Integrated Publication Solutions, a subsidiary of Fairfax Media, has released its new trading terms agreement for the supply of magazines to newsagents. Click here to access a copy. Click here to see a copy of the accompanying letter from IPS which provides background to the proposed trading terms and outlines the benefits accessible including:
- A move from 7 day to monthly accounts
- Greater flexibility in managing supply
- The removal of full copy returns
- Increased commission for publication sales
- New revenue streams through marketing and promotional support
- EDI data flow through XchangeIT
- Greater assistance in managing General Retailers.
- The removal of early returns
The new magazine distribution model from IPS is the best opportunity newsagents have had in years to bring about change in magazine distribution terms and policies. Signing up is a vote by newsagents for change.
The new magazine distribution model has emerged from a year long process of intensive industry consultation by the folks at IPS. They have spoken with newsagents and associations right around the country. This is reflected in the proposed trading terms.
Gotch and Network have every right to be concerned at what the arrival of IPS and their new model could mean for their businesses. I am certainly aware of concerns within both companies about the impact the arrival of IPS could have on their respective businesses.
Management of IPS have made it clear that they will continue to consult with newsagents as they bring on more to their new magazine distribution model.
i was wondering if anyone can answer a few questions for me.
if we have accounts with fairfax, do we still need to do anything or they will automatically transition us over?
also, i saw a note on our xchangeit client that we have applied for partnership and is granted.
have i missed something here , i have not seen anything on xchangit about anything to do with fairfax .
i dont have a clue what going on with isp all i know is it part of fairfax media. please explain!!!
Thuc please click on the links in the blog post – it explains…
Mark the links are great and i apreciate being able to read them , but why is it that they have not comunicated at all with us and we have to find out on here , what about the thousands of newsagents that do not go on to this blog , how do they know what is going on
Shaun I am sure that they will. I have been able to post the links faster than mail. (With their permission.)
fair enough , i have already recieved mail from a publisher staing they are going with ips , and i am thinking am i even involved in this ips group or what .
By the way i am all for the idea and i think iot is a great for the industry to see changes like this
Looks resonable but I would prefer to select the magazines that we want and not be told we have to carry certain titles.
Ian you can do this with IPS.
Mark,Under default section it states that you have to carry titles as told by IPS.
Ian, Page 18 is clear about the pull model and the control the specialist retailer has.
Yes Mark I had read that section which also states that it is to be in line with IPS business rules. So they have contridicted themselves later on. Clarification from a person from IPS is needed and a change in the contract re carrying titles they say we must carry.
This would appear to be great news all round. Lets hope more publishers jump on board with IPS it could be a real game changer.
Would any ordinary newsagent from a country area please post here when they have actaully seen this mythical beast of a “contract” ? Thanks
Here is further information from IPS on this:
Primary Business Rules
Integrated Publication Solutions acknowledges that the Specialist Retailer is in the best position to determine the optimum supply levels and grants primary control of supply to the Specialist Retailer to make supply adjustments to best meet the needs of their business.
Integrated Publication Solutions will support the “Pull” supply model granting greater flexibility for Specialist Retailers to choose the titles and quantities they require in line with Integrated Publications business rules.
The Specialist Retailer agrees to stock and sell all publications secured onto the Integrated Publication Solutions supply chain platform for minimum of three editions, excluding all publications with a shelf life of greater than 6 months. This requirement is limited to 6 titles per calendar month. This business rule is designed to create an opportunity for publishers to find their target audience and maximise sales opportunities initially. After three editions there will be sales history for all parties to base there future supply on. This will provide transparency to publishers which will then support the appropriate supply levels into the market removing over supply.
Integrated Publication Solutions will allow a suitable timeframe for the Specialist Retailer to adjust supply levels of publications after allocation modelling has been completed.
The Specialist Retailer agrees to maintain ranging of a publication if there is evidence of sales in either the preceding 6 months or three editions which ever is greater. This business rule is designed to ensure that newsagents maintain supply of publications that are selling to ensure sales for the publisher and product for the end consumer.
The Specialist Retailer understands that there is no early returns process for the Publications.
The Specialist Retailer agrees to use its best endeavours to maximise sales of all of the Publications and maintain availability throughout their respective on sale periods.
Publications are to be supplied to the Customer in the same good condition as they are delivered to the Specialist Retailer.
Publications must remain on sale for the Specialist Retailer’s entire trading hours on the day of on sale, or for the life of the Publication. The latest edition of a Publication must always be displayed. If the Publications are sold out prior to the end of the on sale period for the relevant Publication, the Specialist Retailer can call Integrated Publication Solutions to request that additional Publications be delivered to the Specialist Retailer. Integrated Publication Solutions will endeavour to make extra copies of the Publications available for this purpose.
The Specialist Retailer agrees to maintain accurate and up to date Records for the purposes of this agreement.
Integrated Publication Solutions may provide other reasonable Instructions and Performance Criteria and amendments
Secondary Business Rules
Specialist Agents can not reduce their supply to lower than their highest sale +2 from the preceding 3 editions. For e.g. If an agent is receiving 20 copies but they are only selling 12 then they can reduce their supply to 14 (minimum sale +2). If a few weeks later they are still receiving 14 copies but their highest sale has been 6 then the agent can reduce their supply to 8 (minimum sale +2). This business rule is designed to maintain current sales levels and provide an opportunity for sales growth.
Agents can only order 100% or less or their original supply when requested paid extras via IPS Online. For increases outside of this amount the agent will need to contact the customer service team for approval. This business rule is designed to avoid keying errors and over supply.
Agents can order supplies of any new publication at anytime with a limit of 10 copies for the first order.
The comments in bold reflect additional commentary from IPS GM on the business rules.
I have published this here with permission of IPS.
Mark , what do we do next are we waiting for them to contact us or do we contact them . I thnk there is a lot of confusion on what is happening
Shaun I am completing the agreement for my stores and sending it to them.
Brace yourselves, this is a long one …
Having now read over the contract and business rules, i can’t say I’m that impressed. We seem to be removing some negatives of the traditional magazine supply model, only to introduce equally restrictive hurdles.
Forced Supply of New Titles
Retailers will be forced to carry up to 18 new titles during any one month, regardless of whether a) they have space for those new titles or b) they are able to sell those titles. Being forces to carry 6 new titles every month for 3 months regardless of whether they sell is an unnecessary drain on cash, space and time.
No Early Returns
This has to be the biggest deal breaker for me. To not be able to early return titles regardless of how many we sell is going to provide problems on multiple fronts. Firstly, if a title isn’t selling, retailers will be forced to keep a product that ony serves to suck cash flow and take up valuable space. It also creates a nightmare for returns processing, where retailers can only return products during their recall week. That means we can no longer simply scan into our back office system what we wish to return – we have to check recall dates and sit aside products we wish to early return, until their recall date in reached. This essentially takes the all power out of retailers hands in managing their existing stock.
Forced over-supply of underperforming or special order titles
The rules governing minimum supply levels will essentially force retailers to accept titles (which cannot be early returned) that underperform. If a retailer only sells 1 copy of a title each month, but wants to stop supply because they can’t justify shelf space for 1 sale a month, then they will be forced to keep that title for at least 6 months. Many newsagents have limited space and cannot accommodate every title that does not meet a certain KPI. Again, this takes the decision out of newsagents hands. The same situation will arise with customer orders. If a retailer orders a customer 1 copy of a niche magazine each month, they will then be sent 3 copies each month (1 sale + 2 extra required by contract). If the customer cancels their order the retailer will then be forced to accept that title for at least the next 6 months.
Forced use of POS material
There are some newsagents who do not use POS material for magazine displays. We haven’t done so in the past and don’t plan on doing so in the future. All our magazines displays are created using product only and are designed to reduce visual noise instore. Retailers will be forced to participate in 4 promotional campaigns, regardless of whether they suit the individual newsagency. A promotion surrounding fashion, for example, would not do well in our area and would simply be a waste of space for the duration of the campaign. And, depending on the time of the promotion, many retailers simply won’t have space. During busy seasonal periods (xmas, mothers day, etc) we simply would not have room for a magazine display.
Control of individual titles is impractical
While more transparency in the control of the supply of individual titles is great, it would be impractical for many newsagents to micro-manage the supply of every single title they range. The IPS supply model does not seem to address one of the main problem with the traditional model – that retailers do not know, nor control the calculations used by the distributor to determine supply. Unless retailers are micro-managing every individual title there is still the potential for over-supply but in this instance, no short-term remedy such as early return.
While the IPS supply model gives more transparency and more clear rules for retailers, I can’t see that it affords retailers much more, if any, control. In some aspects it most definitely provides less.
Jarryd I disagree. Yes, it is not the ideal contract. However, it is considerably better than what we have today.
Control of individual titles is absolutely practical.
who will be offered a contract only the supply agent?
I welcome any new ideas BUT we can also contol stock from the other 2 and also early return . i am not seeing anyithing new except for the part on over supply and this is why i welcome the idea
Jarryd Couldn`t agree more
No early returns is the killer.
And do we think that they wont change the rules if it suits them
IPS is happy for newsagents to print and complete the form published with this blog post. They do not have contact details for all retail only newsagents.
As to the detractors I’d say – this offer from IPS is progress. reject it and you vote to continue with the Gotch and Network approach. Go with it and you vote for change.
We need to very careful, we could be taking 1 step forward & 2 steps back. Jarryd makes some very valid points. The only real control we currently have is early return. With that taken away we could be at their mercy. One to carefully think about…
Scan based trading would have been a mighty step forward, however, that option is also clearly blocked by the contract made available here. Personally, I am dubious about the IPS change being a step forward, but time will tell.
Mark,
My largest concern is no early returns. This completely removes the agents ability to control stock once it arrives instore.
I disagree that control of individual titles is practical. Having to constantly micro-manage every title is both tedoius and impractical for many time-constrained newsagents. I want to be able to control a set of variables for the calculations used to determine supply. This gives the same, or even greater control, without the time consuming process involved in title micro-management.
This new contract essentially tells us what supply we will be required to accept, but doesn’t give us any mechanism to control it outside the rules. The existing disibutor contracts do the opposite. They don’t really tell us what we will be required to accept, but do give us a mechanism to control it once it arrives in store. To me it seems that we are, for the large part, trading control for transparency.
Why can’t IPS just allow early returns ??
They could just remove the ” no early returns” clause from the contract.
Jarryd,
I expect that you will find that in a situation where a title totally fails you would be able to negotiate an early return. What they are trying to stop is the abuse of early returns which hurts many publishers today.
You are looking at title adjustments as if they have to be done using the technology f today. Imagine a smarter and more automated approach. I expect that we can hope for this given the approach IPS has taken on this issue.
I see considerable benefits from the new contract.
Gotch and Network are banking on newsagents not engaging.
Because newsagents abuse them. I will have a blog post up tomorrow which shares data on this. Dumb newsagents returning to a point where they are denying themselves guaranteed sales. Hundreds of newsagents.
i just got off the phone with fairfax circulation who directed me to IPS directly.
i asked them will we get the new contracts by mail…answer was it should be emailed to all newsagents who have email detail with them, or can get forms from industry bodies, or download from ips website.
I have just published links to all of the documentation.
Mark , i think “dumb” is a bit harsh , desperate to make ends meet would be more apropriate .
@mark: you are correct in saying newsagents sometimes overdo it and there needs to be a way to prevent that….. however….
i completely agree with jarryd’s points. i will elaborate a bit more:
1. 6 new titles a month. have to hold for 3 months. cannot change allocation during this time. So, how many copies will they send us initially? aside from cash flow problems this might create…..a more immediate problem of SPACE
2. can only return on recall week. there will be times where magazines are covered by browsers…..misplaced and similar stuff. so if we can only return normally then this might cause problems in unreturnable magazines (100% loss)
in fairness, i do like the system where you can change the allocation every 3 months based on sales…compared to Network’s system.
i agree with you Mark that change is really needed…… but personally i don’t think we should accept change just for the sake of change.
Maybe i am viewing it incorrectly, but i think that the so called changes are not much better (if not worse) than what we have now. I am really hesitant to sign the new contract and become a slave again.
Does anyone feel the terms are too dictatorial?
Mark,
If that is the case then I would want it in the contract. Anything not written on paper isn’t worth a dime.
I newsagents forced to keep a supply of titles every month for 6 months, regardless of whether they sell enough to justify space on the shelf, then those titles will inevitably end up sitting in a store room waiting until they can be returned. That stock is dead and useless to publishers. They can’t recoup the cost of that stock. It also makes it less likely that newsagents will be able to order extra stock if they need it. While some stores are holding onto stock they won’t sell, others aren’t able to access it if they need more.
I would have slightly less issue with no early returns if I had complete control over my supply. But thisis not the case with IPS. We can only control supply within the very restrictive rules.
I would actually be deterred from trying many new titles under an IPS contract. If I happen to sell a small amount, but not enough to justify keeping the title permanently, I’m then forced to keep it for 6 months where each issue will sit in a store room sucking cash flow.
If they want to stop newsagents abusing early returns that’s fine, but there has to be a contractual allowance for newsagents to set some form of KPI so they are not suck with dead stock and publishers aren’t paying for copies that will never see the outside of a store room.
Shaun I’ll stick with dumb. Consider a newsagent early returning 9 copies of a title after a week, having sold one, where they have an average sold of 7 copies of that title. AND not early returning titles with a far worse performance.
hate, I have been down the road more times than I care to remember with magazine distributors on contracts. I have been fortunate with IPS several times on this contract. I intend to sign it as much on faith and hope as on what is on the contract. Only time will tell if I am a fool.
The contract gives me the opportunity to terminate with three months notice.
They have consulted widely and put together a contract which, while not ideal, is an advance on what newsagents have today.
No early returns ?
This has to be a misprint surely !!
Mark, in regards to this comment ( What they are trying to stop is the abuse of early returns which hurts many publishers today )
I am sure most agents would agree if network and gotch stopped sending so much shit through there would be abuse as you put it
@Jarryd
1. Newsagents would be contractually obliged to display titles for the full sale period, so putting them in a store room is not allowed. IPS reason is for all titles to have the best chance of selling.
2. How many magazine titles distributed by Fairfax do you currently stock?
And other agents? Comments please from those who have been getting magazines from Fairfax for the past 12 months.
does anyone have an idea of what titles will be with IPS at launch? i hope its not going to be titles similar to ndd during their ending days……
Hate I agree
Once again we are being told what magazines we will carry.
Mark, consider a distributor sending out so many titles (the week before the account for that month closes off) that the newsagent is forced to early return 60% of the delivery regardless of potential sales because the extra sh*t sent out stops all cash flow.
are these newsagents dumb too?
Early returns is vital. It would not be “abused” if distributors worked with sales figures correctly, and did not send out titles for the sole purpose of increasing the bill.
The fact that IPS does not allow us this life-line should be very worrying.
(The fact that it is Fairfax worries me enough)
Steven that is the wrong approach. It hurts you. returning stock which you will definitely sell is dumb not matter how you look at it.
I would not judge IPS by the behaviour of Gotch and Network.
so if we don’t sign up with them…what are the alternative ways to get a few titles ( fin review, internation express etc)
i only sell about 5 fin review a day and maybe 10 express a week….the rest dont move at all….i don’t want to be forced to recieve more stuff i don’t need. can we still be sub agents with someone for the papers?
Mark, of course it hurts you, but it doesn’t help keeping the magazines which will sell in a few weeks when you have a bill from NDC or GG a few thousand dollars more than usual which needs paying in a week.
Early returns is vital.
Hate, sub agent.
Steven, I agree that being able to do early returns is vital. There is no excuse for dumb early returns as there are always other titles which can be returned.
I believe not alowing early returns puts us at a far greater disadvantage than we have with other suppliers. It is the best tool we have to manage supply and cash flow. We would be fools to sign the contract with this clause in.
You have to think, if there are hundreds of newsagents “abusing” the early returns, there must be a reason. Not just that they are dumb.
Hi I am interested in why people are so concerned about the early retruns when the early return process was developed to manage the over supply of magazines.
Although early returns assist me with my cash flow they also cost me money to return. I would have thought the removal of over supply and early returns would be a benefit for all?
Steven, my considered estimate is that around 20% of newsagents early return in what I call a dumb way.
I have taken the time to read the IPS documentation and the comments here. I am going to sign up and vote for change. As Mark says, I can get out at 3 months notice.
Tim
The concern is whether over-supply will be eliminated. If are still oversupplied, but with no early returns, we are worse off IPS than with the other two.
Mark
I would not know about these figures, but I can understand that it is sometimes necessary (although regrettable) in order to stay afloat.
That being said, I think we all know that the bigger problem is being oversupplied with mags which never sell, and constantly being sent more of these titles.
The only thing i do not like about it is early returns … if they have faith in there own set up that they are promising then there should be no need to early return anyway this is why i don’t understand why it is even in there .
I am going with the contract in 3 months time if i am not happy and i am just seeing a repeat of the GG and NDC’s of the world well i will bail out .
At the moment i am only selling about 5 different mags from Fairfax and 4 out of those 5 do not sell anyway so i am looking forward to seeing what they have on offer in magazine range . I am just hoping i do not see any tittles from overseas as these do not work for me at all and i will not be forced to carry them
I am guilt of occasional early returning without thinking. I have done this out of anger in the past.
I will be signing with IPS.
Early returns may be a blunt instrument, but it’s the only one we have (dumb I guess)
If IPS were confident in their system why not pay the specialist retailer to carry the base amount 1 + 2.
Seems they are willing only to put our money where their mouth is.
Mark,
If around 20% of newsagents early return in a commercially unbeneficial (dumb) way, then the tact of IPS seems to be that those remaining 80% of newsagents will be disadvantaged to curb the stupid decisions of the minority.
Istvan,
1. Newsagents may be contractually obliged, but in reality many (most?) newsagents wont have the space for all these titles. I certainly would not have the phyiscal space to display all the titles that would be sent. As hate mentions, SPACE would be one of the immediate issues. This is something retailers have little to no control over.
2. We don’t stock any magazines from Fairfax. We are a retail-only newsagent.
Mark
Early returns are absolutely essential.
We hold al magazines at least 1-2 months (ie at the end of June, mags received during May are “performance reviewed”) and we return the non performing ones.
Fairfax have not paid the money they have to just have 50 titles – assuning they took all of NDD’s mags (or similar) it could be as much as 500+ magazines. If we have to carry and displayall of them, where does a small newsagency put Womans Day, New Idea, TV Week, Better Homes and Garden etc – Magazines that we know DO sell? It also puts us in breach with Network and Gotch because their contracts say the same thing. I know who’s mags I would prefer to carry. My NDD account used to be around $2k per month – my combined Network and Gotch then was around $30k per month.
One point not mentioned so far – What about the loss of sales because supply is capped?
We do not know when publishers are going to do promotions (TV or whatever). They will never give enough warning of a super promotion because theur competitor will counter this with their own. Promotions from publishers have a surprise element. Promotions should mean we/they sell more. The publisher is wasting their money doing a promotion if the supply is capped at the same level every time.
Subaru and others … yes it is all to hard. So many shadows. Let’s stick with what we have now.
I refuse to stand still. I have met with the folks at IPS and so I have an unfair advantage in my assessment. Worst case is that I am three months down. I don’t expect that to be the case.
Newsagents bleat and moan and when something comes along which is a step forward they flinch and blink and complain. We will end up with the model we deserve.
Jarroyd , i am one that does not have the space any longer , to many years of abuse forced me to cut back my magazine range and i turned that space to books /novels etc and have never looked back 100% returnable i order my own stock and display how i want to and the $$$$ are better .
Mark you are presuming no one is signing up , i am .
As you say you have the unfair advantage you have sat down with these guys geees we have not had any contact at all .
Should we just take your word for it ? or should everyone express what they efeel about it ?
last time i took someones word for it it was a disaster
If we had this blog a few years back probally no one would have went with old mates at Bill xpress .
Shaun, no. Didn’t say all others. Maybe I am naive, it seems straightforward to me.
Mark,
No shadows. I think the contract is relatively clear and transparent. My beef is not that I don’t know the outcome of obscure terms (as is the case with so many contracts), but that I do know the terms and don’t like them.
I think the biggest hurdle IPS face is selling no early returns to newsagents. There is little benefit in this for those retailers that do not abuse the process but use it to benefit their business.
Mark, it may seem straight forward to you. You have had the luxury of talking to IPS. I’m sure you have asked questions & had questions asked of you. You appear to have reached a level of comfort.
We haven’t had that luxury so we are seeking a level of comfort through this forum.
I hope IPS read this blog & realise that it’s not just a matter of throwing a contract at someone – & saying sign it – its good for you. Well we all have questions and they are being discussed here. There’s comfort in communication..
Having clicked on the links provided I feel comfortable that enough information has been provided. As for no early returns, I suppose that is the flip side of getting the stock and quantities that I order my self. We all complian about oversupply and the need to early return so should appreciate the opportunity to take control of our own supplies. Early returns should not be neccessary if we do this properly, this is not a luxury available with many other supply models.
Brendan,
If Gotch and Network were using the sales data (correctly) that is being provided to them from our point of sale systems, there wouldn’t be the issue of oversupply in the first place. And we would still be able to early return to these suppliers…
Having read the precious comments more thouroughly, Shaun mentions bokks that can be returned. We stocked books some years back and the return conditions on them were that they could not be returned prior to 6 months of invoicing and not after 12 months, is this still so Shaun. The IPS deal is better than this and highlights that this is not an unreasonable contract in this regard.
Just my two bobs worth.
subaru, if we use our sales data correctly and order from IPS what we can sell there should be no need of early returns. It will take a little while to bed in but should be good in once it does.
i wouldn’t worry about having no early returns IF they let us choose what titles to recieve.
a lot of you are saying we finally have control over supply…….. can you please explain to me how we control supply.
maybe the IPS model would be good to those “20% dumb users” , but for someone who in most cases keeps tracks of what sells and what doesn’t…..the terms seems worse.
1. IPS’s condition we stock/display ALL titlese THEY send us. (should read: we must display all titles we order and cannot early return them….see the difference?
2. we can cancel a title after 3 months…..can they assure us titles we cancel won’t come back to us? ( i mean i “technically” can cancel titles with GG…but they come back to me after a few months)
——————————————-
different point:
Network and GG send us magazines (whatever they want) we can send them back now
IPS send us magazines (whatever they want) we cannot send them back.
another thing, they want to sell the extra 2% commision…… currently Magazines take up the most time in terms of labor….yet the returns are not proportional.
i don’t want to get NDD-like magazines which never sell……. almost all the good titles are with the 2 other distributors. so far, all the titles i have recieved from fairfax have been money losing ventures for me. they don’t see plus i pay to ship them back……im not even gonna count my labor.
Subaru re your comment about Gotch and Network. They are pure logistics businesses. they make money primarily from full trucks. It is only publishers and newsagents who truly rely on over the counter sales for revenue.
hate, unless I am missing something IPS gives me more control than I have today with the other two. I’ll know after three months.
What I do know is that the current model is broken. This looks good enough to test drive.
well, so far, IPS don’t know I exist, so
this is all an intellectual excercise……..
havn’t heard from them in any shape or form….
h, as noted they have made contracts available through a range of outlets including this place. What you do is up to you.
Brendan,
What is the point of us sending OUR sales data to them if THEY don’t use it to send us the correct amounts of magazines?
I know what sells in my own shop…
Mark,
What makes you think IPS are any different? They get paid by the publisher for every magazine distributed. The more they send, the more they get paid – I have a customer who is a publisher and this info also came straight from him – Accoriding to the contract we are just going to be sent the first 3 issues at the levels THEY choose, and we will be stuck with them regardless of if we do or don’t sell them.
Having read this thread with interest, I have to say I’m not impressed. Call me dumb, too, but as one of the many uninformed, this just doesn’t gel.
Firstly, it’s Fairfax. It seems to me that the terms are really no different from the current mag system, which stops just short of bullying regarding their ‘rules’. Every single day I’ve had to check our supplies on Connect, because my having clicked ‘update’ isn’t by any means, final in their eyes, when locking in our order from week to week. We’ve had to do this daily, because they keep lobbing new titles on us and, if we’re not careful, we might cop another 22 copies of world cup crap, none of which was sold last year. But the onus is on us to head these little surprises off at the pass, at a great expense of time and effort. And we’re probably the smallest primary in the country! I’d hate to think of the headache resulting from a much bigger outlet’s efforts at staying on top of this. In my experience, micromanagement is essential to keeping up with their practices to date. Or are they simply micromanaging us? I feel like an errant employee, they way they go about it all.
Of course, new titles are mandatory (WHERE DID I SIGN???), and we have no say about carrying crap like Yoga Life, or Grind, which are sprung on us when we’re not looking. If we enquire via Connect, we’re simply told to adjust on Connect, but of course, there is no facility for that. It’s locked in. End of story, no discussion. No return. And, if we knock back any of those titles, we were told that we would have to knock back them all. Again, no discussion on that decision. Our micromanagement of them, is much more work than theirs is of us. Because they pull the strings. Because they can.
Secondly, we have the old run-of-the-mill ‘contract’ with Fairfax, yet we have heard absolutely nothing directly from them regarding IPS. Oh, if you don’t count an email we got the other day, telling us to go and look at Connect. So the merry-go-round just keeps spinning like it always has. Personally, I find their information dissemination (using that term extremely loosely) approach most impersonal, and a bit offensive. There is no attempt to ‘sell’ this concept at all, which speaks volumes about how it’s going to be handled once it’s up and running. Not even close to the most base ‘take it or leave it’ attitude. This tells me loud and clear that it’s not about an alternative at all. More like another means of control and an outlet for a white elephant that they’re probably already regretting taking on. Who in their right mind would choose to continue to have this crap lumped on them otherwise? We will still be copping ‘Make your adjustment on Connect, or whatever their online supply pages will be called’. Of course, new information on Connect is often wedged between all sorts of irrelevant, or out-of-date headings. Yet another way to waste our time trawling through a morass of headings for something we may not (or may, but missed) have seen before.
Thirdly, if we don’t sign up, it seems we lose the titles we already have (the ones we want, anyway). Those titles are not on the Connect form anymore, and it’s possible, I suppose, that the couple that are still there will go the same way. So we will be forced to go with it if we want those, too. Further, we have been given absolutely no option (or is that also lost in the list of old headings on Conncect’s homepage – no matter too bloody late to look for it now) regarding the titles removed from our supply lists, not to mention the fact the we can’t do anything with those pages until the 27, now, anyway.
Mark you may be all excited about this, but I’m not convinced it’s worth locking myself in under the conditions discussed here. Given that none of us had signed up for the outright abuse of our stores by their mag distribution, and yet have no choice about how they impact on our businesses, I sure as hell won’t be sharing your enthusiasim to finally commit myself in writing to it.
Dumb? Whatever. A bad feeling is a bad feeling.
Y&G, I would not say that I am ‘excited’. I do think it is progress worth embracing for a trial period. The alternative is to stick with what we have.
I won’t be signing any contract until I see what the magazines sent are and at what supply levels. I don’t have a signed contract with IPS at the moment but I’ve just receved email notification of my account log in on the IPS website (strange considering I haven’t signed anything !). Just had a quick word to my lawyers and they said I can do whatever I want regarding returns if there’s no signed contract as use of their (Fairfaxs) system doesn’t imply acceptance of the conditions in their contract. So I guess I’ll get a “free” test drive to see if I like how it works.
Shall be interesting to see what comes of this as I’m fence sitting at the moment…
i decided not to sign their contract. i won’t miss their titles anyway.
only problem i have is, apparently they have “migrated” my fairfax account/connect to their IPS…..and apparently my xchangeit client has already applied for partnership with them.
so i will no doubt be recieving a bunch on unwanted magazines come june 30th(?). and it means complicated/unfamiliar returns process. I didnt ask for this. I don’t want this.
do you think its too late to tell them i am not signing their contract so they can stop supply to me?
@Mark
can you help us out. i tried calling IPS’s accounts dept….also their circulation dept….No one knows anything.
I called them to tell them i am not signing their contract and i don’t want their supply of magazines. Nobody knows anything how to stop my account.
i can’t even ask them to not send me magazines under the IPS trading rules. i am expected to follow IPS terms even if i have not signed anything. how absurd is that.
@Hate,
They can’t legally migrate your contract to force you into taking product that you didn’t consent to upon signing the original contract (so you need to check the terms of the original contract). You would probably need to check with your own solicitors or state body but you should be able to return anything to them , at THEIR cost, that you haven’t requested or signed a contract regarding.
And we wonder why we get treated they way we do. Newsagents get something closer to what we want, more margin, payment for displays, control over titles and a 90 day get out.
I am not happy with what IPS has offered but I will be signing up as it is better than what I have from Gotch and Network. 27% margin and payment for displays is good and as Mark says I’ve got a 3 month notice period.
All of you complaining are holding out for something which will not come.
Mark I disagree.
I cannot see what is so good about this contract for a small newsagency.
It is IPS telling us what magazines we will carry and when we can retun them.
Some of us do not have the room or cash flow to carry magazines that do not sell
Let us select the magazines we want or let us early return.
Problem solved.
To me it is that simple
I am also concerned about “early returns” but we are purveyors of our own
destiny sometimes.
I was going to early return the masterchef with the Junior masterchef book simply because I had sold so many of them for Xmas last year that I thought the market would be saturated. Luckily I checked my sales data after two days this week and hurriedly removed the items from returns and unpacked them and put them back on the shelf. It seems that everyone loves a bargain and the mag/book are walking out the door.
We need to use our computer systems to greater benefit and control our own destiny.
Here in SA Fairfax media rang us to see if we had the contract and when I said no because I don’t belong to the ANF they immediately downloaded it to me.
I don’t think we can ask for better service than that.
Mark,
Conversely we get forced to take new titles, forced to stock under-performing titles, forced to use POS material for displays, forced to participate in promotions, and forced to hold onto stock with no option to early-return.
This model moves far too close to the dictatorial nature of newspaper contracts and treats newsagents like dumb agents, rather than competent business people (although I admit that not all fit this description).
Both the increased margin and display payment are incredibly small. The display payment is dependent on creating displays within the strict rules of the contract. I am likely to make more creating displays with multiple titles and not wasting space using POS material.
The contract rewards obedience, not innovation and results.
Change and unknown outcomes don’t frighten me in the slightest. I’d like to think I’m one of the last people here that could be accused of not embracing change. It’s not change itself that is being questioned; it’s the nature of the change in question.
Mark,
We get treated the way we do because in the past newsagents have obviously settled for what ever was on offer rather than actually pushing for beneficial terms and contracts. As you yourself have said this is where other retailers have had an advantage over us in that they’ve been able to negotiate more favourable outcomes for themselves for various reasons.
There are certainly some good points to the IPS contract but there is a potentially substantially unfavourable downside to it too which needs to be clarified or expanded upon by Fairfax.
The other thing to consider is that unless IPS are going to be poaching some of the widely popular titles from Network or G&G is there going to be any substantial benefit from the small increase in margin and display allowance compared to the lost interest gained (or cash used elsewhere in the business) from having to probably cover payments for a larger range of less than popular titles that you may not have wanted to stock normally anyhow ?
So many questions that really still need to be answered !
if i may add another point as well……IPS is still starting with technically no customer base yet…. they need newsagents locked into contract to earn money. they have invested money into this product.
why can’t we ask for “a bit better” terms? even the addition of early returns would appease a lot of us who are simply very skeptical.
using the example from the Newspaper inserts, where a lot of people finally said NO! why can’t we say NO to their terms? we have not invested anything in it.
Leverage.
like what paul and jarryd have said. i don’t believe in change just for the sake of it.
another point, i don’t want to recieve Nana Loves Rap, Cooking with the Stars, Man’s Day, Complete Guide to DOS, Complete GUIDE to Nokia, Air Guitar Magazine and titles like that and be expected to create SPACE for it, spend time and SPACE in compulsary POS materials, and actually tie my cash to it.
In this case, i don’t buy into its better than Network and Gotch thinking. What we want is a GOOD product….not compared to anything but plain GOOD for US.
Newsagents always complain about things. Well, this is a real chance to bargain for something thats for us. lets not waste this chance.
If IPS is so proud/sure that they wil not oversupply and force us….let us early return. If we get good sellers, then there is nothing to early return. If we get relevant titles…then we will display it. AFter all, we are here to make money right? and if a few “dumb” people early return good sellers….it’s their pocket not the rest of us.
Have to agree with hatebullies here. Early returns are essential if we will be forced into supply of all new titles.
We’re a small country town newsagent. No-one here wants mags on Skiiing, Surfing, Show Dogs, Naturist Lifestyle or S and M quarterly. If they did, similar mags in the category would sell, or they would ASK me for them. I know my demographic and I know what sells. If IPS send me a mag that won’t sell, I want to return it ASAP. I have no faith in their ability to select what mags they send me, they’ll just send whatever they want to shift.
After all this is what Gotch and Network do, in spite of my best efforts at commmunicating with them.
As a case in point, the other day we were sent Poolside magazine. In spite of the fact that I’ve early returned every other copy they have sent and cancelled my allocation. There is one house in town with a pool, and my sister owns that. Its too cold in summer to swim more than a month of the season and guess what people? Its bloody winter!!
So I’ll wait and see with IPS. Add in early returns and / or the ability to select the range of mags we’re given and I’ll be keen. Surely they have a bit of info about each of their publications we could read and then Order what we’d like? As new mags come online, email us a blurb and we’ll add it to the list if it suits our customers.
If its truly a ‘pull’ model, shouldn’t they have to “sell” us the product, not thrust it upon us?
it is clear that most newsagents want to be able to early return titles that have not, do not and will not sell.
If you trust Fairfax to do the right thing, then go right ahead.
Also look at the credit application form – sign your property over for what , a few miserable magazines.
This Deed of Guarantee is quite draconian.
If the contract allows us to set supplies within their businees model to levels that suit our businesses then to me this is a winner (will have to try it and see).
Early returns in themselves are a waste of effort, money and time for publishers and newsagents, except for the distributors paid on amount distributed and the Green Goblers that take the returns back as backloading at what I consider to be exorbitant rates.
Take all this out of the sytem and it is an efficiency gain for all except the distributors involved. It will be a direct saving in money and time for us, a very useful productivity gain. Further gains also in the elimination of Fulls with its consequent encouragement to oversupply.
With the requirment from us to try so many new titles it is something that is essential if you want to stay a abreast with the lattest trends as magazines go in and out of fashion. What I am restive about here is I am in effect guaranteeing IPS to so many pockets in my business. I can’t help but wonder what the result would be if I tried to sell the access to these pockets for a set time on say ebay.
The extra margin is very well accepeted along with freight savings and productivity gains I should be able to achieve in my business.
One would assume IPS will encourage more titles by offering a better deal to publishers based on reduced wastage and increased efficiency and this will then drive the range they can offer.
Recently watching what I call the churn of title swapping between distributors (or is it Marks software) I suspect the publishers are also looking for something better, why else change ditributor. to the extent it appears to be happening.
It was also of intreset to see IPS using the word territories in their documentation.
As to the Deed of Guarantee, my biggest fairfax spend a week is my local paper at 3.3k a week the regional paper 1.3k a week then SMH at 1K a week, Land 2.2k a month and various other fairfax products. I think it will take IPS quite a while to challenge these figures.
I can see us as Specialist Retailers been forced to put on General Retailers (sub agents) at the request of IPS otherwise they will give the General Retailer a direct contract. So we are expected to service our territories. In some ways not much different to the demands of Ruperts Push.
One question, is are we obliged to bill General Retaillers monthly (same as IPS terms to us). I will continue to do my subbies weekly (read General Retailer) as in most cases the bulk of their spend with me is newspapers number one and a longway second magazines, with IPS magazines not even on the radar.
My thoughts are if this works it is a definate boon for my business. However I would still like to see a beter offer from IPS who wouldn’t.
I also meant to say on the 90 day get out if you do not pay you bill it may happen quicker than that.
Peter,
The point is that the terms of the contract will not allow newsagents to set supplies to a level that suits their business. The terms are clear.
Newsagents will be forced to take 6 new titles a month and keep them for 3 months. If I don’t sell any copies of the first or second issue why would want it supplied again?
They will also be forced to keep under-performing titles for 6 months. Why would I want continued supply of a title that only sells 1 or 2 copies per month?
I would argue that early returns actually improve efficiency at a store level. Being able to simply scan a product into the stock management system and return it at will is much easier than having to sort through magazines in storage to find those that are being recalled. Those agents who are forced to receive magazines from Fairfax are likely to know the operational difficulties in managing titles you can’t sell and don’t have space for, but can’t return.
I have no problem with trying new titles. We do this every week and often re-try old titles that we think may sell. The problem lies with us being forced to take on 6 per month for 3 months. If the new titles on offer are not suited to our store then I don’t want them. IPS can’t guarantee they will be able to offer 6 new titles each month that will fit our demographic. If every distributor demanded this we would have to hand over a bare minimum (only accounting for 1 pocket for title) of 54 pockets. If every distributor demanded we keep and display every single title that we have sold at least 1 copy of in the past 6 months then many newsagents would have to either find a bigger store or dismantle another department to accommodate the sheer number of titles they would find themselves burdened with.
If they did, similar mags in the category would sell, or they would ASK me for them. I know my demographic and I know what sells. If IPS send me a mag that won’t sell, I want to return it ASAP. I have no faith in their ability to select what mags they send me, they’ll just send whatever they want to shift.
A quick calculation will show that if a newsagent sold just 1 copy of each new title sent (6 per month) they would be forced to carry 48 new titles by end of the first 8 months! That’s 48 potentially underperforming, unprofitable titles.
If all three distributor done this it would result in 144 new titles! Who has this kind of space available?
Jarryd you are making assumptions about what IPS may or may not do regarding new titles.
here is what Ann Nugent, CEO of the WNF sent out late last week on IPS:
I realise that most of you would have already received correspondence from IPS and this hotline is a little belated but I had been waiting to have a conversation with Adam Gray, General Manager of IPS before being satisfied with their contract.
Adam has assured me that even though they have removed the ability to early return this will not disadvantage the newsagent. I was concerned that initially newsagents would be unable to return surplus stock but have been assured that you are able to call their Call Centre and request credit for early returns over the phone for the next couple of months (until the ‘pull’ system completely up and running).
The ‘pull’ system is where you decide the exact quantities and in exchange you keep the magazines on display for the entire on sale period.
From Monday newsagents will be able to go on-line and alter all make order quantities to reflect their expected sales level. These alterations will take effect immediately – the only reason why you would receive a different quantity from what you have requested would be if a particular title had already been allocated to your newsagency – in this case, once you receive the magazine, you call IPS Call Centre and ask them for early return credits. (All returns are tops only)
The aim of this new model is to promote change, create sustainability and increase profitability for all stakeholders.
The foundation for this change will be the establishment of new Trading Terms between newsagents and IPS. The new Trading Terms will provide improved revenue streams, the ability to manage your own supplies and improve data flow to streamline operations.
The trading terms have been designed to eliminate wastage by reducing the oversupply of magazines into the market. The focus of IPS is operational efficiencies and this begins by maximising sales efficiencies for each publication. A reduction in the copies distributed into the market will lead to
• reduce costs of production for publishers,
• reduce costs in transportation and distribution for IPS, and
• reduce over supply and cash flow implications for newsagents
These factors are designed to create a more sustainable future for all stakeholders – retailers, publishers and distributors.
Mark,
I have made no assumptions, only used the terms detailed in the contract.
– 6 new titles per month (which must be trialled for 3 months)
– if any magazines has evidence of sales in the past 6 months it must be ranged
– no early returns
My concern is not the surplus supply of titles that I wish to range, it is the potential for IPS to force newsagents to accept and range titles who’s who’s minimal sales don’t justify being kept. There is nothing in the contract to prevent this.
The “pull” system that Anne details is one where newsagents have complete control over both what and how much they are supplied. This is NOT the system set out in the contract.
If IPS intend on not enforcing all the contractual rules surrounding forced supply, then there should be no reason to include it in the contract in the first place.
IPS would need to have the six titles per month to start with.
Not all new titles will go to all newsagents,.
I have been talking with one new publisher who only wants to put 1,000 copies of a magazine into the marketplace and they want at least three copies in each location.
Mark,
The same situation still exists regardless of whether IPS send out 1 or 6 new titles. If a newsagent don’t sell enough of a title to justify keeping it then they are potentially stuck with it for another 6 months (assuming that they don’t follow the rules in the contract, keep it off display and don’t sell any for that time).
Even if a newsagent only recieves 3 new titles per month, that is still 24 new titles at the end of 8 months.
I should also point out that the contract doesn’t prevent IPS from oversupplying, but rather allows a newsagent to stop said oversupply when and if they find it.
This model, for a dire lack of another more appropriate term, is easy to manipulate and once done will save us time and money after 48-96 months
Mark , do you know when the files start comeing through xchangit ? I have magazines from IPS but no files yet . Maybe i have missed somthing and have to do something with xchangit
Shaun they have started a trial with a small group of stores. If you are not on that you could contact them and see if you could be part of it.
thanks .
Why have they started ‘trialling’ this ‘model’, yet have already removed mag titles from Connect’s supply pages?
And why have they lumped such titles as Winning Post and Best Bets in this category?
At this stage, we are still not signing up, yet we’ll probably be forced to for the sake of punters. We can definitely live without the crap they’ve been sending us to date, but this changes things and will require some thought as to alternative supply options.
Has anyone else noticed also, that newspaper supply figures aren’t available beyond a fortnight.
On Connect, that is.
Y&G
For me, they never have had any more than the current week and for the week after. FYI
Hi Mark
You can talk up ips all you like, but as far as I’m concerned it’s all crap.
To me its offensive that fairfax are in the mag trade at all.
I really resent the fact that the newspaper truck driver’s early morning work is impeded by handling over-supplied crap.
New model: bollocks. As far as I’m concerned, ANYTHING that comes from fairfax, that I have not specifically ordered, is OVERSUPPLY.
I’ve been thinking about finding an alternative source for my Highlife & one or two other titles. Now I will. They can jam their contract.
Gary , i get the feeling you do not like the idea ….:)..
Well said Gary. We are going to do the same if a customer asks for a particular title – if we can find somebody in our area who WILL sign the contract!!
I said previously that early returns are essential -perhaps not when you consider their first magazine under the NEW system “White Dwarf” this morning – recd 27the June – to be returned 30th June 2011 – 3 days!!!!(how can you early return quicker than that)
Shows what their data control is going to be
If they can make “mistakes” like that – they will also be able to stretch return dates as well.
It is even more essential to have the NO EARLY RETURN clause deleted from the contract
It looks like we are forced to deal with IPS like it or not – at least if you want Trader Tag, Winning Post, Best Bets, National Greyhound, International Express, and New Zealander which are probably the only titles we want.
I cannot find out from their website what titles or quantities we are receiving except for 3 titles, nothing else was listed.
I have emailed them and was referred to their website.
I called them and got the answer “I don’t know”.
Maybe I won’t sign their contract and wait for them to chase me.
We are been offered a system where :-
1. We may well some effective control over supplies.
2. Consequent efficiency gains with reduced returns (unecessary over supply).
3. Increased Margin.
These plus the fact I believe there appears to be a lot of discontent with publishers and the present system. I would not be at all surprised if Fairfax/IPS very quickly builds a reasonable market share. If this happens will it include titles I do not want to loose.
My reading of the contract is you can read it as a pull model or a push model. However to date IPS appears to be supporting the pull model.
At the end of the day I will give it a try and I can always leave it with 90 days notice or even quicker by refusing to pay their bill.
well….. as dean said i have been on the phone with them ….i also get the “i don’t know” ……no sugar coating……just acknowledging that they don’t know whats going on. that does not inspire confidence. call customer service number. call accounts line. same answer. I DON’T KNOW.
im surprise the people you talk to knows anything mark.
i asked not to be sent anything and today i did not recieve anything…..
however, this afternoon, they still sent me a username and password. got curious and logged in….apparently they sent me 4 copies of white dwarf.
i thought they put me on a do not send list. well screw them……only way to stop supply is…….DO NOT PAY them. lets see how fast they stop supply.
i will be sourcing the MINISCULE amount of express and winning post from somewhere. no sense handing over personal guarantee for a few copies of mags. they can drown in all the white dwarves that i’ll never sell.
Peter,
The model is neither pure push nor pull. It is a combination of the two.
It also seems strange to me that the “business rules” are not part of the actual agreement. My understanding is that in not doing so it may leave them open to potential unilateral alteration by IPS.
We were told that we could stock a limited number of mags. but when we said the contract says something else it was a “don’t know” We will not sign a contract that as Jarryd says can in the future be changes to suit IPS as it could also impact on cashflow.
I have to agree with Mark on this. While the contract is not ideal, it is better than the current arrangements. Signing does send a message to the others.
The big question is, can we TRUST them? Certainly in the case of the oversupply of Overlander 4WD by Express Publications on the 29th June, no we can’t trust them. Will IPS be any different, or will the publishers they deal with be too strong for them.
I question the need for a supply contract in the first place. Newsagents are far too regulated by its key industry suppliers, which is why we in the situation we find ourselves.
How about going back to simple trading terms? Newsagents need to regain effective control over their businesses, which has been lost to these suppliers over the past two decades.
Fewer contracts, more control.
h,
Trust should never come into the equation when it comes to contractual arrangements. Newsagents should have learnt this from the Bill Express debacle.
I’ve also noticed that the contract doesn’t deal with sale anomalies. If a title gets a temporary sales boost for a particular issue (popular freebie, local content, appealing cover, etc) then for the next 3 months the retailer will be over-supplied and stuck with a quantity that they cannot sell.
I’m also surprised that only one person has commented on the potential for IPS to change the ‘business rules’ at will. Does this not concern retailers in the slightest?
Like other, we were simply sent a heap of mags this week without prior notification.
I AM BEING OVERSUPPLIED, AND I HAVE NOT EVEN SIGNED A CONTRACT.
Screw them. If this is how they will operate, they wont be getting my support.
I have just spent the last hour or so reading all this on my holiday.. not impressed ..
Mark, I cannot understand how you can appear to represent your fellow newsagents without first consulting and discussing this with them.
It is clear from the feeling about the new IPS system that newsagents are not happy with what is being offered.
Look at the TV Guide debacle. If it were not for the outcry and persistence we would not have achieved a sensible outcome. Those that wanted to toe the line must be grateful now we achieved common sense.
Look at the track record of Fairfax and magazines. We have been dealing with this/them for over a year and the time wasted with all their stock sitting on shelves waiting for recall dates is ridiculous. They even say to early return, then no credits turn up, then the recall date passes and you have to do another claim on connect. Very Sloppy. With GG and Network you can recall any madness in the same billing month and receive credits on the same statement!!!!!!!
This new system will not work without MASS consensus, it has to work (they, Fairfax, will do anything to make it work) even if we lose supply temporarily of guaranteed sales – this will hurt the BBets, NZ, etc very quickly.
We need to have some input in this and for it to turn up in our faces in the days or weeks before implementation shows the mindset behind the contract I have still not even seen. Panic the buggers with no advance warning and we will ALL sign ON MASS.
Change might be good, but don’t swap that old wife for some young beauty in a flash cause you might end up with a disaster.
Early returns is a must.
Regards as Always…
David I have not claimed to represent newsagents.
IPS consulted me along with many others – associations and individual newsagents.
The contract is available through this blog and various associations.
IPS, while a division of Fairfax, is being run independently. The contract offered is not the contract you would expect from Fairfax. Yes, it is not perfect. It is excellent progress.
Knock yourself our David, keep complaining. Navigating change requires compromise and trust. While time may prove I am wrong, I am prepared to give this a go. The alternative is not appealing at all.
Let me get this straight guys……as a retail only newsagent i can now get titles such as International express, new zealander, best bets and winning post at full commission supply? I can also get Trader tag at a full 50% commission (not the 10% on offer from my supplying agent)???? If this is all true then i am willing to give it a go.
Allan, we sent our paper work off this week for an account. Whatever the terms, direct supply beats subagency status hands down. The terms look workable to us and can only improve our business. Direct supply a) rewards us properly for our efforts and b) gives us the mechanisms to improve our business to its full potential. My attitude is go for it.
Ah !! Now I understand why some newsagents like the new contract – due to the better terms as a result of not being treated as a sub for some of the better selling lines. It’s a little more apparent now why some are so keen on it and in those cases rightly so. For the rest of the “full” agencies I still don’t see any benefit and haven’t signed anything but will wait until a couple of months have gone by to make a decision as they seem to be sending the regualr stuff to me still without having signed anything.
I’ve been direct with G&G for over 12 months now and have just become direct with ACP so while this is another chance to improve the way I operate with distributors, I also appreciate the opportunity to deal with IPS on a new basis where I can control my stock to my needs. If it works out it’s a big win, if not I’m still better off than I was but I’m an optimist and expect the new supply structure to be an improvement on the current model.
We can’t whinge about over supply and at the same time be negative about the chance to better control our supply.
With the opportunity to control our stock and quantities, it is obvious that we will ultimately have a responsibility to do our best to sell the stock we have chosen. This is only as with any other product supplied to our business and how many of them allow returns at all?
We need to encourage suppliers to change the supply model. It won’t improve if we don’t give it a go.
Brendan,
The IPS terms are only better for control of supply of titles that a retailer wants to stock. For titles that they don’t wish to stock or that underperform, the terms are worse.
You say that “it is obvious that we will ultimately have a responsibility to do our best to sell the stock we have chosen”, but what about the stock that we don’t choose – the stock we are forced to not only accept but keep until its recall date?
Paul,
We’re a sub-agency for newspapers and the terms still aren’t appealing to me. We sell only a handful of the publications listed by Allan so the increased margin for a couple of copies is neither here nor there for us – as I suspect is that case with many newsagencies.
My first, and probably only comment on this thread.
The magazine supply model is bad. Worse, we are doing nothing to fix it apparently. So along comes the first new player in a decade who offers something, a fresh breeze, and we roll over and take whatever they offer? Tragic.
What an opportunity! The federations could have told IPS that they could have had 110% industry support if we tweak the model a bit, suggest a better way. But no, we dont, we just take what is offered. What a disgrace, for us, for IPS, for the federations and for the publishers who all could have won from this.
Is it too late to get this right? I challenge IPS and the federations to sit down and get some amendments done. Lets get a model that all can benefit from, for goodness sake!
Brett, maybe that is what is happening.
IPS is much smaller, hungrier, more accessible and operating off a completely difference cost base than the others.
While I don’t know if it is true, I’d expect that newsagents who do engage over the next few months will be in the best position to encourage and guide change.
The contract IPS delivered was considerably better than the starting point a year ago. Give the newsagents and associations credit for their participation in this.
Brett
I understand that the federation did give input but not all the suggestions were accepted.
What do you want them to do.
If NO ONE accepted the contract then IPS would have to modify it further until it was acceptable.
This is how the big players like Coles and Woolies get what they want out of suppliers. Newsagents, being what they are though, won’t do this and too many of our suppliers know that.
Mark, given your past blogs about magazine profitability I am suprised you are so supportive of this. With a fixed cost of $1.25 per pocket per week in rent I would need to sell 1 copy per week of any title IPS send me. Of the current 20 mags I range from Fairfax only Int Express and SA Life measure up. I fail to sell more than 1-2 copies of any mag they have sent me. Normally intial allocations start at 6 copies. I will not be signing up under these terms.
Brett, Paul,
I agree. The associations and marketing groups should all have advised newsagents to not sign the IPS contract.
The Fairfax empire wants to enter the magazine distribution space and newsagents are (were?) in a rare position to determine how that plays out. Instead of using our position to control the discussion and determine what supplier has access to our collective retail space, the industry bodies and individual newsagents have taken the old approach of accepting a half-baked offer.
The actions of the industry only prove how commercially weak it really is.
Bill, As I’ve noted I will do this for three months and then assess. There are other factors in the IPS opportunity which can deliver a return. It is quite different to the model of Gotch and network.
why the need to trial? Let’s get what WE want and NOT what THEY offer.
Hate, I am referring to this as a trial in my businesses. It’s not a trial as far as IPS is concerned.
The only way newsagents will get what they want is if on national issues like this they speak with one voice and if there is a mechanism which drives compliance nationally.
As I have written already, I see this as a reasonable next step, worth trying.
I don’t consider it a ‘trial’, when supply is from IPS, and I’m also surmising that opening an account with IPS is the only way to enter returns data, or claim for returns.
How is that a ‘trial’, when we’ve not been consulted in any way regarding this?
They have decided to supply without permission, and appear to be forcing us to sign up in order to get our money back. And who will send the bill for what they’ve sent?
Trial? No. Coercion.
i understand what you mean Mark.
But my question is, what would IPS have done for example if all of us including you said “no, the terms are not to our liking we are not signing”.
forget the associations. just purely everyone said no. what would they have done.
a. roll over and die
b. sit down and amend terms.
i think B
Paul and Brett said it 100% on the spot.
Brett I agree that a few tweaks should be made : Full control over allocations and the type of magzines to eliminate early returns.
As more publishers come on board this is needed, as Bill mentioned the price per pocket for Newsagents is what it comes down to.
I dont disagree with Mark as it clearly says one can discontinue after 3 months however all Newsagencies are not the same and people are envisioning the raining of stock and having nowhere to display the titles.
A “Grace” period is a good idea too try and get an idea of what maybe good for one’s Newsagency.
I do hope that the representatives & Publishes are sitting down to revise the control issue.
I still acknowledge which has really gone unoticed that Associations are or seem to be communicating and working with each other, a issue that has been hot for a long time, again congratulations.
I don’t know hate.
What I do know is that the contract offer from IPS is the most widely consulted new contract we have seen in my 30 years in the newsagency channel.
Yes, it is not ideal. They win points with me for trying. What has ultimately been offered is much better than where this started.
Our channel is very different. What you do in your business is very different to other newsagents. How you run your business is different. It is this extraordinary diversity which makes negotiating terms a challenge for any supplier.
Mark, how many mags sent to you from fairfax that now transfer to IPS have been cashflow positive for you in the past 12 months. I expect not many.
Bill, none (0). As we are a sub agent for newspapers we are not supplied Fairfax magazines by our distribution newsagent. [insert groan here]
Our problem is too many return forms one every day and not as user friendly as NDC & GG
Today I recieved my 1st bill from IPS there is already an overdue amount and is due for payment in 10 days!!! I have sent 3 letters now stateing that i have no contract with them and that my terms of trade are not conducive to oversupply nor will we be tolerating early returns not applied to acct. We are processing early returns and applying the value to the statement as i do not have a contract with them and have not agreed to accept there publications given they do not have any sales data by which to supply. Take a stand constantly harass them if we all do the same thing who are they going to be able to distribute to. My 1st bill was $967 AND I HAVE SOLD $85 of there titles so the rest they can jam and i will only be paying for delivery – early returns and credits. We have the right to refuse deliver altogether leave in bundle the mags you dont want and have them collected with returns sealed as arrived.
Just wondering how IPS is working for those with an account?
Brendan so far all is good . i wouldn’t say i have an over supply problem at all . my bills are slightly higher than my sales but i figure this is because of new tittles that are getting tried and tested and once they show that they are not selling i will cut them (hopefully increase them )
i really think we need more time on this one to see how it will go .
Thanks Shaun,
I sent of the paperwork for an account some time ago and and was surprised how little there was to fill in. I receives an email acouple of week ago advising that I had not sent of all the required paperwork and I am just completeing it now so I was wondering how it was settling down now. There are a number of magazines I have not been aware of and some that we used to get but have not noticed missing lately so I would hope for increased sales once thes are on our shelves.
The issue for is that although we have given their magazines a fair go they simply don’t work in our market area.
If they weren’t also the suppliers of Winning Post and a couple of other papers that we used to get from Fairfax we wouldn’t actually need an account with them.
We find it a bit sleazy that they have got distribution of these newspapers which effectively forces us to trade with them. Thereby enabling them to send us all of the unsaleable magazines.
We did not sign the contract as we did not want the other titles that they had as as Kevin says don’t sell. We go and purchase papers/mags for a couple of our regular customers from a larger newsagency who do a put away for us.
Massive issues getting credits. Massive issues getting supplies changed to those requested.
Will be cutting WHOLE IPS range from the store as this company is too difficult to deal with and carry the Fairfax arrogance with them.
Sales are not worth the hassle.
Whilst we have been been using I am noticing that credits are slow to appear… When returning through Connect for Fairfax products you are often asked for ‘some’ magazines. These are accepted onto the system, but never appear as a credit. I know they have not been credited to IPS as we have not received any credits from them…
Anyone else found this?
After a few issues to begin with things have improved. I have managed to set my supply levels and cancelled titles which do not sell. had some issues with credits but these have been resolved and the extra comission is a bonus.
Haven’t had one single problem with getting return credits. XChangeIT link via my POS system has been working fine, with credits now confirmed by email within 24 hours. Sure, the initial few weeks involved getting used to the new IPS system. It is not perfect, but it has been OK. Monthly accounts are similar (read identical) to Rural Press, so no problem understanding those.
to date i have never recieved an email confirming returns , but then again i have nevr had any problems with returns
We are now starting to get credits through XchangeIT, however have you been checking your credits on your Fairfax account through Connect… Some of the items are returnable through this, and are not being credited…
Six months ago I removed my magazine from newsagents as I was very unhappy with Gordon and Gotch who sent me a letter assuring me that my deal from Network would be honoured. Magazine is due to go ON SALE in newsagents with IPS
Stephen,
Did IPS explain to you that many newsagents have cancelled their contracts and do no stock IPS magazines. That others like me operate under suffrage to stock minimal number of key titles and move quickly to get new titles removed. Did they tell you their policy on early returns means you will have no meaningful data on what is sold, available for sale or topped waiting for return.
Thought not.