Lottery NEWS - Lottery Retailers Association
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YOUR
LotteryNEWS
JULY - SEPTEMBER 2016 NEWSLETTER
Lottery Retailers Networking Event at Gibson Gifts
Special 2016 Annual General Meeting
and the inaugural Lottery Retailers Networking Event Edition
The LRA was delighted to hold its first new format Annual General Meeting (AGM) and Lottery Retailers Networking Event on
24 August 2016. Thank you to our members for your RSVP and all of you who attended which helped make this night such
a great success.
We were very pleased to almost reach our capacity with over 70 members in attendance and 16 key suppliers and
supporters of the LRA.
The event was a huge success, with a lot of important information shared, great learnings and many successes celebrated.
Many attendees mingled and networked afterward the AGM with representatives from the Australian Lottery and Newsagents
Association (ALNA), The Lott and the Lottery Retailers Association Committee, as well as key sponsors: The Horfield Group,
Premier Business Consultants and Wollermann and Associates Business Brokers.
We would like to specifically acknowledge the following LRA sponsors, networking event sponsors and LRA supporters:
• Official LRA Sponsors
o The Horfield Group Shop-fitters
o Leasewise
o Premier Business Consultants
o Wollermann and Associates
o Tower Systems
• Networking and Cocktail Event Sponsors and LRA Supporters
o Gibson Gifts
o The Lott
o Workforce Guardian
o Avenue Solutions
o Marsh Advantage Insurance
o Arthur J Gallagher Insurance
Gibson Gifts exhibited great hospitality in hosting our event and showcased their extraordinary range of gift and homewares
for members. Please take the time to check them out at www.gibsongifts.com.au. To help keep us energised through the
event, attendees enjoyed a delicious and plentiful range of gourmet cocktail food and beverages throughout the entire
evening.
A key highlight for attendees was hearing about the many and varied benefits available for members as a result of the LRA’s
affiliation with ALNA. These include financial planning, insurance, ATM and banking services, vehicle and travel discounts,
to name just a few. I would encourage you to log on to www.anf.net.au (using your outlet number and LRA password). The
LRA will showcase more of these throughout the coming months so please look out for our e-news alerts.
We also heard from Travis Hall General Manager Tatts, who presented on a range of The Lott’s key objectives, programs and
the successes achieved this year. Importantly Travis also presented on some exciting new initiatives from The Lott.
As some members were unable to attend, we have placed on the LRA website a copy of the AGM Booklet, containing the full
President’s Annual Report, a summary of the Associations audited financial statements and information about our speakers,
in addition to some of the supplier flyers available on the night. Should you have any questions about the AGM or any other
member benefits, please do not hesitate to contact the LRA office.
The Presidents report was very comprehensive and clearly demonstrated the large agenda and significant amount of work
undertaken by the Association on your behalf this year. Those who attended heard first-hand about the LRA’s achievements
and future priorities and opportunities – a commission increase submission, the LRA Bulk-Buy Shop-fit and DigiPOS screen
discount programs and the Post-2018 Lottery Licensing process and a lot more. A summary of the Presidents Annual Report
and speech is following in the newsletter for your easy reference.
It was a great evening and we thank everyone who was involved in making the event a success (members, LRA committee
and office staff, speakers, guests, sponsors and supporters) and we look forward to bringing this format again next year.
In addition, we are excited to announce this event will be supplemented throughout the year by a Program of Regional
Meetings so we can personally meet and discuss important matters with members who are not able to attend the AGM. We
are very conscious of people’s time so we are exploring if we can align the timing of these regional meetings with The Lott’s
Territory meetings. We will announce more details about these meetings shortly.
3
President’s Annual Report It was Sharyn Cole’s pleasure to present the Presidents Annual Report for the year ended 30 June 2016. Following is a summary of the report but we encourage you to read the Presidents full report in full as it contains important information and will demonstrate the full extent of the work the LRA has done on your behalf. Engagement and Representation This year your association has doubled its efforts on key representations to the Government regarding the really important issues affecting lottery retailers. This is critical as the Government progresses through the lottery licensing review period which is likely to conclude in the first half of 2017, well ahead of the expiry of The Lott’s licence in Victoria in June 2018. This is the last licence review for the next ten years so the review process is a critically important opportunity for the Government to reset the licence framework and bring about a fairer structure that not only corrects some the current licenses shortcomings, but also addresses the imbalance of power between a monopolistic lottery licence holder and small family business owners. At the moment it is important to note there are some limits on the extent of these discussions due to probity restrictions while the Post-2018 Lottery Licensing process is underway, however, members can be assured that any shortcomings or deficiencies in the new licence will not be because the government was not informed or warned by the LRA. Due to unforeseen circumstances we have a new Minister responsible for Consumer Affairs, Gaming and Liquor Regulation. The LRA has written to the Hon Daniel Andrews, Premier of Victoria and the new Minister, the Hon Marlene Kairouz, Minister for Consumer Affairs, Gaming and Liquor Regulation requesting an urgent meeting to discuss these developments and any impacts on the licencing process. The LRA has also implemented a program of meetings with the Opposition, State and Federal Small Business Ministers and with Ms Kate Carnell, Australian Small Business and Family Enterprise Ombudsman to ensure the key issues affecting lottery retailers are understood and to discuss how they can be addressed. These issues have been discussed in the context of the current retailer protections under the Franchising Code of Conduct and the proposed extension of Unfair Contracts Legislation to small business and have included The Lott’s exclusive on-line lottery sales, new distribution channels (convenience/supermarkets), The Lott’s mandated shop-fit upgrades, end of term treatment of franchisees, unilateral changes to the franchise arrangements and retailer commissions, etc. Strategic Alliances Over this year the national consolidation of lotteries has led to The Lott standardising operations in all jurisdictions and implementing a national approach to key elements of the franchise business. This underscores the importance of the LRA and ALNA entering into an Affiliation Agreement to work together on all national lottery issues. This is a vital change needed and will strengthen our representation and enable us to more powerfully negotiate outcomes with The Lott and governments at a state and national level. The LRA is now your one stop shop for all lottery and newsagency needs. The LRA will work hard to strengthen our relationship with ALNA to drive even greater value from your LRA membership. 4
President’s Annual Report (Cont’d)
To date our focus and joint representations have been:
• Retail Image and DigiPOS Screen Bulk-Buy Programs - the implementation of the first Retail Image Bulk-Buy
Program where approximately 38 LRA members participated and benefited from savings of up to 25% on their
shop-fitting costs. This was supported by an arrangement with Entwined Solutions which delivered our members an
exclusive 5% discount on the screens and equipment.
• Leasing Finance - to support these programs, we negotiated very competitive leasing rates for members and formed
a strategic alliance with Macquarie Leasing and Rental.
• DigiPOS Financial Support - the LRA also made strong representations to The Lott indicating they had an obligation
to cover the cost of the DigiPOS equipment and they should contribute financial support to retailers who have already
installed the Generation One Retail Image and now wish to retrofit the DigiPOS system. Subsequently, The Lott made
incentives available to affected retailers.
• Shop-fit Deadline Extension - the LRA voiced serious concern over the affected retailer’s ability to complete the new
shop-fit by the June 30 2016 deadline and asked The Lott for an extension to this deadline. As a result of our
ongoing lobbying, The Lott extended the due date to 30 November 2016.
• Commissions Submission - the LRA previously reported our intention to prepare a submission to The Lott for a
national commission increase for retailers by utilising ALNA’s national Authorisation. I am delighted to report we have
now commenced this work in earnest in conjunction with ALNA.
• Potential Opportunities and Threats – in recent times there have been significant changes in the on-line market with
the emergence of new entrants such as Lottoland, which are in direct competition with The Lott’s on-line channel and
the retail network. Protecting and strengthening the official lotteries will be vital in dealing with these new threats and
ensuring the official lotteries remains our customers first and only choice.
The LRA and ALNA have met with Lottoland’s Chief Executive and at this meeting we discussed the impacts of the
introduction of their international lottery betting service to the Australian market, to better understand their business
strategy for Australia and the potential risks and opportunities for the lottery industry.
Representation with The Lott (Tatts)
In addition to all of these activities, a core part of the LRA’s work centres on key representations to The Lott. This year the
LRA has maintained a schedule of monthly meetings with The Lott and formal written communications focussing on:
• On-line sales – the LRA has tirelessly challenged The Lott’s exclusive on-line sales channel, in particular, the
unprecedented growth of this channel and the impact it has on the traditional network. We have also challenged The
Lott’s increased advertising to drive customers on-line and UBET advertising to Tatts Card customers, etc. On-line
sales remain the issue of greatest concern and detriment to retailers. As this is the most important issue affecting
every member of the LRA, we will do whatever is necessary and not rest until we can bring about a satisfactory
outcome on behalf of all members.
• A commissions increase – as detailed earlier in my report a joint submission with ALNA is currently being progressed.
• The Lott’s rollout into the convenience channel (Coles Express and now Caltex Woolworths) – the LRA continued
to call on The Lott to abandon these failed strategies and focus its attention on the traditional retail channel which has
been responsible for helping to establish its strong and trusted brand in Victoria.
• New games – the LRA has discussed the performance of Set for Life and Lucky Lotteries and the need for more new
games into the future.
• Instant Scratch-Its – the LRA has pushed strongly for the removal of the $44 weekly fee and for the Lott to more
quickly develop new games and multi-jurisdictional games.
• The new DigiPOS Retail Image – the LRA has addressed several important issues relating to the new DigiPOS retail
image including:
o Screen advertising - the LRA has addressed concerns and sought assurances over the advertising and content on
the DigiPOS screens including potential third party advertising and the potential real time, dynamic ‘on-line’
advertising on the screens.
o Reducing shop-fit costs and incentives – as mentioned earlier in my report these representations resulted in the
financial incentives being offered by The Lott.
5
President’s Annual Report (Cont’d)
o Lottery Licensing process on the DigiPOS shop-fits - the LRA has also sought some assurances over the potential
impact of the Lottery Licensing process on the DigiPOS Shop-fits i.e. what will happen if The Lott is not awarded
the Lottery Licence post-2018?
o DigiPOS faults - the LRA has already been made aware of some faults or issues being experienced by retailers
with delivery and operation of the new DigiPOS screens. In response, the LRA is liaising with The Lott and
Entwined Solutions to implement clear procedures for retailers to follow when receiving delivery of the equipment
and what to do if a subsequent fault is experienced.
• Annual minimum performance sales level reviews – the LRA has raised its concern and opposition to these reviews
with The Lott. The LRA considers this treatment of retailers unfair when you consider all Caltex Woolworths sites are
trading well below the $8,400 minimum sales level (now $7,000), but are not be subject to the same performance
conditions.
• The Lott’s treatment of community service outlets – the LRA has strongly challenged The Lott’s change in policy and
targeting of these outlets. We have vigorously and successfully assisted retailers to retain their franchise.
• Annual terminal allocation reviews – the LRA has successfully worked with affected members in developing
strategies to drive transactions to protect against removal and helping retailers secure additional terminals and
seasonal terminals.
• Breaches notices – we have addressed the breaching culture emerging within The Lott. The LRA has experienced an
increasing number of calls from distressed members because they have received a breach notice for minor infractions,
so the LRA has recommended The Lott adopt a more collaborative and respectful system of written warnings for first
offenders.
• Tatts Card barcodes on electronic devices – the LRA is challenging why retailers are not permitted to allow
customers to purchase tickets or claim prizes using their electronic devices/barcodes.
• The New Franchise Agreement – following changes to the Franchise Agreement and Disclosure Document to include
references to cover the new ‘Generation One Retail Image – DigiPOS’ and other changes such as a move to twice
weekly sweeps, the LRA completed a comprehensive review of the agreement and challenged The Lott over some
changes.
The LRA’s representations with The Lott will be a continued focus for 2017 as we proactively address the key issues that
matter to retailers and we quickly respond to any unforeseen matters that arise.
Delivering Greater Value to Members
Throughout this report I have highlighted areas where the LRA has been delivering even greater value to members via our
affiliation with ALNA and our Retail Image and DigiPOS screen Bulk Buy Programs. The LRA has continued to explore new
member’s services and drive greater value for members from the support and services we offer.
1. The Lott’s Mandatory PI Insurance
Recently the LRA was very pleased to announce we successfully secured an exclusive Membership premium discount,
with Marsh Advantage Insurance (MAI), in respect to Lotteries Professional Indemnity Insurance. Exclusive member
benefit PI insurance for only $134.
In addition to this, the LRA hopes to expand our offer to include a membership premium discount for your general shop
insurance. The LRA will communicate more about this later.
2. Accredited Training Solutions
The LRA will announced the launch of our Accredited Training Solutions for members and the only cost to the retailer is
the $100 enrolment fee that can be paid off over the course of the training. Some of the courses included are a Cert IV
in Business Sales and Cert IV in Retail Sales (including customer engagement). This will enable retailers to provide
valuable accredited training for themselves or staff at the very low cost.
3. idroppedit
The LRA will soon be trailing a new retail service offer exclusive to LRA members. The trial will initially involve
approximately 16 members in regional locations who will take on the idroppedit mobile phone repair service. Idroppedit
provides an economic mail-in solution for retail mobile device repairs and members will have the ability to earn a rebate
for repairs taken.
Rest assured the LRA will continue to look for great member services that drive real value and savings for your business.
6
President’s Annual Report (Cont’d)
Membership
This year the LRA consolidated its membership base. The LRA remains the official, most qualified and relevant lotteries
representative body in Victoria. Your membership and ongoing support is vital to the work the LRA undertakes on your behalf
for the benefit of all lottery retailers. I would like to thank you for your continued support.
Member engagement and support
Last year I announced the LRA had employed additional resources to increase our face to face contact with members and
provide additional services including a Professional HR Support Service. This year our dedicated retail specialist, Jim Lindsay,
has visited and assisted retailers on a range of important issues and has provided members with useful and proven
operational, business development and retail sales strategies to help you improve your outlets performance.
In addition to the above support provided, many requests for help and information are received each week by the LRA. In
response, the LRA CEO and Retail Lottery Specialist have provided members with specific support in the following key areas:
• Preparing 16 new outlet proposal (objection) submissions to The Lott and the results were 10 not approved, 4
approved and 2 not determined to date
• Providing mediation support and joint attendance with members at several mediation sessions at the Small Business
Commission
• Supporting retailers at several joint meetings between The Lott, the retailer and LRA on dispute resolution, etc.
• Conducting 8 comprehensive lease reviews and LRA attendance at lease negotiation meetings
• The LRA’s CEO, Lottery Retailer Specialist and Committee also implemented 980 member visits
This vital support has delivered outstanding results and will be continued next year as part of your membership.
The Future
There are always new challenges and opportunities facing individual members and the industry overall and I am confident
we have the team and resources to build on our record of significant achievements and we will continue to evolve and adapt
to ensure we deliver even greater value to members.
That concludes the highlights from Presidents report but I encourage you to all read the full report on the LRA website where
we have also included a summary of the key services and support programs the LRA now offers which further demonstrates
the exceptional value of your membership.
7
A snapshot of your Association at work...
What are the key initiatives and activities your Association has been progressing recently?
• Representations to Government – as mentioned in the Presidents report the LRA has continued to make key
representations to the Government regarding the really important issues affecting lottery retailers as the Government
progresses through the lottery licensing review process.
The lotteries licensing process is progressing but slightly behind schedule. We understand the Government issued the
Invitations to Apply (ITA) for the Lottery Licence to the shortlisted registrants in August 2016.
Despite numerous approaches the LRA was extremely disappointed that the new Minister, the Hon Marlene Kairouz,
failed to meet with the LRA prior to the Invitations to Apply (ITA) being issued.
In response, the LRA again wrote to the Hon Daniel Andrews, Premier of Victoria to seek an urgent meeting to discuss
areas of the Lottery Licence we anticipated the Government would not adequately address or resolve for lottery
retailers i.e. on-line sales. In our correspondence we warned the Premier the network of 800 plus lottery retailers in
Victoria are silently suffering the residual and unintended detrimental impacts that were inflicted as a result of the last
licensing regime this Government created, including the significant financial costs. Specifically, we have warned if the
key issues affecting all lottery retailers are not adequately addressed in the new Licence, they will no longer stay
silent.
On the 7 September 2016 the LRA President Sharyn Cole and Gary Carter finally met with the Hon Marlene Kairouz,
Minister for Consumer Affairs, Gaming and Liquor Regulation. Despite the Minister taking refuge behind probity
restrictions and refusing to comment on specific matters relating to the licensing process, the LRA delivered a very
strong and unambiguous message about areas of the Lottery Licence we anticipate the Government has not
adequately addressed or resolved. In particular, our focus was on on-line sales.
The LRA made it clear, that despite our strong and sustained representations, we had no confidence the Government
would satisfactorily address on-line sales for our members, by compelling the new licence holder to allow retailers to
participate in on-line sales or support this channel for fair reward.
The LRA clearly explained that based on what we can surmise, it appears the Government is once again on a
trajectory to deliver a deficient and potentially flawed lottery licensing regime that favours big business at the expense
of the 800+ small business owners in Victoria. Furthermore, it risks being an outdated model from the outset that
doesn’t anticipate the rapidly changing on-line market and new threats such as Lottoland. The LRA’s representations
have been focussed on delivering a licensing regime that can harmoniously bring the official lottery channels together
in an omni channel approach that not only protects the industry but positions it for sustainable growth.
The LRA also outlined our thoughts on the prospect of the Government imposing a premium payment on the new
licensee for commission paid for online sales. The government indicated in the Registrations of Interest (ROI)
document it was considering whether the New Licensee may be required to pay an additional premium payment for
commission paid for online sales. If implemented this would deliver additional revenue to the Government. The LRA
has no objection to this, however we made it very clear that it would be
indefensible if the Government imposed this without also permitting
retailers to participate in or support the on-line sales channel with an
opportunity to earn additional commissions. If this occurred, the
Government would be essentially double-dipping.
• Letter to the Minister - in early September the LRA also wrote to The
Hon Marlene Kairouz and alerted the Government to the rapid changes
within the lottery and wagering industries, and importantly, the
concerning convergence of the two i.e. Lottoland. In our recent meeting with the Minister, the LRA elaborated on
these developments and the detrimental impacts already being felt by our members. The LRA was seeking to
understand the government’s position on these rapid industry changes and what action it might be taking to support
and protect the official lottery industry and the value of the lottery licence.
As anticipated, by the Government not addressing on-line sales for retailers through the Post-2018 Lottery Licensing
Process, we stressed that the Government would miss a rare opportunity to bring the official industry together on a
unified platform to counter and protect against these new external threats. The LRA will continue to make strong
representations to the Government on this important issue and the threat it poses to the official lottery industry.
8
A snaphot... (Cont’d)
• Meeting with the Minister for Small Business, Innovation and Trade - the LRA President Sharyn Cole and CEO Gary
Carter requested and attended a meeting (22 August 2016) with The Hon Philip Dalidakis, to discuss important
issues affecting lottery retailers.
We regret to advise that this meeting proved very unhelpful and the Minister was not interested in discussing lottery
issues despite our members all being small business owners.
• Meeting with the Opposition – in early September the LRA met with Russel Northe, Shadow Minister for Consumer
Affairs and Liquor & Gaming Regulation. In contrast this was a very productive meeting. The LRA sought to
understand what the Opposition’s policies would be in regard to the key issues affecting lottery retailers such as on-
line sales, and what they would be prepared to commit to in the lead up to the next State election in 2018.
The Lott PI Insurance – Exclusive Member Benefit PI Insurance for Only $134
Earlier in August the LRA announced we had successfully secured an
exclusive Membership premium discount, with Marsh Advantage
Insurance (MAI), in respect to Lotteries Professional Indemnity
Insurance.
Many members have taken advantage of this great offer and have
reported they have made considerable savings.
Over the coming year the LRA will endeavour expand the offer to include a membership premium discount for your
GENERAL SHOP INSURANCE. The LRA will communicate more about this in the future.
DigiPOS Generation One Retail Image - The Lott's Shop-fit Target List for 2017
2017 LRA Shop-fit Bulk-Buy Program: The LRA has been contacting
members from the 116 lottery retailers in Victoria who are due to
complete their new shop-fit by 30th of June, 2017 to advise them about
our Bulk-Buy Program for 2017. Already approximately 30 members
have expressed interest in participating in the program.
In the background the LRA has been busy writing to or meeting with
selected shop-fitters which includes a mix of 6 approved national and
local shop-fit companies. The main objective of this program is to deliver
the new Generation One Retail Image more efficiently and economically
to our members without compromising on quality.
The LRA has also been preparing a number of important Bulk-Buy Program quoting and process documents to enable the
LRA to assess the shop-fitters and quotes with some degree of consistency. Importantly, this preparatory work will give
members confidence the shop-fitters know what is expected of them and you understand what will be included in your shop-
fit project and the total expected project cost, without surprises. The LRA has asked the selected shop-fitters to complete a
comprehensive 40-point questionnaire to confirm their ability to meet our requirements and enable us to properly assess
their capability and suitability.
The selected shop-fitters were asked to compete their quotes and the questionnaire in early October 2016. Following this we
will be able to advise members of the outcomes and our recommended shop-fitter(s).
9
DigiPOS Generation One Retail Image... (Cont’d)
Do you need to complete a shop-fit by the June 2017 deadline? If yes, have you expressed interest in the LRA’s Bulk-
Buy Program by completing the Expression of Interest form (EOI)?
• By completing the form, you are only giving us permission to provide your details as part of a package to have
quotes completed, but this is not an obligation to proceed.
• It is only once the program is commenced and you are happy with the bulk-buy pricing achieved that you will be
required to confirm your participation.
DigiPOS Screen Bulk-Buy Program: In addition to the LRA shop-fit Bulk-Buy Program, we have worked together with a
number of other associations interstate on a Bulk-Buy Program for the DigiPOS digital signage to achieve further savings for
our members. The successful supplier of the DigiPOS digital signage is Entwined Solutions. Entwined were able to provide
the best pricing and also the best service model for our members of the two suppliers. This importantly includes the
Entwined Express Replacement Program (ERP). A copy of the Entwined ERP fact sheet is available on the LRA website for
your reference.
Entwined have again offered the LRA an exclusive 5% price discount for members participating in the LRA’s Bulk-Buy
Program. Combined with our competitive Bulk-Buy Program for shop-fit pricing, this will deliver significant savings to
members.
a It is reassuring to note that the full savings achieved by the LRA are passed to members in FULL.
Important: if you wish to participate in the LRA Bulk-Buy Program it is important you do not prematurely sign a contract
with a shop-fitter before you have our bulk-buy pricing. The Lott have advised all shop-fitters you are required to complete a
shop-fit, so many will be canvassing for your business already.
It has already been brought to our attention by members that some shop-fitters may be suggesting that they have achieved
a better price for the screens via Entwined Solutions, however, Entwined have confirmed to the LRA that this is not the case.
The exclusive offer from Entwined to the LRA is, to the best of our knowledge, the most competitive in the market and does
not have a shop-fitters margin on it. If in doubt, please call the LRA office.
Competitive Leasing Offer: Traditionally retailers have paid for the shop-fits outright, however, due to the significant capital
outlay and additional cost for the DigiPOS equipment, retailers are looking at leasing options as a viable alternative.
As part of the 2017 Bulk-Buy Program the LRA again provided important information and a competitive leasing offer from
Macquarie Leasing and Rental. The LRA have formed a strategic alliance (via the ALNA) with Macquarie Leasing and Rental
and as a result of this is able to offer LRA members a highly competitive leasing package selected only after comparing what
several banks and financial institutions were able to offer retailers for shop fitting. Members can choose to lease only the
DigiPOS equipment or the complete shop-fit including the DigiPOS equipment. A copy of Macquarie Leasing and Rental offer
and application process is available on the LRA website for your reference.
Bulk Buy Program Explained: The LRA has received many enquiries from members asking about the difference between the
various bulk-buy offers in the marketplace. To answer these questions, the LRA has prepared a Q&A Fact Sheet for your
reference. A full copy can be found on the LRA website members section or call the LRA office to request a copy.
10Instant Scratch-Its
Instant Scratch-Its Quality
In our last newsletter the LRA advised members had reported some issue with the quality of the latest range of Instant
Scratch-Its i.e. poor perforations. Specifically, that the Instant Scratch-It tickets constantly tear when retailers are trying to
slide them from the dispenser. This issue was communicated to The Lott by the LRA and our members directly and we are
pleased to advise The Lott has taken action.
The Lott have advised this was due to the printing company in Canada changing the cutting blade used for creating the
perforations. We are advised this has now been rectified and The Lott expects to sell all affected Instant Scratch-It’s by mid-
2017.
Instant Scratch-Its – Game Close Dates
Further to our last newsletter article on this subject, the LRA is still receiving an increasing number of calls from members
who have been caught out when The Lott have closed Instant Scratch-It (ISI) games that have been fully issued to the
network but remain unsold for six months.
In September the LRA also sent members an e-news alert to remind you about the process The Lott follows for upcoming
Instant Scratch-It game closures. Importantly, how do you avoid being charged for un-sold Instant Scratch-It games which
could total hundreds of dollars.
In The Lott’s newsletter (Issue 18 Fortnight commencing 4 September 2016) they have highlighted two new game closures
including $10 The Big Money Ticket and $4 Aladdin’s Fortune.
• Do you have excess stock in these games?
• Please note the game closure dates of the 17th & 24th November respectively.
• Check your safe and storage areas for stock and make sure you have these on display and actively sell through the
stock.
• Make sure your sales staff are aware of the need to sell through this stock.
The LRA have asked The Lott to include a terminal message several weeks out from closure as a reminder to retailers. To
date they have not agreed so the LRA is trialling the sending of e-news alerts to members as a reminder. Please keep an
eye out for these!
This issue emphasises the need for retailers and all staff keep up-to-date on the information supplied in Tatts Talk.
9Commissions Submission – The Lott Survey The LRA has previously reported our intention to support ALNA in preparing a submission to The Lott for a national commission increase for retailers. ALNA is the only lottery and newsagent association with national ACCC Collective Bargaining Authorisation. Commission ALNA is currently developing this submission to The Lott and have commenced work on this document with the support of the Lottery Retailers Association (LRA) and Lottery Agents Association of Tasmania (LAAT). Through our affiliation with ALNA, the LRA is actively involved in supporting and preparing this submission. As it has been several years since your last lotteries commission increase, ALNA has notified The Lott that we will be presenting them with a national submission reviewing the current lottery commissions and fees. The Lott urgently needs to correct, or bring commissions/fees, to a level commensurate with the changed market conditions (including rising costs and margin erosion). This submission will also look at resolving some barriers in the lottery relationship e.g. franchisees participating in online sales. Our submission’s aim is to improve the overall net profit position for members. Therefore, fees and charges, as well as commissions, need to be reviewed and the final outcome negotiated may include a blend of both to achieve the desired result. In mid-September you received an e-news inviting you to participate in the survey. Missed it? Please contact the LRA as soon as possible so you don’t miss out on this important opportunity. Now it is time to provide us with your input into the submission to The Lott and we are at a stage where we need your ideas and feedback. This survey covers a range of important questions about your business and the need for a commission increase. It is also important to note increases in commissions are generally funded through lottery game price rises and the lottery operator is very unlikely to reduce their revenue share to fund a commission increase. So any request for an increase, or a reduction in fees, must be realistic and workable. When completing the survey, please answer every question as accurately as possible, and provide any supporting arguments, so we have accurate and evidence-based information. Your well-considered responses will be vital to the preparation of a strong submission based on facts and compelling arguments, which will help to achieve the best possible outcome. ALNA will also be conducting steering committees in each State and the LRA will facilitate this in Victoria. These meetings will provide representatives the opportunity to expand on responses and provide any additional feedback. Spaces will be limited and attendees chosen to represent the different types of businesses selling lotteries. Applications are at the end of the survey previously emailed to you. The LRA sincerely thanks you for taking the time in completing this important survey. ALNA Board Announcement In mid-September the ALNA Board announced they had appointed Adam Joy as the new Chief Executive Officer of ALNA from 30 September 2016. Adam has been with ALNA for the last 7.5 years and has over 15 years' experience in working with small and independent businesses. The LRA had already established a very productive relationship with Adam so we welcome his appointment to the role and wish him every success. We are very confident Adam will be able to advance the strategic direction of ALNA and build on the great legacy left by Alf Maccioni. 10
Oz Lotto Price increase from 8 November 2016
The Lott have advised the subscription price of playing Oz Lotto will increase by 10
cents to $1.20 per game (plus commission) from draw 1186 on Tuesday 8
November 2016.
You should have already received point of sale to display in-store to notify customers.
Please refer to the Oz Lotto Price Increase 2016 Toolkit located on Retailers Web.
This contains important information and answers to key questions i.e. Why can’t I
sell my customers some multi-week entry types? It also includes a copy of the Oz
Lotto Price Increase Trade Presenter for your confidential use.
Tatts Group Limited (Tatts) potential acquisition of Intralot’s Australian
and New Zealand Businesses and announces merger with TABCORP
In response to media speculation Tatts confirmed it had for some time been in discussion with Intralot SA in relation to a
potential acquisition of Intralot’s Australian and New Zealand Businesses.
The announcement indicated these discussions had advanced to a confirmatory due
diligence stage and Intralot has agreed to conduct this process on an exclusive basis
with Tatts.
Given no final proposal has been made by either party, there is no certainty that the
discussions will result in a binding transaction.
Furthermore, on 19 October Tatts and TABCORP announced their intention to merge
to create a world-class, diversified gambling entertainment group. The merger is
expected to be complete mid-2017, following Tatts shareholder, regulatory and other approvals. The LRA will keep members
informed, as necessary, throughout the process.
Tatts Reports FY16 Result
Tatts have released their full year results and a summary of the announcement is following:
Record Lotteries Performance
• Record Revenue á8.2% to $2.14b (FY15: $1.98b)
• Outstanding Jackpot Run
o 45 jackpots at $15m or more (FY15: 34)
o 1st division pools average $28.8m (FY15: $25.3m)
o Record two $70m Powerball jackpots in Fy16
o $60m Oz Lotto jackpot on 18 August 2015
• Record EBIT á11.3% (margin 15.0% vs 14.5%)
Outstanding Digital Sales Momentum
• á32.2% for Lotteries — 13.5% of all sales
• Wagering + lotteries apps on 1.5m devices (FY15: 0.7m)
This unprecedented growth in on-line sales is a key reason why the commission
submission will focus on initiatives aimed at resolving the obvious barriers and
difficulties in the retailer’s relationship with The Lott i.e. franchisees participating in
online sales.
11Tatts Reports Fy16 Result (Cont’d)
Powered by Game Innovation
• Set for Life
o Launched 3 August 2015 – first new draw game in 20 years
o Ahead of launch year targets
o 22.9% of sales digital
o Younger demographic
• Lucky Lotteries
o First full year contribution
o Extended beyond NSW + ACT homeland & New territories contributing 13.9% of sales
o 17.5% of sales digital
• Instant Scratch-Its
o Sales á6.3%
o First full year contribution from return of Victoria
o Innovation in game portfolio
• Launch of ‘the Lott’
o Umbrella brand
o Australia’s official lotteries
o 1.3m app downloads
Strong Retail Sales
• Sales growth of 5.4%
• 3,908 outlets á10 outlets from FY15
• 5,230 lottery terminals á163 terminals from FY15
• New digital point of sale display - 153 outlets already rolled out
• Convenience fuel rollout - 54 new stores
Delay on Payment of Auto-sold Share Wins
Members have reported a one-week delay on payment of auto-sold share
winnings especially on Oz Lotto and Powerball – with wins declared it is
theoretically payable well before end of week settlement is required to be done.
The Lott have advised… “a process has been in place for auto-sold shares since
the introduction of the current syndicate system.
Prizes cannot be paid on tickets that have not yet been paid for by the outlet,
and the 7 days was implemented to allow time for all processing associated with
auto-sold shares to occur.
If retailers do not want to wait the 7 days for any prizes, it is recommended that they purchase any remaining shares as a
personal purchase prior to draw close.
11.8.2 Prizes Won by Auto Sold Shares
Any prizes won by a Retailer as a result of Auto Sold Shares will be accounted for 7 days after the last draw applicable to the
share ticket through the EFT process and via the nominated bank account.
First Division prizes are paid in the first EFT after the end of the 14 day provisional period.
Details of prizes won by Auto Sold Shares will appear in the Settlement Report, the Accounting Period Detail Report and the Auto
Sold Syndicate Share Prizes Report.
Upon payment of a prize for an Auto Sold Share in the manner detailed above, Tatts obligation to pay the prize is fully
discharged.
12Instant Scratch-Its (ISI) Outlet Performance
The LRA continues to receive correspondence and information from members highlighting the unfair impacts of The Lott’s
$44 weekly fee for Instant Scratch-Its.
This is a permanent agenda item raised at every opportunity the LRA has to meet with The Lott! This issue was also raised
strongly at our recent AGM.
To date The Lott has been quite intractable on the issue and refuse to entertain discussion on removing the fee. As I have
reported before they cite the short time left on their licence and the costs associated with taking over from Intralot. They have
also cryptically alluded to their agreement with the Government when they took over from Intralot…but to date we are unable
to verify anything that we can rely on.
So what have some members shared with us?
Case Study 1: “…Our outlets ISI sales since Tatts took over in Feb 2015. I have been rewarded (after weekly costs) with
the princely sum of $247.34 on sales of $45,736. This is despite sales promos, prompter strips, etc., etc., or even that we
are 48.8% up in sales. The weekly costs are unacceptably taking any and all profit generated. Over 50% of the weeks
traded (43 times) – we have actually lost money.”
Case Study 2: “…You will recall that I wrote to you in March this year in regards to my disappointment about the
performance of the scratchies and especially the $44.00 per week fee. I now have our figures for the financial year and the
story does not get any better.
On the surface all appears well as we increased our sales by 17%, which was greater than the region which was 16.6%,
and our gross commission increase to $35,572 from $30,937. However, our fees increased from $4599 to $6634 – a
44% increase!! So nearly 50% of our commission earned by extra sales was taken in extra fees. So our net commission
only actually had a 9.8% increase.”
The main culprit was the fee $44.00 for scratchies. These fees actually meant that after selling $25,000 worth of
scratchies we lost $230.”
If The Lott are the successful applicant for the next Lottery Licence, they will have no excuse for maintaining this fee. As the
LRA has outlined previously in this newsletter we have commenced preparation of a comprehensive submission to The Lott
for a national commission increase for retailers. This submission will also deal with a review of the current fees, particularly
those that impact a retailer’s profitability and cannot be justified, such as the $44 fee.
Twice Weekly Sweeps
As retailers sign new Franchise Agreements and move onto twice weekly
sweeps, they are concerned over the financial impact this may have on their
business.
The LRA has asked The Lott to provide some post implementation analysis
now that there is a substantial number of outlets on twice weekly sweeps.
The Lott advises the change has already resulted in defaults being reduced by
approximately $2m per annum and the main purpose of the strategy is to
reduce The Lott’s risk.
The LRA maintains if the implementation has not caused any detriment to retailers as The Lott’s pre-implementation analysis
showed, they should share this with retailers.
13Breach Notices
Outlets receiving breach notices still accounts for the highest number of calls to the LRA. The Lott indicates that as a result of
their compliance measures (including Breach Notices), the Market Pulse surveys have improved from approximately 88%
compliance to 94%.
Retailers would have already received advice from The Lott advising they are commencing site surveys across the network.
The Lott maintains the aim of the surveys is to… “deliver the highest quality service to your customers and measure outlet
operations to ensure compliance with current standards, policies and procedures.
Site surveys provide the opportunity to review and measure the effectiveness of many aspects of our business and are an
independent way of obtaining feedback on what The Lott and your business can do better. Three surveys will be conducted
by an authorised representative in each outlet per financial year.”
We understand The Lott are completing approximately 80 site surveys per week and that they are reviewing every result
before it gets sent to retailer – every question and every photo received is reviewed.
There are four measurement bands for site survey results:
1. 100% Your outlet has achieved a perfect result.
2. Between 95-99% Some small changes or issues may need to be
addressed in order to achieve 100%.
3. Between 90-94% This result indicates immediate action is required.
4. Below 90% This result indicates significant and urgent action is required.
If you have received your results and feel that this is not a true and accurate account or it has resulted in a Breach Notice,
please contact the LRA to see how we can assist.
Think Before You Click ‘Send’ – Your Email May Result in A Binding Lease
In a recent matter, the Court found that an email exchange between a tenant
and a landlord’s agent created a binding agreement for lease and licence.
This was despite the fact that no formal lease or licence documents were
signed by the parties and the parties were still continuing to negotiate the
terms of the lease.
If you negotiate lease agreements or any other agreements, you must be
careful in communicating with the other party. If you intend that negotiations
should not be binding, then you should state this clearly at the beginning and
throughout the negotiations process.
You should also consider adding a note to the effect that any negotiations
between the parties are subject to a formal written and executed document setting out the final terms of the agreement
concluded between the parties. If you fail to take such precaution you may find yourself and or your principal bound by
agreements containing terms that you may not be happy with.
Obtaining legal advice at the earliest stage in the negotiation process is always recommended as is contacting the LRA for
assistance. If required the LRA can direct you to our preferred legal providers who can assist with drafting, reviewing and
negotiating leases and can help you review or draft your agreements to lease and licences.
14Dismissing Employees:
What Every LRA Member Needs to Know
Dismissing someone is often one of the hardest things you’ll ever have to do. You not only need to think about how your employee is likely to react,
you also need to make sure you don’t expose your business to costly and time-consuming legal claims.
This month, we take a look at how you can dismiss employees in full compliance with the Fair Work Act 2009, while also minimising the possibility
of unpleasant claims.
Step 1: Confirm the Minimum Employment Period
Employees are only protected from so-called ‘unfair dismissal’ if they have completed the applicable ‘minimum employment period’ at the time
they’re fired. The minimum employment period is determined by the number of people you employ:
• If you have fewer than 15 employees your business is a ‘small business’ and the minimum employment period is 12
months
• If you have 15 or more employees, your business is not a small business and the minimum employment period is 6 months
Importantly, these minimum employment periods apply even if you’ve issued employment contracts containing a shorter ‘probationary period’.
So, if you run a ‘small business’ and dismiss an employee for any lawful reason after, say, 10 months, he or she will not be legally entitled to lodge
an unfair dismissal claim against you.
Dismissing employees before they complete the minimum employment period is very important, and can save you thousands of dollars and
countless hours dealing with subsequent claims for unfair dismissal.
Step 2: Confirm whether yours is a ‘small business’
As noted above, shops with fewer than 15 employees are called a ‘small businesses’. If yours is a small business, you can dismiss employees via a
special process called the ‘Small Business Fair Dismissal Code’.
If you carefully follow the steps contained in this Code, and ensure that all your documentation is in order, you are effectively protected from future
unfair dismissal claims. This is because the employment tribunal, called the Fair Work Commission, is generally required to automatically find in
favour of a small business employer who has correctly applied the Code.
Many small business owners simply don’t realise that this Code exists, but it’s an invaluable tool that should always be used even if the employee
hasn’t yet completed the minimum employment period.
Step 3: Follow a fair process
The Fair Work Act 2009 does not require you to provide ‘three written warnings’ before you dismiss an employee. This is a myth. Instead, the Act
does require that you follow a fair process when letting someone go.
Unless you’re dismissing the employee for ‘serious misconduct’ (such as theft, fraud or violence), you’re expected to have given the employee at least
one prior ‘final written warning’ before subsequently considering their dismissal. This final written warning must have made it clear that any further
misconduct/under-performance would potentially result in the employee’s dismissal.
Regardless of the reasons for the dismissal - and even if it’s the result of ‘serious misconduct’ - you must always advise the employee you are
considering dismissal and offer them an opportunity to respond before any final decision is made.
For example, if you witnessed an employee hitting another employee, you should hand the employee a letter advising them that you intend to
dismiss them for serious misconduct unless he or she can ‘show cause’ why they should not be dismissed. Don’t make a final decision until after
you’ve received and considered the employee’s response.
Step 4: Provide the applicable notice period
The Fair Work Act 2009 requires you to provide employees with ‘notice’ in the event of dismissal. The amount of notice you need to provide is based
on the employee’s period of continuous service in your shop:
• Less than one year: one week
• Two to three years: two weeks
• Three to five years: three weeks
• More than five years: four weeks
You are also required to provide an additional week of notice if the employee is aged over 45 and has completed two years’ continuous service.
There are two general exceptions to these notice obligations:
• You don’t need to provide notice to casual employees, and
• You don’t need to provide notice if the dismissal is because of serious misconduct
If you’d prefer the employee leave immediately, you can also pay them ‘in lieu’ of the applicable notice period and advise them they don’t need to
return.
Step 5: Prepare for claims
Even if you follow all of the above steps, your ex-employee may still go ahead and lodged a claim against you. This could be on the basis of ‘unfair
dismissal’ or one of the other grounds permitted by the current laws, including ‘unlawful termination’ and ‘adverse action’.
If a claim is lodged against you, it’s important you immediately obtain expert advice. Delays can weaken your case, and poorly drafted defences can
cause you significant problems as the claim progressed from conciliation to formal arbitration.
Dismissing employees certainly isn’t for the faint-hearted, but the above steps will go a long way towards protecting both your business and your
blood-pressure!
David Bates
Managing Director
Information provided by Workforce Guardian: www.worforceguardian.com.au
All members have access to the HR advisory service. When you call 1300 781 299 you will be asked for your outlet number to confirm
your membership - it is as simple as that!YOUR ASSOCIATION YOUR VOICE
YOUR COMMITTEE
SHARYN COLE
PRESIDENT
BELMONT VILLAGE LOTTO
03 5244 0644
ANDREW KNOTHE
VICE PRESIDENT
THE LUCKY CHARM AIRPORT WEST
03 9330 4207
BERNIECE MCGREGOR
SECRETARY / TREASURER
ASCOT VALE LOTTERIES & CARDS
03 9375 7222
TONY ANDRIESSEN
BLACKBURN NEWS
03 9878 0101
BRENDAN STOCK
MANOR LAKES NEWS & LOTTO
03 9974 2253
EMILY BEIRUTI
KARINGAL LOTTERIES
03 9776 7066
MICHAEL ROSSATO
ASHBURTON LOTTO & STATIONERY
03 9885 8333You can also read
