paid correctly.

In their situation they were being paid cash in hand at a rate that was higher than what they would have got had it been taxed but at a lower cost to the business had it been paid at the required gross rate and on the books. Also, being cash in hand there was no super contribution.

With employee entitlements being in the news so much recently – 7-Eleven, Woolworths, the ABC and others – the last thing we need is the actions of some reflecting on the channel.

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Ethics

ACCC publishes statement of issues with Bauer acquisition of Pacific Magazines

The ACCC today has published Statement of Issues with the proposed Bauer take over of Pacific Magazines. The statement includes:

The ACCC’s preliminary view is that the proposed acquisition is likely to substantially lessen competition by reducing the number of major print magazine publishers in key magazine categories from two to one. The focus of the ACCC’s concerns is in relation to the loss of competition in the supply of content to readers/consumers between Woman’s Day (owned by Bauer) and New Idea(owned by Pacific Magazines) and the loss of competition between Take 5(owned by Bauer) and That’s Life! (owned by Pacific Magazines).

Bauer has released a statement:

ACCC HAS PRELIMINARY CONCERNS WITH BAUER MEDIA GROUP’S ACQUISITION OF MAGAZINE PORTFOLIO FROM SEVEN WEST MEDIA

Sydney, 19 December, 2019: Bauer Media Group is disappointed that the Australian Competition and Consumer Commission (ACCC) has today indicated that it has preliminary concerns with the proposed acquisition of Seven West Media’s Pacific Magazines portfolio.

Adrian Goss, Bauer Media General Counsel says: “In view of the ACCC’s own findings in its recent Digital Platforms Inquiry, we are surprised that it has not cleared the acquisition at this stage. While we are confident of receiving clearance in the New Year, the ongoing uncertainty is enormously challenging for Pacific Magazines’ staff and the business more generally. Bauer Media has always seen the acquisition as a positive step towards ensuring the sustainability of print magazine publishing in Australia.”

Bauer Media will continue to cooperate with the ACCC in addressing the matters raised in its statement of issues and expects the acquisition to be cleared in early 2020.

 

-ENDS-

While I agree it will lessen competition, so to would the closure of Pacific.

Magazine publishing has changed dramatically in recent years, with more changes coming. Blocking the takeover, if it did come to that, would serve little purpose in my view.

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magazines

The desk calendar opportunity for newsagencies

Desk calendar refills are one of a dwindling number of counter impulse lines in the stationery category that commercially work in the newsagency channel.

In my own shop, we have had them out in a small space situation at the counter since they became available and have been topping up regularly.

A common comment is I better get this while I can. Customers often tell us they see them in less shops now.

In addition to the counter pitch, we have pitched the refills one social media.

While this is a small win, it is a win and any win is worth taking while we can.

Overall, desk calendar refill sales have been declining for several years, like diary sales and, to a lesser extent, calendars. With digital calendar access on our watches, phones, tablets and computers, the need for the print versions is less. From what I see, sales are not at a point to exit the category yet. However, to warrants watching.

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Calendars

Westfield misses with fake snow theme for Christmas

I was at Westfield Southland in Melbourne today and saw their centerstage Christmas feature event – a snow village, complete with fake dry snow falling at regular intervals. I heard one kid say this is Australia mum, we don’t have snow at Christmas while most kids were standing under the falling ‘snow’.

The snow theme interests me as one of the push ks I hear from shoppers and newsagents is relates to snow themed cards and gifts at Christmas. People usually say it’s not appropriate for Australia. The marketing ‘experts’ at Westfield disagree based on how they spent the considerable marketing dollars provided by their tenants.

For me, the snow theme is a fail. However, the queue of families wanting to experience it and have their Santa photo moment was long.

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Ugh!

Website advice for newsagents and indie retailers

Here is a video I created a few weeks ago for retailers using POS software from my Tower Systems company. In the video is advice that could be useful to newsagents considering websites for their business. I see many retailers app0roach their online presence with a plan to place all in-store inventory online and to do this under the banner of the physical shop. I think both these moves are a mistake, and I explain why in the video.

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Newsagency management

Attracting new shoppers to the newsagency

Usual product categories attract usual shoppers. If we want new traffic we need to do this with products that reach beyond what is traditional for us.

Here is a video I made Saturday to promote Pushed, a very successful new traffic products for us.

I shot the video using my iPhone. I used iMovie to clean up the sound and freshen the colour. Then, I used a web app to lay in the text and underlay music.

The whole process took fifteen minutes. I have a video that we will use four or five times. Already,k it’s resulted in some welcome revenue.

This post is not about the content but, rather, about the process of creating the content. More newsagents should do this as contents you have created will be more meaningful and more connected to your business. This makes it more valuable to you.

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marketing

An early look at Christmas trading in newsagencies

I have looked at sales data for ten newsagencies for the last four weeks, comparing 2019 performance to 2018. The businesses are: 3 x capital city shopping mall, 3 x high street suburban, 2 x regional (pop. 25K+) and 2 x rural (pop. 2,000 – 4,000). None of them are mine.

The businesses are not all in one newsagency marketing group. I did seek out businesses that traded in all of the reported product categories.

While this is not a statistically sound sample size to project results for the channel, the numbers are interesting. Here is a summary of the overall stats.

  • Cards (overall): down 3%.
  • Cards (Christmas): down 2.5%.
  • Christmas specific gifts / homewares: up 6%.
  • Gifts: up 6%.
  • Toys/games: up 10%.
  • Jigsaws: up 5%.
  • Homewares: up 2%.
  • Newspapers: down 14%.
  • Magazines: down 11%.
  • Stationery: down 9%.

Looking at the businesses in the data pool of 10 that are performing better, they share several things in common:

  • The front of their shops, as much as permitted for those with lotteries, do not look traditional.
  • They are active on social media with 500+ followers, daily posts, engaging and entertaining posts.
  • They offer diverse product and overall non-traditional range.
  • They encourage shoppers to try what they sell.
  • The encourage staff to have fun.
  • They are community connected.
  • They don’t see themselves as newsagencies.

Now, what does all this mean? Well, that’s up to you and how you see your business. Digging into the data deeper, for the majority of the 10, Christmas is under way and is, overall, slightly better than last year. I think they are seeing Christmas under way because of how they are engaging with the season in-store and out in social media and elsewhere.

We really do make our own success, through our buying, visual merchandising and out of store messaging.

I appreciate that most news outlets are reporting on declining retail sales. National data represent that. Below the national data is the battle between rooftops, retailers winning retail revenue from competitors. While there is plenty to not like about being in a shopping mall, it is in a shopping mall situation that you can more easily engage in competition with a nearby rooftop.

There are retailers doing well and, yes, there are retailers not doing well. I think that we have more control over where we land than we think. The more we actively manage for success the more likely we are to achieve it.

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Newsagency management

Awful day for Myer yesterday

All Myer department stores across Australia suffered major POS system tech failure  yesterday (Dec. 14), a vitally important day for Christmas trade this season.

Most consumer facing tech at Myer runs on XP from my understanding, an operating system that was at end of life years ago.

Among IT professionals in retail, the Myer tech infrastructure has been a running joke. Clearly those in control of IT capex within the company have not had the stability and efficiency interests of the business at heart in their decision making.

With Windows 7 at end of life in four weeks, what happened to Myer is a reminder of the importance of having sound and current IT infrastructure in retail or any business for that matter.

The Myer IT infrastructure is old, out of date and technically unsafe.

My newsagency software company Tower Systems, we have been sharing advice with our 3,500 indie retail business owners about the soon to be end of life of Windows 7, providing options cost effective upgrade.

We provide a personal hardware and software upgrade service, tailored specifically to the needs of each customer.

We have also, in 2019, delivered comprehensive POS software updates, keeping our specialty POS software at the forefront of each marketplace in which we serve: Jewellers, garden centres, bike shops, produce stores, pet shops, toy shops, fishing and outdoors stores, rural supply businesses and newsagents.

What happened to Myer Saturday could have been avoided with better leadership, decisions focussed on managing IT and data as core business assets.

Take a moment and check your hardware and software.Make sure they are up to date. If you are running Windows XP or Windows 7, you must change to something more up to date. If your POS software has not been updated this year, look around at something more modern and fit for the needs of today.

Our Retailer Roam portable POS software and our Retailer cloud based and desktop POS software provide indie specialty retailers tools through which to better serve and compete locally. As active retailers ourselves (3 shops), we willingly share broader retail insights we see in our travels.

The Myer story from yesterday is timely. It need not be scary if you are prepared.

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Newsagency management

Kudos Greta Thunberg

Not that many newsagents in Australia stock Time magazine any more.  This is an issue to pitch at the counter.

You don’t have to like Greta Thunberg to appreciate the extraordinary influence she is having on debate and discussion of climate change.

Personally, I respect Greta and appreciate her work on this existential issue the world faces and which too many ignorant politicians dismiss.

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Social responsibility

People love buying The Saturday Paper

Many who purchase The Saturday Paper comment positively when purchasing. This happens rarely with other newspaper purchases. Today, I heard, thank god this paper still exists.

What I like about The Saturday Paper is it hits its mark, offering deep analysis of top news stories of the week and breaking stories dailies have missed. It is a good newspaper, always challenging.

It looks better than the fading product from Nine. The Age used to be a newspaper of record for Victoria. Not now, sadly.

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Newspapers

A perfect magazine to pitch on social media

This one-shot, Inside The Crown, from Pacific Magazines under the Who banner is perfect for pitching on social media right now.

With season 3 of The Crown TV series out now on Netflix to critical acclaim and achieving extraordinary viewing engagement, this accompanying magazine should be selling well. That’s why I suggest pitching it on social media. It is the type of magazine product that could drive traffic.

I’d also suggest placement of the one-shot with newspapers as well as at the counter. It is a perfect title for impulse purchases.

Make the most of the opportunity. Even as a low-cost Christmas gift it works.

While I get the magazine margin remains offensively small, we have the stock so we might as well chase incremental business.

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magazines

Reserve Bank head talks about phasing out cheques and the move to cashless

Phillip Low, governor of the Reserve bank in a widely reported speech Tuesday this week spoke about the rapid decline in use of cheques and cash.

Addressing the Australian Payments Network Summit in Sydney, Dr Lowe revealed the bank’s traditional survey of payment systems has found another huge fall in the use of cheques.

Over the past year, the number of cheques written has fallen by 19 per cent with the value down by 30 per cent. Much of this is due to the real estate sector moving to electronic property settlements.

…

Dr Lowe said the use of cash was also falling away with 80 per cent of retail transactions now tap-and-go. That rapid take-up of tap-and-go is faster than in most other countries, aided by the “willingness of Australians to try something different” including wearable devices.

“There has been a further trend decline in the use of cash, with cash now accounting for just around a quarter of day-to-day transactions, and most of these are for small-value payments,” he said.

I appreciate that cashless retail is not a popular topic here. There is no denying that it is on the horizon and approaching us.

I see evidence of cashless in my own shops as well as in other retail, in government, in banking service changes and elsewhere. I think there is no stopping this move.

By the way: my preference is cash.

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Newsagency management

What if magazines drop from 2 days a week to 1 day a week

I would not be surprised if magazine deliveries do drop to one day a week. With the number of publishers and retail outlets contracting, it is challenging to make efficient use of the logistics necessary to land magazine at retail outlets.

Dropping to one delivery a week could be economically essential for the current magazine specific delivery situation.

If magazines could be cost-effectively delivered outside this single purpose and single supplier controlled process the days of delivery could be different, more flexible.

At the Bauer Media Connections conference on the Gold Coast in September the General Manager of Ovato posed the question of dropping to one day a week delivery.

So, that’s what I am interested in today. If magazine deliveries were to drop to one day a week, which day would you prefer?

Delivery one day a week would impact local newsagency foot traffic. If such a change was contemplated, maybe a Wednesday works better for labour management, shop floor workflow and shopper traffic attraction. What do you think?

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magazine distribution
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