Yesterday, I met with a bank representative about securing better EFTPOS rates for our clients. The subject of least cost routing (LCR) came up after I pointed out that our analysis of EFTPOS fees showed a big difference in fees between banks even though they had similar rates. I discovered that many merchants lost thousands of dollars a year last year in fees because of ignorance.

To understand why these unnecessary costs occur and how to avoid them, we must first understand the mechanics behind payment processing and the critical role of least-cost routing.

Least Cost Routing (LCR)

Least Cost Routing (LCR) is a payment processing feature that can significantly reduce your fees when processing debit/credit card payments.

When a customer taps their card, the payment can go in as an EFTPOS or credit card.

Now, some banks will often do a deal that both go through as 1%. Generally, this costs you more. So it's no wonder they offer it.

What is smarter is to have EFTPOS charged as a flat fee per transaction, say, $0.15-$0.30. Let us work here with 20 cents for this blog post. Visa/Mastercard generally go in as percentage-based fees, e.g., 0.8%-2% of the transaction value, say 1.2%

The exact charges will vary but generally depend on your average transaction value and the amount you send through the system.

Payment processing costs

Let's say I come into your shop, buy a $10 item, and tap. Your cost if it is EPTPOS is 20 cents. Your cost if it's Visa/Mastercard is 12 cents. It is better for you that it goes through as a Visa/Mastercard.

Now, if I brought a $50 item, your cost if it is EPTPOS is 20 cents. Your cost if it's Visa/Mastercard is 60 cents. It is better for you that it goes through as an EFTPOS here.

The EFTPOS flat fee model is usually cheaper for transactions, typically above $30-$40.

Without Least Cost Routing enabled, your payment terminal automatically processes contactless "tap-and-go" payments through Visa or Mastercard networks. If you have it enabled, you can direct them to the cheapest system.

Now, here's the kicker: There are two different types of Least-Cost routing, LCR and MCR, and although banks tend to call them the same, they are not.

LCR vs. MCR: The Critical Distinction

Let's start by untangling the often misunderstood terms.

With LCR enabled

• Each transaction in real-time is analysed
• Fees are automatically calculated for each route.
• The payment is routed through the network that will cost you the least

The key advantage? There's no manual intervention required.

Merchant Choice Routing (MCR)

With MCR, you, as the merchant, have the choice of which payment network to route a transaction. You must understand the costs and select the route manually each time.

Reasons for the Financial Impact

Ignorance

Many merchants remain utterly unaware that LCR/MCR exists. Banks do not automatically set them up; you need to ask.

Misleading Marketing

Some payment providers market the MCR solutions as LCR, leading merchants to believe they automatically get the best rates when they do not.

The Complexity Conundrum

It's another thing to remember in retail when doing a transaction.

Set It and Forget It Fallacy

Merchants often assume that everything is fine once MCR is enabled. They don't realise that they must monitor and train their staff.

The Staff Apathy Factor

This is huge. Even if the owner understands the importance of the payment, if the staff member processing the payment doesn't understand or care about the difference, they will route the transaction through the most convenient (often most expensive) network.

The Hidden Cost of Inaction

The cumulative impact of improper routing is staggering:

• A cafe processing 200 daily transactions could lose $15-20 per day, or over $5,000 annually.
• A retail store with an average transaction of $80 could save up to 1% on each sale through proper routing—potentially thousands of dollars per year.
• For a business with tight margins, these "invisible" costs can be the difference between profitability and loss.

Taking Control: How to Really Optimize Your Payment Processing

Become an Informed Consumer

If you have the least-cost routing, activate it and then find out how it works. If possible, demand LCR.

Work out the best system for a transaction to go through as debt or credit card.

Prioritise Staff Training

Provide your staff with clear, concise training on how to use the EFTPOS system correctly.

Monitor

Go through your statements that your instructions are happening.

Save on transaction fees

You can make substantial savings with a little effort and work.

As Australia's number one newsagency software provider, I believe we found while recently updating our marketing list that we were shocked to discover how many Australian newsagents hadn't claimed their free Google Business Profile (GBP). Out of an estimated 3,000 newsagencies nationwide, we estimate that less than half have one. That is a horrible statistic.

Now, I have spoken about this many times.

This gap represents a significant missed opportunity for most newsagents, considering the sheer volume of online newsagent searches to find their location, almost all by customers looking to purchase something from a newsagency.

Although the figure is not released by Google, looking at our SEO package, it estimates that Australians perform over 55,000 searches every month for "newsagent near me" and "newsagency near me". As I stated, most of these searches customers use to direct them to a newsagency to buy something. Yet, approximately 1,500 newsagents are missing out as their potential customers will never find their business. What these customers will see are other newsagents. 

Why go to all the trouble of making your shop the best if no customers come?

What Is a Google Business Profile?

A Google Business Profile is a free tool that puts your newsagency on Google Search and Maps. It displays essentials like your location, hours and phone number.

Why It's a Game-Changer for Newsagents

Boosted Visibility

Show up at the top when someone searches for a newsagent nearby. Look at the image above.

Trust Factor

A polished profile with photos and reviews makes customers more likely to choose you.

Local SEO Edge

Climb higher in local search rankings with a well-managed profile.

Smart Insights

Access data on how customers find and interact with your listing.

It is free and low-effort. You can set it up in under 30 minutes.

Turning Losses Into Gains or The Real Cost of Inaction

If you do not have one, with 55,300 monthly searches for newsagents and only half of them visible online, each newsagency gets around 40 monthly searches on average.

Now consider this.

Lost Revenue Impact

No Google Business Profile means missed foot traffic. Say an average sale is $25. If half of those people were coming to buy, that is, 20 customers a month, they should have picked up. In dollars, that would be $500 a month; those newsagents have lost $6,000/year plus possibly much repeat business from those 20 people.

How to Set Up Your Google Business Profile in 5 Simple Steps

Claim Your Spot

Head to Google Business Profile

1. Search for your business.
2. If not, create a new listing.
3. If it is there, check that you have claimed it; if not, claim it.

Add Your Details

Enter your business name, address, phone number, and hours.

Pick categories like "Newsagent" or "Lottery" to match customers' searches.

Show Off with Photos

Use your smart camera to take a few clear shots of your storefront and products. Add them to your profile; this is important as profiles with photos get 42% more direction requests.

Stay Active

At least once a quarter, go into your profile and update it.

Claim Your $6,000: How You Can Win with Google Profiles

With 55,000 monthly searches up for grabs and half of Australia's newsagents missing out, the time to act is now.

Claim Your Profile Today, its free!

Loyalty programs are a fantastic way for SMB retailers to boost customer sales. You'll need to let your customers know their value. Adding a charitable giving component to your loyalty program would work well. It will appeal to socially conscious customers and provide instant gratification a key element in any loyalty program.

Here, we will discuss crafting a loyalty program that drives sales.

The key metric used here for this loyalty program is 5 points for every dollar spent in the shop, $1.50 off for every 100 points, or $10 off for every 500 points. The customer can instantly convert any number of points to your nominated charity at $10 for every 500 points, so it says they have 12 points. So you will donate 12/500 x $10 = 24 cents. Remember, you are getting the tax deduction here. Plus, donations are non-refundable.

Now, your nominated charity must be a strictly non-political charity that no one would complain about, e.g. the Heart Foundation.

Setting the Stage, the message

These messages introduce your loyalty program and ensure customers understand its benefits while highlighting any charitable options.

Your message should grab attention and clearly explain how your loyalty program works, including any charity options.

Subject line: Big News! [Your Store Name] Rewards are Here!

Body: We're thrilled to introduce our new loyalty program designed to reward you, our valued customer! Earn 5 points for every $1 you spend and DOUBLE points on selected items. Redeem points for discounts: 100 points = $1.50 off 500 points = $10 off! Or donate your points to [Heart Foundation] instantly! Join now and enjoy exclusive perks, savings, and the chance to make a difference. [Sign up today →]"

Part of the sign-up is their email address. Remember, you can send emails for nothing.

Why It Works

• Combines excitement with precise program details.
• The charity options upfront, appealing to socially conscious people.
• You need a strong call-to-action (CTA) to encourage immediate sign-ups.

Welcome Email: Make a Great First Impression

Once someone joins your program, follow up with a warm welcome email that makes them feel appreciated and highlights personal rewards and donation opportunities.

Subject Line: Welcome to [Your Store Name] Rewards!
Body: Thank you for joining our loyalty program! You'll earn 5 points for every $1 spent as a member. Would you prefer to give back? Transform your points for [Heart Foundation] instantly! Redeem your points for fantastic rewards now: You get $1.50 off for every 100 points or $10 off for every 500 points!

Why It Works

• Personalised tone strengthens connection with customers.
• Introduces donation mechanics clearly and early.

Social Impact Strategy: Loyalty Programs That Give Back

I confess it's not the reason why my company donates to charity, but I certainly let people know about it.

Adding charitable giving options to your loyalty program drives customer engagement and builds goodwill for your business. Here's how to position this effectively in your emails:

Why instant Charity Options work.

Customers who buy from you irregularly will think they will never get enough points, so they do not bother; now, they know they get something if they buy. Many customers like businesses to support social causes. A study showed Australian consumers are more likely to buy from companies that support charities.

Incorporating charity into your loyalty program can enhance emotional connections with customers and encourage contributions by showing the direct impact of their actions on others.

Email Example: Promote Charitable Giving

Subject Line: We Make a Difference with Your Points
Body: Your rewards can do more than save you money—they can save lives! Donating your points to [Heart Foundation] at checkout. Together, we can fund lifesaving research and support those in need."

Highlight the impact with progress bars: *"Thanks to members like you, we've donated $2,340 to the Heart Foundation → Goal: $5,000!

Do not forget to celebrate a goal. For instance:

"We hit our goal! Thanks to you, we raised $5,000 for the Heart Foundation."

Keeping Customers Interested

Once customers are in your program, you need to send emails so they remember you. You can also keep them engaged with enticing offers to encourage repeat purchases.

Lotto is great for this as it has regular super draws. Also, do not forget holidays. For example, it was just Valentine's Day; you could have sent out an email stating that you have great gifts for Valentine's Day and maybe added a note of double points on these gifts.

Limited-Time Offers with a Social Twist

Time-sensitive promotions combined with charity appeals are highly effective at driving action.

Subject Line: Double Points + Double Donations This Week Only!
Body: Earn DOUBLE points on selected items this week AND double the impact of your donations —this week only!"

Relationship Builders

Every email nurtures long-term relationships

Final Thoughts

A well-designed loyalty strategy can transform an occasional shoppers into loyal customers. Use clear communication Urgency-driven offers Personalised touches

Include the current donation amount and milestone.

Yesterday, I attended the Global Virtual MarTech Summit 2024. What I like about this summit is that the speakers, who are all very experienced, use retail marketing technology. Although these tend to be from the high end of town, they are relevant to SMB retailers regarding how modern businesses approach customer engagement and technology integration.

Balancing Technology and Personal Connection

It's ridiculous to do what some people do: buy an advanced computer to humanise their business.

Everyone agreed that although technology has advanced dramatically, it cannot yet replace the human element. Building personal connections with customers fosters trust and loyalty, essential for long-term success. Customers are more likely to return to businesses where they feel an individual bond.

Making Data Work for Your Business

Technology needs solid, integrated data. The speakers highlighted the problems with information being scattered over many different systems. A shop is better off with one integrated POS System to make technology work.

Listening to Your Customers

Everyone felt that you have to listen to your customers. They noted that most of what people say about your business doesn't come to or from you. They felt you needed Social media and Google search to fill this gap. It can provide a wealth of information about your customers' thoughts about your brands and products. Reading these conversations can offer valuable feedback and early warning signs. For instance, if you notice people on X(Twitter) saying, "I stopped buying XYZ because..." something is wrong.

Emerging Technologies for Marketing

There wasn't a clear consensus on the best marketing tools; everyone seemed to use something different. Of the free AI, Google Gemini was broadly the favourite. I was unsurprised about this, as our tests showed Google Gemini was narrowly the best for retail here.

We found that this platform combines search and performance advertising capabilities, offering businesses a powerful tool for more effectively reaching their target audiences.

Predictive Analysis for Future Insights

Predictive analysis is a hot technology in retail. Here, you use technology to help you see what is likely to happen so you can make plans.

Now, I would like to finish up on how you can use it as today, this is the buzzword. If you want to know where the action is in retail technology, I strongly urge you to work through it.

I used Google AI here to help a newsagent forecast trends and make informed strategic decisions. You'll need to create an account to use it.

Have a read of a sample conversation I made for a scenario of a newsagency in a small strip centre.

If you go through it, you will get the idea.

If I were continuing, I would do it by selecting a topic and asking questions on each topic, a sample of the continuing conversation might be:

Adapting the Business Model

Since retail-focused shops are replacing traditional news agencies, how can I embrace and develop revenue streams for gifts, toys, and stationery?

What kind of gifts should I look at to substantially grow my gift revenue?

Should I stock a few lines with more gifts in each, or should I have more lines with fewer gifts in each?

I am thinking of phone cases; what are some pitfalls here?

What extra products should I consider to add revenue to my business?

Customer Engagement and Service

How can the newsagency actively engage with greeting cards to boost sales?

Financial and Operational Efficiency

What can I do to cut costs to save money?

Location Specific

How will the presence of a Woolworths supermarket affect my business?

What opportunities exist with nearby offices and gyms?

etc. etc., I would be going for a few hours.

Getting Started with such predictive analysis

To begin integrating AI into your marketing strategy, follow these steps:

Define Clear Objectives

Identify what you want to achieve, such as more customers or profit. Do not worry; you will have plenty to think about.

Use your information

The more, the better.

Do it a few times

I always say it's not hard on your third attempt.

Conclusion and Next Steps

I hope you understand what people are looking for in technology. What is clear is that retail is evolving. With changing customer expectations, rising competition, and the need for efficiency, SMB retailers must adapt to thrive.

It is said that "Strong people can break, intelligent people can overthink, beauty in people fades, but adaptability will go forward."

Update: I wrote this article a few weeks ago and was asked about the other free AI model, GWEN, that was recently released. So, I decided to test this one, too, and add it to the list. It's an excellent AI model. Also, for the sake of completeness, I decided to add Microsoft Copilot. So here is the updated list.

No one has talked about artificial intelligence (AI), and now it seems people are talking about little else. We have been actively involved in AI for several years now.

In retail, AI promises to boost sales and reduce operational costs in the POS system. Like everyone else in business, those leveraging AI will stay competitive in a rapidly evolving market. 

Comparison of AI Models

A good leaderboard of what AI models is available here.

But these are not measured on what our clients now use and the problems they encounter. So, to understand the current landscape of AI needs in retail, we compared several leading widely available AI models:

1) DeepSeek

2) Gemini

3) ChatGPT

4) Claude

5) Meta AI Facebook

6) Grok 2

7) GWEN

8) Microsoft Copilot

We tested these models on real-world scenarios that retailers encounter, such as product descriptions, inventory management, customer service, and sales forecasting. We then combined the answers, amended them by hand and came up with answers that we scored 40. We then compared each AI's answer to this score of 40. All of this took us a lot of work.

Our test results showed that Gemini (Google) was the top performer, scoring 39 out of 40. It also offered a comprehensive package with many additional benefits, making it an attractive choice for businesses seeking a robust AI-powered POS system.

Claude excelled in writing capabilities, scoring 37, which makes it most suitable for tasks requiring explicit and engaging content.

ChatGPT and Grok 2 scored 36, demonstrating their ability to handle various tasks effectively. What we liked about Grok 2's answers is that they contained advanced information on items the other AIs did not have. If, for example, a new game came out and you wanted to see what people thought about it, Grok 2 gave the best response. I cannot wait to see Grok 3, which is overdue now.

DeepSeek scored 35 despite being significantly cheaper. It offers impressive performance at a fraction of the cost of other models, making it ideal for businesses requiring API access.

GWEN scored 34, which is a bit lower than Deepseek's, but like Deepseek, it is free. We weren't that impressed with what the AI model could achieve compared to the other models mentioned; it also lacks an API, which could lead to issues in usage.

Microsoft Copilot scored 32, but like Deepseek, it is free and integrates well into Microsoft products that many of my clients use. Again, we weren't impressed with what the AI model could achieve, but if you use Microsoft products, it fits well into the suite. 

However, Meta AI (Facebook) struggled, scoring only 30, but was still included in the assessment due to its potential in specific use cases. Overall, I would not recommend it as your primary AI.

Recommendations

Gemini is likely the best choice if cost is not a concern due to its superior performance and additional features. Google's support and integration capabilities make it an excellent solution for businesses seeking a comprehensive AI-powered system.

However, DeepSeek presents a compelling option for those prioritising cost-effectiveness. At only 2% of the cost of ChatGPT, it delivers nearly comparable results, making it an attractive choice for businesses requiring API access.

Grok 2 is particularly noteworthy, especially with its upcoming update. Its integration with X (Twitter) offers access to a vast source of real-time data, which can be invaluable for businesses that must stay informed about the latest trends and news.

AI in POS Systems: Promises

English and spelling

Not everyone is good at English with AI lousy spelling, and people with bad grammar can communicate in writing better. It also allows them to communicate better with non-English speakers.

Marketing material

AI can be successfully used to write marketing material. A client wanted to create fancy names for their lotto syndicate, so they used AI to help them.

Real-time Predictive Analytics

AI analyses sales data and market trends to forecast demand, helping businesses optimise and prepare for busy seasons. For example, a retailer can use AI to predict a surge in demand. As trends overseas tend to come first before they hit us, they can tell us where the market is going.

Personalised Marketing

AI could provide tailored recommendations and promotions based on customer purchase history and preferences, fostering loyalty and boosting sales.

Dynamic Pricing Optimisation

We like that it can better set prices in real time based on demand. Companies dealing with marketing events often have goods that sell well in that season, but the demand for the product collapses as soon as it's over. We are hoping AI can help us with this, too.

Implementation Challenges

Implementing AI in POS systems can present challenges. The answers are often not as good as they look. They are often wrong, and it's hard to argue with it because they look so right.

The future

It is unclear where the AI market is going. Will consumers want a low-budget or medium-budget, or are they prepared to pay for an expensive system? One company told me they spend $200/month on ChatGPT, which is $2,400 annually. Will the consumer bear that?

The other issue is whether a business needs a car or a truck in AI. In the context of retail POS systems, AI is not just about speed or luxury; it's about finding a solution that can handle the workload efficiently. Businesses need a reliable truck rather than a sports car to carry a heavy load rather than speed.

I am sure there are privacy issues, too. Some AIs are specially built with that in mind. But this all would involve a deeper discussion of data privacy, security, and compliance (such as GDPR or Australian privacy laws) beyond the scope of this post. 

Some industry research shows that over 70% of retailers plan to adopt AI within the next two years. I would not be surprised if it will be closer to 100% in one year, as AI can enhance competitiveness and drive growth.

FAQ: Frequently asked questions

Q: What is the role of AI in POS systems?

A: AI in POS systems promotes boosting operational efficiency.

Q: Which AI models were compared in our tests?

A: The models tested included DeepSeek, Gemini, ChatGPT, Claude, Meta AI (Facebook), and Grok 2. These were evaluated in real-world scenarios such as product descriptions, inventory management, customer service, and sales forecasting.

Q: What were the results of the AI model comparison?

A: Gemini (Google) scored the highest at 39 out of 40, offering a comprehensive package with additional benefits. Claude excelled in writing capabilities, scoring 37. ChatGPT and Grok 2 scored 36, while DeepSeek scored 35 despite being significantly cheaper. Meta AI (Facebook) scored 30.

Q: Which AI model is recommended for businesses with no budget constraints?

A: Gemini is likely the best choice due to its superior performance and additional features. Google's support and integration capabilities make it an excellent solution for comprehensive AI-powered systems.

Q: What about cost-effective options?

A: DeepSeek is a compelling choice for businesses prioritising cost-effectiveness. It offers impressive performance at a fraction of the cost of other models, making it ideal for those requiring API access.

Q: How does AI improve communication in retail?

A: AI helps individuals with limited English proficiency communicate more effectively in writing. It also facilitates better communication with non-English speakers.

Q: Can AI assist with marketing tasks?

A: AI can be used to write marketing material, such as creating product names or promotions. It can also help generate engaging content.

Q: What are the benefits of AI in predictive analytics and personalised marketing?

A: AI analyses sales data and market trends to predict demand, assisting businesses in preparing for peak seasons. It also offers personalised recommendations and promotions based on customers' purchasing history, enhancing loyalty and driving sales.

Q: What challenges are associated with implementing AI in POS systems?

A: Utilising AI can present challenges, such as ensuring the accuracy of AI-generated responses and integrating AI with existing systems. Additionally, although AI responses may seem correct, they can still contain errors.

Q: What does the future hold for AI in retail?

A: The future of AI in retail appears promising, as over 70% of retailers plan to adopt AI within the next two years.

Q: How does the analogy of a "truck" apply to AI in POS systems?

A: In retail POS systems, AI is not just about speed or luxury; it's about finding a solution that can handle the workload efficiently. Businesses need a reliable "truck" rather than a sports car to carry a heavy load effectively.

Q: Are there privacy concerns with AI in POS systems?

A: Yes, very much so. Some AI systems are claimed to be designed with privacy in mind. It remains an essential consideration for businesses implementing AI solutions.

Q: Is a POS system AI?

A: A POS system itself isn’t AI but can be integrated with AI to enhance its capabilities.

Update: The federal and SA governments have blocked access to DeepSeek over its network and directed public servants to stop using and remove it from devices. More details are available here. There are security concerns over the product. 
 

Suppliers tend to prioritise larger retailers because of their product stupidity (If a large retailer is not monitored, they often do stupid things), higher spending power and perceived reliability. SMB retailers face problems securing favourable terms, yet SMBs need to establish supplier relationship management despite these obstacles.

Ask your suppliers where your business fits in their priorities. Understanding your position can help you tailor your approach, such as negotiating better terms or diversifying your supplier base.

Diversify Your Supplier Base

Relying on a single supplier puts your business at considerable risk, including stock shortages or price hikes. What you should consider is diversifying your supplier base:

• You reduce dependency risks.
• You gain leverage in negotiations by having alternative options.
• You ensure consistent product availability.
• Have a better pool of products to select from.
• You're not left stranded if one supplier faces disruptions.

Actionable Step: Use your POS system to track supplier sales performance. Could you identify which suppliers are underperforming and explore alternatives to fill gaps?

Negotiate Beyond Price

Negotiation isn't just about securing the lowest price; it is about more. Often, the seller has more flexibility than initially disclosed, but you must be willing to ask first.

What to Negotiate:

• Extended payment terms (e.g., 30-day credit).
• Bulk discounts or promotional pricing.
• Marketing support
• Shipping Terms

For example, I received a huge order and told our supplier I needed a better trading term to help me get the order and fast delivery. I got both. Remember, you can negotiate improved trading terms and expedited delivery by highlighting the mutual benefits for both parties.

Pro Tip: Once you've diversified your supplier base, use their competition as leverage during negotiations.

Conduct Independent Research

Suppliers may present information that benefits their agenda but verify everything independently. Ask your customers, visit similar shops, examine the advertising, use your POS reports, and do Google searches. I find that Amazon's top-selling lists in Australia are beneficial resources. Check here.

These are some items to check:

• Compare sales data between Supplier A and Supplier B for similar products.
• Assess whether each supplier's margins meet your financial targets. Some suppliers hide their margins, which can be a problem. A typical problem is that some quote markup and some margins. Always work in margins.
• Investigate alternative suppliers offering better terms or unique products.

Offer Products at Multiple Price Points

Stocking products at different price levels allows you to cater to diverse customer segments while also strengthening supplier relationships:

• Budget-friendly options attract cost-conscious shoppers.
• Mid-range products appeal to the average buyer.
• Premium items target customers seeking quality or exclusivity.

This strategy not only broadens your market reach but also creates upselling opportunities.

Leverage Technology for Efficiency

Your POS system has an invaluable tool for managing supplier relationships and improving operational efficiency:

• Use the report "Sales Comparison by Supplier" to rate your suppliers.
• Automate reordering processes based on sales trends.
• Monitor margin creep (declining profit margins) and address it with suppliers promptly.

Use Sales Comparison by Supplier

Use the "Sales Comparison by Supplier" report in your POS System. This report will show you͏ the actual figures, and the͏ changes over time for each supplier. By ͏analysing your suppliers, you can gain valuable insights about your shop based ͏on various criteria such as the number of sales, total value of sales, average sale amounts and ͏profit. For example, it is important to determine which suppliers are unde͏rperforming or overper͏forming. Check if they are giving you enough margins to meet your needs.͏

How to Access the "Sales Comparison by Supplier" Report

To access the "Sales Comparison by Supplier" report, follow these steps:

It is in the register sales reports; find the report "Sales Comparison by Supplier."

Click on it, and you will get this screen.

How to Interpret the "Sales Comparison by Supplier" Report

You have a report of your suppliers that shows you the summary statistics for each supplier. They are based on each criterion you selected and a comparison of how you have been travelling with them. The big ones and those with significant movements in the comparison percentages are fascinating.

Look at the profit figure. Today, we are seeing significant downward margin creep. This is an excellent place to see it. There appear to be many reasons for this downward margin, and it seems to be both due to changes in customers and suppliers. I will discuss this in another article.

Now, rerun this report and compare suppliers based on those that handle similar products. Now, compare and contrast these different suppliers based on their performance over time, noting the number of sales and profit.

Build Strong Relationships

Suppliers are more inclined to give more to retailers they see as partners instead of merely vendors.

How to these relationships:

• Please make sure to let them know about your needs and concerns often.
• Pay invoices on time to build trust.

• Show loyalty by prioritising their products when possible.

• Tell them information that they may find helpful.

For example, if a supplier launches a new product line, consider promoting it immediately. This shows commitment and builds goodwill.

Take action Based on Data Insights.

How to Customise the "Sales Comparison by Supplier" Report

To customise the "Sales Comparison by Supplier" report, follow these steps:

Select a period for the report, let us keep it simple so start with the past 12 months and compare it with the previous 12 months. So leave it AS IS and run the report. Afterwards, feel free to explore more options as desired.

Screenshot of Customised Sales Comparison by Supplier Report

Using data-driven insights from tools like the "Sales Comparison by Supplier" report allows you to make informed decisions:

1. Identify underperforming suppliers. Then, address any concerns with them directly.

2. Strengthen relationships with high-performing suppliers.

3. Monitor trends such as declining margins and/or dips in sales.

Example: If Supplier A's products exhibit decreasing margins over time due to increasing costs, renegotiate the terms or consider switching to Supplier B, which has superior profitability metrics.

Challenges and Opportunities

I encourage you to contact underperforming suppliers and express your concerns. Please also inquire about how you can collaborate more effectively with well-performing suppliers and how to do more with them.

Please give it a go and see how it goes.

Valentine's Day offers retailers a chance to increase sales, but achieving understanding involves more than just figures.

It's crucial to analyse your store's performance to determine what worked well and what did not and to improve. Here’s a guide to assist you in evaluating your Valentine’s Day sales.

Last-Minute Shoppers

Many Valentine's Day purchases are impulsive, so people buy even after the holiday. Please keep displaying your themed products for a little. Also, remember that some bargain hunters are now looking.

The Importance of Measuring Sales for Businesses

Businesses need to measure during busy seasons such as Valentine's Day. These days are unusual, and what you find on them can work against you because they are uncommon. This makes it harder to make decisions. Luckily, tracking sales has become more straightforward and practical with a modern POS system.

Sales Reports

Sales reports are crucial tools for monitoring sales performance. They show your profit, bestselling products, and employee performance. Using these reports, you can identify trends and make data-driven decisions.

How to Track Sales Performance

Go to reports and click on sales.

This report will allow you to check how each department in your shop is doing compared to previous periods.

Now select the dates you are interested in, 14 February 2025 and 14 February 2024

I am ignoring all the extra options for this example. Please feel free to review this later after you work through this example.

When reviewing reports, navigate the left-hand menu to focus on the most relevant departments. It will help you pinpoint areas of success and those needing improvement.

The advantages of utilising sales reports: By analysing sales data, you can determine, in particular, the bestselling products and employee performance. Your business strategy must be to gain insights to maximise profits. If you follow what happened on those days, you can identify trends that you need to make informed decisions. It will help your businesses make data-driven decisions.

Another good way to measure sales on Valentine's Day is through employee sales analysis. It is interesting because, by analysing sales data, you can identify employees who perform well.

Top-Selling Products

Create a list of your best-selling items! Did red roses or heart-shaped chocolates fly off the shelves? Also, please remember items that didn't sell well; each has a story for me. In my experience, it's best not to fight the market if the public wants these heart-shaped chocolates from you; give them to them and do not try to do better.  

Leftover Stock

Everyone hates these items if they cannot be sold after Valentine's Day. These items highlight what did not resonate with customers, so if you're left with too many red candles or gift baskets, make a note for next year.

Sold-Out Items

Which products sold out too quickly is more important? These cost you money. For instance, if heart-shaped chocolates sold out too quickly this year, plan to increase inventory next year.

Summary

> Valentine's Day is an excellent time for businesses to boost sales, but it requires strategic planning and measuring sales.

> Measuring sales during busy seasons such as Valentine's Day is essential.

> Sales reports are great for monitoring sales performance.

> Employee sales analysis is another way to measure Valentine's Day sales. It can identify high-performing employees and those who need more training. Using this information, you can boost sales.

Businesses can use this information to boost sales and customer satisfaction.

(Friendly Advice for Non-Tech Business Owners)

In 2025, it's clear that Facebook's recent changes have made it more difficult for you to reach your customers for free. Before, businesses could easily connect with their customers without any cost. While it's still possible, it's not as easy as it once was. Facebook increasingly encourages businesses to pay for advertising to reach their audience.

Also, it got better and more complex, so now it might feel tricky, but it's still a good tool for local shops wanting to connect with their customers. Let's walk through some changes and how you can make it work for your business—no fancy tech skills needed.

Why Your Shop Needs Facebook (Even Now)

Every local business should keep its Facebook page updated. Think of it like your digital shop window - people expect to find you there. If they look, they should find you; if Facebook sees that they want to find you, it will push you.

What if your potential customers look for you and find your competitors?

What your Facebook page shows is:

You're open and active

Customers check Facebook before visiting

Answering questions quickly

Facebook likes that as do your customers and potential customers.

• A thumbs-up emoji
• All you need is a short, friendly message
• Answers to any questions, if you do not know the answer, tell them you are investigating. -Talk like a local.

Sharing what's new

Could you take a picture of what is new or your weekly special? If, for example, you have a lotto, there is no reason why you cannot post something new once a week. Someone won big in the shop; there is a good draw, your opening times, etc.

Free Tactics That Work

Post When People Are Browsing

If you share when folks are looking, Facebook shows your posts to more people.

11 AM-1 PM

Perfect for lunch break shoppers
Please don't post after 6 PM - your post gets lost overnight.

Videos Get Seen More

You don't need fancy equipment. Try these easy ideas:

• Film a 20-second video of new stock arrivals
• Record staff explaining a product's features
• Share customer testimonials on camera (This is excellent stuff in retail)
• Top products. Why not set up a free product showcase? People like to buy stuff that their peers are buying.
• Go to your page's "Shop" tab
• Snap photos of your top 5 products
• Add simple descriptions

Events

St Valentine's Day, do you sell cards, toys for pets, perfume? Snap a few of them and put them up. Cards inside and out as many people really care about the words.

Save Time With These Simple Tricks

Batch Your Posts

Pick a quiet morning to:

1. Write 3-4 post captions
2. Take photos of your products
3. Schedule them using Facebook's free tool

Check What's Working

Visit your Dashboard weekly to see what your readers like and want to see:

• Which posts got the most comments
• When your followers are online
• How many people clicked your photos

Your No-Stress Action Plan

Here is a step-by-step plan to try.

-Ask your customers to give you likes on Facebook.

Now, you can go to your top-selling report and pick your top five selling items by quantity. Take pictures of them. I discussed how to do this here.

• Add these top five products to your Facebook Shop
• Make a few Facebook posts showing these items.

Conclusion

Consistency matters more than perfection. If you wait for perfection, you will do nothing. You can always make it better later. Start small.

A single sapling becomes a forest through daily growth, not instantaneous majesty.

Facebook requires more effort than before, but it's still worth it.

Receipt Marketing: A Powerful Tool to Boost Your Business

A crumpled receipt at the bottom of a shopping bag is one of retail’s most powerful marketing tools. About 92% of Australian consumers check receipts before recycling them, and forward-thinking retailers are transforming this afterthought into a strategic advantage.

Receipt marketing is a low-cost, effective marketing technique. It involves adding promotional messages to the point-of-sale (POS) receipts businesses issue after a sale.

This article will discuss receipt advertising, its features, and some methods for utilising receipt promotion to support your business.

Reasons for larger receipts

Small businesses often do small receipts as it is cheaper to print a small receipt than a larger one, but you notice that majors tend to use large receipts. Could you take a look at a supermarket receipt today? They have done their figures. If you'd like something to think about this, you can check out this video.

While small receipts are financially savvy, more significant receipts offer many advantages. 

What Are Its Advantages for Business?

Receipt promotion is a low-cost method businesses can use to increase. Special offers are added to the receipts given to clients after the sale.

Receipt promoting offers businesses a few advantages, including:

> A savvy method for contacting the people who buy from you.
> Receipt messages are a minimal expense item.
> Be very flexible with the message, which can urge your customers to return and make extra purchases.
> Offering customised offers and advancements to your customers.
> An easy method for building your shop by adding your shop details.

No matter what the size of your business, receipt promoting offers a financially cheap method for drawing customers.

Ideas for utilising receipt messages

Coupons

People are searching for cash savings, so put an exciting offer on the POS receipt. 
> Try to make it engaging.
> Keep the offer straightforward. A modern consumer will not sit down and try to figure out what you are trying to say. A helpful tip here is to ask a kid about ten years old to read it and tell you what you want to say.
> Make it simple 
> Make the offer real. You have an opportunity to sell; the last thing you want is for the customer to think it's ridiculous. I can assure you the customer will remember that.
> Put a cutoff date on the offer. It creates a need for your customers to move soon.
It may end a common legal problem when an offer is valid. 
> Try to make the offer something that drives more sales to the business. Some items have excellent added sales value. 

Marketing season

There are times of the year when people buy unique goods. You can use your receipt to let your customer know you are in this market, too.

Customer feedback

You can use the receipt to get customer feedback, but I will discuss this in another post as you need special equipment.

Thank you message

Thanking customers can be an easy way to foster business loyalty. Showing appreciation may make customers more likely to buy from your business.

Could you consider saying something like this?

"We appreciate your support for our small local business! Your patronage means a lot to us, and we are grateful for customers like you who help keep us going. We look forward to serving you again soon and wish you all the best!"

Creating Your Receipt Advertisements.

You should work out your message first by following this rule.

The 7-3-1 Rule

Today, receipt marketing thrives on simplicity.

7-Day Maximum Validity  

Change your message every week; there is no point in sending the same message unless it is particularly good. 

If you are going to add a special offer, make it only available for a week. For example, "$5 OFF your next purchase. Valid 7 days from this transaction."  

3-Sentence Maximum Copy  

Shoppers today scan and don’t read. The message is three sentences tops.

One Call-to-Action  

Do not confuse people too much; it should have only one call to action. 

Once you have worked out your message,, you can just go to the main menu and select the Cash Register section.
Choose Register Setup.

After that, select the Receipt option (see the green arrow below) from the menu. 

Now there are many other options available, which we will discuss later.

In this section, you'll see that we've done much work recently.

The first option we'll discuss is adding an image to the receipt's top. You'll often use this feature to put your logo on the top of the receipt, but only some use this function.

The next choice is to include an image at the bottom of the receipt. In this instance, the illustration is a Valentine's Day advertisement. The file came from the supplier. 

The last option is the one that is used the most. You can quickly add advertisements to the receipt here. Use this to promote your range of products, items on sale, and/or marketing seasons.

The receipt below illustrates such an advertisement. It promotes the store's extensive inventory of inkjet cartridges.

Conclusion

> Receipt showcasing is a minimal expense. A viable showcasing procedure that gives reasons for a customer to come back.
> Bigger receipts offer many benefits that little receipts can't.
> Receipt messages promoting offer advantages, including connecting with clients.
> Thoughts for receipt messages incorporate coupons. Make the offer genuine, put an end date, promote marketing seasons, thank your customers, and get criticism.

Psychological marketing techniques have transformed modern retail, with giants like Starbucks leading the way in implementing these strategies. I listened to a talk about them here. So, let's explore five evidence-backed psychological marketing tactics they use that demonstrate measurable ROI in retail settings.

Let's examine five evidence-backed psychological marketing strategies demonstrating measurable ROI for Starbucks.

The Decoy Effect

The decoy effect works by offering the customer three options. When presented with three choices, most people gravitate toward the middle. So, say you have two items, a cheap and costly product. Now, if you add a super expensive item, many people will tend to the middle, so they will buy the costly item because it does not look so expensive. The super costly item has increased the sales of the costly item.

This psychological principle drives significant revenue for businesses like Starbucks.

Bundling and Promotions

Could you make bundles with a base product and additional items? Many people who want the base product will often buy more with a bundle.

The whole is more appealing than the items individually; your items appear more attractive when presented in a bundle.

Consider bundling good-selling items and bad-selling items together. It's a great way to get rid of unsellable stock.

Charm Pricing

Charm pricing involves setting prices just below a round number (e.g., $3.99 instead of $4.00). This tactic makes products seem more affordable and can drive faster purchasing decisions as people see it as $3 rather than $4.

Making it 95 cents rather than 99 cents works better in many retail settings, as it creates a perception of better value. It is also easier in Australia to handle cash, as we have a five-cent but not a-cent piece.

Although it was not mentioned in the talk. Many Chinese people live in Australia. To Chinese people, 8 is a lucky number, so if someone wants to experiment with, say, 3.88, please let me know how it goes.

The Cashless Effect

Removing dollar signs from prices can also increase spending by making the transaction feel less significant. For example, you should not write $24.95 on a price but 24.95; you do not want to push a $ sign at people.

People also tend to buy more with cashless payments. Although it costs more to process cashless payments, people tend to buy more if the sale is cashless.

Building Emotional Connections with Customers

Creating emotional customer connections is vital for building loyalty and driving repeat business. Starbucks, for example, always asks for your name for each order.

Offer customised loyalty programs and personalised recommendations based on customers' interests or past purchases. Your POS System has a free CRM; why not use it?

Conclusion

These five psychological marketing strategies have significantly enhanced customer engagement and shop sales.

Update: 

Although this talk did not mention it, what Starbucks does is a tactic. 

Scarcity

Starbucks offers limited-time offers, like the Pumpkin Spice Latte, for a short time. Customers rush to try exclusive drinks before they disappear.

Valentine's Day is coming, and you must prepare for a record-breaking year. With projected sales of $535 million this year, it promises to be the most profitable Valentine's Day ever.

Market Projections for 2025

Roy Morgan's early estimates suggest a 15% increase in spending compared to last year. However, past trends indicate that actual spending often exceeds their predictions. For instance, in 2023, Roy Morgan estimated $485 million, but Australians ended up spending over $849 million, according to a review by the NAB. This discrepancy highlights the importance of being prepared for the impulse buyer.

Consumer Spending Trends

The Google Trends data indicates a notable rise in interest for Valentine's Day 2025 compared to the previous year, reflecting a robust demand across all states. This observation aligns with the overall increase in consumer enthusiasm for the holiday.

Top Gift Categories

Roy Morgan's data reveals the most popular gift categories for Valentine's Day 2025:

• For Men:

  • Flowers
  • Food, chocolate, and alcohol
  • Experiences (dinner or trips away)

• For Women:

  • Food, chocolate, and alcohol
  • Flowers
  • Cards

Inventory Management Steps

To capitalize on these trends, follow these practical steps:

Analyse your past Sales Data

To prepare for this year, use your POS software effectively. Reviewing last year's sales data will give you valuable insights into which items were the top sellers. Also check your current inventory levels. This information is essential for deciding what products to stock up on to meet customer demand!

Research sales data from the previous year.

To see what sells in your shop on Valentine's Day and what stock you have, It will take seconds to discover and give you some good ideas. Remember, unlike other marketing holidays, many products on Valentine's Day are still marketable afterwards if you select wisely. 

So, in your POS software, look at the Top N stock report, which gives you the top-selling items.

Go to Register Reports marked in green.

Select stock.

Now, you will see two reports. Click the one on green first. It would be best to hold the purple in reserve, as you may need it before placing an order.
 

 
Now select a week before last year's Valentine's Day and a few days after, and then use the top 40 items, which should be plenty. I suggest doing it by quality sold.

You will get a report with top sellers over Valentine's Day, plus your current stock holding, to see how you stand for Valentine's Day.

We now have a list of the products that have sold well in your shop. That took less than a minute. Now, make sure you have enough stock.

Order now

Don't wait. Sales are starting now.

Stock Up Strategically

With the average person expected to spend around $150, ensure you have various gift options available. Chosen wisely, as many Valentine's Day products remain marketable after the holiday.

Visual Merchandising Tips

Creating a dedicated Valentine's Day section in your store can significantly boost sales. Here's how to do it effectively:

Create a Special Section

Designate a specific area for Valentine's Day products. It doesn't need to be elaborate; make sure it's visible and appealing.

Decorate with Love

Use cute messages and signs to decorate the front of your store. It will attract passing shoppers and spread the love.

Gift Wrapping

Consider offering gift-wrapping services to go the extra mile for your customers.

Conclusion

Valentine's Day is a significant opportunity to increase sales. To make this day profitable, please ensure you have the right products and an inviting shopping environment.

Maximise your Valentine's Day sales.

This is a typical map that customers call daily to search locally for goods and services they use. See the green arrow, which they look at in the Google suggested listings of the businesses they are looking for now. I have spoken about this before and must talk about it again, as in 2025, local search in Google has become a cornerstone for businesses. Today, there is a dramatic rise in "near me" searches, and now nearly half of all Google searches have local intent, which has grown by 500% in recent years. It translates directly to sales, as 76% of local searchers visit that business within 24 hours, and 28% of those searches result in a purchase often in an hour. I suggest you go through the complete list of the items on this website I linked to.

Many more people are now searching for local shops on Google. Google Maps Marketing is crucial for enhancing your visibility and customer engagement.

Why Local Search Matters

For example, if a customer searches for "lotto near me," they want a lotto agency near them; almost certainly, this is a potential customer looking to buy. Today, this local search is pivotal in driving foot traffic and sales to shops. We want to target customers with high purchase intent, as 28% of these local searches result in a purchase, often within an hour.

Local search is critical for SMB businesses. You, David, can compete with the Goliaths.

How Google Maps Marketing Works

Google Maps Marketing involves promoting your name in local search results. It requires you to claim your Google Business Profile, ensure consistent business information across the web, and encourage positive reviews to improve your visibility and attract customers.

Setting up your Google Business Profile is the first step in Google Maps Marketing. Make sure your profile is fully completed and is correct. Please ensure you have accurate and up-to-date information. Put in your business name, address, phone number, and hours of operation. It's also important to categorise your business correctly and include relevant services in your business title. The ones you need to categorise are the ones that people are searching for you.

Ready to improve your local visibility? Let us proceed.

Understanding Google Maps Ranking Factors

Let us examine the key factors that influence rankings and why you can, as David, compete with the Goliaths out there.

Firstly, Google Maps is what we call a zero-sum game. That means there are limited spots, and if you are in, someone else is out. So, we need to push the factors that get us in so we get the place.

Now, the three primary factors that determine your spot in Google Maps are:

Relevance

Relevance in Google Maps rankings refers to how well your business matches the customer's request. If I am a potential customer looking for, in this case, lotto, you have lotto. You must ensure that your Google Business Profile lists you with lotto.

To enhance relevance, businesses should focus on the following strategies:

Correct Categorisation

Ensure your business is listed under the most accurate category. Google provides a list of categories that you can choose from when setting up your Google Business Profile.

Keyword Optimisation

Include relevant keywords of your business in your description.

Distance

This one is difficult as there is little you can do about the distance between you and the customer. Distance plays a crucial role in Google Maps positions. The fact is that businesses closer to the search location are more likely to appear in search results. However, distance is balanced with relevance and prominence to show the most relevant results.

Prominence

Prominence is determined by your business's online reputation and offline credibility. It includes positive reviews, high ratings, and mentions online. Being active online does help.

Basic Optimisation Steps

Introduction to Optimisation

Optimising your Google Maps presence is crucial for improving visibility and attracting more local customers. The process involves several key steps that help ensure your business appears prominently in search results. These basic optimisation steps can enhance your online presence and drive more foot traffic to your business.

Claiming your Google Business Profile

Claiming your Google Business Profile is the first step in Google Maps optimisation.

Steps to Claim Your Google Business Profile:

1. Verification Process: Verify your business through Google My Business. This typically involves receiving a phone call from Google. From experience with many of my customers, it is not easy. It often needs to be done a few times until it happens.
2. Complete Profile Information: Ensure your profile includes accurate business information. Double-check your name, address, phone number, and hours of operation.
3. Business Categories: Choose the most relevant categories to improve your business's relevance in search results.
4. High-Quality Photos: Take high-quality photos of your business with your smartphone to enhance visibility and engagement.
5. Description and Keywords: Write a compelling business description with relevant keywords to improve your profile's visibility.

It will take you a few hours of work, but it's worth it.

1. Encouraging Reviews: Encouraging people to review you is critical. Positive reviews improve your visibility in search results and build trust with potential customers. Ask customers to give you some reviews. Do not worry about negative reviews. We all get them. If you are in business, you need to have a thick skin. It goes with the territory.

Need help implementing these changes? Give me a call.

Monitoring and Improving Rankings

Monitoring your local search rankings is essential to understanding how well your business is performing in Google Maps and identifying any needed improvements. While there are tools advertised to provide insights, asking your customers is the most effective way to gauge your progress.

Asking Your Customers

Asking your customers how they found your business is a straightforward, simple and robust method for understanding your local search performance. This approach allows you to gather firsthand information about your visibility. Ask them what they are looking for, what they used and why they picked you.

This way, you will get:

Direct Feedback

Customers can provide direct feedback on how they discovered your business, helping you understand which marketing efforts are most effective.

Personal Connection

Engaging with customers builds trust and strengthens your relationship.

Insights into Search Behavior

Understanding how customers search for businesses like yours can help you better meet their needs.

Questions to Ask:

What Did You Search For?

Ask customers what keywords or phrases they used in Google Maps to find your business. It helps you understand which search terms are most effective for your business.

How Did You Find Us?

Please inquire about the steps they took to find your business.

For example, you might ask a customer: "What did you type into Google Maps to find our lotto shop?"

Do tests

Go to the parking lot near your shop. Now, search Google Maps for your business's services, such as "lotto near me."

What happens, what appears?

Do the same test in another part of your shopping centre, and try again.

Continuous Improvement

Once you get some answers, change your listing till you get it right.

Conclusion

Understanding Google Maps can help you leverage this technology to attract more customers in 2025.

Frequently Asked Questions (FAQ)

Q: What is Google Maps Marketing? A: Google Maps Marketing involves making your online presence appear prominently in local search results in Google Maps.

Q: Why is Google Maps important for local businesses?

A: Google Maps is crucial for local businesses as customers will use it in 2025. It drives foot traffic and sales and provides a platform for businesses to compete locally. Most importantly, it reaches customers with high purchase intent.

Q: How do I optimise my Google Business Profile?

A: Fill it out; not just 60% of many do. Ensure it is complete with accurate information and has the relevant keywords.

Q: How often should I update my Google Business Profile?

A: Until you bed it down, probably every month, and after that, once every three months just to check it out.

Q: What are the costs associated with Google Maps Marketing?

A: Everything I have said here is free. We can discuss later the paid stuff.

Q: How long does it take to see results from Google Maps? A: Generally, businesses notice improvements within a few weeks.

In today's digital age, we all need decent internet speed. The NBN has transformed Australia's internet infrastructure, which most of our clients run.

Factors Affecting Internet Speed

Now, your internet speed depends on several factors, some of which you may be able to control:

Type of NBN Connection

Different plans offer varying speeds.

Number of Users

More users in your area can slow down your connection.

Time of day

Different times of the day have different speeds. I noticed my speed dips at about 7 p.m., while I get heaps at night. Test your internet speed at different times, such as in the morning, lunchtime, and afternoon, as peak usage times can significantly impact your speed.

Copper

Today, much of the copper infrastructure in Australia's internet network has been replaced with fibre, but we still have to make progress.

Business Internet Speed Requirements

Today, SMB businesses should aim for internet speeds of at least 25/5 Mbps, preferably 40 Mbps

Case Study: Troubleshooting Internet Issues

We once had a client who complained about slow internet speeds. Upon investigation, our engineer discovered corroded internet wiring, which caused the problem. Once the wiring was replaced, the issue was resolved.

Testing Your Internet Speed

You must test your internet speed regularly to ensure your business runs at its best. A free speed check tool is available here that can give you an accurate reading of your current speeds.

For a download, 25 Mbps should be a min, and 40 Mbps would be better. Upload 5 Mbps if you do video conferencing, e.g. Zoom 10 Mbps would be the min.

For latency, 50 ms is for general use; if you do any video conferencing, 20 ms is the min.

Download/Upload latency should be at least 50 ms.

Troubleshooting Checklist

If you're experiencing slow speeds:

Check wiring

As stated above, most user problems are caused by cables. A big issue here is the fluro lamps in the shop. Move the wires away from them.

Restart Devices

Restarting your devices can sometimes resolve issues.

Contact your Internet Provider

If issues persist, contact your internet service provider for assistance.

FAQs

Q: How often should I test my internet speed?

A: Once in place, you should notice any slowdown. I recommend testing every three months, ideally at different times of the day.

Q: What is a decent internet speed for an SMB business in Australia?

A: I would say as a min 40Mbs down, 10 Mbs up

Q: What is latency?

A: Latency is the time it takes for information to travel from. your computer to your ISP. A low latency of under 20 ms, is crucial for video conferencing.

I understand how frustrating it can be to lose a customer. Even though it may appear to be a defeat, it does not have to be the end of the road. Keep your cool.

Customer churn is a significant challenge for business today. Losing a customer is a setback. We need to examine it to improve our business practices. Here, we'll explore strategies for winning lost customers.

The True Cost of Customer Churn

Losing customers will significantly affect your bottom line. Acquiring new customers to replace them is costly, so tackling customer churn is vital for maintaining profitability.

Building a Customer Recovery Strategy

Implement these proven tactics to regain lost customers:

Communication

Effective communication is the first step in recovering lost customers. If you can communicate with them, you can offer solutions or compensation, demonstrating your dedication to their satisfaction. It's also important to request feedback to understand their reasons for leaving. Sometimes, these reasons may be beyond your control, but showing that you value their business can make a difference.

When communicating with lost customers, consider their motivations. They might have left because of a negative experience or because they found a better deal elsewhere. Understanding these reasons can help you tailor your approach.

Taking responsibility for any mistakes is key. Even if you weren't directly at fault, showing that you're committed to improving their experience can help rebuild trust. This proactive approach not only helps in winning back customers but also enhances your overall customer service.

Leveraging Your POS System

While effective communication forms the foundation of customer recovery, implementing systematic tracking through a loyalty program enables proactive customer retention. A loyalty program allows you to measure and track customer loss, identify patterns, and maintain a solid relationship by regularly following up. Many POS systems, including ours, offer a built-in retail CRM to help you manage customer interactions and loyalty programs without additional costs.

Learning from Customer Loss

Studying the reasons behind your customer churn is a vital exercise. We must be open and honest here. Did the customer leave 1) A negative experience with you 2) Conditions have changed, e.g., because they moved to a different area; 3) They found a better deal elsewhere. Use this information to improve the customer experience and make the necessary adjustments to avoid similar issues in the future.

Proven Strategies for Customer Retention

Customer retention strategies are vital for maintaining a loyal customer base. Here are some key steps to focus on:

• Follow Up with Lost Customers: Regular communication shows that you value their business.
• Provide Solutions or Compensation: Offer incentives to encourage them to return.
• Take Responsibility for Mistakes: Show commitment to improving their experience.
• Gather feedback: Understand the root cause of customer churn to make informed changes.

Conclusion

Losing a customer hurts. Regaining lost customers often requires a direct approach. Remember, customer retention is more cost effective than acquisition, and recovering lost customers can turn them into brand advocates.

Would you be ready to transform your customer retention strategy? Access these powerful features in your POS Software today; you have a free CRM, so why not use it?

Running a gift in your shop can be rewarding, but success hinges on understanding the financials and implementing effective strategies. Let's explore how you can boost your shop's profitability.

Location: The Foundation of Your Success

Before diving into operational strategies, it's crucial to recognise the impact of location on gifts. Gift shops in high-tourism areas often perform better due to increased foot traffic and demand for souvenirs. When looking at your location, consider:

• Proximity to tourist attractions
• Local demographic trends
• Competition in the area
• Potential foot traffic

Of course, a prime location will significantly boost your sales potential and create higher profits.

Expanding Your Gift Shop with cloths

Although not gifts, adding clothing can significantly boost your profits and attract a broader customer base. The average Australian spends about $200 a month on clothin. We are some of the top spenders on clothes in the world.

When selecting clothes for your shop, consider whether your items appeal to tourists. T-shirts with local designs or slogans work. If you are in a coastal area, look at beach cover-ups.

Jackets, hats, etc are good as you do not need a changing room.

You'll want to stock a variety of sizes to cater to different body types, so remember to adjust your inventory based on the time of year and local climate.

Consider related items, such as hats, beanies, etc.

When pricing your clothing items, aim for a markup between 2.2 and 2.5 times the cost price. It will give you a decent profit margin while being competitive. Consider offering bundle deals to encourage multiple purchases, which can increase your average transaction value.

Effective display and merchandising can significantly impact your clothing sales by creating visual interest in your shop. Grouping complementary items can encourage add-on purchases, boosting your overall sales. It's important to rotate your displays regularly to keep the shop looking fresh and exciting, enticing repeat customers to see what's new.

Phone cases

Phone Cases

Australians buy a phone on average once every four years, which is about 9 million a year. Since new phones are different sizes, almost everyone buying one needs a new case. Since cases are replaced more frequently than phones, it is reasonable to estimate that tens of millions of phone cases are sold annually in Australia.

They do not take up much room, but they do need a stand, which must be organised by type, e.g., iPhone, Samsung, and other brands.

Then, you need to sort them by model; ensure you have the latest with a range of rugged, slim, leather, or eco-friendly cases.

Look at your price points. You need to offer budget-friendly and premium options to accommodate different customer preferences.

To sell them, though, you need some product knowledge.

Understanding Gift Profit Margins

One point that I have noticed is that those who do well in gifts are people who grasp the key financial metrics and know and monitor your numbers:

Gross Profit Margin

Gifts typically achieve a gross profit margin of 40% to 51% in a successful shop.

Net Profit Margin

You need to check your expenses, as the net margin is 12% to 22% for those shops that sell gifts; the additional costs are more than the cost of the goods.

Essential Financial Metrics for Gift Success

Understanding your financials is crucial, so studying your profit and loss (P&L) statement is worth studying. Consider it your business compass as it shows the critical metrics about your expenses. Pay close attention to these key percentages:

• Cost of goods sold (COGS): Typically 48% to 56% of revenue for gift shops
• Rent: Can range from 6% to 20% of turnover
• Wages: A significant expense that needs careful management. To sell gifts, you often need staff who know the product.

Keys to Success in the Gift Shop Business

Now that we understand the profit potential let's explore the key strategies that will help you achieve and exceed these industry benchmarks.

1. Grow Your Sales

While cost-cutting can improve margins, in my experience, it's not a path to success; sustainable success comes from growing sales. Consider these strategies:

• Create a unique product stand with relevant gifts together.
• Make the stand inviting.
• It needs to be somewhere your customers can see it
• Plan your inventory around peak holiday seasons to maximise sales

2. Price Strategically

Retail pricing is often recommended with a markup strategy of 2.5 times the cost price. This allows for a healthy gross margin while remaining competitive. However, I suggest walking into a few competitors nearby and getting a feel for their price points. See what they are getting. It will tell you what people in your area will pay.

3. Improve Efficiency

Enhance your shop's efficiency to control costs and improve customer experience:

• Streamline inventory management
• Optimise shop layout for easy restocking and customer flow
• Invest in a reliable point-of-sale (POS) system for faster transactions and better inventory tracking

4. Analyse Your Product Mix

Regularly review your product performance:

• Identify high-margin items driving profitability
• Recognise popular products that attract customers
• Discontinue or discount underperforming items.
• As a rule, you need about 10 new products constantly.

Advanced Strategies for Revenue Growth

To take your gift shop to the next level, consider these advanced tactics:

1. Develop an e-commerce presence to reach customers beyond your local area
2. Implement a customer loyalty program to encourage repeat business
3. If relevant, look at unique, locally-made products

Success lies in working smarter and making informed decisions based on your business data and market trends.

Artificial Intelligence (AI) is now revolutionising the retail industry. It is already changing how businesses operate and engage with customers. I have witnessed firsthand the increasing impact of AI on our retail sector. This article investigates how we anticipate the latest generation of AI solutions will transform the brick-and-mortar retail in Australia.

The retail landscape is evolving rapidly, with AI leading the charge. From inventory management to customer service, AI promises to provide solutions once deemed impossible. 

The Focus Engine: Our Early AI Solution

Almost three decades ago, we created an AI solution that transformed stock ordering for our users. Using the Focus Engine, this system has been a pillar of our service offering and has stood the test of time. No one has been able to match it in our market space.

Key features of the Focus Engine include:

• Widespread adoption: Thousands of our clients have used this solution, many in their daily operations; it is a testimony to its effectiveness and reliability.
• Cost-effective: We've always offered this powerful tool free of charge, making advanced AI accessible to all our users.
• Tailored for specific needs: The Focus Engine was designed to address particular challenges in stock order and excels in this specific domain.

The most telling indicator of the Focus Engine's success is the feedback we've received from our long-standing users. One particular comment I liked by one of our users when talking about the latest update:

"You can update it however you like. Just make sure that it gives the same figures after the update."

It's hard to beat a dedicated AI specially built for one task. However, it does speak volumes about the trust and reliance our clients place on the consistency and accuracy of our AI solution.

ChatGPT in Retail: Limitations and Challenges

Recently, some of our clients have been using ChatGPT. Unfortunately, in tests, its application in retail has revealed some significant limitations:

• Cost concerns: A significant problem with ChatGPT for many retailers is that it's "not particularly affordable." This poses a significant barrier, particularly for small—to medium-sized businesses operating on tight margins.
• Weaknesses in retail-specific issues: Although versatile, ChatGPT frequently encounters the many nuanced challenges unique to the retail sector in Australia. Most of its information is form overseas. 
• Mathematical limitations: One significant flaw of ChatGPT is its struggle with maths and arithmetic, which are essential for numerous retail operations.
• Pattern recognition methods: ChatGPT's strength resides in pattern recognition rather than actual computations, which can pose a significant drawback for retailers requiring precise calculations.

These limitations highlight why solutions like our Focus Engine, designed specifically for retail requirements, remain valuable even against the backdrop of broader AI advancements.

Enter DeepSeek: A Game-Changer in AI

The AI landscape is undergoing a seismic shift with the arrival of DeepSeek, a Chinese AI model shaking up the status quo. It's making waves in the industry, and here's why:

• Unparalleled speed: DeepSeek operates twice as fast as competitors like ChatGPT, allowing quicker response times and increased productivity.
• Cost-effectiveness: Perhaps most importantly for retailers, DeepSeek costs around a tenth of the price of its competitors, making advanced AI more accessible than ever.
• Comparable power: Despite its lower cost, DeepSeek boasts comparable power to the best commercially available AI models.

Here is a table I constructed to show the difference, in particular checkout the costs.

Why DeepSeek Matters for Retailers

DeepSeek's capabilities are particularly well-suited to the retail sector:

• Mathematical prowess: Unlike some general-purpose AI models such as ChatGPT, DeepSeek excels in mathematical problem-solving, a crucial skill for inventory management, pricing strategies, and financial forecasting.
• Improved efficiency: The combination of speed and accuracy means retailers can make decisions faster and more confidently.
• Cost-effective hardware requirements: DeepSeek is less reliant on expensive Nvidia microchips, allowing it to run on much cheaper equipment. It significantly lowers the barrier to entry for retailers looking to implement AI solutions.

These advantages are already impacting the tech industry. Nvidia, a major player in AI hardware, has lost nearly $1 trillion in market value, indicating a shift in the AI landscape. Moreover, DeepSeek's popularity is soaring, becoming "one of the most downloaded apps in the world".

The Open-Source Advantage

One of DeepSeek's most significant features is that it's the "only powerful AI model in Open-source". This open-source nature brings several benefits:

• Public preference: Users and developers alike prefer open systems. They like to know that the systems they use are open for inspection.
• Wider deployment and development: An open-source model allows for broader deployment and faster development of new applications and improvements as developers can see what it is doing.

Speed and Processing Power

DeepSeek's high processing speed makes it particularly suitable for businesses that require quick, real-time decision-making - a common need in the fast-paced retail environment. No one wants to wait unnecessarily.

Privacy and Security Considerations

While DeepSeek offers many advantages, it's essential to address our privacy concerns:

There are worries about the Chinese government's potential data access. It is also an issue with most AIs, as wherever they are hosted, there is a government with potential data access.

Running DeepSeek locally can mitigate some of these concerns. For those concerned about data privacy, I recommend using DeepSeek "for personal or exploratory use only."

The Bigger Picture: AI Industry Disruption

DeepSeek's emergence is more than just a new product launch; it represents a significant shift in the AI industry:

• It challenges US dominance in AI development.
• It positions China as a strong competitor in the global AI race.
• This competition will drive further innovation and development in AI technologies.

Current Limitations and Strengths

While DeepSeek is powerful, it's essential to understand its current position:

• It is only text-based tasks.
• Its focus on these areas means it can provide better-targeted, efficient solutions for many retail operations.
• Its maths and arithmetic are better, but it does make plenty of mistakes.

Looking Ahead with its Cost-Effective AI retail solutions

The emergence of DeepSeek and similar AI models is set to revolutionise the retail industry. We predict that many more AI models will soon copy its approach, making AI increasingly more cost-efficient and accessible. This democratisation of AI technology levels the playing field, allowing smaller businesses to compete with larger retailers in terms of AI-driven capabilities.

Despite these advancements, there's uncertainty about fully leveraging generative AI capabilities in practical applications. However, the potential benefits for retailers are significant:

Enhanced Customer Experience

AI can dramatically improve customer interactions and satisfaction:

• Provide personalised shopping experiences with 24/7 customer support, handling inquiries and potentially leading to simple transactions.
• Use AI-powered recommendation engines to offer tailored product suggestions, mimicking the personalised service of knowledgeable salespeople.

Improved Inventory Management

AI can revolutionise how retailers manage their stock, particularly in predicting demand fluctuations, automating inventory management, reducing waste, and ensuring popular items remain in stock.

Marketing Optimisation

AI tools can significantly enhance marketing efforts:

• Target ideal customers more effectively, maximising marketing ROI.
• Analyse market trends and competitor pricing to optimise pricing strategies.
• Generate more engaging product descriptions and marketing content.
• Analyse foot traffic patterns in physical stores to improve layout and product placement.

What I particularly like about AI is its ability to scan social media to check out current public thoughts. If you haven't tried it, I suggest you do. You can use this feedback to analyse customer sentiment. I will write another article with a step-by-step approach to show how you can do it now in a few days.

This cost-effective AI implementation means that even small brick-and-mortar retailers in Australia can now access powerful tools. By leveraging these AI capabilities, you can streamline operations, enhance customer experiences, and make data-driven decisions to drive growth and profitability.

The Promise of Cost-Effective AI Implementation

The emergence of DeepSeek and similar AI models is set to revolutionise the retail industry. We predict that "Many more will soon copy its approach", leading to AI becoming increasingly cost-efficient and accessible. This democratisation of AI technology levels the playing field, allowing smaller businesses to compete with larger retailers in terms of AI-driven capabilities.

Despite these advancements, there's uncertainty about fully leveraging generative AI capabilities in practical applications. However, the potential benefits for retailers are significant:

Retail technology trends

The rapid advancements in AI technology will transform the retail landscape.

From our early Focus Engine, which has served thousands of clients for nearly three decades, to the latest advancements in AI, we have seen how these technologies can revolutionise stock ordering. Soon, they will move into customer service, inventory management, marketing strategies, etc. Who knows where they will end up?

One thing is for sure: DeepSeek and what I am sure will be similar AI models will represent a paradigm shift in the AI industry.

Its speed, cost-effectiveness, and open-source nature challenge the status quo.

By staying informed about these developments and thoughtfully integrating AI solutions, Australian retailers can boost their competitiveness, enhance customer experiences, and drive business growth.

Understanding your actual profit margins is crucial for retail success. While supplier-provided figures offer a starting point, after years of experience, I can assure you that their figures are often wrong. I do not trust them, and neither should you. What you need to do is verify your actual margins. In the real world, things can be different. Here is how to do it.

The Reality of Supplier-Provided Margins

Supplier-provided gross margins often paint an overly optimistic picture that may not align with your business situation. Many factors drive margins. Salespeople are rarely the sort of people who can calculate the details. They take the figures they are given and quote them to you.

Verifying Your Actual Margins

Go to the menu

Now in sales, select  the "Discounted Item Sales Summary."

Pick a period. I suggest the last 12 months and now check; I would recommend it as a first attempt by the department.

Now you will get a detailed report of where you are discounting by quantity and price.

Actionable Insights from Margin Analysis

Understanding your actual margins can lead to valuable business decisions:

Pricing Strategy Refinement

Adjust prices on items with consistently lower margins.

Supplier Negotiations

Use actual margin data to negotiate better terms.

Inventory Management

Focus on stocking items with actual healthier margins.

Discount Strategy Review

Analyse the impact of discounts on overall profitability.

The Importance of Regular Margin Analysis

Making margin analysis a regular part of your business review process is beneficial. Who said today's price and margin are valid tomorrow? By consistently monitoring your actual margins, you can:

1. Quickly identify trends or changes in profitability.
2. Make data-driven decisions about product lines, pricing, and promotions.
3. Maintain a clear understanding of your business's financial health.

Remember, average retail profit margins can vary significantly by department.

Conclusion

While supplier-provided margin information can be a helpful starting point, your sales data will always provide the most accurate and relevant insights for your business context. Regular analysis and adjustment based on this data will help you maintain healthy margins and drive your retail business towards greater profitability.

Ready to uncover your actual profit margins? Start by diving into your POS data today and discovering the real story behind your product profitability. Remember, knowledge is power in retail, and accurate margin analysis is the key to unlocking your store's full potential.

The November 2024 RBA report here showed significant shifts in Australian retail payments directly impacting retail.

What are the payment trends in Australia?

Card Payments: The Reigning Champion

Card payments continue to grow the most, with total purchases growing by 5.8% in value and 5.0% in number year-on-year. Notably, debit cards are slightly outpacing credit cards, I suspect mainly because merchant surcharges are cheaper.

Key statistics:

• Total card purchases: $87.7 billion
• Debit card growth: 5.9% in value, 5.0% in volume
• Credit card growth: 5.8% in value, 4.8% in volume

I doubt anyone would be surprised to read here that credit cards are used for higher purchases.

Recommendations for merchants

1. Ensure your POS system accepts all major card types.
2. Consider incentives for debit card usage to align with consumer trends.
3. Implement contactless payment options, as 39% of card transactions are now via mobile wallets.

New Payments Platform (NPP): Rapid Ascension

I was stunned by the high growth of Bill Payments and direct bank transfers. Merchants are clearly trying to avoid using cards by conducting direct bank transactions, and I am sure this is especially true of the bigger transactions.

NPP growth statistics:

• Transaction value: +17.7% year-on-year to $168.7 billion
• Transaction volume: +15.0% year-on-year to 142.1 million

Action items for businesses

1. We are now working on expanding your NPP capabilities into your POS system
2. Get ready for it.
3. Clearly, the public now is accepting it. I would look into it with your bank.

Cash

Cash usage is up, not as much as card usage, but still up. Plus, clearly, there are fewer but larger withdrawals. The reduction in the number of ATMs forces people to take out more, and there is inflation.

ATM withdrawal statistics:

• Value: +2.7% year-on-year to $9.0 billion
• Volume: -2.2% year-on-year to 28.7 million transactions

Considerations for retailers

1. Maintain sufficient cash reserves for customers who prefer it.
2. Do not drop cash as people want it.

The Decline of Traditional Payment Methods

Traditional payment methods show a significant decline, which I doubt surprises anyone.

Cheques: A Rapid Descent

Cheque usage has plummeted; I know that now few people want to accept it.

Cheque payment statistics:

• Value: -22.6% year-on-year to $15.4 billion
• Volume: -30.9% year-on-year to 1.1 million transactions

Interestingly, the average value of each cheque is down now.

Recommendations

1. I suggest that you seriously look into phasing it out.
2. Communicate with your customers about transitioning to digital payment methods.

Merchant Fees: Understanding Transaction Costs

This part of the report was particularly interesting, and it's worth your time to compare what you are paying to the average. Note that if the customer is not present, the rate is generally higher.

Merchant fees vary significantly across card types. Understanding this is crucial for optimising your payment acceptance strategy.

Average merchant fees comparison (September quarter 2024):

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Action items

1. Review your current merchant fee structure against your costs. You can often get better rates if you take out a contract.
2. Consider reducing fees by promoting Cash/EFTPOS as a preferred payment method.
3. If you have not done it yet, implement least-cost routing to process transactions through the lowest-cost network automatically. Not having it is costing you money.

What are the future trends in payment systems?

The Australian retail payment ecosystem is rushing towards digital with its real-time solutions.

You must position your business for a digital retail environment.

If you want the details of this report, click here

Australia Day on January 26th represents our only national celebration. What was supposed to be a holiday meant to unite us in celebrating our beautiful, diverse country has become politicized. It indeed commemorates a day when much changed in Australia.

Australia Day trading hours

If your business operates on Australia Day, clear communication is essential. Display prominent signage, update your online trading hours, and ensure your storefront indicates you're open for business.

Local Support for Local Businesses

As a proudly Australian-owned Point of Sale provider, we are one of the few remaining, so we know how important it is to help local businesses maximize their Australia Day revenue. To that end, we are running our support lines today if you have a problem.