Our supply quantity of Australian Business Solutions magazine has been increased by 2 copies with the latest issue. I cannot see any justification in our sales data for this title for the increase. If they are planning a promotion and wanted us to have capacity to grow sales as a result then the usual supply has enough room for that.
These two extra copies of this magazine, or any other, come at a high cost to newsagents when you play such an increase out across the channel. If they don’t sell, as will probably happen, the channel has provided extra cash (from the extra copies) to the publisher and or the distributor for their purposes.
Magazine distributions should not permit any increase unless sales demand it or unless I agree to it. Where such a rule is reached I ought to be given the additional stock for free. Otherwise we have the system we have today – these two extra copies sit on my shelves until recalled. I am out of pocket as a result.
While my experience of oversupply is much better today than a year or two ago, it still happens. Those responsible don’t understand the cash-flow impact.
This is one thing that drives me to distraction. We too received extra ABS without one sale of the previous issues. Last week we received from network the aussie guide to about everything you can think of – ie cycling, photgraphy,etc.etc. at a retail cost of $14.95. The thing that annoys the most is that we received some of these magazines last month and early returned them. They had already done the rounds to various newsagencies prior. You are right Mark they do not understand cash flow impact at all.
“…they do not understand cash flow impact at all.”
Oh, they do, they’ve been told enough times by enough agencies.
They just don’t give a toss.
Comments from Yvonne Smallman QLD State Manage ANF in the QLD news letter dated 15/9/09 #8.
Supplier Trading Terms
I have had meetings with suppliers and
publishers in the past couple of weeks and
inevitably the discussion has turned to the effect
the current economic climate has had on
business.
The message that has been very clear from
each meeting is that the suppliers and
publishers are monitoring their cash flows even
more closely at the moment and as a result they
are tightening their credit policies.
This means that if accounts are not paid within
their trading terms where they may have given
you some leeway in the past THEY WILL NOW
cut supply immediately so if you are
experiencing cash flow problems please talk to
them.
Y&G, the distributors understand cashflow extremely well.
They send out gross oversupplies of mags that nesagents have to pay for within 20 days or they stop supply. Then they hold onto that cash from publishers until returns are done. It’s great for their cashflow, just bad for everyone else.
Luke, My point exactly. The opening sentence in my post was a direct quote from the last sentence of db’s.
From recents posts I believe that the current model is lose-lose for everyone. The newsagent loses from over supply of useless magazines and publishers are losing out from un-sellable returns.
Perhaps if the publishers worked a little more closely with the end-distributors (meaning newsagents) the could work out a suitable solution which would suit everyone’s cash flow?