Many of you who are now who are not sending sales data are being contacted to ask why not. Now if you refuse or cannot send sales data, then XChangeIT intends to increase your XChangeIT fees calculated from a backdate.

If you need to set up your sales data, we have an information sheet here. (Outdated file - decommissioned) It is quite easy to set up, but if you need some help, please contact us.

The six months from July-Dec 10 for Weekly and Non-Weekly magazines are now available as are the latest quarter Oct - Dec 10 newspaper circulation figures here from the Audit Bureau of Circulation report.

The figures are down about 2.6% for newspaper which is slightly better than what was reported last quarter a fall of 2.9%. Based on this, the floods may have added only .3% on sales nationally.

Magazines are also down by about 5 to 7%.

The problems with XChangeIT servers and GG are now solved. You should be able to contact GG now though XChangeIT.

With all the arguments now about newspaper sales, I though this article is an interesting study that shows that the current methods used in measuring Australians online numbers are also exaggerated by about a factor of three. If so this is much more an exaggeration than newspaper circulations.

You can find the study here.

I think the Australian figures online would be further exaggerated because although the study does mention it, it goes into no details of the problem of people having multiple machines. For example I use at work a computer, at home two computers, I also have an iPad and a Android Phone. That is five computer that go though three internet suppliers. Based on there study, I might be counted as fifteen people.

XChangeIT is now starting to ring up their clients who are not sending sales data and talking about increasing their XChangeIT fees and talking of fining them for not sending this sales data.

To me, it sounds fair. Many people are getting a discount because they are sending something of value, the sales data. If someone is not sending the sales data why should they get the discount?

So we are now doing a campaign to our clients to explain the importance of sales data, and offering to make sure their system is sending back accurate and timely sales data. Many of you will get a newsletter about it very soon.

If you wonder is the sales data being used, the answer is YES. By not sending sales data, it is costing the newsagency in bad distributions.

It soon could cost the newsagency because of an unnecessary increase in fees!

If you are not sending sales data and using Xchangeit we have here an information sheet explaining how to set up sales history here. (Outdated file - decommissioned) It will take only a few moments to set it up, then you can forget about it.

Despite some large rainfall in Melbourne, I was pleased that it appears none of our clients rang today about problems. Maybe the newsletter we sent out about taking backups worked.

What is surprised is that I have been told that there is still no telephone access to some newsagencies in Northern Queensland.

[link removed]

The Australian is now getting involved in these cut-price deals for universities. I thought they had more sense.

This is a dollar a week. Still, it is not as good a deal as the Age home delivered on weekends and pickup at university for 52 weeks for $30. That works out to 60 cents a week.

These deals make no economic sense and never have.

The Melbourne Age on Saturday will from next month be called "The Saturday Age", the layout will be changed and it will have its own masthead.

In retrospect what is making the recent floods, particularly bad for newsagents beside the physical damage that the waters did to the shop and their business.

1) Trade stopped tourist and restricted all the trade to locals which had access. This time of year, Queensland depends on tourist.

2) Never have I seen a demonstration of just how vital to newsagents are current supplies. As newspapers and magazine supplies were often cut, much business was lost. Say I do not buy food today, tomorrow I probably will need to buy more food to fill up the fridge. With a newspaper if I do not buy it today, tomorrow I will not buy two to make up.

Some of the stuff, I heard was just unbelievable. Some newsagents reported that they were blamed by their customers for not having newspapers.

To their credit, most suppliers, I can testify are really trying their best to get supplies in. Almost all have set up hot-lines and priority services like we did.

3) Electricity, telephone and the internet in many places were cut. No electricity, meant that much just halted.

What turned out to be a real blessing was mobiles. How did people in crisis managed before without mobiles?

4) Many staff could not get to work and many could not come for family crisis. Shops suddenly lost key personnel at a time where they really needed them.

At this point, I would like to thank my staff who I think did a terrific job of helping our clients.

In the last seven days almost half our Queensland newsagents have contacted us with problems. The worst of this flood occurred right in the middle of a POS Solutions area round Emerald in Queensland. Certainly nothing quiet here. It is only today that it has started to quiet down.

You really get a feel of just how important computers can be in a modern business. Much of the problem is compounded because many shops in the area are now on a skeleton staff as many people are finding it hard to get to work. So on top of the *normal* duties of a newsagency we now are getting calls on

People need to know how to cancel some rounds run and re-run rounds as only a few papers arrived.

Stop/start days for the papers and magazines need to be redone.

XChangeIT problems

Computer networks circuits have blown and they need to quickly fix it.

Subagent tickets need bulk credits as the papers have not been getting through due to the floods.

Clients need to urgently backup data manually something many have never done as our systems are automatically backup.

People want to know how to set up computers at home.

The retail sale scheduled for this week is cancelled because of the flood, so how do you put it off until next week?

Water got into the computer, and now they have the blue screen of death on the main computer, and also getting on another machine message disk boot failure insert system disk a press enter.

The XchangeIT along with Gordon & Gotch and Network Services Servers will be unavailable today between 3pm and 5pm AEST.

During this time, you will not be able to access the XchangeIT website, send returns and sales files nor will you be able to download invoices.

It is hard to say what is happening up there as in many areas telephones and the internet is down but the Queensland Newsagency Federation to its credit has just done a phone ring around of its members in the North in the flood areas. Lucky no-one has reported anyone badly hurt or worse. Although in some places no-one knows what is happening as all the QNF can report is the town flooded and no phones are being answered.

Still although it had fewer responses than we have received from our clients in the region it basically confirms what I said a few days ago.

There are two major problems, the first is the actual water damage. Floods appear to be very much all or nothing. If the shop is unlucky to be in the waters' path, the fixtures, stock, carpet and the building will take a lot of damage.

The next problem is, even if the newsagencies is not water damaged, and they are trying to stay open with the roads being flooded many newsagencies are not getting magazines, newspapers or other stock, so they have little to sell. One newsagency told me yesterday that this week, they have had one shipment of magazines on Monday and nothing else.

It is certainly causing weird sort of problems to those trying to run a business as we can see by the calls coming in. Currently, about half our support calls are from people suffering from these floods. I just have everyone including myself, answering calls.

Just because a company is not part of XChangeIT system does not mean that you are unable to get the invoice files. There is a actually a large part of the industry that is capable of sending these files using email. Generally they use the older DDO file formats which are actually a modified format from our invoice formats.

For example Hallmark are able to send you these files by email if you ask. Some of these companies that can do it are not particularly big an example here might be Gallery Collection.

So it is worth asking your rep when you can whether they can do it. At the very least it might get them interested. If they can do it, it can save you a lot of time if you have a point of sale system. This is regardless if you have the older 32-bit windows system or the newer 64-bit systems.

I was actually quite upset when one supplier asked recently XChangeIT for help on producing these files and was rebuffed because they had no intention of using the XChangeIT system. Considering that the ANF owns so much of XChangeIT, one would expect that XChangeIT would be encouraging suppliers to have these files regardless of whether they are going through their system.

Anyway we are currently working with three newsagent suppliers to get these files for our clients with their system, we expect that soon we will have an important announcement about this.

We are now installing one of the biggest newsagents in Australia. So I started yesterday with a list of thirty (30) newsagents stationery suppliers to contact to see if we could get an electronic catalogue for them.

Current result is depressing, out of these thirty suppliers, seven suppliers it is not available. They just cannot do it and are not interested.

One can and is doing do it now.

Two can only supply in a PDF format which is useless for importing into a system.

One can supply but we will need to hack it into something useful.

Nine did not know, and are checking into it now.

The rest, I could not contact so I just left a message.

Except for one, all claimed that they had never been contacted before about this, something that I find hard to believe.

This year, Australian papers are expected to erect a paywalls on their internet site in an attempt to get some money from the news online. They will also presumably be trying to get their iPad apps going. Clearly the newspapers are looking at an internet solution. So where does it leave us?

So I was very interested in discussion held in Melbourne just now on the future of print media held by some of their senior and ex-senior Australian managers.

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I think you will too.

What I got out of it was this message that newspapers are profitable, and as long as they remain profitable little will change. What is important is that we remain consistent giving people no reason to change because unlike yesterday, today there is a lot of choice available if people do decide to move. Finally, what we have now, will not last.

This is the equation to make more business.

Profit = (Number of products) x (Price of products) x (Margin) - Fixed Costs

Now how can we help you to grow in 2011?

I would firstly like to qualify by saying that predicting what will happen is difficult. Who for example at the start of 2010 would have predicted the Australian economy doing as well as it did, the iPad would be such a hit or that NDD would go? In our own market space we would not have predicted that one of our major competitors would go bankrupt and another one only saved from closure in the eleventh hour or the 64-bit windows would be a standard and notebook sales would be flat. However 2011 has arrived and we need to take the steps to be ready for it.

Let us start with the above equation, which is basic for all business

Number of product

I predict that none of the major standard sale lines in a newsagency will increase in 2011 with the possible exception of magazines, as their sales are very affected by the economy. If the economy improves, expect your magazine sales to improve.

Lotteries also depend on the economy but here I think we will see more competition.

Like any other business, newsagents need new products that sell in 2011. These products are unlikely to come from newsagents traditional suppliers and as 2011 has shown most of those new products will be technology products. Already in some newsagents these products are major lines rivaling newspapers and more profitable too. If you are not integrated with Telco's products in 2010 you need to be in 2011.

Price of product

Too many in my view, look at quantity rather than price! If you want to move into product lines like giftware, you will need to get your pricing right.

What people tell me after installing our software is that they have discovered much by looking through the sales reports. It makes it much easier to find out what people are buying by category so to try to up sell them better products. For example a person who comes to buy a cheap inkjet cartridge can often be up sold to a genuine.

Margin

Too many items now are coming through from suppliers with margins that are poor. Often suppliers sneak them in, you would not notice them without a computer. We have several margin reports that are extremely useful in tracking these items. I suggest that you search by them by family and category as well. For example you can often substitute a calendar from one supplier to another with better margins.

Tobacco margins, I think will go up in 2011. The market will remain constant. However the supermarkets stands and mass advertising of cut-price is now restricted. What I was talking about earlier of competition effectively going. With price being less of the equation now, tobacco sales will depend more on service and availability. Our clients with find our system can provide those good controls as it has been well-tested by the tobacconists who we have installed it into. I am sure our windows program here will be shown to excel in the tobacco marketplace.

Fixed costs

As sure as day follows night, these will go up this year.

The biggest cost is purchases making up about 70+% of the shop’s turnover. One trick here you may want to consider is what about buying with a few of your friends making one big order rather than buying separately and creating many small orders. Here our computer reports will help by giving you your sales reports.

Overall I believe with what we have now much room for improvement just by adopting better monitoring procedures in 2011. In one study we did, in November last year we found in one shop 20% of all the items in the shop sold one or zero items in a twelve-month period. There is an immediate saving just there by cutting into these products.

Plus we have introduced better purchasing reports in 2010. These should be used.

The biggest cost after purchasing is labour. We need to get more efficient. Using technology we can often do more in less time. An example might be just work out what slow machines cost your business. If your software is still on 32-bit windows, you need to seriously consider upgrading to 64-bit. How much does 10-25% of your shop’s time on a computer cost? It is probably cheaper to upgrade then keep it running as is.

Conclusion
I confess that I am optimistic in 2011 and I believe that it is going to be to the ones that use technology the best.

I cannot believe it but there is still no support available from XChangeIT. They are closed until the 4th January.

This is despite the big problems we have had with XChangeIT over the past few days such as the Gordan and Gotch week 1, not being sent. If you have this problem, please call the GG direct as there is no point wasting your time ringing XChangeIT.

Someone needs to explain why this happened. The magazine companies and ANF also have some explaining to do too, as they all own a chunk of XChangeIT. Their support lines are working now, so why did they let XChangeIT close their support lines? I am sure it has been creating extra work for them too.

In 2005 in Victoria, the government decided that the existing Metcard system was falling to bits, and the solution was a new system Myki which would replace the old system by 2007. It had a budget of $500 million dollars.

Today more than five years later and $700 million already spent on Myki, we are now told it needs several years more and another $700 million dollar to complete.

It has been a disaster, in the meanwhile the old system, is going at 99% efficiency.

One of the main problems is that few people are using Myki. For this, I can speak as an expert on one reason as I have been to several high level meetings about Myki.

One reason for that the seller gets almost no margin from it. If I was a retailer, and I am making almost nothing, why would I stock it? If the margin is so small, why would a business or organisation fight to get the product? As a result few stores stock it.

Those that do either have to as the head office insists e.g. 7-eleven or because they want to offer a service to their clients, but even so, these are not pushing this product? Most if a client comes in, they are almost always selling them the older Metcard leaving Myki unused.

The Victorian government and its department of Transport have not treated their resellers' fair, and the result is that their resellers are not selling their products.

We still have several unanswered questions that we wanted to be answered by the newspaper publishers, but unfortunately, we cannot wait longer. That is why the current set of written information sheets has some flexibility in the wording for managing newspaper deliveries. It should not be like this but what can anyone do. These information sheets were just emailed out. Updates are available on our software blog now.

Thursday, 23 December 2010

Dear Newsagent,

CHRISTMAS REMINDER

A reminder that Connect will be closed until 9am Wednesday, December 29, 2010. Order changes will only be accepted by phone or fax during this period. Only the supply function will be locked, agents will still be able to access returns forms
and view orders as normal. If you need to alter your supply figure during this period please call the Circulation Department on (03) 9292 1073.

· Newsagents are not required to trade on Christmas Day as the Herald Sun
will not be published

· All newsagents are required to trade on Boxing Day and New Years Day normal public holiday hours - 7.00am to 12.00pm as per your contract with HWT as well as the gazetted public holidays Monday and Tuesday Dec 27 & 28, and Monday January 3, 2011.

· Metro Returns will be collected on Thursday December 30, 2010 and Wednesday January 5, 2011 during this period

· Newsagent statements will be delivered on Thursday December 30, 2010 and Wednesday January 5, 2011 during this period

· The full facilities of the Circulation Department will operate over the Christmas/New Year period.

· Circulation Area Managers will also be working on the Mornington and Bellarine Peninsulas and will be available to help you review orders.

The department will be closing at 3.00 PM Friday, December 24.

Please notify your relevant staff members.

Thank you for your cooperation and we wish you, your family and staff a Merry Christmas and prosperous New Year.

Mike Webster
CIRCULATION OPERATIONS MANAGER