A QLD newsagent received 11 copies of the latest issue of Australian Traveller magazine. They early returned 8 copies. They subsequently ordered four more copies because the issue had sold well. They should never have early returned the magazine, not right away at least. Three issues prior they sold 10 copies. While sales in their store are volatile, they had the evidence to know that early returning would likely lose them sales. At the very least they had not given this issue an opportunity to show what it could do. Early returning was not justified.
How do I know all this? … from a discussion on Twitter between the newsagency and publisher.
Some newsagents make ill-considered decisions on early returns which feed a self fulfilling prophecy and drives volatile sales.
A smart magazine manager would not have handled Australian Traveller in this way. I appreciate it may come across as harsh to say this about another newsagent. If we are to improve we have to call a spade a spade. It is dumb to take action which costs sales.
On Australian Traveller: promote it with your weeklies or women’s magazines as more women make travel decisions than men. For us, it was worked here as well as at the counter.
Of course, early returns are driven by magazine distributor behaviour around other titles. It’s no excuse, however, if we consider ourselves magazine specialists.
It’s not just Australian Traveller. Early returns is costing newsagents thousands of dollars in sales every week, maybe tens of thousands of dollars.
what was the newsagents reason for sendng these back ?
We received a heap of mags in the last week of the month, knowing we will be billed for all of these and payment is 20 days we sent the bulk of them back as early returns. Then into the new month when we felt sales justified an increase and the billing terms were better for us ie 20 days plus the rest of the month we reordered.
I am not the newsagent you are talking about but I have done this in order to conserve my cashflow in the past.
fair enough Luke.. It is the newsagents business after all… none else’s … They can return and reorder as they please..
Luke, this has created extra costs to the distributor AND you in creating the returns, the cost of returning, the cost of the distrubutor receiving the returns, the cost to you of reordering, the cost of repicking and forwarding this stock a second time, the cost to you of receiving the stock a second time and probable lost sale while you did not have the stock.
Doesn’t make any sense to me at all and I don’t see any real financial benefit to any one including yourself.
JMO (just my opinion)
@brendan. THANK YOU for understanding!
@Herewegoagain Publisher don’t just have stock sitting around to send. Refurbishment costs and time to get them in mint condition, almost isn’t worth it if the frequency of the title is a month, as every day is a crucial selling day/missed sales?
Just today, I had a newsagent early return all their stock, because of cash flow.. but they had a solid history of strong sales and sell outs for the niche title.
So, waste of distribution, waste of space, waste of print. Now, those copies will float around, in unmint condition, or in a warehouse while others scream for more copies.
@brendan. THANK YOU for understanding!
@Herewegoagain Publisher don’t just have stock sitting around to send. Refurbishment costs and time to get them in mint condition, almost isn’t worth it if the frequency of the title is a month, as every day is a crucial selling day/missed sales?
Just today, I had a newsagent early return all their stock, because of cash flow.. but they had a solid history of strong sales and sell outs for the niche title.
So, waste of distribution, waste of space, waste of print. Now, those copies will float around, in un mint condition, or in a warehouse while others sell out and scream for more copies to replenish.
still most of the blame are on distributors for OBVIOUSLY using us as banks. some of us may have overdone early returns….but still…..
look at the root of the problem.
hate, I am not against early returns, just dumb early returns which deny the newsagent certain sales. It’s the stuff which will absolutely not sell which needs to be the focus of attention.
Alf, we are not good enough to receive your title from the distributors so this is not directed at you but all would be fixed if distributors/publishers stopped oversupplying at the back end of the month OR allow us to adjust our own supply.
Some will say we can do this now but come on every newsagent knows it does not happen. Example we got 75 AWW the last Wed of the month but our sales show month in month out we only sell 20. We early returned 50 copies then IF we need a few extra at the back end of the next month we may order 3 or 4.
I will not go broke over a broken mag system and I will not pay more in cost then I make in sales, sorry not going to happen so I use early returns to juggle costs.
Luke – you’ve summed it up in just a few well chosen lines.
Well put Luke.
Happy to talk if you have any issues with our publications.
Alf.
Luke,
Your AWW example was also our experience. The supply levels were presumenably adjusted up for many Newsagents because of the spike in sales for the Royal Wedding issue (we sold 3x normal), meaning average sales went up. We will early return at least a third of our supply before this month end for cash flow reasons. I suspect the waste on this AWW issue will be very high across all Newsagents. So whilst Agents need to be smart about what they early return, Publishers and/or Distributors could be a lot smarter with their sales analysis when setting fair supply levels.
The reason why this happens is because the numbers are controlled by the wrong party. Any business makes a judgement call on any item to sell, when to restock, what margin they need to achieve a return on their investment and so on.
The system does not even come close to offering any real control.
In the same vein, it would be wonderful to never make a mistake, but generally I find those that don’t, aren’t really doing anything. So make your call with returns, right or wrong, it’s your call.
Through their ignoring of sales data which they receive daily, distributors have proven beyond doubt that supply problems are of their doing alone – early returns, be they dumb or not, are simply a reaction to the problem.
Newsagents can’t fix the problems on their own just as publishers can’t
If ever there was a need for a magazine czar, it is NOW.
By all means, early return whay you won’t sell but keep what you will sell. Early returning what you know you will have to reorder is senseless.
Sales data is wonderful but just because you sold out of it last month doesn’t mean you will this month. Surely you understand Alf, it depends on the quality of the articles.
I have had 2 customers cancel long standing orders because they say the writing / journalism has turned to crap, and too many ads compared with 2 months ago.
BTW – I have 2 shops and juggle the stock if a customer wants it and Ive early returned. Not so difficult.
I still believe that the mag model is very sick – we should in these economic times be able to order in what we want. A standard order for say a fortnight at a time. If the newsagent does not resubmit new order, they get the same old stock standard order. Bit like when you order fruit and veg from Aussie Farmers. They send you the same stuff week in week out until you advise them otherwise. They don’t add an extra watermelon each time to clear their warehouses because they have taken on too many watermelons!
Lukes post 9 is a good way of explaining some of Newsagents problems with trying to come up with the money to pay a distributor with his example of the AWW. Gone are the days that the majority of Newsagents have a nest egg each month put aside for Distributor invoices.
What happens when you cannot come up with the payment for the distributors? exactly!
Alf’s point is valid because the sales data proves it.
There really needs to be lawful review undertaken to address the issues and come up with a fairer and an equally importantly a more transparent model.
Luke’s example of the 50 AWW is a prime example why things need to change.
The problem is that punishment is being meted out in such a way that it hurts the newsagent and maybe not the party causing the cash flow problem.
Newsagents are not in a position to mete out punishment to the magazine distributors, it is the other way around. I understand the frustration about inefficient early returns, but they are not done to punish distributors or publishers, merely to gain some control over the one product in our stores that we currently have no other way to firmly control.
Wendy, the key issue is to early return so that you do not cut yourself out of sales.
Mark
Good point post 17 & 20.
I can see what Wendy is saying, overall its just very frustrating.
I should comment about AWW. If there is regular oversupply of this title it means there is some other problem. ACP runs on a tight budget and wastage is expensive given the size of the book. So if this is happening for you I would take it up with Network.
We are all concerned with the trend of magazine sales falling yet some run their magazine department in a manner that creates falling sales, this is obvious from some of the previous posts. Customers who cannot get their magazines from us will resort to subscriptions and this will be our fault. Think about returns carefully, When blatanly oversupplied they are necessary BUT if they cost you sales they undermine your business and reduce its value.
The whole issue of early returns comes from a total lack of confidence in what the distributors send in the “push down” model. Network I find are the major issue. They have the capability of sales base replenishment(SBR) but fail to use it to maximise its usefulness. Image if we were sent our average issue sales for monthly titles and SBR, or for titles greater than a month a token allocation and SBR. Why do I need a year worth of stock for AFL Select cards, AWW Health Diaries, Symply Too Good to be True, Wedding titles etc. If these titles were all on SBR it would free up cashflow and the the average newsasget wouldn’t need to make rash decisions on other, less frequent titles titles. To all the publisher who read this what are you doing to force the distributor to act in our mutual best interest.
The beauty of using SBR as described by Bill is that not only does it free up cash flow, it allows newsagents that have unexpected success with a title to replenish asaprather than wait for someone who has an oversupply of stock to return some and should ultimately increase sales for the publishers too.
Mark, I agree early returning should be based on hard facts available from a POS system. There’s no doubt that losing sales because of inefficient or inaccurate early returns hurts our own businesses, just as much as oversupply and undersupply do. My objection was about our actions being considered punishment of the distributors or publishers. The fact is we are not in any position to punish anyone but ourselves and our customers by misusing the early returns process.
Wendy I do thing that some newsagents approach early returns as a punishment. This is what the data suggests.
Just invoiced what will arrive tomorrow being last billing day of the month with no possibility to return and our network supply is about 20% of the total of our last months bill. And publishers wonder why we early return when we have the chance, this is bulls#%t, 20 days to pay for stock that we cannot return until after the pay date.
Express Media Group appear to have responded to the voice of reason. Their new policy with 4 week on sale period and early in the month on sale date is sensible direction and we will support them as much as we can.
Luke you can early return tomorrow
Not for network, we have been caught before. They need at least 1 business day to process returns or you will find they may not be processed until the next month. GG you still can but network is the main problem child
i hopppppe not or i am in big S^&^t . i have saved it all for the last day . i must say i have never had a problem with ndc and last day returns but always a first hey
Luke, are you calling Shau a Child?? ha ha (daily dose oflevity acheived)
No Brendan, I am calling network the problem child, the website states “Credits added to your statement within 24 hours”, and as I said before we have been caught out by returns that were done on the last day not going on until the next month, but it may just be me.