Magazine trials

There is much that has been said about these magazine trials by its critics. Much of it in my view is nonsense. For example, it is certainly not true that all newsagents at the ACCC meeting that spoke criticised the ANF handling of the issue. All were upset about the current distribution model and if one looks at the figure below, it's quite clear why they were upset.

Another point, although not brought up at the meeting is that despite all the problems with the magazine distribution, the current system is legal. Furthermore, I am not so sure to the ACCC view that it's a bad model. What it does is guarantee a much greater range of magazines being distributed to the public then other model that these critics were proposing. Finally, everyone who has signed up for the trials is a volunteer. No-one is forcing them in it. I do not see how anyone should try to stop these trials from proceeding. Let us, firstly, hear what they come up with before criticising.

My complaint was that because all the raw figures are not being released, it's impossible for anyone else to confirm or deny the success of these trials. I believe without data all you have is opinions. I am certainly disappointed with the outcome, as the ACCC did state several times that these trials should be open, and yet I do not think they are.

Okay having said that the MPA is starting to send information to those on the trials. Many of these are our clients, and they are sending us the data as the first step is to match up their systems to the magazine distributors.

What I find interesting is that these figures are from the magazine companies, so there is no argument here that there is something wrong with our figures as these are their figures.

Here is a graph over a 12-month period of the magazines titles delivered to one newsagency. The list is not perfect. I quickly calculate about 3.7% internal errors but to be fair for this sort of work this is quite acceptable.

It is the sell thru rate by the 2800 titles.

As you can see marked with a purple arrow, there are many titles with zero or almost no sales. Much of this is caused by the lack of space for the newsagent to display these magazines. They just cannot display all the titles they get so they have to make a choice on what to display. This is not a small group as it makes up about 34.7% of all magazine titles. Almost 50% of all titles sell thru rate are less than 20%, 75% have sell thru rates less then 40%.

The average sell thru rate is 45.47%.

On the other side of undersupply where the arrow is marked in red, we have about 1.78% that not enough stock is given.

This is not a good score.

Interestingly both G&G; and Network figures are almost identical. G&G; sell thru rate is 45.37% while Network is 45.47%. So they are probably just about as good as each other although as G&G; magazines are a bit dearer, it does mean that G&G; is slightly more profitable.

The complaints that many of the magazines sent to a shop are too expensive to sell in them seems to have only some justification, the average cost of a magazine coming in is $5.79 while the average cost of those that sell is $5.39, not that much difference.

The trial should produce an instant cut of 41% of magazine titles which is making those involved so far very happy.

Let us see what happens, and I will report back as the trials continue.