Following on from my last entry…

What is on my mind right now is the future of independent small businesses in Australia and in particular newsagents. There are 4,600 newsagents and they rely on newspaper publishers, magazine distributors and lottery companies for their key direction.

While newsagents own their businesses it is their suppliers who lay out the road ahead. This is not a criticism. It’s a historic situation.

Back in the 1990s when the distribution of newspapers and magazines was deregulated, the job was not completed and newsagents were not adequately educated to become independent thinkers and business like. Further, the accounting and supply practices from the regulated era were maintained – unfair given the new deregulated and more competitive regime which allowed competitors an advantage.

But I digress. My core concern for the future of newsagencies is based on the future of their most important products – newspapers and magazines. The future of these categories is at the heart of the future of this retail channel.

In newsagents were truly entrepreneurial they would face the challenges and break through with a plan. That is not happening with newsagents. Hence my concerns

And while this has nothing direct to do with the technology my company makes, it is an issue central to my company because we own a newsagency, we’re close to opening a second and elsewhere we’re big investors in businesses connected with newsagents besides our software business. Besides the commercial angles, there is the matter of the iconic channel, the local nature of these businesses which compete against the corporate brands. Newsagencies promote competition whereas our competitors fight against it.

Newsagents lack strong industry leaders and this only exacerbates their individual and channel wide challenge. The current industry leaders have been aware of the signs of tough times ahead for years and have done nothing to find a future. They have not even facilitated open conversation about the challenges.

If you doubt the extent of the problems, consider that in some cases newspapers account for half the foot traffic in newsagencies. As this op ed piece published by the US ABC News organisation shows, mainstream media is becoming alarmed about the future of newspapers.

In years to come, what is happening and will happen with newsagents will become a business school case study.

We have the capacity to get it right. The keys are for us to achieve business like leadership in all industry associations and for all of us to be messianic about finding other traffic generating opportunity which ensure the future of Australia’s unique and culturally vital small business network.

So, in our software and in our advisory work with the newsagency channel we will try and find growth opportunities so that they may successfully weather the challenges ahead. In the short term newsagents ought to find a way to become part of the citizen journalism movement – so their businesses become news centres.

This article from the Editor and Publisher website shows how rapidly newspapers are embracing the world of blogging.