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Comparing the challenges of bakers to magazine publishers

Screen Shot 2015-02-12 at 9.32.59 pmI am grateful a newsagent drew my attention to an article on page of The Australian Financial Review yesterday. Baking giant’s profit crumble on page 27 is a timely read as what Goodman Fielder has experienced with Coles and Woolworths, Australian magazine publishers could also experience as bread and magazines share some common aspects.

Here is what the newsagent wrote to me about this:

The comments in the AFR today regarding Goodman Fielders result (page 27) and the steps this company is taking to recover from a huge drop in profit due to oversupply and massive returns of bread sound just like magazines. I wonder how much push came from the supermarkets or is the effect on Goodmans bottom line the driver. Maybe we can learn something.

We see supermarkets driving some activity with magazines around discounts and bundled deals – all pitching the titles at below their cover price.

I wonder if there is pressure for this to increase – offering discounts, bundles and other promotions. Supermarkets are more active in the magazine space than at any recent time.

The only way we newsagents can address this is to be a unified channel of value to magazine publishers. I suspect, however, that the behaviour of magazine distributors toward newsagents is s barrier to that happening.

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