One of the challenges facing legacy product suppliers to the newsagency channel is the success many of us are having with new product suppliers.
It is only natural that newsagents, like other business people, prefer to invest in traffic, GP and, ultimately, bottom line P&L growth.
Therefore, newsagents are more likely to invest in products and infrastructure supporting products that fit the growth story. It is also why newsagents are less likely to invest in legacy products and the requirements of legacy product suppliers. It is why legacy suppliers struggle to get attention of newsagents.
The extent of transition in the newsagency channel is encouraging. Newsagents embracing new categories and through these new suppliers. It is leading to shop layout and fixture changes as well as technology changes as newsagents pitch new products and categories through their technology in ways that help attract new shoppers.
Our legacy suppliers who historically have relied on bully tactics and being required products are coming, slowly, to realise the new world, that their products are not as needed, that the expensive and anti-competitive processes are not appreciated by newsagents. Well, some at least. There are others who continue their ignorant bullying ways.
We are in a golden era of change in our channel. There are winners and losers. Market forces are at work, and this is a good thing.
When contemplating a request from any supplier, consider the new traffic, GP growth and bottom line benefits. If the request does not improve these then maybe ignore it. The suppliers of legacy products who handcuff you to anti-competitive processes may one day get the message.
Legacy suppliers need to realise that they should try to build relationships with successful retailers as the businesses that are only relying on traditional products will not be here in 10 years. More importantly, the successful retailers will not be interesting in dealing with these suppliers anymore. I am constantly telling my News Ltd rep that I will not actively promote any of their offers anymore. Why would I use valuable real estate on products that make 15% (7.5% for subagent retailers) when I can use the same space for products which make me 100% or more whilst also changing the perception of my store transition in customers eyes.
I sometimes think these companies either
A) see the writing on the wall and can’t be bothered changing
B) have such a poor company attitude towards newsagencies that would take decades to change.
bring on the new world!