Talk at the Lucky Charm Newsagency

The Lucky Charm Group had a presentation dinner which several people from POS Solutions were invited as special guests. Since it discusses our work with them on the Rewards Card Program, something that I feel is probably the most import innovation in newsagencies in the past few years, I decided to blog it.

Hi guys

Thanks for attending our dinner last Friday. Helen and I hope you had a great time.

Introducing Joe and Phil from POS Solutions as the reasons why we could launch TLC Rewards was an honour and a thrill for me.

To hear the rapturous applause from our retailers and suppliers was one of the biggest moments in 26 yrs of retail.

Thank you very much for your attendance.

Phil you asked me to explain why would someone want to be part of TLC?

I thought it would be best if I summarised it as follows;

TLC is focussed on ensuring we do everything in our power to ensure the customer understands they get a little bit extra in a TLC store. We are the only group that offers a franchise model that delivers the following;

1. Regular meeting with our members so that we never lose focus of what our members want. Whilst we listen to all members we will proceed with the best endeavours for the group and not individuals. We like to feel that we are a team and family group.
a. Our platform is built on the following values
i. Strength
ii. Structure
iii. Family
iv. Support

2. All stores work on 1 point of sales platform - POS Browser. All our operations manuals on how to run your store is written with browser in format.
a. If stores want support with POS we are on call and understand the system.

3. Branding a consistent planogram in all stores are similar i.e. allowing the customer to identify with the brand i.e. Hallmark, magazine planogram ink and stationery etc. Stores are still allowed to carry local product however items such as support for key suppliers is paramount.

4. Catalogues and marketing - unlike any other group our marketing is done in house and approx 5-8 catalogues are distributed and /or advertised in the local Sunday TV guide at no extra cost.
a. Eg. 4 x Ink plus BTS plus Xmas,

5. TLC Rewards - since official launch in Sept we now have over 44,500 members. NO EXTRA COST
a. Monthly promotions - ACP, Ink, Stationery and Cards
b. $10,000.00 will be given away to entice people to join
After only 1 month of promotions we have seen the following results
• Average basket size of non rewards customers = $9.89
• Average basket size of rewards customers = $12.68

Hallmark Greeting card promotion
• (Ipad giveaway) sales up 45% on pre promotion period
• No. of transactions +26%
• No. of cards purchased +37%
• Average card basket size increase 20%

ACP (Woman's Day and Ok Weekly) magazine promotion (Delonghi coffee machine giveaway)
• Woman's Day sales increase in week one = 10%
• Ok Weekly sales increase in week one = 106%
• Combo sales increase in week one = 346%
Ink and Toner promotion Ipad giveaway - week 1 results
• No. of cartridges sold +209%
• Basket size increase +17%
• No. of customers +155%
• Total $$ spent increase +199%

We expect the loyalty program should add between $6,000 and $15,000 in profit per annum (depending on how committed they are and the size of the store. Effectively it should cover their annual fees.

6. Stationery online business. Partnering with Corp Express
a. Stationery booklets supplied to stores
b. Online website for customers to buy
c. Stores must be compliant
i. Each store will have their own log in
ii. Each customer will have their own log in
1. Customers order online (they can pay via Pay Pal or the store owner can give them an account)
2. Pay online at anytime
3. Access to approx 50,000 lines (see book provided last Friday)
4. Customer places order - store approves and CE deliver direct to customer in plain packaging with delivery docket)
d. Profits to retailers = approx 20% GP

The general expectations is that by gaining a minimum of 1 new account per month at a retail value of $600 per month should equate to an annual online sales of approx $47,000 @20% = $9400 in year one. Compounding this should at least double in yr 2 with a Gross Profit of at least $20,000.00. Very good considering you do not need to carry any stock. Our members can the use this facility to drive office and corporate customers back into our stores

Greg from Hervey Bay believes the online business will add $100,000 per annum to his stationery business in yr 1 @20% = $20,000. He already has 4 national accounts lined up and we will not launch until Jan 2012

We are the best group working on new areas to innovate their business.

We are the best group working on growing their business not trying to simply screw suppliers

Cheers - hope this helps. If you're not sure about any information provided don't hesitate to give me a call.

Kind regards

Mike Kentros
Lucky Charm
Managing Director
Tel 1300 582 592