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A test program developed by the Magazine Publishers of America hopes to uncover the fundamental requirements of scan-based trading

Magazine publishers are looking to scan-based data gathering to help improve single-copy sales efficiencies and ultimately profits in the category. Through the Magazine Retail Advisory Council (MRAC), a group formed by the Magazine Publishers of America (MPA), a pilot program testing the application of scan-based trading (SBT) to magazines has been initiated.

The objectives of the pilot test include assessing the reliability and integrity of scan data, determining the accuracy of the SBT identification of each issue sold, and identifying and measuring the savings from SBT throughout the supply chain. The test will also measure and document shrink by title, issue and store, as well as identify the next steps for the pilot, which could be recommendations for process improvements and reducing shrink.

Retailers have long complained that they do not have accurate ways of tracking magazine sales, either as a category as a whole or by specific titles. They say that without a proper way of monitoring sales they are often left without guidelines as to what titles are selling the best in their stores. "Magazines is a category that really depends on sales results because different titles sell better in different stores because of customer demographics," says one magazine official. "It is extremely important that retailers and publishers join together to develop a vehicle that properly tracks sales."

MRAC officials say that scan-based trading, which includes the use of retail scanner data to create a market-driven supply chain, will enable retailers, publishers and distributors to synchronize the supply of magazines with consumer demand at the point of sale. It should also provide accurate information that can be audited and used to manage ongoing business relationships between trading partners.

The advisory group says the primary function of the pilot tests is to reveal a greater understanding of three critical issues: shrink, issue add-on code and data sharing. Each of these issues will aid in the strategic planning for SBT in the future.

However, officials with the MPA and MRAC emphasize that the testing is only a first step. "SBT is currently in its infancy and the magazine industry is a pioneer in developing a framework for testing," says Anne Finn, vice president-consumer marketing for New York-based MPA. "We understand that a limited number of retailers may have the ability to fully embrace SBT, but we are confident that it will be a major benefit for those trading partners who cooperatively implement it. The findings from the pilot test will help formulate the future framework."
Average signle-copy
circulation for top ABC
magazines, 2000
1 2 COSMOPOLITAN 1,844,728 2,022,039 -8.77%
2 3 FAMILY CIRCLE 1,802,235 1,845,439 -2.34
3 5 WOMAN's DAY 1,748,765 1,688,882 3.55
4 4 NATIONAL ENQUIRER 1,706,367 1,773,05 -3.76
5 1 TV GUIDE 1,611,628 2,052,852 -21.49
6 6 WOMAN'S WORLD 1,528,298 1,542,995 -0.95
7 8 PEOPLE WEEKLY 1,392,046 1,407,569 -1.10
8 7 STAR 1,356,636 1,463,037 -7.27
9 9 FIRST FOR WOMEN 1,286,159 1,313,578 -2.09
10 -- O, THE OPRAH MAGAZINE 1,242,078 -- --
11 11 GLAMOUR 1,069,839 1,143,263 -6.42
12 10 GOOD HOUSEKEEPING 1,048,505 1,181,381 -11.25
13 17 MAXIM 986,576 660,206 49.43
14 12 IN STYLE 925,623 855,697 8.17
15 14 READER'S DIGEST 742,897 731,584 1.55
16 13 GLOBE 695,665 756,461 -8.04
17 16 TEEN PEOPLE 654,524 680,573 -3.83
18 15 SEVENTEEN 588,783 682,620 -13.75
19 21 REDBOOK 580,582 551,773 5.22
20 23 MARIE CLAIRE 577,669 523,823 10.28
Source: Magazine
Publishers of America
* 2000
* 1999
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Copyright 2001 Gale, Cengage Learning. All rights reserved.

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Publication:Grocery Headquarters
Date:Sep 1, 2001
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