I have spent the last week relaying the magazines in my newsagency. On Monday I spent several hours researching performance of each title by a range of measures. More than 40% of what I had on the shelves was not covering the cost of the real estate. I had 12% more titles that I could physically accommodate. Popular titles in some segments were being held back because of insufficient space and the doubling up of product in display space designed for one title.
So, Monday afternoon I decided it was time to make decisions as a retailer and not as a warehouse for product sent by magazine distributors who are paid a fee to distribute.
The result, a week later, is a fresh magazine presentation. All 1,500 titles in the store look good, they each have their own place and there is even room for professional displays. Time will tell if sales suffer. I expect they won’t. In fact, I expect the strong titles in each segment to increase sales since customers will be drawn to them thanks to how we are able to display them now.
It is inappropriate in this deregulated marketplace for newsagents to carry the cost of small circulation titles. If someone wants to pay for the space in my shop that’s fine but since it’s my money I am reclaiming my retail space to be allocated as I see fit to best serve the needs of my business. This means that successful suppliers will be happier because their sales will increase.
So much of operating a newsagency in Australia is reacting to the demands of others imposed by the stock you receive each day of the week. It is a balancing act with each new product demanding your time, your promotional space and your shelf space. Suppliers do not work in together and the newsagent is left to make balancing decisions themselves. This is a tough job made tougher by frequent calls from suppliers wanting to know if you have done this or that or whether you have their product in the right place to receive your reward points allocation.
The newsagent channel is cracking at the seams because of the supply problems and 95% of the problems are with the titles accounting for less than 10% of the sales.
I fear it will take some business collapses before people who should be working on this take notice.