At a recent publishing event someone claiming to know was putting it about that newsagents were achieving a sell through rate of 50% for magazines.
The person reportedly saying this does not have access to data to backup the claim. I think it is their best guess. But they did not qualify it.
I see real sell through data for many newsagencies. While there are some with an overall sell through above 50%, there are many below. But this high level measure is unhelpful. The best measure is non weekly sell through as this is where newsagents are hurt the most.
Once I take out high volume weekly titles, the average magazine sell through I see for newsagents is close to 40%. That is, 60% of this stock fails to sell and is either recycled through the system at the newsagent’s expense or thrown out and wasted.
The MPA driven magazine code of conduct that is at the basis of a supply model trial with selected newsagents will not address this as the code does not go far enough. Replacing a failing title with another failing title allows a distributor to pass the code but fail the newsagent.
I want magazines I can sell. I’m happy for a 75% sell through – less than that does not work for me or the publishers I serve. The problem is that 75% does not work for the magazine distributors. hence the uncompetitive supply model forced on newsagents.
Yes, I hear you … blah blah blah – nothing new here. That’s true. But I feel better for writing it.
Mark, even newsagents who are not with xchangeit (hard to believe I know) can easily work out their returns %.
After 40 years in this industry mine is still
about 53%-57% and I have written about it for years.
It erodes the cashflow of our businesses and causes huge workloads which costs us
with wages (which could be halved on stock days if we could only get what we know will sell). The extra wages eats into the profitability and erodes the 25% we should make on mags.
One of our agents in SA wrote here last year that by the time he pays for returns
and the expensive shelving (rent)for the mags he actually only makes 5-7%.
We have been scapegoats for many years but we still plod on.
We absolutely have to look for other product for our shelves because mags are
simply not paying their way with the current distribution model.
This morning I got Fete magazine 3 weeks later than a gift shop in the centre about 100 metres from my shop.
I had already cancelled it with GG because of the delayed arrival when the other retailer had it for weeks before me but in it came this morning and I didn’t even undo the bundle but sent it straight back.
I changed the mag to 0 online and then sent a followup email which GG acknowledged and still they sent the product unrequited and cancelled.
The system is broken
I just struggle with the fact a 50% sell through is not only considered acceptable, its the industry benchmark. Not only that but the distributors talk up a 50% sell through as some kind of proof their doing things right? If its so acceptable I’d like them to name another industry were you produce twice as much product as neccessary and then throw half away.
I agree. A 50% sell through is a failure.
What do the various unions around the country do when members are mistreated? …They go on strike of course.
ALL Newsagents should not pay their account for 2 months(or however long it takes), and demand change.
We will all be surprised by how little profit we lose in this time even if they cut our supply.
Its as simple as that to get change!!
Peter for that to happen we would need
unity????? and an ANF which would adhere
to our requests regarding changing our trading terms etc etc.
The companies have improved their bottom lines through technology. No postage, paper or ink (the newsagent now pays for it all so the 25% profit margin is eroded again by these costs)
The ANF has forgotten that its mission is and has always been???? for the benefit of newsagents and to protect our investments.
They simply haven’t done their job and I’ll say it once more – neither have the state associations who have always and forever
impeded national unity in the interests of their own hip pockets.
I know I have written about this ad nauseum but it is true and those of us who
are doing our best to flourish and prosper (not merely survive) have had to do it on our own.
With the ANF newsagents get what they pay for. The association has closet its way and prefers to compete with newsagency suppliers than serve newsagents.
June.
I think you’ve jumped the gun on Fete.
There’s a one shot holiday annual and then there’s the quarterly issue. It’s a growing title and to your detriment to cease an adelaide produced title.
Alf,
June’m main gripe is that another store near her had this title many weeks earlier than she did. And this seems to be a continuing trend on previous issues.
How is this possible?
Why is the newsagency channel treated as second string distribution channel before a gift shop?
Subaro.
It’s not possible for June to get it several weeks after another retailer. Happy for June to contact me direct.
Alf with all due respect I dont think June just made this story up.
June you are right the unity will not come from the ANF.
We must find ourselves a messiah to lead us to the promise land full of riches, and the occasional day off…. Did I just see Mark Fletcher put his hand up then?lol
More seriously, the ANF needs to be split into Distribution, and Retail, or better still a whole new body started to represent Retail, then there would be no conflict of interest as there is now. The ANF seem to have absolutely no idea how to deal with the retail side of the Newsagency channel and no idea what is required of them as the self proclaimed “peak body”.
Being a retailer only, I see them as having the fat cat syndrome, getting paid for nothing.
Alf, I blogged here about Fete and I received it last Thursday but a gift shop
a few metres from me (with no other mags in her shop) has had the summer edition for at least 3 weeks and when I rang the people at Fete mag I was told “retailers always get it first and then the newsagent” WHAT THE????????
Are we not retailers was my question and
they would not budge so I have cancelled as I won’t be a second string to any publisher and they have to understand that my retail space is very very expensive.
The funny part about it was that the shop
that had it (a small gift shop) was also named as a retail outlet in the back of the mag and we were not so one has to know when to hold’m and know when to fold’m
(in the words of Kenny Rogers).
Adding to my above comments I was instrumental in obtaining Fete for my customers (not the other way around) so obviously when the publisher is thinking about distribution they choose a distributor (GG in this case) and then obviously get sick of paying and decide to do part of it themselves and the result is what you have read here.
It is called ‘having your cake and eating it too”.
As the publisher’s of fête magazine we do understand the frustrations of newsagents as we (Jane Cameron and myself) have been publishing niche titles for almost ten years now. As a very small, local and independent magazine, we too have to be constantly finding ways to increase our sales. As mentioned to June when I contacted her in regards to this matter – we are an Adelaide based, totally self funded publication and in order to survive over the past three years while launching fête we have had to seek out alternative retailers to newsagents who are keen to purchase our title on a firm sale basis. These retailers will often sell upwards of 40 copies per issue, which has become a vital aspect of our brand awareness and growth, after persevering with newsagents around the country who more often then not would early return our title or keep one or two copies we simply had no choice. Seeking out alternative retailers is hugely time consuming and labour intensive for our team of two and it is certainly not our preference to reach our sales targets using these methods. We are constantly working on our newsagent distribution and are keen to work with newsagents to get a better result, including our own marketing and social media strategies as well as providing posters and a newsagent finder on our website. There are several newsagents who have worked with us and have taken a leap of faith in promoting our title, seeing it’s locally produced, quality content as a draw-card and they have been rewarded with extremely good results. It is disappointing that June has decided not to continue to stock fête as my daughter attends the local school, situated a few minutes from her store and many of the school mums are now avid readers of our title. I would always direct them to June’s newsagent when they wanted to find a copy. Now I will have to send them elsewhere. Just to clarify, the issue the gift shop received was our “One Shot” fête/holiday issue, this was released completely independently from the quarterly issues which June normally receives, this one shot title was released in limited supply and as such was offered to our top selling newsagents and via pre-order. The Holiday issue runs concurrently with our spring and then Summer issues. The issue which June received three weeks later was in fact the summer issue which was delivered on time and which she did in fact receive before the gift shop. I did visit June’s store personally to see if they had received the holiday issue, as I knew there would be customers looking for it. When I couldn’t see it on the shelf, I enquired with one of the staff and they informed me that they would not be receiving it. I was disappointed, but presumed that June had decided not to support the “one shot”.
I would welcome any feedback from newsagents as to how we can work together to increase efficiency, I appreciate this is not only a problem for publishers but for newsagents also and as we are a growing title, there is always an element of trial and error when releasing “One Shots” and additional issues.
What margin are you providing for those that want firm sale? This would be a great way to get more traction with a lot of newsagents so long as we are setting supply numbers also. Give newsagents a decent deal and watch them push your product over every other mag in their store, this seems to be forbidden territory for publishers tho.
It is called ‘having your cake and eating it too”. – so true June.
And not too different to Horse Deals appearing in “retailers” before we get it or Donna Hay appearing in IGA in a counter unit 3 days before we saw it – no prizes for guessing what’s happened to my sales of both.
And if publishers reading this blog think they can get away with short-circuiting the system by screwing newsagents then think again – who’s going to push your product when the “retailers” move on and the newsagent doesn’t have room for your product because he has reduced magazine pockets?
Annabelle, maybe you should have introduced yourself or asked for me when you came into my shop. Instead you spoke to my staff. You obviously knew I was hopping mad that the customer who alerted me to Best Wishes having the product when I clearly didn’t, was aggravated with me – not with Best Wishes.
BW is a small gift shop with absolutely no mags in it and suddenly your mag appears and undermines my business.
I don’t mind competition but I think an even playing field would be good. When the magazine came into my shop (3 weeks after BW got it) it was topped and returned to GG because I was not going to be second fiddle to BW for whom mags are not a core product.
I have never seen a mag in those premises before and I am perfectly happy for you to distribute to them but don’t expect my expensive retail space to be allocated to your product.
I agree with you Jim – we get screwed and I, for one, will not participate in that.
I expect newsagents everywhere will be topping and returning Fete magazine – not because it isn’t a nice mag but to have a show of solidarity when we are treated so shabbily by publishers.
For the record Annabelle, I am in my shop six days a week all day every day except for Tuesdays so please come and meet me
if you can explain this issue in a way that is beneficial to us both – which I doubt!
Annabelle, I don’t think you are managing this well. Instead of your essay you ought to have said: sorry, we fucked up. We are committed to the newsagency channel and will not supply any other channel in the future. June, please have us back. Now, newsagents please tell us how we can make more money with and for you.
Mark, have you had a liquid lunch today??? I have never heard you swear before and I thought you were perfect?????
Some things just come across better when you add an extra word in …. love it
Happy to talk to ANY publisher about firm sale and a mega shift in margin. The way rents and wages are going, if mags stay at 25% they will all be off the shelves within 3 years. We have data, we know our customers needs, lets go firm sale and 50%+ margin. We know they can do at least that as Magnation proves daily
Issue is outside the top 500 newsagents in australia the rest are shit retailers with shit stores, poor business skills and limited english. Id have no troubles providing higher margin to those deserving stores. Firm sale is a pipedream for magazines..The volume and scale just wont be sustainable for publishers long term. The solution is somewhere in the middle. Fair and reasonable margin sale or return, maximum 1 month shelf life, newsagents able to set their own supply but those who don’t bother get scaled out based on recent sales history. Would early returns then be needed to manage supply?.. a dream i know, but it can be done. Moreso the amount of imports accepted by particularly gotch needs to stop. American and european delayed shit crowding shelves. Take away 50-70% of these and that would be a massive improvement. Bit by bit….
June, no liquid lunch. In this instance, swearing was necessary. I had not read your comments and the one from Annabelle.
Joe, while there are shit newsagents, I would not put a number on it. The problem comes down to economic respect. 25% does not cut it. Nor does a push model over which I have no ability to curate range appropriate to the business I want to create.
Issue is outside the top 500 newsagents in australia the rest are shit retailers with shit stores, poor business skills and limited english. Id have no troubles providing higher margin to those deserving stores.”
Joe are you a publisher ? if so what magazines are yours, just need to know what to bundle up and return !!
Bunnings sells Handyman and all BHG titles. Are you going to cull those as well? This is business. The publishers are going to give preferential treatment to those that support them. Unfortunately the Publishers deal with GG and NDC, both of whom hate Newsagents (even though we are the reason they exist) and are told the story from the Distributors side. All I ask for is a level playing field where we are treated equally. Same commission levels, same returns policies and same delivery dates.
Did any of you click on Alfs name. His link goes directly to a website which promotes magazine sales in retailers (outside of newsagencies) so his motivation is to increase sales of magazines in boutique retailers. Just another level of competition for us.
I will still sell Fete magazine because I have customers who request it. But I will not promote it, not due to Junes issues but due to the fact that it is too small in sales for any extra energy to be put into it.
I think Annabelle needs to get some guts and meet with June.
Alf is the publisher of Frankie mag and Frankie diary both of which I stock. However niche mags are now pushing into
supermarkets etc so we are no longer the “go to” destination for magazines.
Nothing infuriates me more than seeing people reading (and not buying) mags in the supermarket. I see customers of mine purchasing mags there as well and I realize that there is no way this is going to change unless we do it better.
Putaways are a big thing in my business.
Anyone who requests a mag I don’t stock my staff will ask them if they would like us to get it in and keep it for them regularly.
As I’ve said before – you can’t have your cake and eat it too.
Soon the duopoly will have a larger share of the cake than the newsagent and then we will see them cut the prices and force some newsagents to the wall.
We have had plenty of warning about this
from lots of avenues.
Newsagents who are near supermarkets are in danger but don’t be lulled into a sense of security if you are not because the end result will be the same.
That’s why we have to do it better than the supermarkets and that is not too hard.
The staff have no idea about mags and we do so we have to promote ourselves.
June, I visited your store before I was made aware if this issue as I was passing by I thought I would drop in, otherwise I would have seeked you out to discuss in person. As you know as soon as I was made aware of this issue I called you directly to discuss your concerns. I am more than happy to come and see you in store and will do so early next week, I will call to make a time that is convienent to you.