Australian Newsagency Blog

A blog on issues affecting Australia's newsagents, media and small business generally.

Lovatts increasing magazine supply without justification

Mark Fletcher
March 12th, 2018 · No Comments

Lovatts Media has increased supply of several titles in situations where data show there are consistent returns. I see no evidence in sale or return data supporting an increase in supply. I see no evidence in current issues indicating a supply increase was warranted.

Lovatts senior management had previously advised they do their own allocations. Assuming that is the case, Lovatts has failed my small business, and maybe many others. Check your data. If my assumption is wrong and Gotch controls  allocations, then it is Gotch that has failed newsagents with unwarranted increases in supply.

Every magazine publisher needs to understand their situation on the shop floor in newsagency businesses. Every time a newsagent sees unjustified oversupply it encourages them to consider other steps to fight back. These other steps can include moving the location of magazines and cutting floorspace for magazines.

You could look at the screen cap I have included with this post and say: hey, it is only four extra copies. The is true. However, it is four extra copies soon top of what is being returned. This title from Lovatts has a 50% failure rate.

Their increase in supply increases the extent of the failure. It extends the financial risk to my business as I carry the cost fo theft. I also carry the cost of labour for product management and the cost of space for placement of the extra stock, which will not sell.

The problem here is a problem for every magazine publisher to contemplate and act on.

Newsagents are not the compliant agents of yesterday. Today, newsagents are more likely to be retailers looking carefully at what they make per square metre of floorspace. The failure of a single magazine to sell is far more a problem today than a few years ago. This is because more and more of what we sell has a GO% of 50%, sometimes more. The 25% from magazines puts the category more under the spotlight.

Lovatts needs to take control of this issue and immediately audit all supply situations. Given data available, Lovatts management could have an understanding of the scope of the problem in a few minutes. It will be interesting to see of Lovatts acts, to see if they care about newsagents.

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Category: magazine distribution · magazines

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