Tower Blog

A blog about smart POS software for independent small businesses.

Month: December 2005

OzJet’s useless customer service gets worse

After my experience documented here a few days ago – they cancelled their Melbourne Sydney flights on January 1 and forced my friends and I on to Qantas – OzJet has further demonstrated their care for customers by not responding to my complaint. I’m left with four Melbourne Sydney tickets which are of no value.

On the one hand their advertising touts their new experience in travel – their “executive service experience” while on the other is my experience of cancelled travel and no response to correspondence. This is no way to win the business travelers OzJet is after.

OzJet won’t last at this rate. Unfortunately as their in flight product is good.

If OzJet management were smart they would jump on these flight cancellations and ensure that those affected were really taken care of so they would only have good comments to make. Instead the frustration of the cancellation has been fanned and I’ll happily tell anyone that OzJet is unreliable.


Small business panic could have been avoided

It is curious (and frustrating) to me that despite our advance notice to our small business newsagent clients – by mail and by email – on how to handle Christmas specific issues (special pricing of newspapers, switching of daily newspapers to spanning several days), at least 20% ignored the advice and called in a panic as how to handle special, pricing requirements for their suppliers. Trying to address these requirements late caused more stress and cost us and them tons more time than would have been used had they done the job when they first received our advice. To top it off we were usually blamed for them not acting on the advice in the first place.

I’m frustrated because the grief could have been so easily avoided and because of the high cost on other clients who followed the advice when we provided it.


OzJet flounders and cancels flights on January 1

Last week I booked four seats on an OzJet flight from Melbourne to Sydney for travel on New Years Day. On Christmas Eve I received a call from OzJet advising that they have decided not to fly in New Years Day. They proposed compensation of putting me and my guests on a Qantas flight at the same time – in economy. (OzJet is an all business class airline. Their advertisements promote superior service.) So, they booked us on a Qantas flight in economy and offer four OzJet flights to Sydney as compensation. Trouble is the flights are no compensation because my guests don’t fly to Sydney. In the same call they told me that the return flight from Sydney to Melbourne will leave an hour later.

This is no way to launch a new airline.

I’m a frequent Qantas traveler and would be in their top 10% of flyers. This makes me interesting to OzJet and they have stuffed it. Frequent passengers want to know that their flights will leave on time regardless of how many passengers are on the flight. This move by OzJet to cancel flights on January 1 because of poor loading is appalling. It wold be like my retail business saying, gee, I don’t think I’ll have many customers today so I’ll close the doors. I would have thought that Paul Stoddart would know better.

I doubt I will fly with them again and I doubt they will last as an airline.


Where is the Chadstone protest?

I am surprised at the lack of protect about the plans announced just before Christmas by the State Government that the giant Chadstone shopping centre is to almost double in size. I drove past Chadstone on December 26 and the traffic was so bad that there were police at the lights keeping people under control. There was a list of cars more than a kilometre long queued up to get into Chadstone. The centre already sucks the life out of small centres and high street shops surrounding for many kilometres. Take a look at the satellite image on Google maps and you soon see the size of Chadstone compared to shopping centres within a half hour drive. Making Chadstone bigger is bad for communities and bad for all businesses not in Chadstone.

This is bad planning by the State Government – socially irresponsible.

I hope that small business owerns, residents nearby and other concerned citizens protest.


Chadstone: the tornado which sucks up small business

Tornadoes flatten everything in their path. The new Chadstone shopping centre, already Australia’s largest shopping centre, is to get bigger thanks to a decision by the Victorian State Government on Wednesday this week. The new Chadstone will be a tornado against small business – sucking up sales which would otherwise have gone to small businesses for many kilometers surrounding what will be a monolithic shopping centre.

This giant of a shopping centre will now grow a further 50%.

I feel for the hundreds of high street and centre based small businesses already struggling in suburbs surrounding Chadstone. This new development is an unreasonable and unnecessary challenging to their businesses. The south eastern suburbs of Melbourne are well serviced by shopping centres. There is no need for Chadstone to become a giant killer. Being the biggest in Australia ought to be enough.

The State Government has a social responsibility to the small businesses which will be affected and the knock on effect for families of owners and employees. Sure the new Chadstone will create jobs but what about the loss of the local business, the place where suburbs gain and pass on their character? This will be lost forever. Socially, this decision stinks. Mall shopping is, well, mall shopping. It’s not the same as poking around the independent retailers in high street, learning the unique qualities of a suburb. Such adventures are to be cherished and not abandoned as the Victorian State Government has done.

This is a bad decision and one the government ought to reconsider.


The violation of theft

We have been working with a independent retailer colleague this week – helping them navigate an employee theft situation. No matter how many times we get involved in such a case the feelings are the same. The business owner feels violated and that they, somehow, are to blame for the theft. Some are so upset that they shutdown and need time off from the business. Others want to strike out and inflict harm in some way. Rational thought is hard to find for those directly involved.

While this case involved less than $1,000 in the last week, it is what was taken prior to that which drives the emotion. The owner knows they are missing around $60,000 and an employee admitting $650 in a week gets close to matching that amount allowing for their understating of what they have stolen.

The difficult aspect of employee theft here in Australia is how you navigate dealing with it in the context of unfair dismissal laws. Even though there is new legislation the employer groups are cautioning small business to be careful.

Beyond the money, the cost of theft in this and other situations is owner energy and confidence it steals. I have seen situations where a business owner sells up as a result of the theft. In the situation this week it was a family member who stepped in and demonstrated impressive strength which allowed the owner to step back and regroup. These are the personal costs of employee theft.

Months later I see employers looking back in frustration at the justice system – the time and money it costs to bring an employee to justice means that many instances go unreported. Most small businesses do not have the resources necessary to follow a case through.

Our role in all this is to help small businesses discover employee theft sooner and to have easy access to police grade evidence to enable swift and safe action. We’ve seen that achieving that can reduce the stress – the key is getting small business owners engaged in using the tools they have access to. Too often people don’t want to know the extent of a theft problem.


Google mall, the landlord emerges?

Google has been good for advertisers – small and big business alike. The decision to buy a stake in AOL and give preference to certain ads, effectively based on spend, demonstrates Google’s pragmatism. It also shows Google acting more as a landlord than the Google of the past.

One thing I and others liked about Google was the fairness of how it effectively auctioned advertising. Thanks to the AOL deal all advertisers are not equal. Small business may be the loser.


Small business doing well online this Christmas

This report from the New York Times quotes Forrester Research in talking about significant growth for small business online. It says that small business is set to get 45% of online sales this Christmas compared to the 42% it achieved last year.

Call me a cynic but the more there is competition for real-estate in the form of online ads at Google and the like, the cost of the real-estate will rise.

This is why its important for small businesses to have a multi layerd strategy for attracting traffic and sales. Relying on Google, Yahoo or similar puts you at the mercy of their pricing. Sure they should be in the mix and it’s easy to use them to build traffic but the key is to reduce reliance once your business model is operating efficiently. No cost visits are far more preferable than a per click cost visit.


Google loves me

Received a very nice Christmas Gift from Google yesterday. Sent air express from the United States. What looked like a toolkit turned out to be a kit of wonderful USB gadgets: a light, memory stick, port expander, mouse … and plenty more. It sure beats a food hamper or a pen.

Thanks Google.


People who slow down when they pass an accident

It frustrates me when people slow down when passing an accident on the other side of the road. They slow, gawk and then speed up once past.

It’s a bit like that with software updates. They get nervous (usually with some justification) and become overly cautious – blaming every little blip or what may look like a blip on the update.

We sent out a major update a week ago – crazy this close to Christmas – and call traffic has been way up ever since. False alarm calls are leading the call traffic increase. People see something odd and call to blame the update without thinking the situation through. Soon into the call we work out that there is no problem to report and life settles down.

I don’t know why I’m even writing about it because it is part of software update life. However, unlike Microsoft and other giant corporations, we have a direct and personal relationship with our users and this puts us closer to the coal face. So when people slow down to see if there is anything to see we feel the impact.


How to spend the $11billion budget surplus

The government could consider investment in small business when deciding what to do, if anything, with the forecast $11 billion budget surplus which was announced this week:

  • Offer a small business investment allowance for capital investment where productivity and competition gains are expected. This would cover investment in plant and equipment, IT and the like. Provide faster write off and a bonus 40% tax break. This worked well in the Fraser years. I’d suggest that the break applies to businesses with a turnover of less than $15 million. Key to the tax break would be a rule that the maximum benefit would be available if the capital is purchased from another small business.
  • Pay a cash rebate for any new permanent positions created by small business. This could be more valuable than the first home buyers scheme.
  • Put more funds into small business ombudsman or similar programs in the states so that small businesses have more champions fighting for their rights.
  • Provide matching funds for any employee training funded by a business beyond $500.00. The better trained people are the more effective they become and the more likely they are to stay at work.
  • Pay a business start up grant of $20,000 for your first business start up, $15,000 for your second and so on. Entrepreneurship is crucial to a growing economy.
  • Cut company tax for small business.
  • Big businesses access many tax and other breaks which, in many cases, keep them going. Small businesses would use similar benefits well, since their owners are less like to take the cash and run – given that they are in business for independence and lifestyle ahead of money.

    The ideas above are just a start. It would be good to see the government engage in dialogue on this.


    Sustainable communities – a campaign for “local”

    In the UK there is a strong push for a Sustainable Communities Bill. This is legislation which parliamentarians concerned about local communities would pass. It is socially responsible legislation. Some would say it is more important that the workchoices, welfare to work and VSU changes shoved through the Australian Parliament in the last two weeks.

    The Sustainable Communities Bill is a proposed piece of legislation in the UK that will empower local people to improve their local communities.

    The Local Works campaign in support of the bill is “cross-party and is constantly building up support from individuals and organisations across the country, the support that will be needed to see the Bill made law! Currently 8000 individuals, 550 local councils, 200 local organisations and 237 Members of Parliament support the campaign.”

    Clone retail is alive and well in Australia. Small business is struggling against tough national chain competitors. The training and motivational role of small businesses is vital to the future of Australia yet there is little support from government. Something like this proposed UK legislation would demonstrate practical support for small business and for local communities.


    i-mate and Telstra – a poor combination

    I bought an i-mate PDA2k EVDO phone earlier this year at a Telstra shop. It’s connected to the Telstra network.

    This phone has a charming feature. All too often it displays “unable to answer call” when I try and answer some calls. Telstra has no knowledge of the problem. i-mate says it’s not the phone.

    My sense is that the problem is that I j=got into the integrated phone PDE thing too early. I would have been better off waiting for others to have these hassles so I could enjoy the more stable second generation.

    I’ll be ditching the i-mate early in 2006 and probably for a more regular phone.

    My frustration is that because I am dealing with such a large company it is challenging to navigate issues like I am having to a reasonable outcome.


    The value of service

    We started a new business four months ago. Something small which does not detract from our core business but is a nice add on nevertheless. (We did this to extend our knowledge of pure online operations in advance of enhancements to our point of sale software.) Anyway, this new start up is being promoted solely through sponsored links with Google and Yahoo. It’s in a competitive marketplace where price and service are key. When customers go to our website and order we advise how long delivery will take. The delivery time estimate is the actual period plus a day of grace in case things go wrong. We’re clear on our timing requirements to make shipping cut off each day. And our price point is keen.

    The result, four months on, is great growth every month. We’re about six months ahead of where we expected to be at this point.

    The really good news, however, is the customer feedback. Since this is purely on online play we had expected only limited return business. Don’t know why. Each day we’re getting at least one and often more email(s) from customers raving about the service and letting us know that they are actively recommending us to others. We can see from direct access to the website, compared to click throughs, that this word of mouth is working for us.

    The experience, even though only four months old, reinforces to us the importance of customer focus. Put them first every time, deliver on time and for a fair price and the business will grow and grow. This is the small business advantage. A small business should beat a big business of customer service every time.

    We’re revising our plans, working on making our service even better and building a business plan which compressed two years planned growth into six months.


    Flying with OzJet the new business class airline

    It’s good to see more competition for business air travel in Australia. Not before time. Qantas service has dropped significantly since Ansett (remember Ansett?) collapsed four years ago. Last week OzJet launched.

    Yesterday I flew to Sydney and back wit OzJet. The flights were on time. Inside every passenger has a business class seat. That means more room to work. No sitting with your knees around your ears. No cracked laptop screens when the person in front reclines to lay on top of you. So, better seating than Qantas business class.

    The food, not that I usually eat plane food, was good. Better quality than Qantas. Easily better. The coffee was drinkable as well!

    The in flight service was friendly. I got a sense from every person that they were pleased I’d made the decision to travel with OzJet. Not like Qantas where it is hit and miss. OzJet feels like a small airline and I quite like that. I’d expect a good connect with small business.

    I had a full fare ticket and it was around half the price of a Qantas business class ticket. On a discount ticket it would have cost me less than a Qantas economy ticket.

    The only gripe I had was the noise. I’d forgotten that the 737 planes are noisy. But I soon zoned out on that.

    I’m glad OzJet are having a crack not only for selfish reasons but to also pressure Qantas to life their game. I will certainly fly OzJet again and soon.

    I have no commercial interest in OzJet whatsoever.


    Customer loyalty programs: small business versus big business

    In my retail newsagency customers who purchase 11 magazines in eight weeks can choose a magazine up to the value of $10.00 free of charge. The average magazine purchase is $4.50 and the average redemption $5.00. This equates to a 10% discount.

    Over at Coles, if you purchase $49.50 worth of magazines, you accrue around 10 FlyBys points. FlyBys points can be redeemed for gift vouchers. You need 13,500 points for a $100 voucher. That equals 675 points for my free $5.00 magazine. So, I need to spend $3,375.00 to get a free $5.00 magazine.

    Now from time to time FlyBys offers bonus points but a check of the Coles website and considering the range of product in store, current bonus items account for less than 1% of the products they carry.

    Which deal is better? The Magazine Club Card I offer in my small business newsagency or the FlyBys offer from Coles?

    I’ll let you decide.

    State Governments ought to regulate to force businesses to prominently publish in store and on receipts a present value for each point accrued.

    Small businesses, like mine, ought to promote the benefit of their loyalty campaigns by directly comparing the reward per dollar with the likes of FlyBys. While occasional bonus offerings make FlyBys points more attractive, this is not happening enough. Most small business loyalty programs I have seen reward sooner and with more value than their big business counterparts.


    Dragon’s Den renewing interest in entrepreneurship

    I haven’t seen the Network 7 Dragon’s Den TV show yet but plenty of people have told me to see it. Entrepreneurs pitch their ideas to the ‘dragons’ inviting them to invest. I am intrigued that so many people have told me to see the show. They go on to talk about specific ideas pitched and why they would or would not work. Some then go on to tell me their ideas for a business. [I guess they’re talking to me thinking I would be into the show – I’m not that much of a TV watcher – as I own three businesses and am close to the launch of my biggest and scariest start up yet.]

    If my experience is anything to go by, Dragon’s Den is awakening entrepreneurial discussion and motivation like nothing I’ve encountered in recent years. This has to be good for business and for the economy. Getting people to make their dream a reality encourages others to dust off their ideas for a business. Anything to boost confidence in entrepreneurship.

    Just when I thought the majors were stifling the entrepreneurial spirit along comes something like this. Well done Dragon’s Den – I promise to watch next week.

    Starting a business from scratch is enormously challenging no matter how big or small. The emotional and personal stakes are always high. To have more people understanding of these and how much of oneself is put on the line is good. It humanises the business birthing journey.

    What would be interesting to me is some kind of knockout tournament (on TV) based around entrepreneurial skills among some of the people featured on Dragon’s Den and some big business people. Let’s see who has the strongest passion for building businesses and the best strategy.


    Small business blues

    Howard Bursen wrote Small Business Blues in 1984. It has featured on many folk albums since. Small Business Blues is one of the first songs I can recall warning about the impact of globalisation.

    Then they put in a mall selling all kinds of junk
    Like stamped our plastic shoes
    And the hard working folk watch their business go broke
    We got the small business blues

    This song is as relevant today as it was 20 years ago. More so even.

    They’s squeezing people right out of business
    In the name of free enterprise
    There’s 10 million folks out of work today
    And the corporate skyscrapers rise

    Small business is doing it tough today. I’ve had my own business for 25 years and this year have been asked to help (in one way or another) more small businesses in trouble than ever before. While some are in trouble because of poor management many are in trouble because they cannot compete with cheap imports or big businesses eliminating service, cutting costs and selling cheap.

    Just look at any of the major retail outlets. Despite what their TV commercials say, smiles and service are gone. They cost too much. At the small businesses which compete with them the smiles are there because that’s where they understand the value of customer service.

    We can bleat and moan all we like about our big business competitors. The only action which counts is the action of spending. The less we, as small business owners, spend with our big business competitors the more pain we inflict. We could consider Howard Bursen’s Small Business Blues from 20 years ago as a call to action this Christmas, a call for us to support small business with our own gift buying.

    This was all on my mind today reading the page one story in the Australian Financial Review about big business wanting to ensure that their multi billion dollar tax breaks are safe. Big business gets all the breaks and support from government. Small business gets a pittance by comparison. Again, the only way to protest is in our spending. Ignore them with your spending and they may get the message.

    Tell your friends.

    Don’t say America’s gone lazy
    It’s the economy’s gone crazy
    And if we don’t make a change we’re gonna lose
    We got the small business blues


    The frustration of banks

    Our software company processes anything from five to ten times the value of our retail business in credit card and eftpos transactions yet our retail business has fees which are 25% less than our software company. After pleading with the bank to provide more equitable fees for our software company we’re still a way off reasonable progress. Only the threat of moving to another bank gets them interested enough to at least consider some movement.

    We’ve been with the same bank for almost 25 years. It’s been a good relationship. However, the hoops we’re now having to jump for even straightforward business mean it may be time to look around.


    Mobil leading with their new loyalty program

    While I have not run the numbers to see if it offers genuine value, it’s interesting to see that the Mobile fuel discount program is based on purchases in their store. This makes it easier for consumers to determine value rather than shopping in one place and redeeming elsewhere.

    I still think it’s important that we have uniform regulations across the country so that consumers know the value of points, discounts and or other rewards per dollar spent. This would shop some of the loyalty programs for the scams they are.


    We’re hiring

    We’ve stated advertising to fill a position in our NSW office for an IT support, installation and training person. In the first hour of the ad being live we received 10 applications. I’d be expecting over 100 within the next 48 hours, maybe more.

    In the listing I ask people to research the company before applying and to demonstrate whet they know in the cover letter as opposed to being lazy and sending through a resume.

    Based on the 10 received so far I’d expect to cull the applications by 80% without much effort.

    There is no point in hiring someone who has not fully read the ad or not followed the guidelines in the ad.