With Toys R Us in the US set to close or shrink dramatically and some other national retailers in the same or closely related space reported to do the same, opportunities could rise for independent retailers, like newsagents.
While the major pain for suppliers to national retailers is in the US, the impact will be felt worldwide.
Suppliers are drawn to national retailers as there is one the head office to deal with. However, a crash of a national business can have far more of an impact than the crash of a single retailer. The downside is the cost of managing many smaller accounts is higher.
In my opinion, serving many small business customers is better for business than serving fewer much larger customers.
This is a pitch we in small business can make, especially to toy suppliers who may be in pain as a result of the Toys R Us situation, which will cost some many millions in uncollected debts and considerably more with the closure of retail outlets.
Revenue from toys is growing in engaged newsagency businesses, especially in the brand name area. Getting these products means dealing direct with the manufacturer or their authorised Australian distribution network.
The low end of toys, cheap unbranded toys, is flat with discount variety stores selling cheap product for low margin. This end of the market is of no interest to me.
Yes Mark the tide is turning to us and maybe once again wholesalers will consider Newsagents as a good outlet for toys. Many years ago when Toys R Us arrived one of my suppliers outlined the outrageous demands made by them to carry their products in their stores they were;
They demanded a 40% discount on his wholesale price
90 days credit payment and that after 90 days whatever they do not sell the wholesaler takes back for full credit.
The carrot of course was a large order usually in the many thousand pieces.
With that sort of terms you could not loose as a retailer, would I as a Newsagent like terms like this of course everyone would.