Recently we were involved in a test made for trials of supply of magazines in retail shops under the ACCC control. So our point of sale software was feeding information to Boston analytics who processed the information for the ACCC and the magazine distributors. At the time and now I still am personally upset as much of the background material was not released so making it impossible to understand exactly what was being measured. Still there conclusion was that the magazines' suppliers could reduce supplies of magazines so saving labour and cashflow but there would be a loss in retail sales.

However, since we were deeply involved we do have access to most of the data of people in the trial, and we decided to wrap it up and see approximately six months later as the dust had settled now what difference these trials made in shop sales.

So we took five years of sales data in a few shops in the trials and analysed them with over three million calculations. We took out seasonality. What we found was very disturbing.

Here is a graph of magazine sales in a retail shop over five years. The figures are in blue but in red what you will see is the long-term trend taking out the days of the week, the season throughout the year, etc.

The trials showed nothing, a big ZERO.

So we do not believe that if the magazines' suppliers did reduce the supplies of magazines so saving labour and cashflow that there would be a loss in retail sales.

Here are some graphs for one shop.

When you look at the average unit sale per day here. The blue are the actual for the days, and the red is the long-term trend taking out the seasons.

You will see a slight drop but effectively nothing; the average sale in magazines has not changed in five years. Since the margins have not changed either, the long-term effect is zero for profitability, however...

If you look the number of sales, they are dropping so resulting in a fall in profit. Again, the blue are the actual for the days, and the red is the long-term trend taking out the seasons.

The red line shows it's going down, in less than ten years if nothing changes and the trend continues it will be zero.The actual formula the computer came up with was

Daily Profit = 318.15202249808 + 225*Summer + 224.856057910723*Saturday + 54.5292224195555*Autumn - 0.125207 x (Number of days since 01/10/2011)

The retailer we showed this too, has already reduced his magazine pockets from 900 to six hundred and has asked us to look further.

If you wish us to look at your information, please let us know.

As the Pet Shop Software experts POS Solutions is showing its latest software at the Pet Expo in Melbourne now including our ecommerce website on stand 100. If you are at the show please come and see us as we also have technical people at the stand to answer your questions plus I am there too.

Here are some pictures of days show.

The highlight was the dog grooming

There was I felt plenty of products some quite new on offer for pet retailers.

Here is our stand open for business.

One point about animals is they are unpredictable.

One point that comes up a lot in retail is a top seller today will be a good seller tomorrow.Technically its called the decay. Typically in retail, what you expect to see is that an item that sells 50 today will sell about 66% of 50 or about 30 tomorrow and day after that 66% of 30 and so on. What you need to do is identify today what is selling well to check you have adequate stock for tomorrow.

And its easy in our point-of-sale system.

Go to Register reports

Now select "Top N Stock Sales for a Given Period"

Now the following pops up.

I selected a day, normally you would put in today

Out comes a report with the top sellers for today.

Now these need to be checked that you have enough stock.

Give it a shot and see how you go.

Furthermore, there are many other reports there too to help our clients do better.

What often happens in a shop is that as you are dealing with many suppliers all with a changing agenda suddenly, they no longer get stock of some items. Because they are small, they do not notice it.

Any example recently was with magazine retailers when on the 31/March/2016 Network magazine's contracted out its distribution. Soon what happened to many stores was that many magazines suddenly did not come. When you add it up this became a considerable amount as I will show by this example here.

Fortunately, our clients had not problems picking it up as our point-of-sale system had a report exactly for situations like this, to monitor the situation.

In Cash register reports > Stock

There is a report "Stock Sold During Period (a) Not Sold in Period (b) report"

So we can now run a report for.

Period A - 1/10/2015 - 31/3/2016 (the six months leading up to Network's closure)
Period B - 1/4/2016 - 30/9/2016 (the six months since Network's closure)

That gives us items that the shop was selling in the six months before their closure and then the following six months.

As you can see I entered in this here.

Now when I press "View report", I get this.

Look at the first line, almost $20,000 worth of stock with a profit of over $6,000 lost in sales over six months. Much of it, I am sure due to issues in the change over. Although some are noticeable, most of them are quite small so few would notice two to four magazines not sold in six months without this report?

Still together there certainly much here that should be in the shop selling! Once you have the list, its time to investigate.

Another example of the practical and useful advantages of our POS software available.

Knowing exactly what is moving and the trends in your business on everything is vital in retail today, and it takes just a few moments to do so in your point of sale software. What you need to do is make excellent fact-based decisions that help you to grow your business.

Go to register reports and select it marked in green.

Now select the Monthly Sales Summary

Now I would suggest that you work in financial years for formal reporting so you are inline with your accountant's figures, no point in duplicating the wheel. So here I selected two years to give you a comparison. Note you can use more if you like as the choice is yours. I tend to think too many years are confusing and prefer to keep it simple.

Now pops out a detailed report among which you will see a breakdown by dissection and month the sales this year to last year.

For example I can see quickly in Nov 2011 to 2012, books and cards went up while confectionery and drinks went down.

Here you can easily see, which is changing in your sales.

The information we supply in your POS software has been precisely planned to help you optimise your business. This allows you to reduce your costs, increase your profits and grow your business more every day putting an end to guessing in business.

Contactless payments where a person can just swipes the reader is now the dominate form of transaction in Eftpos today in retail as you can see here by days.

The chip cards readers may have made the payment more secure, but in practice, they have also significantly slowed down the checkout process. What the modern consumer and retailer wants is speed. As a result, we have seen the percentage of contactless payments has been steadily growing over the past few years.

Which accounts for why contactless payments are more popular during the morning, but average out to 60% of all transactions by the end of the day.

Today for contactless payments, the average spend is about $30 per transaction, and this seems to be consistent across all business types and interestingly too for every day of the week.

For those that want to know more, I suggest you read this report here by the Reserve Bank of Australia from 2013 on contactless payments that is still fairly accurate for an industry-wide understanding, in particular, see page 18.

Most important with integration retail businesses today with our system can integrate so easing the arduous processes of daily reconciliation and address bank errors that may arise from oversight.

We will have an important announcement about contactless payments, next week.

Over time, plenty of people can have access to your computer system in the shop such as staff, ISP support staff and computer engineers.

So what happened today was one of my clients discovered that some rather personal information was known to one their staff. They were angry and embarrassed. It certainly did not make them feel good. When they investigated as to how did the information get out, what they discovered was it was sitting on an old computer that they had taken from home and used at work. Although they thought that they had deleted everything on the computer, quite a bit was still in a document directory of an old word processor that they had forgotten about.

This is a common problem, once you buy a new computer, what do you do with the old one?

One of the unique functions of our system is that it can run on old computers. To many its probably one of the few uses they have for such computers.

Now If this is what you intend to do, I suggest that you wipe all the information off first before putting this computer in a public place. This will guarantee that no one can get your personal information.

Now as this case shows just deleting is not enough, it's too easy to miss something. What I suggest is a program that will wipe out the entire drive. The program, I recommend is Disk Wipe,

which is free and very easy to use.

It will wipe everything. Then I would suggest you format the harddrive.

Once this is done you can release your old POS computer safely and as an added bonus, you know it is clean of viruses and malware.

One of the key business rules today is that in the brick and mortar physical world, a shop with a bad website it is better off then a shop with *NO* website. This is because no-one today uses the yellow pages to find you, if they want a product a service say Indian Coffee(KAAPI), a greeting card, perfume or a dog wash, they google it. For example, if they live in a suburb of St Kilda, and they want Indian coffee, they google "Indian coffee St Kilda". If you do not have a website, you are going to be low down in the google list. So they are not going to ring you, they are not going to come to you, they are going to ignore you because they do not know you exist. Test your self with a few products and see how you go.

Even if you hate the internet, no website equals missed opportunities. For a modern physical shop, a website is imperative today.

You can blend the online and physical brick and mortar shop together and see how you can get some of this growing e-commerce traffic.
 

We have been approached by the Australian Taxation Office to advise on how our clients will be affected by the new compliance requirements for GST. This may also affect our users who use our system directly and those that use our links into many other accountancy software packages, mainly MYOB and Quickbooks to do their GST.

We run a large computer hardware department, the largest in our market space, so I can tell you why so many Point of Sales systems ours and others fail.

By far, the biggest problem is all this software that people keep putting on software some of it is quite good, but it's just too big for their computers. Then some people have gone down the path of tweaking their system to try to get what is a best marginal performance boost, but often they have done harm to their system. Then add some slow antivirus software, which is designed for a modern computer which there is not. Now add the spyware and viruses which all of us pick up and which no antivirus software can stop all of them. Then over time their files become fragmented. Soon their system is running real slow, and sometimes they have to call us.

The fact is that most current software is designed for the latest computers, as most of the buyers use these computers. If your computer is not reasonably modern and fast, what you are doing is putting on a problem. Removing it often does not work 100% as they repeatedly leave a residue behind. Most good software like ours is designed to juggle threads and optimisation and you are not going to pick up much speed there.

Finally few decent point of sale systems are off-the-shelf packages; they have been carefully crafted to run as you require so playing around with them is often dangerous too.

If you want to read more about it click here.

now if you notice they are curved everywhere part of the reason for this is to prevent skimming hardware from being attached on top of this unit. Still you cannot be too careful.

Three tips that I do recommend you consider is

1) Use a highlighter and writing something like "Property of West Footscray Gift Shop" around on the EFTPOS unit. It just makes it harder for the skimmer to put his unit on top of yours as they need to duplicate your writing too.

2) Run your hand around the unit and make sure that there is nothing on it. I do that before I put any card on a terminal.

3) If you have an old EFTPOS unit, get it replaced, Tyro users can do this free of charge. They are just too dangerous these old units.

I was thrilled that the Cake Matters franchise selected us for their point of sale. They make absolutely lovely cakes. Here are some scenes

Here is Zac, the director of POS Solutions with some of the staff at the Chelsea Heights store.

Zac and Phil our support manager inspecting the shop, note they have a touch screen on the counter which are now gaining rapidly in popularity.

A customer looking at some of the range.

They use much of our system including our loyalty system in their shops and it works well.

Its a simple point system, spend a $1 and you get a point.

Each point is worth 10 cents.

So for a $20 cake you need 200 points.

And its works.

If you want some good cakes, I certainly recommend them.

In relation to the problems that occured recently with their stock files and the confusion that it generated with our clients, on behalf of our clients we complained both to VANA and Blueshyft.

VANA have assured us that they are aware of the problem and have addressed it.

Blueshyft replied too with the following email.

Hi Bernard,

Thank you for your email.

XChange-IT was supposed to have distributed the barcode files to the POS providers prior to our email to the network, which we believed they had, however we were informed after the email was sent that it actually hadn't happened yet.

We are immensely sorry for the miscommunication, and for the inconvenience caused.

Kind regards,

Zoe Archer
Operations Manager
1800 817 483
blueshyft.com.au
Blueshyft
Pier 8/9
Level 4, 23 Hickson Rd.
Millers Point, NSW 2000

We hope it will not happen again.

A solid loyalty program has been proven to increase sales and drive customer retention. So it is interesting for retailers to see what the best are doing.

Roy Morgan research has released its latest research here.

71% of the Australian population are members of at least one rewards program. The most popular rewards program is Woolworths Rewards, which has 49% of all Australians 14 or over of which 78.2% of all shoppers in Woolworths/Safeway use it.

This rewards program is very simple and easy to use. For every dollar you buy, you get one point, when you get 2,000 points, you get a $10 discount on your next shopping trip. Based on a gross margin of 30%, it works out to about 1.2% cost/sales assuming that all of these points are used, which is within the industry average of what the cost ratio should be of a rewards program. As a rule, most reward programs are looking for about 30% of all customers to join although I have seen figures deemed acceptable as low as 10% acceptable.

This program is very easy to set up with our software and it seamlessly integrates into our point-of-sale system.

Most importantly it gives you a user base to market too and our POS system has a large section for doing such loyalty marketing which you will find in register reports marked with a red arrow.

Once you click on it, you will see the following.

Now you can select the special categories you can set up, for example, here it is lotto mail outs, Facebook's clients etc.

Now you can compose say an email to these people advising people on lotto mailouts if say a big draw is going to be held this week. Actually, today would be a good day to have sent out a lotto mailout as a black moon is coming and its an important sign astrologically.

The cost to you is nothing, and if anyone comes in, it has paid.

This gives a highly detailed report including this.

Now in trying to track down an incorrect GST amount divide the GST period into smaller units say months and check each month separately, do not worry about the time, our software is very fast and it will only take a moment, then divide a suspicious month into two and check each of these, afterwards the one that looks wrong divide into two and so on, until you find the day where the mistake is, then I check the transactions on that day.

For the last few days, people have been complaining of the size of the latest window updates coming down also many have once its loaded been having problems with Windows 10 updates as it knocking out receipt and barcode printer. So our support bay been busy fixing up printer problems over the past week. One point that I do wish is that Microsoft stop releasing updates over the week-end; it really hit hard our after hour and weekend support staff.

Not what is really annoying is that much of what is new in the latest update will be I am sure of minor use to most of my clients. Still once you load the update you may want to try Cortana, which is Microsoft digital personal assistant, although I think its too new to be much use in a commercial setting. Still she is a lot of fun, ask her to tell you a joke, what weather is like, who is going to win the grand final, etc.

One feature that saves our clients a lot of time is its ability to automatically update paper price changes, add bumper editions, and paper stops so they do not need to process the changes manually. This saves a lot of time.

So far these are the updates we have planned for newsagents now.

[2016-10-02]: The Monday to Friday edition of the Age will change from $2.50 to $2.80 GST inclusive from Monday 3rd of October[2016-10-07]: The Saturday edition of the Age will change from $3.50 to $3.80 GST inclusive from Saturday 8th of October[2016-10-08]: The Sunday edition of the Age will change from $3.00 to $3.30 GST inclusive from Sunday 9th of October[2016-10-02]: The Monday to Friday edition of the Sydney Morning Herald will change from $2.50 to $2.80 GST inclusive from Monday 3rd of October[2016-10-07]: The Saturday edition of the Sydney Morning Herald will change from $3.50 to $3.80 GST inclusive from Saturday 8th of October[2016-10-08]: The Sunday edition of the Sydney Morning Herald will change from $3.00 to $3.30 GST inclusive from Sunday 9th of October

Plus we know there is special pricing for fnnsw but have not heard confirmation yet so that one maybe needed to be done manually.

This is all on script 2391, that gives you an idea of just how many changes we are automatically updating, and if you conside that it takes just a minute (which is for many people very conservative) to do each one manually you get an idea of precisely how much time using our software can save you as this one script alone is a saving of at least six minutes.

Of course if you decide you do not want to subscribe to the automated updates, all you need to do is double-click on the feature you do not want and untick the option.

Clearly electronic products sell well and there are heaps of them but there is always a *but* as I will show.

With our clients its dominated by two big player's Touch and ePay and even before the recent problems that we had with ePay, Touch is by far the biggest and growing rapidly. The main reason I think is because Touch seems to be more active in the marketplace, and they have a better range. Range is everything here. If people want an ABC voucher, and you do not have it, then they are most likely to go elsewhere, that is why people tend to have touch, they may not have anything else, but they will have touch because they need the range.

Here is a graph of ePay sales over the last eight quarters done about three months ago, before they had all this problems and its fallen since then again.

Conversely, here is a graph of Touch sales in our client base.

Every year sales are going up about $100,000.

We are debating now whether it's even worth supporting ePay much longer.

When looking at it from an individual shop perspective, one problem I do have is that as I am dealing with averages, some only use Touch to buy discounts for what they and their family personally already use and do not bother to market it, which mucks up the figures.

Still I can only look at what I have.

Overall the number of electronic products sold has gone up. Overall every month, our clients are increasing their sales of electronic products by over 200.

The value of the unit price has gone up too by about a $1 each year.

The problem is that the margins have been falling.

When I looked at it per shop, what I found is despite an increase in sales both in quantity and unit price, the profit per shop is falling by about $15 a year, although if you look at the recent figures, it does look like it is going now steady.

The problem in Australia is that this market is dominated by a few large players, who do not see the retailer as important in the sale process other then supplying an outlet.

Still that is not the way to look at it, looking at this graph you can see the number of items sold is about 110 a month or about 4 a day in an average shop.

So the average retailer for simply adding a service with our software and putting a sign up on the wall so is getting about four people a day coming into their shop and hopefully buying more stuff in the shop and getting paid about $140 a month which is clearly why people are delighted with Touch. You can see that from the number putting Touch into their stores, which has been increasing every month. Currently, we are putting Touch service into our clients at a rate of about two to three shops every month.

Overall though I think you can say this, it does pay its own way and there is nothing wrong with an extra 1a0 people in the shop every month, but it's not a game changer. It certainly worth getting before summer hits.

If you want to know more, please let us know. As you can see we have heaps of data.

You can rapidity increase your scanning of barcodes at the register. Our scanners are very good, and they are designed to look for the barcode. This they do much faster than a person. So rather than look for the barcode and aim the scanner, I suggest that you swipe the item in a long arch. If its there the scanner will find the barcode and scan it in less time than you would take to examine the item, find the barcode and scan that spot. If it does not find it, then you have to start looking.

Once you look into your dead stock, you will find it easy to collect dead stock. For example, in a department that is selling well, large amounts of dead stock can collect in the example I am going to quote here the shop had $80,000 worth of dead stock in the shop.
Here it was an accidental problem that as some stock did not sell, it collected but sometimes I have seen it as deliberate policy from a supplier. Its true suppliers generally want their customers to move as much stock as possible so they can sell more but sometimes they have to sell what they have, and if it's dead stock, then so be it as they have to move that dead stock too. If not watched the amount of dead stock can be huge.

That is why it is important to identify these inefficiencies and drill down on these points. When you have robust stock management like ours, you can put in place a solid stock management practice that can warn you about buying and stocking these slow moving items and help you clear out the space out for something that sells.

This is one report to use.

Go to Register reports > Stock > Slow moving Stock lines

Now call it up here

I am going to do it by department but for many shops it does work better by suppliers. One point of our retail software, it is your choice. Here I asked for anything that I had sold less then $100 in a year and am now stocking something.

What I got out of this report was pages of stock items which added up to over $80,000 of worthless stock much in this department.

This is just one report in our point of sale software that can help you expand your business and grow.