FEATURE 

The Arkwright Experience

Pressure on shelf space at the multiples, coupled with some “puzzling” decisions from WH Smith, means, says Bruce Skivington, that specialist publishers should invest more of their time and energy in the humble independent newsagent.

By Bruce Skivington

When watching reruns of the BBC comedy series Open All Hours, I often wonder if the scriptwriter lived in Edinburgh. The antics of Arkwright and his nephew Granville, played by the two icons Ronnie Barker and David Jason, as they ran a corner shop, are funny but very close to home. During part of my upbringing in the 1950s, my uncle ran a corner shop. Like Arkwright, he considered any customer leaving without making a purchase a personal insult, and that there was no job too onerous or too unpaid to give to his nephew.

It did, however, give me a number of important lessons in business, customer handling and marketing. Now as a publisher, instead of being a remote other worldly figure behind an oak desk, it does mean I can understand our whole trade. In many ways, an important thing for a publisher to understand is the retail trade.

Puzzling

The recession has changed the high street, and when big names like Woolworths find they can no longer stay in business then you know there are problems. With the banks also in difficulty, it means that footfall is reducing as the reasons for going to the high street are falling. This means that retailers like WH Smith also have to be careful. Their product range has to be just right to attract business. This fact makes two decisions by WH Smith rather puzzling. Firstly, to charge publishers for “promoting” their magazines and to delist those that refuse to pay is very short-sighted. Even before the recession, many of the smaller specialist magazines ran on tight budgets, more a labour of dedication than a massive generator of profits and now with everyone feeling the pinch from advertisers across the whole spectrum, being forced to pay or be removed from the shelves is one choice too many.

Another area of puzzling business policy is their decision to only stock a single range of travel publications from one publisher in their travel outlets. Admittedly, for this exclusivity, they have been rewarded with a bigger margin, but is it a long term strategy? In the short term, profits might rise but if turnover drops due to the lack of choice and if the sole supplier gets into difficulty due to the lower wholesale price then the whole exercise could rebound. Looking at their business strategy has made it clear to me that the best course for magazine publishing now lies elsewhere.

Shop saves

Of course the problem is range; not even the largest supermarket or bookshop can stock a full range of magazines but a good retailer gets to know their customers and, like Arkwright, can ensure they never leave empty handed. This gives a great opportunity for the smaller retailer. If WH Smith is not stocking a full range of the specialist magazines then, while a small retailer does not have the shelf space to stock them all, he can order them for his customers. While many of the specialist magazines depend on their subscription sales, there are always readers who for many reasons don’t want the upfront cost of a subscription and prefer to buy each month. A steady customer purchasing each month also means someone who can be sold something else.

For the specialist publisher, knowing that retailers are taking orders helps in deciding the size of print orders. The trade in specialist magazines, while not spectacular or with the bulk handling to satisfy large groups like WH Smith, can be useful for a smaller retailer where every penny counts. With the pressure on other ranges such as tobacco and confectionery, the news agency part of a CTN becomes more important. Although there are distributors and wholesalers between the publisher and the newsagent, success in the future is going to depend on closer links.

Print on Demand

No retailer can stock every title; it is easy to stock the popular titles but what of the lost sales of a specialist publication, from a passing request or someone just browsing? Again technology is waiting to transform the retail experience.

Already an application of technology called “Print on demand” is revolutionising the book industry. Where once the biggest problem for book publishers was deciding the print run to ensure an economically large enough print order without being left with thousands unsold, now this new technology means that it is possible to print a paperback book onsite in the retailer in around three minutes. Again using the internet, the files travel direct to what are really just sophisticated colour laser printers with binders attached. The size of a desk but getting smaller, these machines could revolutionise retail sales.

Although this technology is still in development, apply it to the periodical industry and suddenly even the smallest retailer can stock a wide range of magazines. The range is only limited by the availability of the magazine on file. No problems with supply or returns, no pressure on shelf space. Also the satisfaction that no matter what the customer asks for, you have it in stock. Even a back number can be printed if required. Although at the moment the machine cost is high, like all new technology, that is bound to reduce to economic levels. Arkwright would be pleased, another chance to ensure that the customer, no matter what they came in for, always left with a purchase.