Smiths News will begin supplying local shops with Hallmark greetings cards. Smiths News and Hallmark will offer a mix of firmsale and sale-or-return terms.
When contacted by Better Retailing, Smiths News confirmed the Hallmark partnership. The wholesaler stated it would offer stores a “simpler way” to sell an “appealing and diverse” range of greetings cards and gift wrap.
Smiths News head of proposition development Michael Williams said the deal would “give our customers access to the best of the best products that usually only the multiple grocers and convenience groups can access”.
Hallmark’s terms for retailers
Terms and conditions for the supply deal, open to the wholesaler’s 22,400 retailer customers, were seen by Better Retailing this month. They revealed “everyday” cards for events such as birthdays will be supplied on firm-sale terms. However, deferred payment will be available.
Only if or when Hallmark carries out a “range-change exercise” would this stock be swapped out.
Meanwhile, seasonal products, such as Christmas cards, will operate similarly to magazines on partial sale or return.
Retailers pay up front. They are credited for unsold stock if it is sent back via magazine totes within eight weeks of each occasion’s on-sale date.
The terms showed fixtures will be given “free of charge”. However, they’ll remain owned by Hallmark until they depreciate. At that point ownership will transfer to store owners.
Retailers that breach their agreements, including ceasing supply, may be charged. Hallmark’s head of commercial, Fiona Pitt, added it would be “providing sales and marketing support”. This includes “merchandisers arranging the presentation of the greetings cards in stores” and sales support via phone.
Muntazir Dipoti, owner of Todmorden News in West Yorkshire, trialled the Hallmark range with Smiths News last year. He told Better Retailing: “We received free stock and even though we already have a greetings card range, sales have been strong.”
The statement from Smiths News and its terms and conditions failed to state what margins stores should expect from the partnership.
Industry reaction
A card supplier told Better Retailing Hallmark was “keen to get into convenience” after losing at least one major supermarket contract in the UK, which it said represented a loss of hundreds of millions of pounds.
The expert warned the firm-sale terms create a risk of stores being stuck with slow sellers. This could tie up cashflow and harm the performance of the fixture.
They said “little and often” range updates were needed to maximise sales. They warned Smiths News’ as-yet-unspecified minimum- order values could undermine this approach.
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