Further to my April 28 post of Reader’s Digest oversupply, it’s been pointed out to me that a major supermarket group has cut Reader’s Digest from its shelves. Thus must leave thousands of copies to be placed elsewhere. Newsagents, being the least place of resistance in the magazine supply chain, are the victims. Of the fifty newsagents I have had contact with on this matter, only one is being supplied with an economically viable quantity of Reader’s Digest . Most have been hit with unnecessary supply increases which drain cash from cash-strapped newsagents. The only reason a newsagent should be supplied more stock of any title is when the sell through rate of the title passes an industry agreed threshold. I’d suggest that a sell-through threshold of 90% for titles outside the top 200 is reasonable. To increase supply when the historic sell-through is 30% is a breach of trust and, I suspect, the Trade Practices Act.
Newsagents are the only retailers carrying titles outside the top 200. They have little or no control over the titles they receive and the volume. They rely on magazine distributors to scale out based on current sales data. The Reader’s Digest experience suggests that sales data is not being used to determine scale out.
My software company’s newsagency management software warns newsagents about oversupply. Unfortunately, many newsagents do not act on this because they have given up trying to rectify oversupply issues. It was only after I bought a newsagency ten years ago that I started to understand how de-motivating some aspects of the magazine supply model can be – especially for titles outside the top 200.