Fairfax needs to reconsider its distribution model for its food guides. The coupon on Saturday’s newspaper caused more frustration since not all distribution newsagents took up the opportunity meaning that not all retail newsagents had the title. There is no point promoting something on the front page of the newspaper which is not readily available.
I have seen data (without store names) from two publishers detailing early returns of their titles for a recent issue. In each case, newsagents returned stock which their own sales data shows would have sold.
One newsagent early returned nine copies of a magazine a week after it went on sale and having sold one copy. Their own sales data shows that they sell, on average, seven copies of the title. There is little volatility in sales. So, this newsagent, by early returning without checking the facts in their own business data, has denied themselves of the benefits of the sale of six copies. In this same store there were other titles with very poor sell through rates which were not early returned.
Newsagents embrace early returns and claim that it is a control mechanism they like and want. This would only be rue if newsagents were using early return intelligently, based on good business data.
What I have seen for these two titles indicates that there are too many newsagents making dumb and irrational decisions on early returns.
Yes, it is a cash flow management mechanism. I get that. I have used early return for that. However, when I early return I look at data for the title and make a considered decision which will not deny my business sales.
Alf Santomingo from Morrison Media has a publisher perspective on this issue at the Morrison News blog. I urge newsagents to read this and think about the early returns challenge from a publisher perspective. It is a compelling store, especially the example of a newsagent returning stock and effectively rejecting guaranteed sales revenue from Powerhound magazine.
On Powerhound, it is a niche title, exactly the type of title which is vitally important to our channel. It attracts enthusiasts and enthusiasts and important to our fuure in the magazine space and other product categories.
I am not a fan of cutting back range so that we only sell the top selling titles. My ideal range sits between 700 and 900 titles depending on space. So, cutting special interest titles is not something I would do. Even if I was on an early return mission, I would do this based on a review of sales data and not at random as some newsagents seem to do.
We owe it to ourselves, our customers and magazine publishers to not be dumb about early returns. It is a magazine supply management process which should be used for magazine product which will not sell.
Finally, after almost a year and a half, Fair Work Australia realised that the Fair Work Act got it wrong re after school minimum hours. The decision announced Monday to cut the minimum shift in small retailers from three hours to one and a half hours is welcome but late.
Government intervened in something which was working. Many businesses, their employees and associations who represent them lost time and money while the ‘independent’ umpire took too long to realise that the politicians got it wrong.
This is an example of government imposing ill-conceived regulation of a part of business which worked well for decades. While the government will say that it was an unintended consequence of broader reforms, the reality is that they got it wrong and caused considerable disruption in small business retailers, including newsagencies, as a result.
What a waste of time.
At least we can get on with business. If only politicians on all sizes were true to their promises of reducing red tape and making doing business easier.
Customers yesterday were frustrated that they could not purchase from us the coffee guide promoted on the front page of The Age newspaper. Here in Melbourne we love our coffee and we have (IMHO) the best coffee outlets in Australia so it is natural that the offer of The Good Cafe Guide 2011 for $5 would be popular.
Customers thought they could buy the newspaper and the Guide from us in one transaction. The frustration came when told that they have to go to one of the limited number of outlets to redeem the coupon for a copy of the Guide at $5. Indeed, juts over 300 newsagents stocked the Guide. As a retail only newsagent we were not even offered. Dumb.
If what I heard yesterday is anything to go off, goodwill generated by the Guide was compromised by clunky distribution.
The latest Australia Post catalogue is promoting the OfficeMax brand prominently next to the Australia Post brand.
Taxpayer dollars have paid to get the recognition achieved for Australia Post. We have protected Australia Post with a monopoly over postal services and many products. Under this monopoly they have become lazy … this is what comes with protection.
Successive governments have protected Australia Post and facilitated the expansion of the commercial services it operates outside of core postal services.
All of this taxpayer funded support is being used to boost the profile of OfficeMax and to help the government owned Australia Post retail outlets, 850 or so of them, to take business from small business newsagents.
Newsagents continue to be shafted by government owned Australia Post retail outlets. Thanks politicians from all sides for your support. Not.
The Queensland Newsagents Federation recently published power saving advice which could inadvertently lead to newsagents to causing computer problems for themselves. Do not change power settings on your computer until you check with your computer supplier that doing so will not impact on your use of the system.
While the QNF recommended power saving options for a computer screen, a non computer literate newsagent made setting changes on the computer which caused system challenges.
Any supplier or association providing computer settings advice to newsagents should run this by newsagency software companies first.
Read what A Turner wrote at digihub, a Fairfax hosted online news and opinion portal, a couple of days ago about what prompted their move from buying magazines at a newsagency to moving to digital editions.
What will it take for you to abandon printed magazines?
I confess I like to hold a good magazine – reading a glossy magazine is a subtly tactile experience. I like the feel of the pages. The sound as they turn. I even like the smell. But the days of printed magazines are numbered.
I wasn’t in a rush to switch to electronic magazines, but my local newsagent pushed me over the edge. I’d previously cancelled my magazine subscriptions because more often than not the magazines wouldn’t turn up in the post. Instead I preferred to drop by the local newsagent once a week for a coffee with the owner and to peruse the magazine stand for publications of interest. It was a good arrangement, but one that wasn’t destined to last.
The local paper shop which supplies magazines to my newsagent recently changed hands and the flow of magazines dried up. In frustration I turned to my iPad for solace. I found most of the magazines I wanted for less then the cost of the print version – some use Zinio, others their own standalone iPad app.
Read the rest of Turner’s post here.
I am suspicious of this story and would like to know the name of the retail and distribution newsagents so that I can verify the facts for myself. That said, does A. Turner not know that we have more than 4,000 retail newsagencies in Australia? Did they try another store?
The story feels a little too convenient for me. That said, if the story as published by Fairfax is accurate then it indicates that it does not take much for Turner to be led from a medium he clearly enjoys.
Yes, people are migrating from print to digital – some completely and some to enjoy the two mediums. I doubt that people are migrating because of lack of satisfaction with their local newsagent.
Newsagents in South east Queensland, far north New South Wales, Victoria, Western Australia, South Australia, Tasmania and the Northern territory received late notice this morning of a price increase for The Sydney Morning Herald and The Sun-Herald.
Smart publishers provide newsagents with good warning. They also let the newsagency software companies know a few days in advance so that instructions can be sent to newsagent customers. This late notice costs newsagents and software companies time. On a weekend the impact is more severe with some casual weekend staff needing help to make the necessary changes.
The current issue of Reader’s Digest is (poorly) stuck to a free puzzle book.
The A4 puzzle book means that Reader’s Digest does not fit into the usual stand for this title.
Something about the package does not work. Either the weight of the two titles makes them easily fall apart or the adhesive is not good enough. Either way, the package does not work as a package.
As for the promotion itself, it seems odd to me in that it does not appear to connect to the core content of Reader’s Digest.
More broadly on the title itself, as I blogged in March, data I have seen suggests that reader’s Digest has a sell through rate of around 25%, making it of questionable value for all but a few newsagents.
I feel for newsagents on Queensland Country magazine distribution runs who are yet to receive the latest issue of The Australian Women’s Weekly. Many are finding their local supermarket has stock while they, the competing newsagent, does not. Newsagents are often told how important they are to magazine publishers. This situation with supermarkets supplied while a neighboring newsagent is not demonstrates that words can be hollow.
Newsagents in Queensland have not received their supply of Royal Wedding feature magazines from ACP today as promised last week. Curiously, supermarkets in Queensland appear to be unaffected.
The (justified) anger of newsagents directed at ACP is heightened when you consider that tomorrow is a public holiday and traffic is expected to be down.
This is a right royal stuff by ACP. To be fair, they have sent out an email today to try an explain the situation:
Please be advised that due to production difficulties there has been some delays to the scheduled early (Sunday) delivery of Woman’s Day (Bipad 01135) today.
To maximise the sales opportunity associated with the Royal wedding some production was shifted to QLD. Unfortunately this facility is running behind schedule. Trucks were held back as long as possible but ultimately many had to be dispatched without Woman’s Day.
Based on the latest production schedule Network Services plans to deliver your Woman’s Day stock tomorrow morning (Monday 02/05/2011). Please hold off reporting any shortages until then as at this stage we anticipate supplying you in full.
On behalf of ACP Magazines we apologise for any inconvenience caused.
While ACP often tells newsagents that they are a vitally important channel, that they have delivered today to supermarkets and not newsagents shows otherwise. This is inexcusable. The email today should not have been sent. Why offer an apology without a reasonable explanation of how and why you have given a competitor such a free kick?
The ACP team decided to go early with it’s magazines today. They promoted this to newsagents last week. Many newsagents made plans accordingly, even bringing resources so that they could create displays to make the most of the opportunity. They then spend hours chasing answers as to why they did not receive magazines while their competitors did. At 10:43am they get their answer.
If I was affected I’d try and buy up tons of these magazines from the supermarkets. Too not have these Royal Wedding titles available today would present too much of a risk to the business in my view. While I shouldn’t have to do this I would. I’d see no option.
In the meantime, maybe newsagents could consider some form of joint action against ACP for compensation.
We were sold put of the Herald Sun by noon yesterday. We chased more stock and our distribution newsagent said they could not get stock. We bought up copies from Coles and they only lasted a few minutes. Based on customer queries we could have sold at least double the usual number of copies of the Herald Sun. By not long after noon at our centre every retail location was out of the Herald Sun.
We sold out of The Saturday Age by around 1:30. The same deal. No stock.
I am surprised that Fairfax and News did not see this coming given the extraordinary interest in the royal wedding. But maybe they did – they make most of their money from advertising. Printing and distributing extra stock costs money. We only make money from sales, extra stock is essential to us.
Very frustrating.
Seriously! What is up with partworks this year? Last year was lean with a limited number of releases. This year, over the last couple of months actually, we have been flooded. And I mean flooded. There is tremendous competition on retail space – at a time when we have little space to give thanks to Easter, Mother’s Day and school holidays.
Who is deciding when to release all this product into the channel? Who decides to release it late into the month to suit distributor and or publisher cash flow? Who sets supply quantities?
Come on Gotch and network, you are supposed to be specialists. I am seeing little evidence of specialist consideration in your supply decisions this year.
Take The Official Ferrari Model Collection which launched earlier this week. Yes, Easter Monday, Anzac Day. Not a smart move there. But the folks at Gotch probably wanted to make sure it hit our accounts before the end of month cut off. this title should have been out around Grand Prix time or closer to Father’s Day.
Someone needs to admits that they stuffed this up and that newsagents are carrying the cost as a result.
Distributors will blame importers or publishers. Importers and or publishers will blame distributors. Newsagents are left carrying the cost.
The latest orgy of supply of partworks leaves me, once again, doubting the viability of this mix of products. In my view, 2011 is proving to be the year of the partworks stuff up. Poor decisions are killing what should be a golden goose for newsagents, publishers and distributors. instead, newsagents are being ripped off.
I am on the record at this blog of being a fan of partworks. Not sure how much longer.
Express Publications, the masters of the bagged magazine, appear to have made a change to their approach to bagged magazines. I heard from a newsagent yesterday who received Modern Living (#1) which contained Renovating and Decorating Ideas (#2) and Country Decorating Ideas (#3). These are all current issues.
This issue of Modern Living is included in last Friday’s delivery of Modern Home which also includes the current issue of Home Ideas (V6 #3). The current issue of Renovating and Decorating Ideas includes Country Decorating Ideas and Renovating Style.
The current Country Decorating Ideas includes Renovating and Decorating Ideas and Inspirational Living Rooms.
Seriously.
As the newsagent who contacted me about this said: In other words the same CURRENT magazine is in at least two other packs so they are printing at least three times the number of copies required for sale of the title itself (plus the returns which will then be further recycled).
How much is this approach costing newsagents? Is this part of the Express Publications business plan?
Express Publications and their distributor need to come clean with newsagents on this as a matter of urgency.
Fairfax has announced, well sort of announced, a change to the distribution of a TV Guide (a combination of the TV guide from The Sydney Morning Herald and The Sun Herald) in NSW. I say ‘sort of announced’ because Fairfax had not told newsagents before telling subscribers. Here is part of the text of a letter sent to subscribers:
I’m writing with news about an improvement to your Herald subscription service.
From this Sunday, April 24, The Sydney Morning Herald and The Sun-Herald will combine television guides into one bigger, more comprehensive television review section, to be called The Guide.
Please let us know if you would like to receive the new expanded Guide, which comes at no extra cost, and which day you would prefer to receive it.
Yep, newsagents will be expected to deliver the TV Guide on the day the customer chooses. While newsagents are to be paid 15 cents for this, such a paltry amount will not cover the actual costs of this Fairfax ‘initiative’.
Once again, a publisher is pushing on to newsagents without consideration or consultation.
Network Services should not have The Complete Guide Wedding Speeches to newsagents last week. We can source similar wedding speech guides through other suppliers and achieve a 50% or better margin. We can even achieve this with a sale or return model in some situations. Network has sent a title at 25% margin with an on-sale of fifteen months. Sure, we only received two copies – they will say that is reasonable. Well, no. When we do a wedding display, a little later in the year, we will carry more copies of wedding speech titles, enough for them to be noticed in the display. What are we supposed to do with two copies of a title which is too small for traditional magazine fixturing? Seriously! In our case, had we kept the title, we would be okay as we do not use traditional magazine fixturing. Go into most newsagencies with this title today and I think you would be hard pressed to notice it among the magazine mix.
Network Services needs to do a better job in deciding what it will supply newsagents. I understand the utter stupidity of that statement. Network will do what is right for network. The supply of this title and other titles shows that.
I’d note that some newsagents will have been happy to receive this title. They rely on the magazine distributors to keep them stocked of this type of low volume fringe product. However, there are more and more entrepreneurial newsagents who want to exert more control over the fringe areas of their businesses. There is good money to be made by buying well. Sock like this, sourced through the magazine distribution model, is not bought well.
We early returned this title.
Check out the range of bagged poolside titles from Universal Magazines on the shelves of one newsagency in Melbourne at the moment.
Is this oversupply? I think so. Especially given that there are other pool titles out with fresh and more easily browsed (i.e. not bagged) content – who needs this recycled product which can only be re-sent because it did not sell the first time around..
Is this fair supply? No, not having what looks like three different packs on the shelf on the sale time. Not given that space is in high demand in newsagencies. Not given the terms under which newsagents are supplied with magazines.
What would Universal say? They would say that I am unfairly targeting them, that they supply titles which sell and that shoppers like the value offered in bagged titles. They would also say that newsagents should look at other publishers who send out bagged titles to take up newsagent space.
I encourage newsagents to check their shelves to see if they have these titles and consider whether the titles justify their space. If I was this newsagent and sales were not justifying the space I’d be early returning covers.
Universal Magazines and other publishers need to know that they are judged by newsagents on their actions and not how they compare to others. In this instance, the Universal Magazines supply model which they talk up appears to have not worked.
Representatives from Universal and newsagents are welcome, as always here, to comment.
Newsagents were yesterday advised of a twenty cent price rise for the cover price for The Age, The Saturday Age and The Sunday Age newspapers. The challenge is that The Age price rise takes effect next Monday (April 18) while the other two kick in after Easter (April 30 and May 1), after the bumper edition.
By splitting the price increases in this way, Fairfax has doubled the workload for newsagents, doubled questions from customers, doubled the cost of communication and presented more opportunities for mistakes.
A publisher concerned about customer service and the workload newsagents are placed under would have applied all price increases at the same time.
Newsagents tell me that the Sunday Telegraph published by News Limited this past Sunday weighed 920 grams. This is an unsafe weight to deliver using traditional delivery means.
As I blogged on November 20, 2006, the Nery report, commissioned by the ANF, found unsafe work practices which stem from the handling of heavy newspapers. According to the report, current work practices are unsafe. The report documents unsafe work practices which stem, in part, from having to handle heavy newspapers. Any newspaper above .6 kilogram in weight is considered to be heavy. Consider this quote from the Executive Summary the report:
The Results section of this report (page 10) has outlined significant ergonomic risk factors associated with the newspaper delivery tasks. These risk factors are particularly related to dimensions of the weekend papers (Advertiser and Sunday Mail) when combined with the repetition, volume and manual handling aspects of the delivery process. In particular, there are significant risks associated with the delivery/throwing of the larger dimensioned and heavier Saturday Advertiser and Sunday Mail newspapers.
David Nery, the respected author of the Nery report was clear:
The current situation, in my view, is unsafe and modifications to the weight, dimensions and volume of papers distributed per person need to be reduced to provide a safe system of work.
Late last year, News Limited issued a rebuttal to newsagents, based on their own expert study. Their report, or what has been published to newsagents at least, is years late and lacking in detail and professional scope compared with that of David Nery. The News Limited rebuttal is in the from of a letter telling newsagents that they are responsible for OH&S issues relating to newspaper delivery. They claim that Nery is wrong and that it is safe to deliver heavy newspapers.
News Limited controls the weight and dimensions of the product being delivered. They also control most of the economic terms relating to newspaper home delivery: delivery fees, cover price and requirements about obligations on newsagents to accept customers. These economic terms determining whether newsagents can reasonably split a heavy product into two.Newsagents need to revisit the Nery Report in the context of the fat Sunday Telegraph. If I still had a home delivery business and were in a position to influence industry response I would:
It may be that the process results in a negotiated middle ground position between News and newsagents. If it doing nothing wrong, News should have nothing to hide and therefore be prepared to actively engage.
Fairfax lumped a triple whammy against their brand and newsagents yesterday by attacking The Saturday Age. The first issue is that they whacked a garish post it note type ad across the newspaper masthead. This cheapens the brand. They do it because these ads sell I guess. The message, however, is that their brand does not matter all that much. The second issue is that the ad was a subscription offer. Why use my shop and goodwill to take customers away from me? I make little enough of newspapers as it is. This campaign offering a 65% discount is offensive. The third issue is that they are promoting their newspaper a home delivery campaign which contradicts a campaign tthey have asked newsagents to promote, a campaign for which they provided distribution newsagents flyers for recently.
What a mix up. Makes me wonder who is in charge, where they see their brand in 20 years and whether they really care about newsagents.
Thanks to pressure from the publisher we are being supplied the Winning Post. This will make our customers happy. It also encourages me that fractures in the supply model, where a small number of distribution newsagents refuse to supply some titles, can be fixed. It also encourages me to go after more titles for which we are currently refused supply.
We are promoting the Winning Post in a good location to drive sales and provide that the fight to get the product in store was worth the hassle and effort.
Newsagents should heck through their sell-through rates for the Reader’s Digest magazine. If the data I have seen is experienced by other newsagents, Reader’s Digest is delivering a sell through of around 25% to the newsagency channel. This makes it loss making for us.
A magazine needs a sell through 60% to be break even in many newsagencies.
Why we continue to be supplied Reader’s Digest knowing that 70% or more of the scale out by Network Services will have to be counted packed up and returned is beyond me. Actually, it is not beyond me. The magazine distribution model relies on the services for which distributors are paid (distribution and return processing)to be used.
Magazine distributors will say that we need to consider the overall picture, suggesting that the profits of the top selling titles support the lesser performing titles. The same argument would be rejected by supermarkets so why apply it to newsagents.
For years now I have called for KPIs for magazines and financial compensation where a title does not meet the KPIs.
Reader’s Digest needs to be profitable for newsagents on its own.
While I am sure there are some newsagencies achieving a profitable sell through with Reader’s Digest, I suspect that the majority are not. Somewhere between the publisher and the distributor there appears to be a lack of will to resolve this. In the meantime, newsagents act as the financier to both.
The performance benchmarks for newsagents published by the Australian Taxation Office are, in my view, inaccurate. I was alerted to this by an accountant who has several Victorian newsagents as clients. He expressed concern at the inaccuracy of the benchmark numbers. I checked the numbers and agree with him.
Check out the benchmark numbers against which they are comparing our businesses – remember, they use these numbers to decide who to audit!
None of these figures look right to me. But the ATO being what they will expect you to operate within the benchmarks – otherwise they will audit you. This happened to me. They wanted to know why my rent was more than 6% and why my cost of goods sold was less than 70%. Many weeks and man-hours later they moved on saying that maybe their benchmark numbers were not appropriate for everyone. For no one is more like it.
The audit was a waste of time. It was only undertaken because our rations were different to what they expected. I know that I am not alone in having gone through such a fruitless exercise.
It frustrates me that the flawed benchmarks are widely accessible. A landlord I spoke with recently cited them to counter an argument I was making.
Has anyone else encountered an audit as a result of the ATO benchmark data?
Old copies of White Dwarf magazine which failed to sell when sent out the first time have been gathered up, bagged with three to a bag and sent to newsagents as a Value Pack prices at $10.00. In the bag I checked were White Dwarf issues from October 2009, November 2009 and December 2009. Maybe I am wrong and these old titles will sell. If so, great. If not, then I will be wondering why we have been lumped with old product like this. At least fans can actually see what they would be purchasing.
So, old magazine never die, they live on on the endless loop between newsagencies and magazine distribution centres … emitting carbon along the way, soaking up our cash and taking space from a title which may have a better chance of selling.
