CHARTING PERIODICALS

JOEL ELSON

Consolidation within the magazine distribution ranks is making it possible for supermarkets to hone their periodicals racks for greater efficiency and increased sales.

The consolidation that has taken place among magazine distributors and wholesalers over the last several years has facilitated the process as national distributors have attempted to win control of large chain accounts with sophisticated category management programs. Alliances have been formed with retailers to maximize sales in the periodical category and cut down on past inefficiencies in distribution.

Jitney Jungle Stores of America, Jackson, Miss., is now being serviced by just one wholesaler -- Anderson Gemco based in Tuscaloosa, Ala. -- after several of Jitney Jungle's wholesalers merged with the company. "With a single magazine wholesaler there is much better control over inventory," said Allen Booth, assistant director of general merchandise and health and beauty care. The result has been better reporting procedures and more accurate numbers, he commented.

Another benefit of having one magazine distributor has been easier management of the category, including reporting functions. "We no longer have to juggle four or five different wholesalers' reports," Booth said.

In Booth's estimation, magazines need category management. "But category management is such a broad term with so many definitions, I would hesitate to apply it to this category," he said.

Earlier this year the Magazine Publishers of America, New York, formed the 22-member Retail Advisory Council with a goal of improving the category's operational efficiencies for increasing overall single-copy sales. Many large distributors and wholesalers also have initiated category management programs to improve sales at store level.

Those magazine wholesalers that have survived the industry shakeout can expect to face a more savvy supermarket periodicals buyer. Retailers like Booth, for their part, are interested in more comprehensive reporting, seeing improvement in inventory management at mainline and checkout racks and better overall service levels.

Retailers also want their news wholesalers to focus category management principles on improving magazine and book display space through a more profitable mix by store demographics.

After Hannaford Bros., Scarborough, Maine, consolidated its magazine department in its Northeast stores from 14 magazine wholesalers down to two news distributors last summer, it eliminated about half its previously authorized title listings, said Mike St. Claire, the chain's general merchandise category manager.

Hannaford managed to narrow its old 2,500-title assortment, which was supplied by the 14 distributors. "We found that 97.3% of the sales came from the top one-third of the list. And so we eliminated basically two-thirds of the titles and added local titles to increase variety," added St. Claire.

The number of magazines at checkout fixtures increased from about 30 to around 50 titles, using a new racking system which went into stores after the consolidation last summer. "This increased sales dramatically," St. Claire said.

Hannaford now uses Hudson News, Portsmouth, N.H., and New York Periodicals, an upstate New York news distributor for its Northeast stores.

Being serviced by two suppliers also has allowed Hannaford to take greater advantage of cross-merchandising opportunities. "Since the change over, we've merchandised specific titles in floor shippers in other sections. Pet titles are set up in the pet aisle, baby magazines are placed in the baby aisle and gourmet and food publications are arranged in the baking area," said St. Claire.

Whether category management is being applied to magazines in the truest sense depends on the definition of category management, St. Claire said.

By working with fewer distributors, the retailer is now able to adjust the mainline assortment using store-demographic data that the wholesalers generate by applying category management.

Variety shouldn't suffer as a result of applying category management, according to St. Claire. "When you're talking about titles in the hundreds, there is still too much fat. But after cutting some out there's still plenty of variety," he asserted.

A new arrangement with its book and magazine wholesaler, which began in January, has resulted in improved periodical gross profits for Churchill's Super Markets, Sylvania, Ohio, said Robin Zaletta, director of nonfood.

Where previously a store clerk maintained the magazine fixture, Churchill's magazine wholesaler, Buckeye News, Jackson, Mich., now assigns a merchandiser to care for the category in stores.

"Our service level has improved, the racks are fuller and variety has widened," said Zaletta.

Churchill's goal is to customize the titles of its magazines and books by individual store area, Zaletta said.

Applying category management principles can only enhance periodicals, he said. "You can gather information on what's moving and what isn't, enabling you to bring in those better-selling items."

After changing its magazine wholesaler, John C. Groub Co., based in Seymour, Ind., looks forward to its news distributor kicking off a category management approach to the chain's reading centers, said Carl Lang, general merchandise buyer.

The retailer's magazine distributor, Louisville Distributors, a division of Ludington Group, Detroit, is starting to build some historical information, Lang said. "Once we get past that, category management applications will be in order."

Groub envisions category management will bring enhancements to its periodicals, especially in the way demographics can benefit the title selection.