Home' The Channel Magazine : National Newsagent October 2012 Contents Depending on your perspective the
changes in the industry that will be heralded
by News Limited’s announcement will either
be the worst thing or the best thing for the
Not long ago the Government forced
Telstra to separate their Wholesale and
Retail businesses. This was a change
that made eminent sense to me and to
many business commentators; but the
Telstra Board under Sol Trujillo remained
intransigent and were reluctant to embrace
David Thodey succeeded Trujillo and
embraced those recommendations and put
that injection of capital to good use. When
Trujillo started in July 2005, Telstra’s share
price was about $4. When he left in May
2009 is was $2.49. Under Thodey it recently
peaked close to $4 again.
To argue that it is a different industry and
different scenario is to miss the point. The
example simply serves to illustrate a few
• If a bureaucratic behemoth like Telstra
can respond to significant structural
change by embracing the inevitable and
adapting to the new realities, then a
nimble newsagent can do it quicker and
• The best response to deal with inevitable
change is to get on with dealing with it.
This by no means diminishes the
potential risks associated with the T2020
changes. The only way to manage that
risk is with thorough planning and diligent
execution. Change (risk or opportunity) of
this magnitude requires a different approach
to simply adding another suburb to your run
or even handing back a territory.
In the first instance there is a binary
decision to be made:
A: Do I want to be a Retailer?
B: Do I want to be a Distributor?
Do not pass GO unless you have resolved
this question in your mind.
Whilst a business entity may technically
own both (types of) businesses, the
discussion is separated because these are
two very different types of businesses and
they will be subject to two very different
This article focuses on the process
to be followed if you are thinking about
pursuing the distribution opportunity. In a
future article we may consider what must
specifically happen if you want to think about
focussing on retail only.
It may seem tedious, possibly even
academic, but following these steps—in
order—will give you the best chance of
covering all your bases and reaching a
conclusion that suits your objectives and
1. Information gathering
Figure out what information you need to
make a decision and gather those facts.
This is ‘stating the bleeding obvious’, but
we all know that there is a tendency for
people to rely on (and be persuaded by)
‘informal’ information sources.
Pursue the official channels such as the
hotlines and/or the representatives of
state or national associations. Do not base
decisions that come second-hand from
what someone heard from their cousin
who is married to someone who was at
party where they heard a representative
You are probably unlikely to get firm
information about a specific territory
boundary or the exact number of papers
to be delivered very early on, but you can
clarify many other factors.
2. Set objectives
Before you do a lot of work and draw up a
business plan, set your own objectives. Be
honest and be realistic.
• Consider what resources (time, people
and money) you are willing to commit to
• Consider what you want from such a
• Consider the timeframes.
Think about what happens afterwards—not
just in the lead up to the big change.
3. Apply the decision
constraints and issues to
See below for a potential list of issues
to be considered. I won’t discuss each
element here, and the list is probably not
A few points to note:
• There are qualitative and quantitative
considerations and they are both
• Don’t get excited by the potential of the
huge revenues of a territory of 10,000
• Don’t get despondent because you heard
that Joe Blow will be tendering for the
“Man cannot discover new oceans unless he has
the courage to lose sight of the shore.” Andre Gide.
A PRAGMATIC APPROACH
National Newsagent October 2012
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