A concern for many newsagents is the potential for changes to magazine distribution arrangements as a result of the News Limited T2020 project.
Gotch and Network have each said they are looking at how T2020 will impact their businesses. The big questions for retail newsagents is whether there will be operational and margin impacts. These are questions also being asked by people looking at purchasing newsagency businesses.
I have spoken with Gotch and Network and neither is making any statement at the moment.
This is the issue a lot of agents are concerned about.
Forget it just being a news ltd thing, all distributors both mags and papers are looking at this as a way of passing on delivery costs to others. what we are seeing now is the tip of the iceberg,and the losers will be newsagents as we more then likely will have to share margin on mags and other papers with the delivery agent instead of direct supply.
Why would mags continue to direct drop to agents if they can use a model that already delivers papers each morning?
Just a thought, we complained we could do nothing during and after magazine deregulation but again we sit back and do nothing now as other say it will not effect us.
I don,t know about where you are from but my magazines arrive about 3 hours after the papers , so to combine the 2 just would not work .
I agree Shaun there is no way the paper delivery trucks can fit mags.
Mags come from a totally different area and logistically it would be a nightmare.
Has it been tested before I think I can remember a trial of something.
Contracts are currently in place with the suppliers so it is a bit different than the papers.
I thiink unfounded comments like this will just add to the worry some newsagents are feeling.
I also could not see that 12.5% would hold many Newsagents offering the facing that they do now. I myself would move to a offer like the chains straight away as the ROI for that would not exist.
contracts can be cancelled at any time without compensation Mary, as we are seeing with News and we saw when mags were deregulated and our sub agents were given direct supply.
Once there is a new distribution model in place where they all can deliver to a fewer central points and let someone else cover the cost of delivery why would they not all do it?
No one is saying it will not happen are they and they are not even hiding the fact that they are watching with interest?
But just like deregulation, lets all say it will not effect us and it is just jumping at shadows.
If anyone can 1005 rule it out then let them come forward.
Mary, many newsagents have raised the concern with me and others. It is important that distributors are reminded newsagents want clarity. It is also important that those joining the channel are fully informed.
It does need to be sorted, Publishers need to stand up now and get involved also. The magazine business is still strong and Publishers must be proactive in their support for the Retail Newsagent Channel.
Anyone know what new owners of ACP current distribution model looks like?
In the UK they use traditional publishers and are used to the margins we have here.
To retail magazines it is a far more labour intensive and costly exercise to newsagents than to stock papers. Any lowering of margin in favour of the guy who delivers them at the shop door, doesn’t pick up the return boxes nor lends the magazine company large sums of interest free cash each month will simply result in our not stocking magazines…or going bankrupt. Either way it would be lose lose for all involved except the delivery man.
I expect the status quo to be maintained. It would be terrific for such an announcement to be made.
Luke @ post 1
Shaun’s @ post 2
For the past 5 years, perhaps a bit longer we have been delivering magazines to subagents with the morning paper. Our magazine truck arrives about an hour or an hour and a half before the paper truck, so there is enough time to process the magazines first. As a consequence we are able to make just one run that covers both Newspapers and magazines.
For retailers, it means the 24 hour convenience outlets have their magazines at about 3.30am and other shops find the papers and magazines already delivered when they roll up for work.
Having said that, I can’t see a post T2020 magazine distribution model that has us making magazine deliveries to the Retail Newsagent that we supply Newspapers to.
I don’t believe it will happen.
Dennis Robertson
Dennis , is this a full range of magazines or are we just talking what a servo would typically have . Just from my own experience here i know it takes me at least 2 hours to unload my magazines lable them and put on my shelf and i am only a small newsagent . There could be hundreds of different tiittles that you would have to go through just for the one order .
SHAUN S @ post 13
Shaun, in a single days order I would not get a range of hundreds of titles.
To give you an example, one of the 24 hour Servo’s I supply to in the month of August received a range of 210 different titles. I realise that doesn’t include all magazine titles they get, but would give you an idea.
We have used up to 3 of us on big order days when the magazine truck is more likely to be late, compressing the window before the Newsapaper truck arrives. Labelling does take up a lot of the available time.
In addition, at one of the servo’s that we have a Service Level Agreement with, we also remove old titles (returns) and place new editions in the magazine stands for them.
You might be surprised at how many early workers look for Zoo between 4.30 and 5.30am if everything is running late.
Dennis Robertson