Ian C Jones, Berkshire UK 07469018888 https://www.linkedin.com/in/ianjonestas/
Maximising Media Budgets with Retail Goods: A Strategic Barter Approach to Buying Media with Retail Gift Vouchers
In today's dynamic economic landscape, retailers are facing unprecedented challenges. The Covid-19 pandemic has significantly impacted consumer shopping behavior, leading to shifts in spending patterns and a decline in retail store sales. As if that wasn't enough, recent announcements of recession, geopolitical uncertainties, soaring inflation rates, and potential interest rate hikes further exacerbate the situation. In such turbulent times, strategic allocation of resources becomes paramount.
Introducing Newgate Trading Europe Ltd (Newgate)
Amidst these challenges, Newgate Trading Europe Ltd (Newgate) emerges as a beacon of opportunity for retailers seeking innovative solutions to navigate the storm. Specialising in facilitating barter or contra transactions between advertisers (retailers) and media owners, Newgate offers a unique approach that benefits both parties involved.
The Traditional vs. Barter Payment Method
Let's delve into a practical example to illustrate the advantages of Newgate's barter payment method. Suppose a retailer wishes to purchase £100,000 worth of digital advertising. The traditional method entails transferring the full £100,000 in cash from the retailer's bank account to the media owner's account, resulting in a direct outflow of £100,000.
Contrastingly, with Newgate's barter payment method, the retailer can optimise their spending by splitting the payment into £50,000 cash and £50,000 worth of retail store vouchers. These vouchers can be redeemed by the media owner at the retailer's store or online against goods at their normal selling price. If all vouchers are redeemed, £50,000 worth of retail goods leave the store as sales, while the actual cost to the retailer is significantly lower, say £20,000. Therefore, the total cost incurred under the barter payment method amounts to £70,000, resulting in substantial savings of £30,000 or 30%.
Unlocking Additional Benefits
Beyond the evident cost savings, Newgate's barter payment method offers a myriad of additional benefits:
1. Conserves Working Capital and Cash Flow: By leveraging store vouchers or credit notes, retailers can preserve their working capital and maintain healthy cash flow, crucial for sustaining operations in turbulent times.
2. Reduces Media Costs: Splitting the payment between cash and retail goods reduces the financial burden on retailers, allowing them to stretch their media budgets further and amplify their advertising impact.
3. Boosts Sales: The influx of consumers redeeming vouchers translates into increased footfall and online sales for retailers, driving revenue growth and enhancing market presence.
4. Potential for Incremental Sales: Beyond the voucher value, retailers stand to gain from potential additional purchases made by voucher redeemers, further amplifying the return on investment.
5. Breakage Benefit: Unredeemed vouchers ultimately expire, providing retailers with an additional cost-saving mechanism known as "breakage," further enhancing the overall value proposition.
Confidentiality and Remarketing
Newgate prioritises client confidentiality, ensuring that all transaction details are kept strictly confidential through signed confidentiality and non-disclosure agreements. Additionally, gift vouchers are remarketed discreetly through Newgate's extensive network of trusted partners, safeguarding client interests and preserving brand reputation.
Seizing the Opportunity
Now is the opportune moment for retailers to capitalise on Newgate's offerings. With access to a diverse range of media properties encompassing print, digital, broadcast, and out-of-home (OOH) channels, Newgate empowers retailers to negotiate favorable terms that include a component paid for with their own goods. By embracing this innovative approach, retailers can not only weather the storm but emerge stronger and more resilient in the face of adversity.
In Conclusion
As retailers navigate the complexities of today's economic landscape, strategic partnerships and innovative solutions are key to survival and prosperity. Newgate Trading Europe Ltd (Newgate) stands ready to guide retailers through these turbulent times, offering a unique barter payment method that optimises media budgets, drives sales, and enhances overall profitability. For retailers seeking a competitive edge in the advertising market, now is the time to embrace change and unlock the full potential of their media investments.
For more information and a confidential discussion, feel free to reach out to us. Together, let's navigate the challenges and seize the opportunities that lie ahead.
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