Australian Newsagency Blog

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Are newsagents killing sales of Australian 4WD Action and other magazines?

Mark Fletcher
October 26th, 2011 · 41 Comments

Newsagents sell 37% of all copies sold of Australian 4WD Action according to publisher Express Media Group.  Supermarkets and other distribution channels  account for the remainder of sales.

This 12 year-old title has a 70% sell through at retail.

Sales of Australian 4WD Action are declining in newsagents and growing in supermarkets.

Why is it that sales of Australian 4WD Action are declining in newsagencies?  Early returns is one reason.  I have been shown data, without identifying the newsagencies, where newsagents have early returned, leaving insufficient stock in the businesses to even get close to their average sell through.

This early returning action is driving sales of Australian 4WD Action down in some newsagencies.

If this is happening for Australian 4WD Action is it happening for other titles?  I think so.

In thirty or forty newsagencies for which I have seen data there appears to be no commercial reason for early return.  Indeed, these businesses are suffering financially as a result of the early return activity.  They are losing guaranteed sales.

Connecting this information with what I know form other publishers, it appears to me that ill-considered and sales killing early returning is at epidemic proportions in our channel.  If this is true, the implications could be most serious for us.

Beyond creating a self fulfilling prophecy about the future of magazines, there is the implied invitation for publishers to find other channels through which to see and distribute their titles.  I’d do that if I was a publisher and saw that retailers would rather send a title back than get guaranteed sales from it.

The data I have seen for Australian 4WD Action suggests a very serious problem which we all need to address for the future health of our channel.

The folks at EMG (Express) are particularly concerned since they have recently announced:

  1. Moving from full copy to topped returns, saving time and freight costs.
  2. Bonus margin for two months, giving a newsagents an opportunity to reengage in EMG titles.
  3. Shorter (4 week) on-sale periods, better for cash flow and space allocation.
  4. Better allocations for newsagents, leading to a higher sell through.
  5. A new customer service team to help newsagents, queries are handled quickly.

The early returning of the latest issue of Australian 4WD Action gives EMG a message that these moves are of no interest to newsagents.  That is not a message we want to give off at all … unless we want to kill off magazines in our newsagencies.

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Category: magazine distribution · magazines

41 responses so far ↓

  • 1 Brendan // Oct 26, 2011 at 9:24 AM

    EMG phoned me yesterday to set quantities for their mags. I increased all but 1 title and a good proportion of their mags have been selling out recently. Maybe customers who can’t get the mag at theri usual newsagent are finding we have them. I expect sales to keep increasing and will make the most of the much appreciated of EMG.
    If a newsagent does not keep at least 1 more of a title than the have a history of selling there sales can only go down, never up making falling sales a self fullfilling prophecy as Mark says.
    Some do the channel a lot of harm when they are so short sighted.
    This is not to deny that oversupply occurs and early returns are warranted but they should not be indiscriminate and harmfull to the magazine department in our businesses or we may all lose out in the long run.

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  • 2 Leon // Oct 26, 2011 at 10:50 AM

    Mark,

    Is this the problem or a symptom of the problem.

    You mentioned (1) magazine and (1) publisher who is trying to change the model.

    Zeroing in on (1) mag & (1) publisher muddies the waters.

    The model is broken. Newsagents are under stress. They have less staff and are time poor. Every early return they make will not be right.

    Ultimately everyone will suffer – newsagents, publishers & distributors unless the problem is fixed.

    This problem was not caused by newsagents but unfortunately we are now contributing to it. I think we can expect a lot more poor decision making as fear & stress increase. Newsagencies are closing almost weekly.

    I think time is running out to fix this problem now so in the future I can see many newsagencies diversifying and selling mags like a 7/11. Not necessarily a good thing for mags but that life.

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  • 3 Derek // Oct 26, 2011 at 11:23 AM

    I do understand where Leon is coming from!

    It may take time to try and rectify examples like this, the changes from Express are welcomed and will be supported I am certain, however we have to remember years of full returns, lack of interaction with the Newsagency channel while not necessarily the fault of the publisher this has precipated to cause examples such as this one.

    Competition is huge in the 4WD category however Express have now given itself a point of difference and should power on with their portfolio of magazines.

    I like their website and now see what magazines they carry, I encourage them to take their website further so they can communicate directly with Newsagency & retail business’s by allowing a registration portal.

    Publishers have to engage with these business’s, Foresight will see a bright future for them.

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  • 4 BrettS // Oct 26, 2011 at 11:44 AM

    Well I have just brought back into the Newsagency industry after having sold my last One.
    In my last Newsagency I was with another POS system and this time round the One I brought has Tower already there and its has been a learning curve for me lol
    What I find the most challenging and this could be through lack on knowledge with the Tower System POS is when you invoice Magazines in you never see anything about the sale history of a magazine.
    e.g. I always receive 10 of a Magazine and sell 8 then I am invoiced 20 but there is no way to know (that I can see) without a lot of work scanning up each Mag for there sales history, how many to keep or early return?
    What I am saying is this why Newsagents are early returning Mags that they should be keeping?
    Lack of knowledge to drive the POS system plus the time constraint equals bad decisions.
    Just a thought.

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  • 5 Mark // Oct 26, 2011 at 12:20 PM

    Brett,

    First up welcome. Be sure to take up all the free Tower training opportunities like online live workshops, access to the advice sheets, training videos and the help desk. Let the Customer Service Manager know if you’d like some personal training.

    On early returns, some doing them are dumb. Others are in so much pain that any return is a good return in their view.

    The best way to consider early returns is not when you arrive the stock. It is best done as a review of the shop floor. Here, using the software, you can easily see sales history (ALT/T) and make an informed decision.

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  • 6 Mark // Oct 26, 2011 at 12:25 PM

    Leon,

    Given the inability of so many to fix the model for decades, I think it is valuable to focus on this a publisher at a time.

    The example I have given is for one title for one publisher. EMG assures me that this example plays out across many of their titles. Newsagents are losing out.

    They have changed their model. We ought to react positively and show we want to be the magazine retail channel of choice. Otherwise…

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  • 7 D R // Oct 26, 2011 at 12:50 PM

    SELLING OUT ,NOT GETTING ENOUGH STOCK

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  • 8 Mark // Oct 26, 2011 at 2:14 PM

    DR go to the publisher of the titles you are selling out of if the distributor is not responding. Publishers want to hear about such occurences.

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  • 9 eric // Oct 26, 2011 at 2:34 PM

    i have 2 rows of 4wd mags and they are not selling. iam losing space $$ . i think since reading this iam going to cut them to 5 pockets instead of 16 pockets

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  • 10 shauns // Oct 26, 2011 at 4:28 PM

    I presume you are seeing figures over a few different issue to know that they have been early returned for no reason other than cash grab . If it was just for the latest issue there could be a number of reasons , i am only saying this because i am heading down the path of cutting back a few different tittles that do sell that i know for the next few issues the sales will not be the same because we are a small town that relies on farming and the season is coming to a hault in the next week so things will change . These people that do buy certain mags are no longer in town so why would i keep the mags becasue of past sales when i know what is going to happen over the next few months . Another example on why i would early return is i know the 2 months ago i sold a heap of mags with anything to do with caravans and fishing because of the grey nomads passing through but now they have all gone home so i early return some of those mags that would normally have sales figures show that they sell . So i suppose if you looked at sales for my store 2 months ago and looked at what i am sending back now you would think i have lost the plot as well without knowing the reasons behind it .
    So maybe some of these people you talk about are in the same boat . Maybe they have tried cutting back stock only to be told that you cannot cut anything back under you average sales so therefor they early return . When the publisher looks at the previous sales and thinks hey they sold 10 last months and have elready early returned 5 out of 10 what is going on ,just maybe it is the same situation as i am in who knows .

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  • 11 shauns // Oct 26, 2011 at 5:08 PM

    i was just reading a post about express media dating back to 2009 gees how things have changed .

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  • 12 Mark // Oct 26, 2011 at 7:49 PM

    Shaun it’s a trend I have seen for many titles from a range of publishers.

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  • 13 Robbie Niche // Oct 27, 2011 at 2:17 PM

    Hi Everybody,

    Robbie Adams here from Niche Media a independent Australian magazine publisher. Firstly I’d like to let any news agent know that if they have any problems or feedback or questions with our titles please feel free to email me on robbie.adams@niche.com.au as we would love to build stronger relationships with the agency channel.

    the reason I am posting a comment in this thread though is the following comment was recently posted to the facebook page of Desktop Magazine

    Yesterday I headed to my local news agent to pick up the latest issue of Desktop. After 10 minutes of browsing I still could not find it. I asked the lady behind the counter if they stock it. She just looked at me angrily and walked straight past me to the back of the shop. She then stormed past even more angry and still said nothing. She then said, “I just ripped it up! They never sell” And I said, “WHAT?! It came out today” “I know” even more frustrated at herself. then she pulled it out of a box with no cover and gave it to me for free. What a waste of paper, and your time and money! I think it is time to get subscription.

    This is obviously a disappointing situation as we’ve all lost a sale and the agent in question has lost a customer.

    Would moving the on sale day to the first wednesday rather than last wednesday of the month before help with this?

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  • 14 Brendan // Oct 27, 2011 at 3:20 PM

    Robbie, That would be a resounding yes from most newsagents I would imagine.
    None of us like to carry titles that have a history of not selling into a new month so magazines with a niche (pardon the pun) market would probably receive better treatment if onsale early in the month.

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  • 15 rick // Oct 27, 2011 at 4:04 PM

    with all due respect Robbie, if you need to ask that question then you dont understand how the magazine cash drain hurts newsagents. if you send me a mag that im not sure will sell at the start of the month, i will give it a go as nothing to lose, but send it to me at the end of the month, im more likely to send it back for a credit, rather than have to carry the cost til the end of the following month. its not rocket science. Its good to have you engaging with us all the same, cheers for that

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  • 16 Mark // Oct 27, 2011 at 4:26 PM

    Robbie, welcome and thanks for engaging.

    The first week of the month gives the title the best opportunity.

    You should get a report on sell through by store from your distributor. Newsagents need to make a certain amount per pocket allocated. The amount varies shopping centre versus high street versus rural.

    As a rule, a sell through of 60% ought to be a guide.

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  • 17 D R // Oct 27, 2011 at 5:18 PM

    Robbie It is all about haveing you account stopped , then no womens day, no nw, no ok, no tvw no new idea .If we do not have these mags we have no bussiness, that is what early returns are about ,address this and 99% of all this is fixed

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  • 18 D R // Oct 27, 2011 at 6:33 PM

    Robbie How much time do coles and co get to pay .One reason more of this mag sells outside newsagents is the fact that a lot of the supermarkets miss returns .I have just had a look at a mag that i get 4 of, in the supermarket there is about 20 ,they will never sell them ,they have not sold any in a week and will they make their return

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  • 19 Derek // Oct 27, 2011 at 6:40 PM

    Hi Rick

    Welcome – What Brendan said. Cheers for your contact email.

    Mark – I wish their was a website with Publishers who want to engage with links to their websites, is there one out their without being a member?

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  • 20 andy // Oct 27, 2011 at 6:40 PM

    Robbie
    maybe if we had a reasonable margin of perhaps 75% then we would be able to afford to staff our newsagencies with magazine specialist instead of having to look at cost cutting at every chance so we dont have accounts stopped with no real way of dealing with cash flow except early returns

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  • 21 Derek // Oct 27, 2011 at 6:41 PM

    Sorry I meant Robbie…………

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  • 22 Mark // Oct 27, 2011 at 9:06 PM

    Derek, no, just here when publishers make contact.

    Andy, with respect the 75% is ridiculous. We have spent tool long as a channel on lofty goals without success. Small steps work better for us.

    The more newsagents engage with EMG the more other publishers will take notice. It is sort of working with IPS.

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  • 23 h // Oct 28, 2011 at 9:13 AM

    I find it very frustrating to read about incidences like the Desktop story. Clearly the customer buys each issue – but NOT from this newsagency, because if he did, the newsagency in question would have a history of sales and therefore not top the mag early. They would even keep a copy for him as a Putaway if he wished.
    I think it is a BIG ask for every newsagent in Aust to have hold one copy of every mag available just in case of the odd casual sale. Supermarkets don’t carry every title. I’ve not seen Desktop in a supermarket.

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  • 24 SHAUN S // Oct 28, 2011 at 9:57 AM

    H i agree , but you can almost guarante that you can stock what ever tittle for 2 year with out a sale but as soon as you say stuff it and send it back early, some one will want it . This is the same for a lot of items eg smokes i carry a very limited range of what i know sells 364 days of the year it works just fine but there is always that one time someone comes in asking for some brand that i have not even heard of and then all of a sudden i do not operate my stock properly . We are not an open wharehouse that we can stock absolutly every item that suppliers want to throw at us . Ok some publishers a trying to work with us now and offer a better deal but for how long have we put up with a bad deal and now all of a sudden in one month they expect all of us to jump on board and show support . (which i am trying to do ) . The thing is during those bad times when they decided to treat us like #$%^ a lot of us did cut back on magazine range and started expanding into products that showed more potential than magazines . Probally 1/4 of my magazine range has been converted to books now and i have no intention of convereting that area back to magazines , publishers can blame our old mates at the distributors for that one .

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  • 25 Robbie Niche // Oct 28, 2011 at 10:16 AM

    OK I will definitely talk to the Publishers etc about this as the general response is yes. Sorry if it seems obvious to you all but we have trialled delayed billing in the past and still seen early returns so I had to ask.

    We have a few other ideas to foster further engagement, which I will post here once they become a reality.

    Thanks

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  • 26 Paul // Oct 28, 2011 at 11:31 AM

    I agree with your comment Shaun S. Murphys Law says that you can keep something for 12months or more and not sell a copy and then have someone ask for it as soon as you stop carrying it. It’s not too much of a problem if you can convince them to go putaway from the following month, but the way the distribution model currently works it’s often impossible to get the current copy if you dont already keep it.

    I’m also in a similar boat regarding magazine holdings. I’m in the process of getting quotes to convert 30% of my current magazine display space to other more profitable useage (gifts, toys & books primarily) which does well for us in our currently space limited capacity. That compacting of space will probably see me lose about 10-15% of my titles but having looked at a sell through rate report I doubt that will have any impact on my GP from magazines and should drop the monthly account figures from G&G and Network (I haven’t gone with IPS) yhough who am I kidding there ! 😉 .

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  • 27 shauns // Oct 28, 2011 at 11:44 AM

    Paul , My monthly bills with the bandits have not changed – no matter what i cut back something else pops up , i know i am not on my own there .
    my thing is publishers (some) seem to be doing a good thing for us newsagents but the problem is we do not have accounts with these guys we should not have to contact these guys to fix anything . Why can’t the big publishers set up direct accounts with us . The ultimate fix to all problems is go to scan based sales , we will gladly take all the mags you want to throw at us and pay for what we sell each week , if you want to try a new mag go for it , if it sells great we both make money but at the moment if it does not sell , the publisher and distibutors are the only ones making money and the newsagent is losing out .

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  • 28 Brendan // Oct 28, 2011 at 12:51 PM

    Robbie, thanks for taking our responses onboard. The issue with delayed billing is that we are not always aware that it is the case and are likely to miss the fact at months end anyway. Early on sale is the easiest answer for everyone but I’m sure for all newsagents the ideal scenario is sales based billing calculated once final returns are processed after the off sale date.
    This idea has often been mentioned on this blog as the way to go and would ensure that titles were given every reasonable opportunity to sell.

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  • 29 Terry Thelwell // Oct 28, 2011 at 2:20 PM

    Hi Derek

    RE: your request for a website with a contact list of Australian Publishers-have you tried here?
    htpp://www.publishersaustralia.com.au/directories/publishers.

    Most publishers listed here have a link to their website which contain details for relevant departments

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  • 30 D R // Oct 28, 2011 at 4:16 PM

    We had 1500 pockets 5 years ago but now we are down to 950 .Robbie you need to address the accounts and stopping of supply then you can send us everything ,would love to carry more titles but i can not cover the accounts

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  • 31 Derek // Oct 28, 2011 at 8:11 PM

    Hi Terry

    Good to see you keeping an eye on the place, thankyou for the website.

    Derek

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  • 32 Lucy // Oct 29, 2011 at 1:12 AM

    Hi Robbie,
    Another independent niche publisher here and yes, it’s a shame it took me 3 issues of a majority of early returns and LOTS of asking “why?” questions of the distributors who never told me about the “time of the month” issue before it took a chat with my local newsagency to clear that up and my mag now has an on sale of the 1st (or nearest to) day of the month rather than the 25th to avoid excessive early returns.
    What I am STILL having trouble coming to terms with (and I have to be careful here because the distributors read this forum too and know I’ve been complaining so will only make things worse for me) is that I have no way of proving what actual sales are. Every issue, the distributor says “sales are looking better and you may get a return this time”, then the on sale period comes to an end and it’s “oh no we miscalculated, sales aren’t as good as we’d hoped” and lo and behold the sales EXACTLY equal their fees (distribution at $1 per copy even for early returns, then “storage” fees, delivery fees for the few returns I do get (the majority get destroyed) and so far, after 4 issues I’m told I’m only selling around 700 copies per issue (which with a subscriber base of over 250 already and 1,500 Facebook fans I find somewhat hard to believe.
    Newsagents, I have ALWAYS encouraged my customers to buy from the agents, I don’t make the mag available any other way until after the next one has come out and thank god for back issue sales online or I’d have given up by now, but you need to also realize that us independent publishers are already being royally screwed by the distributors so please don’t make it even harder for us by returning new titles early rather than giving them a fair go!
    I count on them sitting on the shelf especially while the title is getting known and it’s getting frustrating having customers tell me that they looked everywhere for my mag but couldn’t find it and then hearing that 2,000 copies were returned immediately without even being put on the shelf… heart breaking actually as the distributors only send me back a tiny fraction of the returns they get.
    I can’t continue with the distributors who seem to be the only ones making money here… I’ve got not $1 back from them yet.

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  • 33 Lucy // Oct 29, 2011 at 1:22 AM

    Is there any way to distribute to newsagents directly without going through the majors? Are you as newsagents prepare to deal with publishers directly? Because I am desperately in need of an alternative…
    I have a great title, that although niche the style has a much broader appeal in what is a growth interest area – it is the first and only mag of it’s type and has a strong and loyal following, but most people who aren’t interested in old caravans probably don’t realize just how popular vintage caravanning is.
    But I need newsagents to support it so my customers can find it!
    What should I do?

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  • 34 Mark // Oct 29, 2011 at 7:17 AM

    Lucy, one option is to write to newsagents are offer firm sale direct supply. If you can provide a reasonable financial model you may find traction, especially if you offer backup stock in the event of a sell out. One frustration for newsagents is not being able to get backup stock easily.

    Publishers and newsagents make money from sales. Distributors, generally speaking, do not.

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  • 35 peter // Oct 29, 2011 at 8:40 AM

    MARK 34 “Publishers and newsagents make money from sales. Distributors, generally speaking, do not.”

    that there is the problem with magazines in australia

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  • 36 Lucy // Oct 29, 2011 at 1:46 PM

    Mark I disagree… I supply the distributors with a quantity of magazines for which they charge $1 per mag, the net return from newsagency sales then EQUALS that fee… so for every issue I send to the distributors, I make $0, they always get their fee and yet it costs me $5 to produce every magazine, so from what I can see, they are making money at my expense!

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  • 37 Lucy // Oct 29, 2011 at 1:49 PM

    Is there some kind of list of newsagency contacts I could approach?
    Have other publishers done this and if so, does it work?

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  • 38 Paul // Oct 29, 2011 at 3:53 PM

    I think what Mark meant Lucy was that the distributors aren’t interested in chasing sales specifically, just handling distribution volumes. Sales are only of importance to you (the publishers) and us (the newsagents) as we both make our livings directly from driving these sales (the distributors don’t as you’ve already found out and commented upon !) . We need more publishers like you who come forward and engage with us, think about the current model and whats wrong with it and then find a solution thats beneficial to both of us (bugger the distributors !) .

    Bravo too to you Mark for providing the means for publishers to come forward via this blog. As the proverb goes ” Every journey starts with a single step” , perhaps this interaction is the first step on the way to getting a sustainable magazine model for newsagents & publishers alike !

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  • 39 Vicki // Oct 29, 2011 at 8:12 PM

    Lucy, its lovely to hear from a publisher so passionate about their product.

    Its unfortunate that the only one making money out of this situation is the middle man. Perhaps before trying to got it alone, engage with us further here, let us know more about your mag and we could give it a go.

    I’ve never heard of a vintage caravaning mag and have never had any supplied by either distributer; who knows, there could be sales out there I’m missing. I’d be willing to give it a try, but I’d need to be able to return those that don’t sell at some point.

    I’m trying firm sales with Dumbo Feather, but its not really working for me yet. I’ll give it a bit longer though, it may just need to build a fan base!

    I try to support as many aussie mags as I can sell, my early returns are usually the engish and american stuff that Gotch likes to push.

    Its coming up to caravaning season. maybe now is the time to ask us all to get behind your mag and give it a push?

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  • 40 Allan Wickham // Oct 30, 2011 at 8:43 AM

    Lucy,
    Because you seem like a proactive Publisher ready to engage with proactive Newsagents i have located your Magazine at the front counter as reward for wanting to connect with us.
    I have been selling out of your magazine consistently each time, it is a good fit with newsagents who have good caravanning magazine sales. Just as a side note, i have never seen any POS for your title, is there any available?
    Cheers
    Al

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  • 41 Lucy // Nov 1, 2011 at 10:35 AM

    Thank you Allan!
    Interesting developments today – I guess they’re sick of my whingeing because I have just been advised by the “Big G’s” that I can be released from my contract with them should I choose to seek other alternatives…
    So, if any agents out there would like to stock the magazine let’s talk! You’ll only get what you think will sell, and I’m happy to work with you on finding an agreeable working alternative.

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