The Media column in The Australian yesterday reported a shake-up in the way Coles handles magazine sales data and payment. The Australian claims Coles will move to a scanned sales model with Woolworths soon to follow. I thought Woolworths had scanned sales in place already – they certainly provide overnight sales data from what I understand.
Regardless, the story is interesting for a few reasons:
- Public acknowledgement that retailers until now have had to pay for shrinkage.
- Surprise that Coles supposedly pays for all magazines supplied and then claims for unsold stock. This does not sound right.
- Supermarkets sell fewer magazines than newsagents yet they appear to have a better deal than us when it comes to shrinkage.
- We can offer a scanned sales model today – at least newsagents with accurate data can and that number of newsagents is close to 1,000.
- Shrinkage. We already know that the magazines most affected by shrinkage in newsagencies are the top 50 titles. The average cost is around 3% of sales. Being compensated for this would be a valuable benefit for any retailer.
This brief diary piece should interest newsagents as it goes to matters at the heart of our competitiveness in the magazine space. The item puts publishers on notice not only from supermarkets but from other retailers including newsagents.