BLOGS AND ARTICLES FROM THE POS SOLUTIONS TEAM

It is Amazon Prime Day today in Australia, which is an annual shopping event on Amazon exclusive to Amazon members. It is their big push for sales today, so its a good time to review their Australian operations. Now if you want to see if Amazon affects you today is the day.

Worldwide, Amazon is a vast global online retailer with close to 232 billion U.S. dollars in 2018 net sales. So big that when Amazon decided to physically come to Australia, as Amazon already had a firm hold on the Australian market and with a physical presence in Australia, many Australian retailers were terrified. So many of them spent fortunes on developing a competitive online product. 

Well, Amazon came here, and the results seem to be mixed.

They have achieved a lot of growth in Australia. Current figures were at 1500% in 2018 but it is only about A$300 million which although is a lot of money is only a small fraction of the Australian online shopping which last year was estimated then at A$28.6 billion and brick and mortar stores do about ten times more than that so as a result few currently pay much attention to Amazon here. 

Many here, including myself want Amazon Australia to close down as it restricts us from buying much directly from Amazon US. However, I doubt that it will not close down even though Amazon now report that it is losing money in Australia soon as large companies like that are quite prepared to run at a loss for an extended time to make a viable product. So we are all going to have to learn to live with it.

Australian retailers must see that in the online space the competition is up, and the two immediate issues are they need to look at their e-commerce and their delivery options. This is where Amazon is powerful.

Where we are unique in our market space is that our point of sale software is a unified commerce solution which brings together both of these issues into one platform in your POS system. Pieced together systems, that our competitors offer cost more money and lead to problems as different systems both in use, training and the need to talk to each other. Plus there is no long-term as who knows what the individual and separate parts are going.

Our unified system gives you long-term as well as a day-to-day business solution. Click here for more details. 

PS If you want using our system you can sell through Amazon too.

Signs like this went up yesterday, as ATMs and EFTPOS machines on Thursday afternoon, went down. Our call centre like so many others took a hammering. There was little we could do. It appears that the big problem was in the debit card transactions if it had been credit, it would not have been that bad as almost everyone with credit has a debit account too. The only workaround that sometimes worked was to use the card manually.

Today a Telstra spokesperson said all services had been fully restored and apologised for the incident. In the process, it is estimated that the cost of this blackout by the National Retail Association, will be over 100 million dollars. The bigger retailers will be less affected then the SMB as they have websites where people could that evening buy later, many SMB do not have such a website. Anyway I am sure this is a gross underestimation what about non-retailers like us with our extra costs? 

Too often we see the passwords in our client's shops ignored and treated like a joke. It does not have to be and let me point out that many of you can be held responsible for misuse of the system. If you treat the matter lightly then so will your staff.

What you need to do is give your staff the resources to do their jobs, which means giving them access to your point of sale software. However you do not have to give them access to all the system. What out system allows you to do is select exactly what they can have access too.

Please go to

Main menu> staff > staff maintenance

Then click the Security Level tab on the top

Now you will see the user levels with our suggested functions for each level. Change them at will to suit your own particular needs.

Now click Staff Maintenance

This screen appears

Now set your staff with a suitable security level that they need to do their position making sure that you give them the functions and information they will need without compromising sensitive and dangerous functions and information.

This is not only a matter of protecting yourself but if your customers see that you treat the information they give you lightly they will remember that. What may be interesting to you is to read the Woolworths privacy statement here. It might give you some ideas

Many of you never switch off your main computer. If so this post is for you.

This is not good practice. What happens is that many of the updates and patches, the computer requires a reboot to complete. If this reboot does not occur weird things happen.

The other problem is memory leaks. What is happening here is that you are building up useless data, chunks, software, etc. in memory. This will slow down the computer and in the worse case can cause parts of the computer to fail e.g. one of your printers no-longer work.

As such it is recommended that all computers, get a restart once a week. 

 

The Russian writer Ivan Turgenev wrote: "The drawing shows me at one glance what might be spread over ten pages in a book" 

A picture is worth a thousand words.

Often it is much easier to see trends in your business by looking at graphs of your sales by over time. Doing this, you can quickly see how you are travelling. You’ll know where you are going went up and down. You can determine what effect the measures you took helped you meet your goals.

And it is effortless to do, and you can do it in seconds!

Go to your reports> Sales> Dissection Monthly Sales Trend (Graph)

Now there are many options here, but I am going to keep it quick and straightforward, and you can build up from there.

Put in a very long time; in this case, I will pick seven years because I am looking at a long term trend.

I decided to look at giftware products, so I picked selected and highlighted giftware.

Now out popped this graph. 

I can certainly see a long-term pattern up. The last few years which I highlighted in yellow are up, notice that the Christmas peaks are higher too. Overall this department has gone from a 20K to 50K a month to a 30K to 80K, making it a very pleasing department. We can see that something here is working. 

I am sure you will agree that it is much easier to see that, then a report with lots of numbers.

Have a go and let me know how it went.

The $64,000 question many of you will be asking now is how well did I do this year in my shop compared to last year. Just how am I travelling? 

Now is a good time to find out and it is very easy to do.

Go to Reporting Documents > Dissection Family Class Period Sales Comparison.

Now put in the financial year dates, in this case, I put down that I want a report on all products. 

Note there are many more options here but let us keep it simple, you can always experiment later if you want to learn more.

Now on the basic version, you get a very detailed comparison by department and class.  It will make I am sure fascinating reading, in my view the two most important metrics here are Qty which are the number of sales for each department and the $ Profit made by each department. 

What can be also useful is running the same report comparing last year with the year before that, this will give you a two-year trend analysis.

Stock turns ( often called the Inventory Turnover) is one of the most commonly used measures used in stock control. What it measures is how many times you turn over your stock.

Now that you have done a stocktake, it is the perfect time to do a full review of your stock turns.

Traditionally it is calculated as 

Stockturn = (Cost of Goods Sold) / (Average Inventory cost)

So say you keep a constant stock of 10 items which is your average inventory, and you sold 50 over the year. You would have a stock turn score of 5.

A score that many retailers often look at here is twelve because they tend to pay monthly, if they sell out monthly then effectively they are not paying for the stock anything under twelve they are paying to keep.  

As a general rule, the higher the score of your stock turns the better. This, however, is not always true, too high a stock turn often shows that you are understocked. Say for example you have an item you could sell one a day, but you order one a week. So every week, you have sold one, so at the end of the year you have a score of 50, which is a great score but you have lost 250 sales that you could have had because you could have sold one a day and all you have sold is one a week.  

How to get your stock turn scores.

Main Menu > Cash Register > Register Reports > expand Stock > select/double click the report “Show Stock Turn by Dissection and Item

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Now here is the sample I produced that shows the stock turns by department.

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What to do now

Take time to analyse what these scores are telling you. This will help you to identify the actions required to improve profitability and return on investment.

Now you need to analyse your stock, check each department see what is working and what is not. A score signals bad sales and that you are more stock than you realistically need at any given time. Maybe you have a pricing or quality issue. What you may have in that department a lot of obsolete stock. If so move the obsolete stock to a different department as it is not going to give you fair figures here.

A high score indicates greater profitability and good return on investment, although as I stated, it may also mean that you are not ordering enough.

Remember every figure has a story.

Stock planning in retail is tricky. What you do not want is a shop full of slow-moving stock, you need stuff that sells! Besides the problem that this stock is taking up space and capital, it is also not bringing in customers.

There are several ways to identify what is your slow-moving stock, but as a rule, a stock item that sells under $100/year is slow-moving. The first point before you can do something is to identify all these items.

So go to Register reports > Stock > Slow moving Stock lines

Now I put in a year of sales, and I say anything that I have stock in and have sales of less than $100. 

I find it best to work by department separately, so in this shop, I was looking at the stationery department.

Now we got a report of 81 pages of detailed information of all the items that we considered slow-moving. It totalled almost $80,000 worth of worthless stock. 

So we have someplace to start.

Such stock analysis can provide you with insights to improve your decision making that can help you reduce costs and improve sales.

Give it a try.

After you do a stocktake when you do your financial figures, you will need the following four numbers.

1) The value of your stock that your computer thinks that it had at the end of the financial year. If your point of sale is up to date, print out a report of your stock valuation before starting the stocktake. If you do not trust the figure in your point of sale software, then you can, or your accountant can give you an estimate. This is the (Perpetual stock value).

2) This comes out of your stocktake and is the value of your stock you have at the end of this financial year. Your point of sale software will have this figure once you enter in the stocktake figure in the stock valuation report. (Physically Counted Inventory Value)

3) What is the total sales of your shop less the non-stock items, e.g. if you sell touch gift cards, these are not stock items so take them off your overall sales figure.  Your total report should be able to give you this figure which is your (Sales of stock product)

4) Value of the damaged goods you counted. (Damaged stock value)

Now please do the following calculation.

Shrinkage% = ((Perpetual stock value)-(Physically Counted Inventory Value))/(Sales of stock product) x 100%

A typical figure here is about 1.4%, but it does vary a lot. I have seen estimates between 0.1% and 6%. 

Now what you may also want to look at is your damaged goods, these have a different story and it can be an exciting story to tell.

Damaged% = (Damaged stock value)/(Sales of stock product) x 100%

Once you get these figures, please let me know as I am interested in this sort of stuff.

Single Touch Payroll (STP), I had a few enquires today about it and questioning the advice sheet that we issued about when they need to be ready for STP. What is happening, I think is that all these salesmen for payroll and accounting systems are starting to push everyone to get their systems that they are giving my clients questionable and possibly misleading information. 

The current situation is listed here.

https://www.ato.gov.au/Business/Single-Touch-Payroll/

"

• Large employers with 20 or more employees should now be reporting through STP, or have applied to us for a later start date.
• Small employers with 19 or less employees will need to report through STP any time before 30 September 2019 - this is a gradual transition, and not all employers will start reporting at the same time.  
• If you're an employer with four or less employees you will have additional options."

If all your employees are family members, you actually can get more time still.

But overall most SMB organisations need to decide on how they will handle STP soon, but if you need more time the ATO will probably give it to you and what is right is that they have announced that there will be no penalties for mistakes, missed or late reports for the first year.

Unfortunately, the banks did decide *NOT* to get involved so now if you have not made any decision on how to handle STP, you need to look at the list of ATO approved solutions here.

Note although many of these say that they are free but actually in the details you will see they do have costs in the fine print. Looking through the list the only really free option that I liked was Payroller. Although I confess, I have never used it and have no idea how good it is.

Of the accounting packages, looking at this list that my clients use, Reckon I saw will now be $5 per month extra and MYOB will be $10 per month. 

One big problem I do see with all of this is that in a large business, the payroll is done by the paymaster and the petty cash office does the disbursements (petty cash). In SMB these officers are the same people who prefer to do these together, so saving them time and money as its only one transaction. The problem with STP is that these disbursements will if done as now will show in the STP transfer, which is sure to cause issues with an ATO officer trying to reconcile the figures they are getting as they do not consider a disbursement a payroll item. The only solution is to split these payments up and do them separately, but that is going to cause more work and extra costs to the SMB business.  I cannot see a solution to this with the way it is now. Whatever way you decide to go, you need to investigate this problem.

I hope this all helps.

Update: Some people pointed out to me that they are upset as they feel that the ATO is forcing small businesses to engage 3rd parties with extra costs. I know the problem as I have been using for many years a combination of an old payroll package and a spreadsheet that I programmed many years ago. These have worked just fine.

Well, there is nothing any of us can do, you now need to either download some phone app and manually entering the info or using a current payroll package that costs and will give you no benefit. 

Cause Marketing is simple to set up with our point of sale system and something you might want to try. What you are trying to do is leverage a charity to help your business. I do suggest though if you are trying to do something like this that you do mean it, people are not fools. If they talk to you, it will not take long for them to see through you if it is false. Besides, it will mean something more to you if it is real. 

I would suggest that the best and easiest way to do this is to piggyback on a charity collection day. This has the additional advantage in that it is temporary on a set day only as this makes going to take several shots to get it bedded down in your shop and the last thing you want in your shop is a long time commitment just yet. 

Now pick a charity local has the advantage of bringing in, locals, if you think of yourself as a local, it is a big plus. On the other hand, a large national charity would probably supply you with better signage and mainstream advertising.

Make sure what you pick is a remarkably uncontroversial choice, eg heart, cancer or children suicide, etc. Try and selection one applicable to your business or person if possible. For example, we had a terrible night when my wife, who is a teacher got an email about 11 pm from one of her students that he was going to commit suicide. It took a dozen telephone calls to the police and the school and many hours till the student was tracked down and questioned by the police. After that, I assure you, I meant it when I said it was an issue that needed to be addressed by the community. 

Here is an example that might surprise you how many people can be turned off by a charity, for example, this was a result of a study done by the research firm Roy Morgan on people views on the environment.

Now if in your shop you pushed the environment issue, you would have about 62% in favour and about 25% of the population in Australia in 2016 against you.  I am sure the figure today would be more negative.  Plus about 68% would think your product is overpriced. These are not good figures to cause marketing. I do believe that business is not an appropriate forum to push politics.

Now the next point you need to decide is how you are going to do it. 

What I suggest and what works out well in practice is you offer to give an amount for a purchase of a product, eg $1 goes to charity for every purchase of this soap. A bonus here is if people do not like the charity they could buy a different soap in your shop and not have any issues. Some people put a cap on the total amount say only on the first 300 sales this money gets paid, but I would suggest not doing this. 

Here are some more advantages

• Most consumers have a more positive image of a company then supports a charity
• Studies show that people tend to go ahead more with the proposed purchase by as much as a third if a charity they approve of is involved that is partly why companies like Amazon do it
• Customers faced by two alternatives which one has a charity they agree will pick the company or product that supports their charity. Studies have shown up to 26% more purchases.
•  It helps people to become more aware of your shop and build a good image in the community.
• A bonus with cause marketing is that you can advertise before and the event how it went by showing your certificate etc.
• These donations are tax deductible 

Try it and see what happens.

If you want to read more about it, click a case study here.

This is the last workday so as busy for us business owners now it normally is at the best of times to stay on top of things, we all have now the last minute stress of making things happen.

From a computer point of view, make sure that you prepare to make an end of year backup and a spot to put it so it can be safe for at least the next five years. 

Now I will leave you while you make sure you have your payroll reconciled, superannuation payments prepared, stock count and all your accounts are up to date.

I really like this new stand that is being given out now to support the new Westpac Presto EFTPOS solution. Take a look at the specifications, I think you will be impressed too.

It is very professional looking, has a nice grip and its tilt is extremely good making it easier to use. This is my favourite but if you want to see the full range of stands now available, please click here.

If you want to know more about Westpac’s new integrated EFTPOS called Presto? Click here to find out more...

The NSW Supreme Court a few days ago here, made a stunner of a decision that a commercial owner of a Facebook page can be sued for comments made by other people on their FaceBook page.  If you want to read a non-technical article with a decent discussion on the matter, click here. This is well worth a read. 

Although most were stunned, I was not as I do know something about these matters as we were taken to court by a competitor and part of our defence was we felt some of the comments said about us were pretty bad and in fact, they were making up comments about us online. In our case, they settled out of court giving us a substantial five-figure settlement so it never got to a decision, but here it did which is the problem. 

This matter will undoubtedly go to appeal. All that the judge ruled here is that there is a case abd that it can go to trial. It may require a change in the law because if it stays, it will have a dramatic impact on our rights of freedom of speech. 

Okay, what can we all do about it *NOW*? 

For now, those that run online a site including Facebook pages, need to make changes. Currently, we allow whoever wants too, to write what they want on our pages. Now it looks like the court expects us to vet all comments before they are published or at least to delete any comments in a reasonable time or we can be sued too. Currently, I check our Facebook page almost every day, and so far I have never deleted any comments there, but I reckon that now I may need to be prepared to do so. I suggest you do something similar too until this matter is resolved. Knowing our courts and parliament on an urgent matter like this, this matter will be with us for many years. 

A lot of you now, preparing or having done a stocktake are looking at a lot of stock that you no longer want. One solution often recommended is to discount it heavily and clear it out. It usually works, but it costs.

Here is another alternative to try out.

Have a word to your supplier of this stock, you are buying off them, and they want to be in your good books. This stock may be useful to them even though it is not to you.

I had a client that made a big order and the supplier agreed to credit most but not all of these unwanted items. So yes the rest went into a clearance bin, but the bulk was replaced with sellable stock. They did not even get charged a restocking fee. My client stated to me it was to them, it was like this money they found in the street.

Food for thought?

Well, stocktake season is upon us again.

Please note that we have updated the help documents in posBrowser's help files so it is worthwhile to check them out.

To get them press F1 while in the register and check them out.

There are four documents:

Stocktake = Standard stocktake doc using Posbrowser on its own to run the stock take. 

Stocktake with a PTD = Stocktaking with the help of a PDT

Stocktake with the stock management system = Stocktaking using the mobile PDA browser program.

3rd Party Stocktake guide = A guide on how to upload stocktake data to and from another program.

Whatever way you decide to run your stocktaking try it in training first to get familiar with the process. Better to know the process ahead of time instead of having trouble when trying to run the real thing

The current edition of the point of loyalty is now out. Its the seventh edition and I thinks it is the best review of loyalty marketing for retails in Australia. What it is a consumer research study into the Australian loyalty program written by people who know their stuff. Plus much of the report is based on facts not opinions which I like.

A free executive summary is available here which I would say any Australian retailer should have a read.

Here is what I got out of it.

Most Australian shoppers (89%) are now involved in a number of loyalty programs.

This figure, however, is dropping although it does appear to be hovering at about 50% active over the years which means that about half of the Australian Shoppers are actively involved in loyalty marketing for points.

The next item shocked me.

28% of these loyalty shoppers admitted that they purchased something that they did not need to earn points, and that figure is significantly up on last year.  

And the reason why is because these people think of the points as cash.

Anyone that wants to argue that Australian Shoppers are tired of points and just want cash are dead wrong. The majority of shoppers today, see these points as cash. Makes sense, if say in a coffee loyalty program where you get a free cup of coffee after buying ten cups, well that eleventh cup is money.

Finally, how best should retailers contact these people?

Answer: Overwhelmingly by email. Any loyalty program should involve the collection of people's email address.

If you think about it, a lot of these are not frequently coming to your shop. If you want to contact them, email is your best and cheapest option.

Anyway have a read, make your mind up and please let me know your thoughts,

Here are tips for queue handling. 

1)  When managing your store’s queue, it is important to influence your customers’ perception of their waiting. Studies show some of the problems can be alleviated by reducing the boredom, can you do something to keep them entertained? 

2) When the queues start to get really big, here is a tip, use a function in our point of sale software which allows one computer to run multiple cash draws. It is best to be prepared by having your extra cash draw ready to go but in a pinch, you can always move the cash draw itself from a non-busy area to a busy area. Now when the lines start to bank up you or your employees only need to switch on the cash drawer and start serving your customers.

3) I would suggest that you set up a policy that if say more then four people are lined up, activate a queue line and make sure that the people waiting are notified that you are trying to serve them and make a new queue. Now, this is an interesting study done in the TV show myth busters episode 242 which you may want to consider, what myth busters did was examine whether one long queue is more effective than several and what did people think. 

In a grocery store, the best way to move customers through a series of checkout counters is to have one long line and route each customer to the next available checkout.

BUSTED

Adam and Jamie set up a mock-store in an empty hangar, with fully stocked shelves and 5 checkout counters manned by experienced cashiers. Upon entering the store, each of 90 volunteers selected a specified number of items and recorded the time when they queued and the time when they reached a checkout counter. For additional realism, a percentage of shoppers were instructed to slow things down by asking for a price check or by paying with a personal check. After checking out, the volunteers would indicate their overall satisfaction with the experience.

In the initial test, the volunteer shoppers were free to choose their own checkout counter and queue behind it. The average wait time using this method was 5:39 and the average satisfaction rating was 3.48 out of 5. In the second test, shoppers were guided through a single serpentine line and then directed to the next available checkout counter. The average wait time using this method was higher at 6:56 but the spread between minimum and maximum times was tighter. The average satisfaction increased to 3.80 with the single-line method due to it being regarded as fairer. Adam and Jamie judged the myth as busted based on average time, but also called the single-line method better based on customer satisfaction.

 

As the end of the financial year approaches, many of you, as are most people now, considering their plans for any last minute changes this year and what they are going to do next year. 

There are several considerations that you should be aware of approaching 30 June date.

Currently, the new EFTPOS rates are starting to roll up, and they all seem to be up.  If you intend to stick with your present provider, I suggest you find out now what the new rates will be. If you want a comparison, Assembly thought Westpac (which if you are with Westpac is an extremely inviting option) and Tyro EFTPOS both of which we interface into now have good deals. These rates, I think they are going to look in retrospect a lot better when you are in 2019/20. If you want to know more, let us know ASAP as we are looking at ten days left.

Also, the government accelerated investment allowance for 2018/9 ends then too if you are looking at upgrading your computer and/or software requirements well again it is only ten days left.

PS If you are starting to budget for the next year, check out your new insurance rates, I got a shock when ours came in. 

This is a handy function in our software and easy to set up. We are now doing some enhancements to it.

What is beneficial information is to find out and then record how did a person come to find your business? This can help, among other things with your marketing, deciding on your new physical location, etc. 

What you are trying to do here is know from the source of how did your customers found out about you and what led them to your shop. Once you have this you also need to consider what sort of customer each of these sources are giving you e.g. say a customer came to your shop as you have a dry cleaning drop off service, now its a question not only what is the dry cleaning worth to you but also what else has this customer purchased off you. So you may want to create a category here for how did you find us which is "dry cleaning drop off". 

If you are going to do this, you need to do is ask when interacting with your customers this question. Although often you can guess. If the first purchase of your client is the dry cleaning drop off, it is a reasonable assumption its the "dry cleaning drop off".

Currently, you can get figures and trends.

The new enhanced reports will give you more options to select from and better analysis of your lead sources. This can help you by getting higher profits and more clients.