We, Australians, small business retailers, suppliers to small business retailers, local towns, all of us need a Royal commission into retail shopping centre development in Australia and the behaviour of shopping centre landlords.
There is enough evidence to indicate that an appropriately skilled and resourced Royal Commission could uncover behaviour that is illegal and harmful to our economy and small businesses and families that rely on the small businesses.
I appreciate that the areas I think the suggested Royal Commission cover are broad and could be better served as two investigations. However, the two issues feed into each other. I think they are best considered together.
WHAT IS A SHOPPING CENTRE?
For the purposes of my proposal, I suggest that a shopping centre is a retail development with fifteen or more shops of any size.
While I am sure there is misbehaviour to consider in smaller centres, for management and focus, a threshold of fifteen tenancies, or similar, is needed. Otherwise, any Royal Commission would run too long and cost too much.
RETAIL SHOPPING CENTRE DEVELOPMENT.
This is the beginning of the issue. Whereas in the US and other countries growth in retail tenancy space is flat or declining, in Australia it continues to grow. Some say we already have far more shops that the population can support.
In regional and rural locations the challenge is that a new centre is usually located outside town and its development can gut the centre of town, diluting or killing off the heart of a small town.
In some cases, mid-size centre development tis driven by competition by the two major supermarkets and aided and abetted by several other anchor tenants and supported by Tatts keen to be in all new centres.
Talk to any small business tenant in a shopping centre and they will have at least one landlord story that causes them stress.
There is the landlord who did a handshake deal with a party that was negotiating to buy a business. the landlord squeezed and the family business closed. The new tenant moved in without paying goodwill.
There is the landlord that took too long on centre re-develoopmnent, making decisions that saw a 50% drop in shopper traffic, and refused any compensation for retailers.
There is the landlord that permits one sore to be on a % deal where they pay 9% of turnovers in rent with a shop next door not able to have such a deal and managing and occupancy cost of 32%.
There is the landlord that strong-arms retailers verbally, never in writing, never in a way that can be used against them.
There is the landlord that takes a marketing levy every month and spends this on activities that offer no benefit whatsoever to retailers.
There are hundreds of stories.
The Royal Commission needs to listen to stories, all stories. Tenants need to be able to do this confidentially as the fear of reprisal by landlords is real.
There are many other questions to answer. My goal here is to kick off the discussion.
Too many families are losing their businesses, homes and other assets. Too many small business operators are having their personal situations, including health, negatively impacted. Too many small business operators are losing their life. Yes, this issue is that serious.
Small business retailers feel helpless. They want their business. It has been their life’s work. They fear without it they will have nothing. This can see them agree to a lease that is at its very foundation doomed inappropriate for their business.
Landlords have the upper hand. They are in control. Too many people in landlord businesses are bullies and aware of how to bully without being caught.
The best way to resolve this is to shine a light. Only a Royal Commission c an have the authority and power to do this.
I get that Royal Commissions are popular right now. This suggestion, however, is important given that those most impacted are also those most vulnerable – small businesses, run by families. Were are told small business is the business backbone of our country. However, there is evidence to suggest that small business retailers are disadvantaged in terms of shopping centre development and retail teensy negotiation.
Here at Tower Systems we only serve small business retailers with our POS software. In our view, small business matters. This is why we support the push for a Royal Commission into shopping centre development and retail tenancies.
This post first appeared on a blog last week in a post by the CEO of Tower.
For years, we have gratefully em braced opportunities to support community groups by providing POS software at no cost or low cost to enable the community enterprises to do their good works more efficiently.
The donations of software, time and event hardware by us is part of our social responsibility commitment program where we seek to work with those we see helping to make Australia a better place.
We are able to do this thanks to the support of our customers.
Seeing the benefits community groups to individuals and their local communities is a joy, especially at this Christmas time of the year.
The federal parliamentarian dual citizenship mess in which we have found ourselves here in Australia for months now shows how politicians treat themselves as elite, special, compared to common folk, the voters who vote them in.
While we in small business are highly regulated, subject to audit and penalised for even simple honest oversight, politicians refuse to permit themselves to be subject to the same.
While individuals are highly regulated, subject to audit and penalised for even simple honest oversight, politicians refuse to permit themselves to be subject to the same.
The moment the first dual citizenship question was raised, an ethical leader keen for democracy would have ordered an immediate full audit of the status of all politicians.
We are bereft of leadership for everyday Australians in Australia.
For months major party politicians have spun their wheels on the issue of dual citizenship and refused to agree to the type of audit that is regular for us in small business. For months they have said politicians should self regulate on this issue while at the same time imposing challenging and enforced regulation on small businesses and on individuals.
Shame on us for allowing your politicians to get away with them setting a standard for their own behaviour that is lower than standards they vote to impose on regular people.
The one party that has provided leadership on this issue is the Greens. From the outset they called for an audit. The are right. Yet their call has been mocked, especially by the government side of the parliament. This side of the parliament that is in control, in leadership, has eschewed leadership and instead engaged in puerile games.
They must think we are fools.
There ought be an audit of all federal politicians immediately, no matter the disruption or the cost.
Section 44 of the Constitution is not new. Its provision have been known for decades. It is easy for anyone to determine their status. Whether they do this comes down to how they see themselves compared to how they see the peril they serve.
We the people deserve honest leadership, leadership that is transparent and for all people, leadership that submits itself to the same standards and level of regulation as they impose on those they serve. We do not have this in Australia at the moment.
Every day, we see small business retailers squeezed by regulation, while at the same time right now seeing politicians refuse even basic regulation. This double standard has to stop, for the good of our country and democracy.
Tower Systems has been engaged with representatives of a federal government agency as it contemplates new legislation that could impact some areas of retail business operation in which our POS software serves.
We have been engaged in discussions, sharing insights and explaining how parts of our software work, so those drafting the legislation can be better informed about the practicalities in retail business operation.
This work with government departments is not new for us. We have been engaged previously in other areas of business operating, helping to inform legislators to their focus remains on a path appropriate to the needs of the small business retail community.
Our first engagement helping government regulators was mack in the early 1990s when several arms of government were investigating fraud facilitated by the use of POS software developed to make such fraud easy. While our software never had such facilities, we were aware of software that did.
As employers, as retailers and as small business owners, mental health issues are often not far away from any small business retailer. The challenges confronting our newsagency businesses add to the challenges already there.
Sometimes, we don’t know we are experiencing a mental health challenge while other times it’s obvious and on show for all to see.
How we confront mental health challenges is important for us, our business and those presenting with issues.
While we are not trained professionals in the area, our years of working with small business owners confronted by challenges to their mental health have helped us develop some guiding principles.
Your GP is an excellent person to speak with. Explain to them how you feel and how this impacts on your life. Ask them to prepare a Mental Health Treatment Plan. This is a government recognised plan. It can usually be prepared in a single double visit to the GP. This plan is the trigger to you gaining Medicare supported access to a psychologist for an initial number of visits, which can be extended depending on your situation.
Some people can feel a visit to a GP or psychologist is not warranted in their situation. While the medical professionals are the best to determine this, there are other resources you could explore:
Beyond Blue has published Business In Mind, a useful resource for small businesses on issues relating to mental health in the workplace. This is a good starting point for learning more. In the resource there are links to other resources that can help.
Finding mental health resources for small business owners dealing with mental health issues is not as easy as it is finding resources for managing the workplace for better mental health. It’s tough running any business and sometimes things can feel overwhelming. This is where networking can help as a first step, talking with others.
Small business retailers feeling challenges within themselves need to treat themselves as employees and use the resources available such as:
We at Tower Systems will help in any way possible.
Small and independent retailers often feel helpless when a big national retailer opens up nearby. There is no match for their range, buying power, advertising coverage or even news coverage.
The sheer size of a national competitor is what scares many smaller retailers. This is often enough for them to give up and close the business.
Giving up and running is the easy way out. There is no lesson learned, just an escape from the fear.
The alternative is to find out how to deal with the national retailer.
Here are five tips for small businesses on how to face and deal with a national retailer moving into the area:
Not competing should include not advertising price comparisons, not focusing on the competitor at staff meetings, not expanding your range to sell more of what they sell and not obsessing about them.
I was working with an independent retailer recently who decided to offer a product they sold which is also available in a nearby national retailer for 10% less than the sale price in the national retailer. This move gave the independent retailer a margin of 15%. In discussion I discovered that most of the customers who visited the independent retailer were unlikely to shop in the national retailer. So why compete on price?
If you know why customers shop with you, you have the opportunity of not giving up margin out of fear.
Too often, independent retailers wait until the national retailer is open to react. This is probably a year or two too late.
Being smaller and independent you are better able to personally engage with the community. You and your team are the business whereas a national chain will always be the corporate. They can throw money around locally, you can throw time, knowledge and more flexible assistance.
Your stories could be about local community connection, convenience of shopping, commitment to range, personal customer service, product niche knowledge … there are many different narratives with which an independent retailer can connect. It is important that one you have your narrative you stick to is, that it inhabits your decisions, marketing and public presentation.
By acting early and in advance of a national retailer opening, you better position your business to weather their advertising and PR onslaught. Get in early, build a stronger business and understand that through this the new business in town will not be your competitor.
We have agreed to be part of a working group with the Australian taxation Office to help our customers meet compliance requirements. Here are the details of the ATO invitation:
Local small business retailers are asked to support local schools, community groups and charities on an almost daily basis. While community groups and charitable organisations beat a path to the doors of local businesses, so do individuals engaged on personal fundraising of their own for a cause or for an other individual.
It is tough making the call about which organisation to support or not for there is a real fear that declining will hurt the business. Often, small business retailers do not look for an uptick in business from a charity support decision but they do worry about a decline.
So how do you choose which local business you support?
Requests from schools, charities and other community for donations can be a challenge for any size business. If you do not take a structured approach to this you will find yourself giving away plenty for little or no return.
Requests are often loaded with guilt. People can be passive aggressive in their approach. Often, people requesting help leverage pester power. It can be hard to say no. There are too many stories of retailers giving a gift as a prize, receiving the Thank You poster and achieving no benefit for the business.
Our advice is to manage your philanthropy as you would any business activity.
THE PRIZE / GIFT
Decide the amount in cash or product value or both that you are prepared to donate in a full year, calendar year or financial year.
Our recommendation is you give away cash, but in the form of a voucher to spend in your business. This ensures that value of the gift or prize is greater than the cost of it to your business.
The best mechanism for giving away cash or an amount to spend in-store is to do it by way of a gift voucher. Use your software to manage this as any manual approach is dangerous and time-consuming.
YOUR PITCH, NOT THEIRS
Get on the front foot and write to local community groups outlining that you budget a year in advance. Seek their submissions. With this advice sheet we have included the text of a suggested letter. Please read the letter as it outlines the approach we suggest and why. It is important you communicate this with all community groups.
On the page after the letter is a suggested notice for use in-store when you are asked for donations.
HOW TO PICK GROUPS TO SUPPORT
Focus on community groups that support you. That is, groups with members who support you. The more they support you the better you are able to support the community.
Be prepared to ask where people shop for the items you sell in your business. Ask if they will change in return for your support.
Asking these questions underscores to you the importance of approaching the decision as a business decision.
Be thoughtful and deliberate. Support the groups that support you. This is important as it helps you stay within a budget.
LET YOUR SHOPPERS CHOOSE
If you run discount vouchers and if customers say they don’t want the voucher, invite them to contribute the voucher to a local group – one of three you setup for in the business. Every month, two months or three months, tote up the vouchers and give the group a parentage of the total voucher value ‘voted’ for them.
This idea could be in addition to any giving program you run in the business. It offers a daily reminder of your commitment to local giving.
Grill’d burgers run a program kind of like this where each shopper is given a bottle cap, which they place in a tub to vote on a group to receive a cash donation for the month. The process of groups submitting to be considered is onerous. You can find out more about that program with this link – it is a good place to research what others do: https://www.grilld.com.au/localmatters/
In addition to any direct gift, consider an offer whereby anyone who is a member of the group who shops with you accrues an amount you donate to the group. You could manage this through your software. It could be you offer a discount to the shopper as well as accruing a value for the group.
This type of program could also be in addition to your core giving program as the value here is driven by sales – hopefully, incremental sales.
EDUCATE GROUPS ABOUT GOOD ENGAGEMENT
Here are things groups you support can do to help your business. You should ask them to do these things:
WRITE ABOUT YOUR ENGAGEMENT
Once you have a decision on which groups you will support, write about this in your newsletter and on Facebook. Not just once but multiple times. Invite them to provide you with content to publish too. Talk about their good works.
Ask them to write about you too.
Your giving has to serve your heart and serve your business. Going about it in a structured way will ensure you meet your objectives.
With more than 3,500 small business retail customers using our POS software we have had to be on top of the push program engaged by Microsoft in the roll out of their Windows 10 upgrade.
The moment we saw the inevitability of the Microsoft roll out, we adjusted our customer service resource allocation to ensure the needs of our customers were well met.
Here is what we did to confront the Windows 10 challenge:
Even though many Windows 10 issues are outside providing support for our POS software, we have taken the calls and provided the advice, at no cost.
Indeed, we have processed close to 2,000 Windows 10 calls. That we have done this at no cost to our customers has collectively saved them a considerable sum.
We are proud of how we have handled this and are grateful to our customers for the opportunity to serve them in this Microsoft caused action.
Now if only Microsoft approached their own update roll out with the level of customer care we have shown through our actions.
The part about the Windows 10 update (malware) that has angered people the most is that they have had little or no control over the timing.
Tower Systems does not use automatic updates nor will we do this. Indeed, this commitment to our users is a valuable selling feature for us.
We believe small business retailers need to be able to decide for themselves when to update based on the facts relevant to them.
As an authorised partner of respected hardware company, we are thrilled to have been able to show off the HP RP9 all in one POS terminal to prospects at several events recently.
While we have an RP9 exclusively for an event last week, we filmed this short clip showing it in all its glory.
Not all POS software companies selling HP branded hardware are authorised resellers, not all sell new equipment backed by the respected HP warranty. At Tower Systems you ave access to the real thing.
With the growing number of retailer supplier relationships passing through our POS software, we can see the value of these increasing in the businesses run by our customers.
Whereas for years the electronic data flow was about invoices, now it is about much more. We are grateful to suppliers for working with us to deliver more value to retailers.
From small wholesalers to large, suppliers are keen to help independent small business retailers improve productivity, data accuracy and other commercial outcomes as they know from these achievements will flow more commercially valuable relationships.
We bring a better understanding that other POS software companies to these discussions as we are retailers too on many years standing. We are able to bring a practical element to the consideration, to help suppliers better understand the value to their businesses of engaging beyond electronic invoices and stock files.
In the last two weeks we have been able to participate in several meetings with key suppliers that will take relationships a step further and thereby help drive more value for our customers.
The strategic work we are doing with suppliers is differentiating for us in several retail channels. We are excited for the enhancements coming.
Cheap POS hardware pitched to small business retailers rarely turns out to be cheap. While the initial purchase price may be lower, the breakdowns, slow speed and other issues along the way can make clean no-name brand computer hardware more expensive.
Our advice is to choose a brand name that backs its hardware with an on-site manufacturer’s warranty. This offers peace of mind. It demonstrates the brand itself standing behind what it sells.
In one business recently, we discovered computer hardware that was sold a new to a small business owner was, in fact, second hand, three years old. The unsuspecting retailer was ripped off by a POS software company through unethical representations. The quote and invoice indicated the computer was new when it was not.
We urge any retailer to do their homework, trust brands, get a second opinion from a professional. The risk to the business from cheap hardware is too great.
Every day can be tough in small business. You can feel like the big competitors are winning and that you can’t climb the mountain to compete. You may not know where to start.
There are green shoots of good news and opportunities in every small and independent retail business. The key is to find these and to leverage them for more success.
A green shoot is a product or a category of products or a supplier performing above average in the business. Often, these successes have gone unnoticed.
We were working with a retailer recently who said business was down by 20% and they did not know what to do. It turned out that the best performing product category in their business was ‘failing’ for six months because they had not replenished stock.
They invested, instead, on new lines that had not gone as well as the successful product.
They, in part, created their own downward spiral and had not looked at their business data to understand that contributed to the problems they were confronting.
Once they realised the situation, they re-stocked the successful range of products and numbers started to improve. More important, their confidence level grew and with this their business decisions improved.
There are opportunities for optimism in every business.
Finding optimism is like mining, you have to look for it, sometimes for a long time. It is there, though, in every retail business.
As soon as you hear yourself talking your business down, STOP. Look at your data, look for the good news. That is what you need to think and talk about.
By looking at your data, we mean looking at year on year, quarter on quarter or month on month comparison data for departments, categories, suppliers or even individual products. Look for growth and once you see growth, think about what you can do with and around the products achieving growth so that you can achieve other growth.
Any product achieving year on year increases in unit sales is a product to be appreciated, nurtured and used to help grow other products that can sell to the same customer.
This is how you grow optimism. Find those small green shoots, leverage them with some small steps and, over time, build more success for your business.
While overall revenue, traffic count and profitability may be down, growth even at the smallest data point, such as for one or two products, could be enough to get you looking at your business differently.
In the Tower Systems POS software, the best initial reports for good news are: Monthly Sales Comparison (department level, category level and / or supplier level), the 10×10 Report, Ranked Sales Report (by units) for one period and then for the comparative period.
We’re here to help you find the good news in your business. Your business data is the key.
We recently invested in a quality defibrillator for our office and registered this so emergency services know its location should it be needed to assist in a health crisis.
While we purchased the defib unit for our busy head office, we welcomed the opportunity to be on a register of publicly available defib units.
Coupled with the installation of the unit was training for team members and our first aid officers.
Thursday November 26, 2015 is Thanksgiving in the US and while this is part of the cultural heritage of the US, it is an opportunity for us to reflect and be thankful.
We are thankful for our customers who use our software for this not only benefits us commercially, it fulfils us as we enjoy seeing our creative efforts being of use to others.