I want to sell out of magazines. I love it when it happens. Independent publishers I speak with love it too. A sell out is good. I it happens early enough in the on-sale I will order more stock. I’ve done that plenty of times.
The newsagent magazine distribution model is not designed for us to sell out. The distributors think that sell outs are bad. One distributor representative told me that publishers don’t like sell outs. I can’t find evidence supporting that view from publishers I have spoken with.
The kind of sell outs which I think are acceptable and for which I would not order additional stock are: weeklies – by day four or more; monthlies – by week three or more, sometimes week two depending on the title and the advertising support for the issue. I am not including anything beyond monthlies since I do not think that any title in a newsagency should have an on-sale of more than thirty days.
So, yes, I like selling out. What do you think?
Mark,
i LOVE selling out of magazines. Personally i believe it gives me a better opportunity to get to the required levels rather than being constantly overloaded with stock. If i can achieve a sell out it saves me time and money (read: no returns). The only time a sell out bugs me is when it is avoidable (like under supply).If i were a publisher i too would love sellouts because i could then give an accurate sales figure to advertisers rather than just distribution figures.
Cheers Al
The optimum is to have one left, a sell out can be a missed opportunity
I’m with you Graeme, 1 left means the we have the capability of selling that extra one to a new customer. The exception would be really low volume mags where a sell out is perfect. If I sell out regularly, then I’ll increase supply by one on these low volume mags.
I see the goal of having at least one copy on the shelf at all times as being a key factor in the issue of magazine oversupply.
In my mind Graeme’s goal of 1 left is close to ideal but not quite right.
I remember talking to someone one day and they said that the goal is to sell your last copy just as you are closing the door at the end of the day.
I think this is the best advice I have heard on this issue.
Unfortunately the ideal world and the real world don’t always agree.
Dean (and Graeme) I would agree if the goal of not selling out did not cause misbehavior in terms of overall magazine supply. I think that it does – hence my position on sell outs.
Graeme,
i agree with the lost sale comment but it can also be an opportunity to pick up a regular putaway customer. Particulary if the sell out is late in the on sale cycle.
Cheers Al
Not if it is sold out Allan, as the customer didn’t see it and didn’t ask if you kept it.Most will walk if they don’t see what they want.
Graeme that is not my experience. Customers do ask. I opened a new newsagency in December 2009 and have built a solid magazine department using this approach – stocking what people ask for. Leveraging this opportunity all comes down to customer service.
I am convinced that the requirement to never sell out is a key reason for oversupply.
My experience too is that customers will ask where a magazine is located and we jump on the opportunity to offer a putaway service when this happens if it is in stock or not.
As an aside, Billy Brownless and Dale Thomas are in the casual leasing area outside my store at the moment promoting the TLife store. Busy busy busy.
Graeme,
It is my experience too that customers will often just walk away if they can’t find what they are looking for. Naturally those who have made a specific trip to a store are likely to ask for something if they can’t find it, and those who have wandered in or made a passing decision to see if your store has what they are looking are more likely not to ask. I’ve caught customers countless times just before they about to walk away without asking. It would be hpocritical for retailers to assume that most customers will ask when they spend so much time, effort and money on marketing and merchandising that indicates the exact opposite.
While I don’t enjoy oversupply, I think selling out in a SOR model is a worse scenario. The fact is that selling out will inevitably lead to lost sales. If a model that discourages sell-outs encourages distributors and publishers to oversupply then then problem is that they are not working to clear enough rules. The problem with the current model is not oversupply, it’s that distributors and publishers are not forced to supply according to strict calculations and rules. The only thing that changes in between a model that discourages sell-outs and one that encourages them is the mathematical calculations. In the current model, the one that has no structured rules, the problem of over-supply exists because no one has set the rules to define exactly what over-supply is.
I neglected to note that the other factor in my consideration on this issue is the decay curve.
A title with a 30 day on sale and which achieves less than 5% of sales in the last, say, 14 days is the type of situation where I would not worry over not having the title in those last 14 days.
Mark you always know the ones that ask but you never know the number who didn’t. Mark if there were 2 newsagencies in your centre and I walked into yours and working on your sellout decay theory and you didn’t have “Underwater Knitting” and then I went to the other one in the centre and he was working on my always having one on the shelf theory, which one will i go back to next month?
Graeme, the question has more elements than you ask … customer service, ease of access, value (i.e. a loyalty program), knowing whether my store would get the title in, magazine layout and the overall shopping experience.
Customers will not block visiting a store on this one experience. maybe in the old days but not today.
Mark,
In my scenario everything else was equal.
Graeme is rarely is.
You are right Mark, one satisfied my immediate needs the other one didn’t so it wasn’t equal
Graeme if newsagents want to operate with that model then fine. Its is not financially viable for the 1000+ titles an average newsagency carries. if we carried top sellers only like many supermarkets or c-store then fine. But not for the range we carry. It is a key reason newsagents lose money on magazines. It is a reason some newsagents get into financial trouble with magazines.
Mark we are talking magazines that we already stock and I believe that the Magazine distributors are less likely or at least less likely to increase the supply significantly if you return 1or more rather than none. Your problem seems to be more about the supply model from distributors rather than satisfying customer needs.
Not at all Graeme. I have looked at the tail of sales at the end of the decay curve for many titles in many newsagencies, at other products by those shoppers and also considered whether those shoppers will return based on that one experience.
In your average suburban newsagency, I do not think that it is financially viable to stock all titles until the final day of on sale.
Many people here say that the magazine distribution model is in trouble. My suggestion of looking at the notion of never selling out is one structural change we could consider. In my view, it would address supply issues for many newsagents.
That said, it will not happen because of vested interests of some publishers and the two main magazine distributors.
The theory of still having one on the shelf is flawed if like the store I work in you have over 40 subagents.That is 40 returned to me,no thanks,I rather they sell out.Less work and my figures aren’t buggered up and I don’t get undersupplied based on those returns.
The small amount of margin lost on the non sale isn’t worth the worry as I would save money on time/wages of processing returns.
If the customer was so desperate for underwater knitting they would have asked for it to be put away.that is what needs to happen, teaching the customers about put aways.
One of my other concerns with a model that aims to sell out is the potential to stifle small incremental growth. If a title’s sales grow just a few percent per month that may not come to fruition under such a model because there is no additional stock allowing for a small increase in sales.
As for titles with a steep decay curve over the first 14 days where only 5% of sales occur in the last 14 days we need to evaluate if we can get a better return on other titles in that space over the last 14 days. Assuming one has some form of KPI based on return per pocket then I would think that the answer to that would be no. It would leave the retailer down 5% in sales with little prospect of making that up in sales of other titles. The bottom line cost of holding such a small amount of stock is very little (less than 0.4 of a percent).
I am a publisher who makes most of their money from sales. I prefer to sell out. While I do not have decay data, I would be happy with unsatisfied interest. This can build and help drive sales. It is what we are seeing at least.