When I saw publicity photos from Thurgoona newsagency,

I remember a discussion in our shop with my sister as to whether we should use a waterfall layout. I felt it was a waste of space, which reduced the amount of stock we could display. She felt as most of the stock supplied was rubbish, we would be better putting stock that sells in a second and even third pocket. You can tell us what you think in the end.

Do you see the economics sense of an Age home delivered every Thursday, Friday, Saturday and Sunday for 52 weeks, for $52. That is 25 cents a day. It works out to a saving of $330 off the newsstand price.

We have checked their catalogue file for the mid-year promotion and it is now available for import here. (Outdated file - decommissioned)

If you have any questions please contact

Kevin Mulhall
ANCOL (SA) 
Telephone: (08) 8346 6415

The Newspaper works an organisation that represents newspaper companies in Australia has put out a report partly in response to the recent ABC circulation report which did not look very good.

They point out that circulation figures are approximately the same as they were five years ago, they call it resilient. On the report check out page six and make your own mind up.

You can see too in this report what I consider the real problem with many newspapers now, the classified advertising revenue on page 30. If any of the major newspapers go soon, this will be the cause. It is an amplifying effect. The advertising drops, many who buy the newspaper for the classified advertisements stop buying it, the advertising and circulation revenue drops so the newspaper has to go up in price so public buy less. As less buy the newspaper, the advertising drops more and so on.

I think this tends to confirm what we have been saying for a long time. Newspapers are still a really good product. They bring plenty of people into the shop, the margins are reasonable, take up only a small space, etc. but newsagents need to change to accommodate the new market realities.

News limited given South Australian country newsagents a top-up of about 6% more for delivery fees given in February.

However, there is a slight change to the previous release as it now specifies that an account keeping fee can only be charged if a printed copy of a statement is sent to the customer.

Still, SA newsagents have done well with their $1.50 account keeping fee and an overdue fee of $3.00.

While negotiating with the publishers, Victorian newsagents argued that like South Australian newsagents they should be allowed to charge a statement fee. What News Limited unexpectedly did was agree on condition that newsagents offer their clients a free internet email solution. So Victorian Newsagents have to on client request provide statements electronically. If they are unable to do that then they cannot charge a statement fee.

Of course newsagents in other states can use this to save money too. It costs nothing to send an email statement.

Postcarden have a new greeting cards, when they come to Australia will be an interesting seller.

What the recipients do is unfold them, dampen the paper and put the seeds provided. In a few days, a Postcarden grows.

Check it out here.

{Link removed}

The Audit Bureau of Circulations confirms what is our major concern in newsagencies magazines, the weeklies..

Looking at the figures, its ACP that seems to be taking most of the drop.

Note number 13 which stunned me, recently Grazia increased its cover price. When we benchmarked it, it was down but ABC circulation figures show it going up in sales. Where was this increase?

It does show though what one magazine distributor told me that magazine buyers are not as price sensitive as many newsagents think.

I went to read the English Financial Times and discovered this.

Some newspapers overseas are now turning to the new subscription model where online reading is no longer free.

Here is a local example, the Examiner a Fairfax newspaper

It will be interesting to see how it spreads to mainstream newspapers.

Queensland Newsagents Federation and the Newsagents Association of NSW & ACT have made a submission to the Treasury, for their members on the current newspaper contracts. This comment that I thought was a good statement of some problems that newsagents face now.

Newsagents are small businesses and face major suppliers such as newspaper publishers, magazine publishers / distributors, suppliers of soft gambling products and landlords.

Conduct that newsagents regularly experience includes,

•Refusal to collectively negotiate – which seriously disadvantages individual newsagents
•Take it or leave it contracts.
•‘Lock in’ which prevents newsagents suffering unanticipated economic deterioration (circulation decline) from exiting
•No proper recognition of specific costs factors escalation which can obviously adversely impact on ‘locked in’ newsagents
•Newsagents getting less advantageous terms than big players like supermarkets
•Newsagents supplied and charged for products that they do not want.
•Unilateral variation of contracts.

They are certainly valid. These problems exist largely because newsagents used to have a monopoly on newspapers and magazines. So, as a result, ACCC started to look at newsagents. The price of the monopoly then was a cheap local delivery. Now the monopoly has gone yet the publishers of newspapers and the ACCC want the cheap local delivery of newspapers to continue.

What the ACCC did allow was voluntarily collective negotiations with newspaper publishers with a state newsagency body. As the publishers of newspapers do not wish to deal with the newsagents collectively, so they do not. This means that large individual players like supermarkets that in many ways are larger than all newsagencies can use their might to negotiate better terms, whereas newsagents cannot. Therefore, newsagents are being offered terrible terms with no negotiation.

What many newsagents that are refusing to sign these contracts are saying is "You can't have your cake and eat it too."

As we are collecting more information, we are sending information sheets on how to handle the coming holiday period. They are going out now and will continue to go over the holiday period.

It is always the same a last-minute scramble for information from the newspaper and magazine companies which is a continual source of frustration to us all. What justification is there for this doubt and confusion with the newspaper and magazine companies over this season? They have plenty of warning as the public holidays for Christmas and New Year are set well in advance. You can click here {link removed} for a listing of Public Holidays for Christmas and New Year in Australia for 2009, they are already listed now for 2010. Many are listed in 2012, several in 2013.

The newspaper and magazine companies have all have done it last year, the year before that and a hundred times before.

Why cannot they get their act together?

This year according to Commercial Economic Advisory Service of Australia, advertising revenue drop is the biggest ever.

The revenue drops from advertising in newspapers and magazines.

Metropolitan Newspapers (-20.9%)
Regional Dailies (-14.0%)
Regional Non-Dailies (-9.6%)
Suburban Newspapers (-16.9%)
Magazines (-9.3%)

It is a disturbing trend that appears will continue.

As I blogged earlier, the newspapers and magazine companies should look at increasing the cover price and reducing these crazy subscription deals which come extremely close to giving away product.

Everyone I speak today about XchangeIT seems happy today. The invoices are coming through although I know Friday is not much of a test. Now I am happy to report that “All is quiet on the Western Front” although we need to wait till Monday to be sure.

I just want to make a note to say that I deny all responsibility for this mess. In my view, XchangeIT was only initially beta tested. In that, it worked well. The problems that occurred had nothing to do with this beta testing. During the Beta testing, the invoices from all suppliers were sent on time, all the invoices were correct and none were blanks. We tested these invoices thoroughly on both posbrowser and DOS and all worked fine. See Lyle comment from Lucky Charm Victoria Point who was among the very first testers.

What happened from there is we requested a pause so only a few sites would have it while they use it we could see what was happening. Then gradually spread it to all users. If this had happened, only a few people would be affected at any time. As there was nothing wrong with the old system and many people were happy to stay on it, there was no rush. So we opposed moving to a mass deployment.

I think the problem occurred in the mass deployment. It appears there was little if any testing for a mass placement. Plus there was no additional support staff put on the suppliers’ side for this deployment something always required if changes are done. Finally, there was also no contingency plan, if something went wrong.

When it started to go wrong misleading information was sent on the 28/Aug/09, on the 31/Aug/09 and 01/Sep/09 and from then on complete silence was broken only by one email seeking details of the current problems. All this made it worse as newsagents believing these messages kept ringing up saying something like “I was told it is fixed but somehow I am having trouble?”

The problem was made worse because so many people rung the support lines about XchangeIT that they clogged the support lines so people with other problems were delayed.

Word got around too as I know one well-known newsagent supplier who was thinking about XchangeIT told me of their concerns of doing this because of what happened.

When this is over, I think some questions should be asked but knowing the industry, I doubt they will and if they were asked, I doubt they would be answered.

The advantage our clients had is that at all times we kept them as well as XchangeIT and the magazine companies informed on what was happening. We released emergency updates, put on extra support staff and started our main support bay from 6:00 AM. The support staff worked till very late answering calls to get through them all.

{links no longer active}

There are several such stories today about a new electronic reader for newspapers. Contrary to what the stories say, these A4 readers are not new. What is news is the fall in price for A4 readers. At $US299, it is now close to a year subscription cost of a newspaper.

I expect early models will probably be released here in two years.

Although I do not know what these new designs look like here are some from a rival company, that do look good.

I find the current ebook readers not comfortable to use but I confess these readers do look good.

The advantage of using these for newspapers is they will always have a current edition, they use touch screens and allow hyperlinks on an A4 sheet that keeps the current layout of the newspaper and magazines intact.

Paypoint software allows other businesses on your behalf online to receive payments, change and enter delivery detail such as stops and starts and check customer accounts.

It also provides an alternative to selling off your rounds as with paypoint software several newsagencies can subcontract the distribution and still own it.

What it has now is an alert messaging system inbuilt. You can see some screenshots below of the new sections.

The following are two powerpoint presentations of circulation of newspapers which we received today.

One shows Australian newspaper circulation over time by title which includes the national and state figures.

The other shows the recent trends in newspaper sales.

These are from the ABC which are the total sale, so just in case before I released them I checked with our newsagency benchmarking data and it is showing a similar score.

Although some people keep going on about newspapers doom, the current figures in Australia are showing steady sales.

Nextra are the largest marketing group in newsagencies and extremely successful. This weekend they are having their annual conference in Melbourne. So Nextra members and their team are now gathering in Melbourne. Tomorrow it kicks off.

With so many newsagents coming to the Nextra annual conference, it will be an excellent opportunity for us too.

We will give a presentation there on the latest in benchmarking. How it works, how it is being used and what it does!

There we will also have technical experts including programmers available to answer questions and show you our software. We will be showing our latest retail management software and explaining the latest developments in computers, particularly XchangeIT where we will be explaining the latest in EDI compliance.

We will be on stall 14. If you attend, be sure to drop by and say hello.

In the press release issued by the Advertiser today.

Soon all the customer relations, administrative and financial work for home delivery of Advertiser in South Australia will be done by the Advertiser, not the newsagent. Stops, starts, billing etc will all be done by the Advertiser.

I was speaking to a few clients in South Australia about it. No-one was surprised. A few were concerned, some thought it was a good move. Nothing anyone can do about it.

Soon I am sure that most Australian newspapers will go to this model after all most newspapers in the USA do it like this too.

McGills is the largest newsagency in Victoria. It has a couple of floors. It was a landmark in Melbourne CBD and now it is closing in a few weeks as no-one offered to buy it.

I remember it well, as a kid, I had to go there to pick up magazines for our newsagency as they used to distribute magazines too.

From the manager’s comments on the reasons for closing were

"Newsagencies are a hard business, very labour intensive and along with high CBD rent it has been difficult over the past few years," he said.

"But I wouldn't say this is a result of the financial crisis."

Newsagents today need to look at much more then just the bottom line as McGill's example shows they have to look at the work involved and floor space.

Now in NSW, the proposed tobacco display laws will require retailers to spend a significant sum to convert the tobacco displays. For a typical shop, the costs are estimated would be about $8,000.

An immediate low-cost solution you may want to consider is converting the space to “hangsell” products like inkjets. This is fairly easy to do and should provide a short-term solution.

Here is one done in Victoria. See the area marked in red.

Reusing the tobacco space was also widely done in Western Australia when strict tobacco laws were recently introduced there.