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News International threatens to stop supply to a newsagent over cover price dispute

The National Federation of Retail Newsagents reports that News International has threatened to stop supply to an independent newsagent who added a 10p surcharge to the price of the weekend Sun to maintain margin after News cut the price of the Saturday newspaper in advance of the launch of the Sunday Sun.

Since February this year when News International cut the price of its Saturday paper to 50p to fund its new Sunday edition, also priced at just 50p, newsagent and NFRN member Walter Bush of Baginton Village Stores, Baginton near Coventry has added a 10p surcharge to both newspapers to ensure that his margin is maintained.

But when News International got wind of his action and despite a Trading Standards official giving it a clean bill of health, the newspaper publisher told the retailer that if he continued to persist, his supplies of the Sun would be stopped.

I support Walter Bush and the stand that he has taken to set the price of the products he sells. This is his legal right. No supplier should penalise him or his business in any way while he is acting lawfully with their products.

News also came under fire when it increased the cover price of the Sunday Times by 30p and cut newsagent margin from 23.5% to 21%.

Newsagents are also in dispute with the News distribution arm over the handling of deposits which other distributors pay after a period of satisfactory trading – News holds the deposit until the business is sold.

While newsagents in Australia navigate the challenges, and opportunities, of change here, spare a thought for our colleagues in the UK and the threats they face in what is clearly a brutal marketplace.

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  1. allan wickham

    I wonder if us “Retail Newsagents” could get away with doing the same…………..

    1 likes

  2. Jarryd Moore

    Allan,

    No. The law is quiet clear here in Australia. A supplier is not allowed to set a minimum resale price (within certain conditions) but they are allowed to set a maximum.

    0 likes

  3. allan wickham

    I wasn`t serious Jarryd, just a little tongue in cheek.
    I do know Newsagents that do charge more f than the cover price on some Newspapers and Stamps………but “this little black duck” plays by the rules !!!!!

    Cheers
    Al

    1 likes

  4. Mark Fletcher

    It’s interesting in that it goes the other way with free newspapers everywhere. I was in Adelaide airport this morning and when I purchased some candy I was offered a free copy of The Advertiser.

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  5. Jim

    Hi Jarryd i think you are wrong on price control in Aust and that is what that is Cuba maybe

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  6. allan wickham

    At the end of the day do the Newspaper companies really care what the cover price is?
    If i could get an extra 10 or 20 cents a copy and the customer is willing to pay that price, would it really be so bad? Because no two Newsagencies are the same we all have different overheads and costs to cover. Sure there might be the ones that try to rip people off but the majority of people today have choice so if i was to charge too much then i am sure i would lose sales but if it was a fair and just price according to my costs then the majority of customers i am sure would not mind (apart from the obligatory whinger).

    It really is one part of our industry that i do not understand………

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  7. Jarryd Moore

    Jim,

    I am definitely not wrong regarding the law on resale pricing. The legislation has been this way for a long time. The ACCC have a brief explaination on their website http://www.accc.gov.au/content/index.phtml/itemId/322982

    Alan,

    My appologies. My sarcasm rader missed picking up the ellipsis 😛

    1 likes

  8. allan wickham

    No problems Jarryd, the printed word is no match for the spoken one. LOL!!!!

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  9. Allan Wickham

    Here`s a question…….In QLD we recieve the Victorian newspaper The Herald Sun a day late and have to change the cover price to include freight. I have just finished processing the Saturday edition and have altered the price from $1.50 to $2.30. The customer is aware of the reason why but is still happy to pay the extra…………so (hypothetically of course) what would be so wrong about doing this in our stores? There could be a whole host of reasons why this should have some merit to it…….just think about your favourite restaurant and why they have a surcharge on public holidays. The list could go on forever……….just thinking aloud !!!!!

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  10. jim

    Hi Jarryd Haveing read the info i still think you can sell over their price ,allit is talking about is recomended price i cpuld be wrong

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  11. Jarryd Moore

    Jim,

    From the ACCC website.

    “A supplier may recommend an appropriate price for particular goods but may not stop retailers charging or advertising below that price. In most cases, a supplier may specify a maximum price for resale.”

    0 likes

  12. Jim

    HI JARRYD COULD NOT FIND WERE IT TALKS ABOUT MAX PRICE

    0 likes

  13. Helen

    What do you expect from News. The poor newsagent.

    0 likes

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