Tower Blog

A blog about smart POS software for independent small businesses.

Month: March 2006


We have launched our 2006 AFL footy tipping competition. It’s open to our clients, newsagents and anyone remotely connected with the newsagent channel. Entry is free.

First prize $500.00
Second Price $150.00.
Third prize $50.00.

You’ll be competing against all Tower Systems employees. Email to register and we will add you to the competition. We will send your username and a password to access our new web site to enter in your tips.

Each week you need to go to the Tower Systems web page ( and click on the Footy Tipping link, enter your username and password and tip away.


More kudos for OzJet

Even though they have withdrawn commercial flight services the folks at OzJet are ensuring that all outstanding obligations are fulfilled. Those who won a ride in a Formula 1 race car, in the competition they ran when they launched, will get the ride this Tuesday and those who had prepaid for tickets will be refunded. I have personal experience in both situations and apprciate their attention to detail.


Employee theft hits independent retailers hard

We spend a fair bit of time helping independent retailers gather evidence on employee theft problems. Too often the alarm is raised too late, when the losses are already close to six figures. The only reason employees get away with theft is lazy management. It’s a choice the owner has made to be lazy. And then when the theft is discovered and the bank and other creditors knocking at the door demanding action, the owner is busy pointing fingers. The most common way employees steal is by not ringing up items customers pay for or by canceling a sale prior to its completion. The customers are none the wiser and the cash balances at the end of the day. Once theft is discovered the business owners complain that they don’t have time to watch the security monitor the whole time etc etc.

We’ve created a way around the problem. We have deeply linked our software with a security system such that it respects time poor business owners. It tracks the likely theft events and provides a highlights package from the day – so the owner only need see the footage from the counter which many be an issue. Taking care of counter operations in this way leaves the owner and or manager with more time for monitoring the body of the shop.

In creating the link we talked with police, lawyers and security experts to ensure that the evidence we gather is useful in pursuing a conviction.

The retailers association tells us that theft is costing between 3% and 5% of turnover. If we can cut that by even 10% then the solution we have created pays for itself.


3M fails to deliver reasonable customer service

We’ve been an active support of the 3M touch screens for a couple of years. They are regarded by many as the ‘Rolls Royce’ of touch screens. Then they started dying. 3M said all was okay with production. But they continued to die. Despite several efforts at resolving their poor failure rate with 3M they continued to blow us off. We could make no progress. We carried spare gear so our customers did not suffer. We also carried the freight cost even though we provided the gear on a return to base warranty basis. 3M continued to ignore us.

Earlier this month I wrote about the problem here. Last week 3M made contact with me but it was too late. We’ve taken their gear off our lsit of recommended hardware. Their touch screens are too unreliable and are certainly not worth the hefty price difference. We’ve replaced 3M with another premium brand and continue to offer the LG touch screens as our entry level model. The LG screens, I should note, have been excellent.

I can accept that problems will occur with new hardware from time to time. It was 3M utter denial about these problems which frustrated by small business and our clients. 3M appeared not to care about us and certainly did not actively engage with us in resolving the problems.

3M can tell us that they have learnt their lesson all they like, that learning has come too late for us. They had an obligation to address the problems in their touch screen manufacturing a year ago.


Garbage in, garbage out – the holy grail of good data

We have been working with suppliers to provide clean invoices and stock flies to our clients for most of our 25 years in business. While most suppliers are a dream to work with, we have some recalcitrants who continue to send their small business customers poorly structured and even wrong data. This poor quality data costs our clients and us money to resolve and there seems to be little will among the suppliers to correct the problems. The challenge we face is whether we become the gatekeeper – the barrier to these non-compliant suppliers delivering bad data to their clients. This is an invidious position and one we would not accept gladly. The worst supplier is one owned, in part, by the small businesses it supplies – you’d think they would know better. Maybe it is time for small business to be tough like big business on EDI data – if it is not clean the products do not go on the shelves and the bills are not paid until the data is corrected.


Loyalty marketing works for small business

I received my FlyBys statement over the weekend and compared how Coles Myer rewards me compared to people who use the loyalty software in the Point of Sale system developed by my company. Since we launched our loyalty software we have seen the most common loyalty reward priced at 2% of revenue. Some stores, offering higher priced items, provide a reward equal to 10%. Small businesses are using the tools to drive sales. Their view is that this will only happen if the reward is genuine. They are smart in the mechanics they use and how they communicate the offering to the customer. Employees are trained to use the loyalty program to drive sales. Direct mail is used to remind customers of how close they are to rewards. Across at Coles Myer the ‘reward’ is less than half of one percent. There is no personal across the counter connect. The statement and accompanying advertising material probably costs more than the rewards themselves. Yet their advertising would have you believe that FlyBys offers exceptional value.

This is an opportunity for small business. Develop a structured loyalty program, engage all employees, support the program with the right technology and remind customers at every opportunity of the value.

In my own retail business we have been using a loyalty program for eighteen months and the resu7lts are exceptional. Sales in the particular category are showing four times the industry average. For our part we have been able to use out knowledge from the technology to drive basket size and thereby increase customer efficiency for the business. Along the way we have been able to win back some customers from Coles and Big W.

The key with any loyalty program is that you reward for above average behavior.


OzJet better than Qantas Business Class

I got to travel to Sydney Tuesday with OzJet – the all business class airline – and then Thursday to Brisbane with Qantas in Business Class. Both were early morning services. OzJet offers better seating, better catering and better in cabin service. Both places were 737s. In Business Class on a Qantas 737 in you’re not in row 1 you might as well be in economy thanks to the cramped space whereas on OzJet there is plenty of room right through the cabin.

I don’t own shares in either airline but I do know what I like and the OzJet space and happier cabin crew win it for me. The demeanor of the cabin crew underscored for me the importance of focusing on customer service. It is the biggest differentiator between businesses.

I hope that they make inroads on the Qantas offering as they could do with some competition.


Is good customer service only skin deep at Virgin Blue

I have only recently tried Virgin Blue, the airline started by Richard Branson started in Australia five years ago, having switched from Qantas. Last week I had my first bad experience. Having used their web check in service I boarded and settled into 2C on a flight from Adelaide to Melbourne. One of the last passengers to board also had been allocated seat 2C. The Virgin Blue person rudely told me that since my seat was a web check in seat it would be wrong. Sure enough, I was forced to pack up and move to 10A (I hate window seats). This was handled poorly by the Virgin Blue person with no acceptance that my seat had been allocated 24 hours earlier using their system. Then, before take off, they offered me row 12, an exit row.

Unhappy, I used their website to make a complaint. In the complaint I provided specific details. I’d like to publish their response but the disclaimer on the email does not afford me that right. Suffice to say that Christa Wyder, Guest Relations Coordinator at Virgin Blue Airlines sent me an off the shelf response which did not address my specific concern. It only served to increase my frustration with their poor customer service.

Sure they have attractive employees. Based on my experience, this attractive exterior is where good customer service ends.

My complaint raised valid questions which they have not even attempted to answer. Christa’s email also reminded me that they are a “relatively young airline”. Nonsense. They’re five years old. They actively promote web check-in. My experience is that web check-in is flawed and their employees rank it below an airport check-in.

The test of any company is how they respond to a complaint. Anyone can choose an off the shelf letter number to be sent in response. It takes commitment to customer service to engage with a customer and actually respond to their complaint.


Shame shame shame Qantas and Australia Post

It is disappointing to read in The Australian that Qantas owned Jetstar and the government owned Australia Post are pursuing the sale of Jetstar tickets in Australia Post outlets. Once again the government is demonstrating its commitment to small business by allowing the retail network and brand it owns to take business from small business travel agents while at the same time making a cabinet decision which protects Qantas on the Austral8ia – US route. Consumers are getting done over on price thanks to one decision and small business is being shafted by the other decision. So much for small business support.


Plastic bags in Ireland

They’re tough in Ireland on the issue of plastic bags. This story in the Irish Examiner reports a 3,000 Euro fine if businesses do not charge the mandatory 15 cent levy on plastic bags. While big business has led the way on reduction in plastic bag use in retail here and received kudos in the media and groups like Planet Ark, small businesses like newsagents have a good, but unsung, track record. It’s easier for a Bunnings to impose a fee for plastic bags than an independent small business newsagent or hardware shop. This is where the Irish approach might help because it makes the issue regulated on the same footing nationally rather than on a store by store basis. It would also stop Planet Ark people getting on TV and radio raving about big business and ignoring the efforts of small business.

From a technology perspective we make it easy for stores using our software to remind employees to NOT automatically provide plastic. We also have the ability to include a message on receipts about plastic.


Woolworths to introduce receipt driven loyalty program

AustraliaIT reports that Woolworths is to trial technology which promotes items based on the contents of a customer’s shopping basket. The Australian says this is “up-selling on steroids”. Woolworths, of course, will charge suppliers to be the product promoted in the up-sell.

We’ve been doing something like this in our software for almost two years – targeting up-sell opportunities based on what is in the shopping basket. But since we’re at the small business end of retail and since our users decide for themselves how such marketing tools are used, there is no group wide or national strategy behind the technology. However, if Woolworths gains traction I’d expect some of our clients would want to get together with us to see if we can aggregate to achieve a better opportunity for them.

I like this idea of reward for the basket purchased as it makes it easier to assess your value to the retailer. FlyBys and similar points programs are close to being a scam with the amount you have to spend before anything truly rewarding is available.

Certainly the media coverage given the Woolworths story has encouraged me to revisit how we promote our point of difference in this area of loyalty.


3M touch screen quality problems

We have put up with quality problems with 3M touch screens for long enough and have decided not to sell their equipment. The financial and reputation cost caused by the failure of the 3M gear has been very high and while they have repaired the units under warranty, it’s just not with it to us. We deal only with small businesses which cannot afford to be without their gear for even a day. 3M don’t seem to get this and have been tardy in responding to what has now been a year long problem. The quality pitch 3M sold us on has not been backed up with experience.


Virgin Blue lets business down

If Virgin Blue wants to attract the business traveler they need to re-introduce wireless access to their passenger terminals.