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though not of it ourselves. Quest, I now have come to realize, is giving us a
good image and favor in the eyes of those we in GOD'S WORK have to deal with.
So I must report to you that the picture has now chanqed concerning Quest.
So last week I sent Mr. Rader to New York to go thoroughly into the
situation--of how much we have invested in it--how soon will it be "in the
black,"
paying a profit--how much more will we have to invest in it before it becomes
self-supporting, and profit-making.
I now have all the facts and figures, along with extra-conservative
estimates for the months and years ahead.
One problem came to me for decision NOW. Quest started as a bimonthly--
six issues a year. We have not finished our second year, but for this second
year it was stretched to seven copies a year--with a December issue offered
as a bonus at no extra subscription cost. Now the question is whether it should
go to a MONTHLY magazine. Several monthly magazines omit two issues during
summer, and publish TEN issues a year.
The advertising people are finding what I could have told them they would
find--great difficulty in selling the advertising space. Now you probably
know that no magazine or newspaper could begin to exist on subscription-price
revenue. It's the ADVERTISING that pays their bills and keeps them in business.
Most of you know that I had twenty years' experience in the advertising
business, in magazines and newspapers. What I learned is true today. I
started in Chicago representing one bank journal, whose circulation covered
seven states. I had made extensive surveys that led to tractor manufacturers
advertising in bank journals. But not with just that one five-state magazine.
I found that space-buyers in advertising agencies, and advertising managers
of manufacturing corporations buy on a yearly contract and national circulation
basis. I found that by adding eight other bank journals, giving me full
NATIONAL coverage, I could sell full-page or double-page space for all NINE
magazines, whereas I could not sell any space for ONE five-state magazine.
Having learned how magazine advertising space is bought, I understand perfectly
the difficulty the Quest advertising staff had in selling ANY amount of space
AT ALL! In this magazine advertising field, agencies and advertising managers
buy A YEAR OR NOTHING! I think Quest's advertising staff has done exceptionally
well to sell as much as they have for a seven-issue per year magazine.
Now, I think many of you know that I have always said a wise decision
necessitates getting ALL the facts, and then making the decision.
I am going to give you the actual facts and figures. We are committed
to publish Quest/79 at least until the end of this fiscal year, June 30 next
year. As of November 8, this year (1978) we already have invested in it $5.6
million. The peak cash flow deficit, which we will have to invest, through
the calendar year 1979, is $1,410,000. We are definitely already committed
to half of that, anyway--through June 30. Continuing in 1980 will require
from us a subsidy of $903,000. 1981 is projected to cost us a subsidy of
$95,000 and 1982 is projected to produce for the Work a profit of $334,000.
I have many more detailed figures, relating to a breakdown of editorial
costs, advertising department costs, production costs, etc.