The headline of this post is a direct lift of the headline of a report published by mUmBRELLA yesterday. While I urge newsagents to click on the link and read the article, I will post portions here and comment.
The boss of publishing house NewsLifeMedia has said newsagents need to be more critical about the range they stock and emulate the way that supermarket giants Coles and Woolworths operate.
I am not sure what Ms Sheffield is reading but I think newsagents have been vocal for years. Look at the recent comprehensive submissions to the ACCC, copies of which were provided to NewsLifeMedia as well as other publishers and the distributors.
What we learned from this and previous experiences is that being critical achieves nothing. The lesson from the ACCC and other recent experiences is: complaining gets you nothing.
Speaking at Wednesday’s Publish conference, Nicole Sheffield said: “Every time there is a range review [at a supermarket] it’s got nothing to do with anything emotional, social, digital – it’s what that pocket is yielding me and if it’s not doing it, you’re off the range,” she said.
As it should be I say. Retail is tough for supermarkets and for us. If a product does not pay its way it ought to be removed. The challenge for newsagents is we are not permitted the same control of supermarkets. This disadvantages us and advantages supermarkets. The model agreed by publishers and supermarkets is a model that makes newsagents less competitive.
“Newsagents are under enormous pressure. There’s a lot less of them. Running a newsagency today is a very difficult, challenging business. You’ve got print products that are in decline and you’re heavy reliant on lotto.
Nicole needs to get out more and understand there are now considerable differences between newsagencies.
“People used to go there for a lot of different reasons and we have to be a reason to make them a destination again.”
Yes, I agree. Magazines ought to be a reason for newsagencies to be a destination. I have a proposal regarding this and will submit it to mUmBRELLA for publication consideration. More on that later next week.
Sheffield’s comments followed those made by Ash Hunter, the chairman of Publishers Australia and CEO of Hunterfive Group, who said the influx of new, poorly trained newsagents is causing problems and it is something the print publishing industry needs to address.
“There is a fundamental failure that’s taking place within the newsagency network and part of it is quite challenging, it’s around cash flow,” he said.
“Many of the new newsagents coming in don’t understand the business as well as they should and they have to manage cash flow.
I’d love to know Hunter’s evidence for these statements, especially the last statement. Sure, there are some who don’t understand the business. That is a failure of the parties that approve entrants: Tatts, magazine distributors, newspaper publishers – any supplier agreeing to open an account. That said, under needs to back the statement with evidence.
Hunter then picked up his game and got to a core issue:
“The issue is reducing range and sending back their returns. This is an area where part of the (print) decline is due to neglect to that distribution network.”
He said it was handing the power to the likes of Coles and Woolworths who typically stock magazines from the larger publishers like Pacific Magazines, NewsLifeMedia and Bauer Media.
What I am submitting to mUmBRELLA to consider publishing next week is one option I think could address this issue.
Publishers can complain all they like. If they want the situation to change, they need to change. They also need to engage commercially and not through the industry associations as that has proven to be a waste of time for years.
I do have a plan to put out there for suggestion. More on that next week. Hopefully, too, more plans from others on this critical issue for smaller publishers and newsagents.
IPS are the worst publishers in town.
Just because they have the needed market of Best Bets and Winning Post they think they can load rubbish 2nd rate magazines on our doorstep..
No right of early return
2 weeks gateway for returns
Compulsory acceptance of product for initial 3 issues
and not even competitive with regards to service…
We return over 80% of their deliveries …..
don’t pay them on time , pay them after 3 months
These experts talk about range and cash-flow as if they know what they are talking about.
Since when is a supermarket a destination for magazines.
If I carried only 100 titles with a shelf life of 1 month or less sure it would help the cash-flow but how does that make me a destination.
I have no cash-flow issues as I manage the department as its own cost centre.
The reason cash-flow is an issue for most is because the stock-holding is too high for the sales performance and the length of time titles out-side the top 100 are required to be kept on shelf.
We need 12 stock turns in this department just to make it competitive with the store average, not 3 to 6.
Thats the issue.
NewsLifeMedia are part of the MPA, the CEO should know newsagents don’t have the same control of supply as the Majors. I’d kill for the chance to do a range review and take control of my magazine section but there’s no mechanism for me to do that. If the CEO of NLM as a member of the MPA had been pushing for newsagents to be given the same rights as the majors to control supply she’d be in a position to make this comment. As it is she just made a cheat, dare I say ignorant?, comment about newsagent’s business skill’s when she definitely should have known her comment’s were wrong.
Steve I am confident I can help you get part of the way there. Let me know by direct message if you would like help.
@ Bill . the comments these people have made (won’t call them experts as they seem to know four fifths of nothing) show how out of touch, uneducated on the subject or just how plain ignorant they are.
@ Mark instead of trying to hold onto magazines as a destination reason I can’t help but wonder if we shouldn’t do the opposite and start to replace magazines more with other reasons to be a destination. IF the distributors/publishers then want to come back to us it puts us in a position to negotiate with greater power as I would bet my business that they won’t find an acceptable alternative. Lets stop pandering to them. Lets make change happen . Lets start giving these buggers indigestion at the least in worrying about who they are going to oversupply all of the magazine stock to when we refuse to take it.
Paul I have done that Magazines are more likely to be the impulse add-on rather than the reason to enter my newsagency. For the vast majority of the channel, though, magazines are 50% of baskets and more.
@David, I have finally get sicked of it. Stop the account. At worst, I ‘ve lost my Saturday Paper, Guardian Weekly and Best Best sales. However, I don’t have to deal with the rest of 90% “rubbish”.
Could be a wrong decision, but hey time will let know.
Budi let the publisher of The Saturday Paper know.
How many titles with a shelf life of more than 1 month do the supermarkets stock?
Eliminate this issue in newsagencies and we would be 90% on the way to solving our over supply/ early return issue.
Maybe NewsLifeMedia would also like us to follow the supermarkets planograms for the magazine category.