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Understanding Magazine Retail Allowance at Your Store

Retailers need to have basic knowledge concerning magazine retail allowance in order to better understand how it works. This knowledge will also help them get the most allowance back for the magazines they sell.

Magazine retail allowance, or retail display allowance (RDA), are reimbursements paid by publishers to the magazine retailers for displaying the publisher's titles at the store. This transaction happens only after the retailers have signed a contract with the publishers (or national distributors) and retailers send quarterly claim forms.

If managing magazine retail allowance sounds easy, the truth is that it is complicated, especially if you do not have previous professional experience handling it. This will help you truly understand how complex this process of obtaining your RDA can be.

You may wonder how much RDA you could receive and if all publishers offer it. Usually, RDA payments are 10% of the cover price, although some retailers expect to receive 15% for some launch titles. A lot of publishers offer less than 10% of the cover price, so your RDA collections may range from 5% to 8% of its annual magazine sales at a cover price. Not all publishers offer RDA, though. If you want to boost your profits, you may want to work with publishers who do.

The process of sending quarterly claims can make the RDA complex, especially for a retailer who attempts to do it on their own.

First you need to obtain a contract from the publisher (or national distributor). When the contract is approved and the transaction officially starts, you will have to track each magazine title sold and the number of each magazine sold during the quarter. Then you write down and submit invoices and claim documents to the publisher, on a quarterly basis. If the publisher doesn't pay the RDA on time, you will have to take the time needed to follow-up on the late payments. This can be frustrating and time consuming.

Managing magazine retail allowances is not only complex, but it will take your time off from displaying and selling magazines, along with the other work that you should only focus on in your retail store. RDA management also involves a lot of paperwork, and not fully understanding what magazine retail allowance is may lead to costly mistakes.

Rather than attempting to do the magazine retail allowance yourself, it is best to hire a professional RDA administration firm like Premiere Retail Services, Inc. They will be the one to take care of the more intricate job of obtaining your RDA -- from contract signing to the following-up the RDA reimbursements. Not only that, the firms will also find ways to maximize your earnings potential and collection of the RDA's. This will provide a big incentive for you, as a magazine retailer, to display and sell more titles in your store.

Understanding magazine retail allowance may help you realize you don’t want to do the process yourself, since you can see how complicated it can be do it yourself. You will realize you need professional help to handle this complex job. A professional RDA administration firm will do the work that needs to be done to make sure you get the magazine retail allowance you deserve.

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