I have seen data which proves that some newsagents are returning some titles too soon in the on-sale period, thus driving sales on a downward spiral.
Newsagents I have spoken with say that publishers overloading them drives early returns.
Newsagent business data shows a different story. It shows, in the cases I have seen, that some newsagents returned stock less than half way through the on-sale and that they could have expected to sell at least two thirds of the stock they returned. Their early returns stopped them achieving sales their data history indicated would have been made. Early returns of these specific titles for which I have seen data cost these newsagents money.
Early returns based on gut feel can drive a self fulfilling prophecy. The newsagent thinks they are oversupplied and that stock will not sell based on what is on the shelf. Without reference to data they send the stock back early. They don’t have the stock to sell. Sales fall. Eventually the title dies in that newsagency.
Newsagents need to take care when early returning – make sure you are not losing sales. Check your sales history for a title before you make the move. Understand when in the sales cycle you sell a title before removing it early. Smart publishers provide access to data which helps newsagents – such as the data I was shown recently. I’d gladly put newsagents in touch with publishers who are proactive in this area if they are concerned about early returns.
Of course, magazine distributors can reduce early returns by supplying to achieve a 60% or better sell through for all titles and not just the top sellers. Newsagents who see a poor performing title have been known to hit back at this by early returning other titles. I can understand this from a cash management perspective. Magazine distributors often have only themselves to blame in such situations.
The other way publishers can reduce early returns is to supply 30 day stock. By this I mean, eliminate stock we are to hold for longer than 30 days. Many longer on-sale products are supplied in larger quantities to satisfy the selflife. Split the delivery and reduce the cash-flow strain on newsagents. There will be fewer early returns as a result.
Early returning because you have no space is a different story, one for another day because that is an industry problem.
I am one of these people that early return a hell of a lot ,i get to the point where i have to return just to make money ,i am happy with my sales and they continue to grow but so does my magazine bills some months they are higher than my sales so there for i have to return some stock that has the potential to sell .I do check the sales history on everything that i early return but the problem is ,most months you could almost guarantee that someone comes in asking for something that has not sold for months and you have just early returned it ,so then you miss out on a sale and future sales of this magazine.
Through an error on our part we missed a returns last month, that missing returns caused our account to increase by close to 60% from $3000 to $8200. We tried to leave stock on the shelves for as long as possible but this has caused a huge drain on our cashflow.
Again I know it was our fault for missing the end of month returns but we will be early returning from now on because we cannot afford to stuck with stock that are slow sellers no matter what the onsale date is, if it is not moving as soon as it arrives then it goes back. The distributors have us over a barrel, pay the full amount by the 20th or your cut off, no questions.
For early returns, I usually keep back a copy on the shelf especially for those not so well known titles from G&G for variety.
Unless I know they have not been selling at all after all the months of supply they go straight back.
For NDD, a similar treatment as per Gotch.
For Network titles, I usually leave them until half-way through the sale period esp for those “Complete Guides”/Cars/Bikes or when a newer issue is out. I don’t early return the women’s monthlies in case they do sell.
So far I haven’t run out yet due to my method and usually those copies I kept behind still end up not being sold, console myself that they are there to provide image of bulk /variety.
why not use your point of sale syatem if on average you sell 10 copies per month and they send 25 then early return 10 or 12 still leaves room for increased sales for what ever reason. cheers andy
I closely monitor the early returns of my magazine and have seen some dramtic returns of ‘special issues’ that have had enormous uplift in sales across all agents – except where they were returned without much of a chance on the shelf.
I will never forget walking into an agent who had returned 50% of their stock less than a week after on sale and not finding an issue. They had sold out in two weeks of an eight week sales period yet had early returned 50% of their allocation.
Its a waste of my money to print something that doesn’t make the shelves – and I know its a waste of your money to have an item that doesn’t sell.
How can I get the message across that there are some seasonal differneces to sell throughs, that certain issues have greater allocations because they have a greater propenisty to sell?
We try and communicate this through NDD and Impact however it doesn’t prevent the early returns of magazines I know would sell if they were put on the shelf let alone left on the shelf.
Don’t get me wrong, I understand the cash imperatives that can drive these decisions and so would not say that none should be early returned, however there are some big mistakes that cost us both money.
Cheers
Q
I’m with Andy. For the agents that don’t have a POS system that can give them the info on a GG invoice it says what the expected sales are. If the expected sales are 4 and you get 25, return 18.
I find it very interesting that we have no problems with being oversupplied by Pacific or ACP. I wish all publishers had a model similar to theirs, then we could all make money.
Perhaps the answer for magazines with long sale periods is for delayed billing with no returns allowed during the no charge period. If the publication doesn’t sell during the delayed billing period, neither publisher nor distributor can complain if copies are returned immediately afterwards. I take Quentin’s point and don’t have a problem with Australian Traveller, but no one should be surprised when 10 copies of an expensive magazine with one year shelf life that sells zero copies in six months are early returned.
For Quentin’s information,
I only get allocated 2 copies of Aust Traveller and so far only sold 1 copy of the special edition.
Traditionally travel mags have not done well in my shop so if I am only allocated up to 5 copies I generally just keep them on the shelf.
As a publisher who regulary receives early return reports and forwards that information onto concerned newsagents I can confirm the losses to agents Mark spoke of. The early returns i speak of are not copies which are returned within the 3 of a 4 week on sale period or 6 of an 8 week on sale time. The magazines are usually returned within the the first 2 weeks. Although we don’t always get it right we try to ensure supply is in line with previous sales history. While I have sympathy for agents who struggle to get the balance right, I also see similar situations to Quentin on a weekly basis. Agents who receive 30 copies with an average of 27 sales who then send 24 copies back in the first 2 weeks. The subsequent sale of only 6 copies then leads to reduced supply and a downward spiral of sales. We are fortunate to have a loyal readership who if they can’t locate the Lovatts magazine at that shop will then purchase it from his competitor. When quizzed about the returns the answer is invariably, “I’ve got a shelf full of crosswords i can’t fit them in, this is of course true but why return the magazines that sell. Or the reply is I was unaware of how many I sold. The solution is as Andy and Sarah said, a good POS system and using it correctly. Act on fact not feel, return the magazines that don’t sell and reduce your overheads, don’t return the magazines that do sell and reduce your profits
Thanks for the info Sarah re: invoice
Their seems to be a problem out their, Newsagents should be breached if they are found to be returning magazines to early that do sell in their store and the examples Quentin & Terry have given us and insight into another part of the channel.
Sounds as if some Newsagents need to be trained / guided and this could happen if one is proved to be breached. Their was a recent Post about the crossword category, their is way to many titles and the Newsagent has a duty to cull them, they are mainly overseas titles which many make a shop look un attractive. We are lucky in that way many Australian publications are allround good publications.
ChrisW idea for delayed billing has merrit. A possible system such as any magazine that has a shelf life for X months will not be billed until returns are reconciled or if you have POS when you sell.
When you have delayed billing though you must have be have a solid model yourself where you know how much you owe in delayed billing or you put money aside.
The recent post on wedding magazines is an example that delayed billing should be used. However from my experience this category is the worst for oversupply and long life.
Derek i am sure no agent out there would send back stock knowing that it would be a seller ,sometime we have to take the gamble and see if it sells or not eg there was a gardening book that came out last week for about $19.00 to me this is to expensive so i am giving it 3 weeks if it does not sell it goes back just in time for me to get a credit this month .
Here is an example of why we send back mags that are sellers
I was getting supplied netguide that i sold 3 copies of every month so they sent me a supply of 9 ,yeah that was ok then i received 12 copies ,well thats no good so i sent most of them back early and requested to cut it back to 5 and there reply was no it had to be 9 si i cancelled the order completly .They refused to let me run my business the best way i know how so i took control and told them where to send this particular magazine ,and you wouldn’t believe it 3 months later and they are sending it again but at the supply i wanted all the time .
Shaun s
I dont have a problem with your post at all, that is what i call getting abused.
My previous post mainly was on options regarding these long life & expensive mags also my crossword category pet hate.
Thanks Derek
Thanks Terry. I hope you work for a publisher that is being transparent with agents about what they hope to achieve. We support publishers who are, particularly those who respond quickly to our requests.
Hi Terry. May be it is time to pay agents a little more, who do not early return . So if you could look at that you will have a lot of agents holding on to supplys longer .You win,how about 1 or 2% bonus. If i was you that is what i would do,
The problem for publishers such as Quentin and Terry is that newsagents are fed up with the abuse of their businesses by those publishers less concerned for the future viability of the channel and the distributors whose main objective is to get magazines on trucks. Magazines as a category are now being hammered by these fed up newsagents who are trying to stem the cash flow haemorrhage. Unfortunately those good publishers (Pacific and ACP spring to mind) are caught up in the wash.
Why not put all magazines into newsagents who have a compliant POS system that can and does provide daily sales data on consignment? At the end of the week 1 tally up what has been sold, send a report to the newsagent via email for them to reconcile during week 2 and direct debit the newsagents bank account in week 3. Newsagents cash flow will be improved, distributors and hence publishers will be getting revenue weekly, publishers and distributors will have dynamic, almost real time, data to act on in making decisions on upcoming print runs and then if there is an oversupply it at least eliminates the need to pay for the stock long before it is sold and therefore increases the chances of it remaining on the shelf. At the end of the on sale period the remaining copies are scanned into returns then thrown out (no physical returns required) as all the necessary data (supply, sales and returns) has been provided electronically. I accept that this is open to abuse, but there must be severe penalties for those that do to ensure that the rest of us have a viable future in the retailing of magazines.
As long as newsagents find themselves in a position where we can have as little as 3 weeks to sell 75% of what we have been supplied with just to pay the bill for that title the following month magazines will continue to be treated with disdain. Example; my sell thru rate with GG is 54% and my sell thru rate of Pacific titles (supplied by GG) is 73%. Therefore “other” titles (including overseas) supplied by GG are dragging down magazine sales performance significantly and Pacific gets unfairly caught up in the “bloody magazines” mentality.
It is time for a complete redesign of the magazine distribution model.
Glenn, the redesign of the model was necessary from the time of deregulation. Ever since then we have been half pregnant.
The best model for newsagents is scanned based trading. I would happily pay tomorrow for what I sold today.
Agents i think need to talk to G/G . We have done this the last 4 months and we are geting a 75% sell with G/G We have cut a lot of US mags out by changeing our rating with G/G , I can tell you now as long as i am upright we will never get scanned based trading.If you are rated a 7 get cut back to a 5 or 6. We have gone from a 7 to a 3 ,less titles more of what sells..Over all our sales of mags has increased,we are looking now for more numbers of what we are getting
Shaun, with grammer like that I’m suprised you could manage your own backside…
Fair enough Jeff i am not known for my grammer but i do not care i built my business up from a dirty old broken down shop to one of the best within 100ks anytime you are up in north queensland feel free to pop in and have a look , and if i am doing something wrong please let me know …..which distributor do you work for ?
Jeff correct me if I am wrong but I was taught it was Grammar.
If you want to pick on some one at least make sure you’re correct.
Ha Ha, good spot Mary!
By the way you should have a comma after Jeff…… LOL and grammer has a small g……. I hardly think some poor grammar on a blog affects the way we run our businesses. Ol’ Jeff is just being a pest.
I went to a school in England and one day, a retiring bus driver went in to see the headmaster, an honours graduate in literature and all that. He said: “Sorry to be a nuisance but I can no longer stand the sign outside your school which proclaims ‘John Ruskin Grammer School.'”
On the issue of rewarding agents who don’t early return unnecessarily, we are probably the only Australian publishers to have paid an extra margin to agents who managed and displayed our stock fairly.
As far as delayed billing, again we introduced this system a few years back but were eventually persuaded by the ANF and State branches to abandon it because it caused too many billing problems.
Hopefully, newsagents will be able to see the difference between distributors and publishers. Why would any publisher in their right mind want to waste up to several dollars per unsold issue? If you can answer that, you’ll work out where any oversupply issues come from.
James, I wonder if that bus driver was my Dad?
Sharing that info regarding delayed billing is interesting which I will not start a bruhar about. I would not think that Lovatts Titles would need delayed billing, amongst a lot of opinions this should be considered for 6 month + shelf life mags that costs over X amount.
While you are involved in this thread has Lovatts considered Marketing material for Newsagents, before you fall of your chair, I know it is an expensive exercise and lot of waste occurrs. For eg: Floor Graphics (they are a heavy duty sticker that lasts a hundred thousand shoes) Coke supplied me with one and it is by far the best Marketing item I have received. I priced one for crosswords and I did fall of my chair. Of course the idea is you buy in bulk and the price reduces dramatically.
In some shops this such a great marketing tool. I would be happy to buy one but I do not need a hundred. I love Lovatts particularly the busy and colourful front covers.
Food for thought?
Derek we do a lot of floor advertising when the lotto reaches the 20 million + mark ,we find it works really well ,what we do is do a A3 colour copy of some posters then laminate them and use double sided tape and basically place them where ever people walk and they get a lot of notice .
Hi James show me the money . That at the end of the day is what it is about.
You should run with this. If i was a distributor or publisher this is the only way ,why print and have it ruturned early DUMB .To sell you must have it out there
In reply
Shaun- your comment on blog 11, why would anyone agent knowingly send back copies which would sell? Alas they don’t know, simply because they don’t have or use a POS system correctly
Sarah
If we at Lovatts were any more transparent you could see right through us (poor attempt at a joke). We’ve always been and will continue to be great supporters of newsagents.
Derek- food for thought indeed, a great foot leading to Lovatts. I know where I’d like to put my size 10 at times when I see the number of unwanted unsold overseas magazines which clog the crossword section. We do have free point of sale material available to agents. which anyone can obtain by contacting me on terryt@lovatts.com.au. I’d also like to hear from any agent who feels they have a problem with supply be that over or under
Shaun- That is what our industry need, passion and what you are doing is great. My wife is one great sign writer and if I have to I will get her to do something special. In some shops this advertising is customer friendly and we must use properly untapped shop space in this case the floor.
Terry-Exactly (with the word lovatts in it) As you indicated your category is clogged, Mark made a decision recently and it looked good. It is a work in progress this part of town but I am winning.
Terry,
Two words – showing gratitude – 8 letters
Which reminds me Terry
Thankyou
Thankyou Brett
Terry and James, on the shop floor, when you see stacks of stock and when you have in your memory the last harrassing call from network demanding payment by the 20th it is possible to make irrational decisions.
Getting the supply model is as important as distributiong through a company which respects the retail channel and does not chase payment for stock sent from publishers less respectful of the channel than you.
my only solution to the ridiculous situation with the crossword books was to cancel all titles except for Lovatts, Puzzler and the regular Take & Life. Sales are better and less clogging of shelves