Empty Shelves at the Newsstand

Turns out the predictions of magazine shortages this summer were spot on. According to Dead Tree Edition, bare shelves are common in the magazine aisles of some retailers, due in large part to the recent collapse of distributor Source Interlink (SID).

“While most grocery and book stores this week were sporting July issues, this CVS store on the East Coast was stuck with May and June copies of monthlies and and a few early-May issues of weekly magazines,” states Dead Tree Edition. “Thank God for bookazines, which stay on sale at least a couple of months, or else the entire magazine section would have looked even more barren.”

Why is CVS being hit so hard? Apparently they went all in with SID about a year ago. And while wholesaler TNG is taking over the bulk of SID’s customers, “it will take weeks for TNG to bulk up its distribution network to handle the majority of Source’s former customers.”

And it’s not just logistics that are keeping the magazines out of the racks.

“Complicating the move is that TNG is demanding that publishers sign off on new terms, which include new fees and a transition to ‘pay on scan.’ Source and TNG both apparently ran into trouble by grabbing market share with agreements to pay retailers based on the number of copies rung up at cash registers, not the number that were distributed but never returned.”

That left the distributors on the hook for the “shrink,” i.e. copies that are neither sold nor returned, due to loss, damage or theft.

The looming issue here is not when the distribution system will get the magazines back in the rack, but if.

“Will they remain empty until the industry is ready to deliver its product once again, or will impatient retailers just turn the space over to other products that are probably less profitable but also more reliable?” Dead Tree Edition asks.

It’s a harsh question but needs to be asked, and the magazine publishing industry must act now. Some major publishers are taking steps toward cooperation; more is needed, and quickly.