Click on the image to see the data available to Network Services for The Australian Coin and Banknote magazine which guided their system and or processes to increase us from two copies to three copies. It appears that all it took was one issue selling out for supply to be increased. If only they responded so quickly to reducing supply – I am often told that it takes several issues for them to have sufficient data to reduce supply.
I understand the challenges of getting the distribution right at the bottom end of the market – for special interest titles where supply is under five copies.
In this instance, based on the sales data for this title, I would have thought that our supply should have remained at two until at least two or three consecutive months of selling out or until we requested an increase. I am sure the extra copy could have gone to a newsagency which is selling out.
Small increases like this add up … as I have written here many times.
Personally I would not mind however using your scenario and I only sold 2 or 1 the next time, a reduction should happen as quickly as the increase happened.
It does not happen as general rule so you do have an argument and we as a channel have an argument.
Derek, hopefully publishers become more informed as a result of this evidence being published and start to ask questions or act differently themselves. They set the print runs after all.
Are there actual people within the publishers who are making the decisions on individual magazine supply or is it automated somehow?
Looking at my Network bill tonight I’m pretty sure they just decide they need more cash. Pretty rediculous when the two accounts from Network and Gotch are more than my magazine retail sales total for the month.
And thats after pretty enthusiastic early returns at end of month !
Jim
To answer your question of who makes the decision on magazine supply, my understanding is that publishers are provided with a draft allocations list of retailers by their distributor prior to each issue being printed. This enables the publisher to review the allocations suggested by the distributor and make changes (reduce, increase or cancel supply), before setting the print run.
Draft allocations are usually based on 6+ months sales history of individual retailers, however they are only finalised sales (i.e. after offsale and the extended returns period). For monthly titles this means the sales history is 3 months behind, which makes it difficult for publishers to accurately gauge supply.
Do all publishers properly manage the distribution and print run process? Reading this blog suggests that many don’t, especially publishers of special interest titles.
Rather than wait for publishers to find this blog and read it regularly, when over-supply of a special interest title occurs a short phone call to the publisher could quickly solve the problem. At the very least it would help them to be better informed.
Mark
I agree your supply should have remained at two until at least two or three consecutive months of selling out or until you requested an increase. In this instance it looks like the distributor saw the numbers and forgot about the ratio. Achieving 100% sales outranks the possibility of achieving 66%. It also strongly suggests the publisher played no part in the current allocation.
i used to try and fight oversupply,on the phone, faxing allocation requests, then changing them online… to no avail.
by simply early returning them as they come in, and then a huge early return clean out on the last returns of each month, i am saving time and money, at the publishers expence.
november network bill
total deliveries $7578
total credits $4578
august network bill
total deliveries $7194
total credits $3696
i know these figures are going to appear small to most stores but as percentages, anyone can see there is something wrong.
oh and by the way…. we keep receiving this banknote title also, never sold one (and I tried), so they go straight back
This whole distribution channel is @#$%^ . Now the bright sparks at GG have decided to cut my better homes and gardens back to less than what my actual sales are .So what do i do call GG call pacific mags waste my time once again . it is a bit hard to be a so called magazine specialist when you have to deal with companys that obviosly do not give a hoot .
Our supply of Dolly got increased from 4 to 17 this month.
Did anyone else experience this?
Peter, your figures might be small but they
stack up with mine. We have been in the
industry for 33 years and our returns ratio
is still approx 53% (the companies will
claim that they aim for 30%)
For this to go on for so long just tells you that the system is broken and the publishers are getting a very raw deal from
the distributors because of their unbendable policies.
If the distributors don’t change their trading terms and policies many more publishers will go out of print.
Xchangeit edi is supposed to “fix all these problems” but it is only being used to top
up when they see sales going well. The
opposite – reducing copies that are not selling – very rarely happens and with good
reason. The distribution companies use the newsagency network as their cash cow
and our leadership at a national level has NEVER been able to negotiate better terms
of trade for us.
I am reducing my magazine pockets in 2012 and adding more stationery & gifts because shopping centre rents are far too
high to be giving too much room to circulation product.
I can sell one $5 card and make more than
selling 10 Fin/Reviews – time for us to take
back our farms.
From reading June’s post, I thought I’d have a quick squizz at Network’s website, in relation to publishers, and see just what twaddle they’re feeding them, in order to get them to go with NDC.
OMG I’d forgotten just how much I’d sneezed while on hold with this mob; as well as last time I saw this page (‘Aaa-BSSSSHT).
The Magshop seems to be a new thing, where they’re actively pushing their subscription arm, which was a bit alarming, really. I don’t recall that bit last time I looked, admittedly a couple of years ago.
Peter, you figures could easily be my figures. Almost identical
Newsagents running the Tower newsagency software can produce a Magazine Sell Through Rates Report which details by distributor / category / title the sell through rates for the last 12 issues. This gives you an overall percentage or issue by issue. It can be most illuminating … and empowering.
We got 4 Better Homes & Gardens, we normally sell 26.
June,
After way too long thinking about it, I removed roughly 300 pockets of magazines taking me from around 1,000 down to 680 pockets in early November.
The space I reclaimed has new product in it and my stationery section has been relayed on new shelving as well, with no overall increase in allocation to space for stationery, just better displayed.
For November my magazine sales were down about 3% POP, as opposed to the previous 6 -10% per month for the last 12 months, stationery was up 25% and I have 2 new revenue streams that are doing better than forecast in the old magazine space. Overall my store was up 9% on November 2010 with the growth coming from high margin product.
Although it is still early on into the changes, so far the results are promising.
Glenn the risk of such a considerable cull is that you reduce the appeal of your newsagency as a destination for browsers. Only time will tell.
Magazine range is the key point of difference the newsagency channel offers over other retailers.
I understand the need to drive a more efficient range. If only magazine distributors understood this too.
Annual Percentage sales
2009 Network sold 61.8%
2010 Network 57.7
2011 ( one month short but the stat won’t change much) 52.1%
2009 Gotch sold 53.3%
2010 Gotch sold 48.6%
2011 Gotch sold 47.4%
This magazine allocation stuff is fairies at the bottom of the garden !!
My best year was 2007 Network sold 65.8% and Gotch 57.1%, it’s all been downhill percentage-wise from then.
heather, now run the magazine Sell Through rates report with Pacific and ACP titles reported separately. Sit down.
Will do tomorrow – afternoon off for
haircut at a locally run business today !
Nexus magazine
last month – received 11, sold 2
this month – received 21
never sold more than 2 in any month for the past 2 years
Ever since NDD shut down and most of that crap went to network, my sell through has just kept dropping.. no matter how much i early return either gotch or network crap titles, they just keep sending it.
Today I received about 15 different titles from EMG. 90% of them are new titles or titles I have previously cancelled because they don’t sell. That is a lot of new space I have to find to display them. IMPOSSIBLE, and they wonder why their early returns are high. I used to have their titles managed well, now they seem to think they can dump everything on me.
Same here DM.
I’ve already topped at least half of the EMG titles received today for early return as I simply don’t have space for them. Like Glenn @ 14 I’m dropping around a third of my magazine pockets for other revenue producing streams. Similarly, I’m also showing an increase in other areas with a net 6% increase in November to the previous year and GP up thanks to higher sales in stationery (which includes gifts) of over 20%, greeting cards and passport photos.
After doing a magazine performance report as Mark had recommended here several months ago I was stunned to find that nearly 43% of the magazines I carried didn’t pay their way, hence the cut back. I’ll then look to more heavily promote and grow sales of what remains next year as part of my overall business plan.
Today I recieved 10 Jewelry Redist. from NDC
Previous issue – 5 recieved, 5 returned.
At $19.95 a pop, this is a great way for NDC to increase my account and suck out my cashflow.
Full returns mean this title will fill an entire box, which costs me $5 in freight. I have lost money just by recieving this title.
Another no-win magazine situation.
I will not return FULL stock to NDC or GG for that matter if its there inability to manage my magazine distribution as that is their responsibility.
e.g. If I sell 20 copies of lets say Just Parts and I keep getting an increase (and I am) but I am still selling 20
Why should I pay for their inability to manage my magazine distribution not just effectively but efficiently
BrettS, have you had any problem with credits, when you return a full title as a cover?
I would love to do the same but to have $$$ not credited because they were returned incorrectly is a huge risk i cant afford to take.