News Limited has announced the suspension of the T2020 territory consolidation trial under way in south east Queensland.
News Limited now moves to a voluntary consolidation model. This is particularly appealing to Victorian newsagents who have been at the forefront of territory consolidation for years and have been held back by the News T2020 process.
While there will be speculation about the reasons for the decision by News and claims by associations that they have driven this decision, I am certain the company made the decision because it suits them at this time. This is their decision and not something forced on them by anyone.
I see it as a pragmatic decision based on the challenges experienced in trying to consolidate territories in a state where newspaper home delivery has been in crisis for some years. Just over a year ago I claimed that the company was in crisis in relation to newspaper home delivery. They vehemently denied this at the time and engaged in an offensive pitching that they had a plan. Months later, T2020 was the plan.
While T2020 as planned will not happen, I am certain we will see consolidation, maybe faster than the company actually planned.
The needs of News Limited which were driving their pursuit of T2020 remain. Newsagents need consolidation. Indeed, many need the ability to hand back their runs urgently.
In the meantime, there are newsagents in Queensland in the middle of consolidation under the T2020 rules /guidelines who need attention from News. There is even an argument for compensation given the commercial impact of the now suspended changes that they had had ti live with for many months. These newsagents need independent professional advice.
Might be wrong here but to me it seems that actually paying someone the correct amount to deliver the paper just does not add up for the big paper company and more to be made by making the delivery agent work for peanuts .a model they know does not work
What an absolute farce.
The whole T2020 was an absolute joke from the start. I cannot believe people were naive enough to think this would work.
Meanwhile, Fairfax has been able to implement absolutely disgraceful fundamental changes to the remuneration agents receive despite this not being in the contracts people signed with them.
Yet some people are sitting there saying that they should just accept it and move on.
Associations are a disgrace.
My advice for those agents in QLD affected by this: rather than get independent professional advice on your own, do it as a group. It only takes 7people to make a CLASS ACTION!
What does this have to do with associations?
That is breaking news Mark.
Haven’t heard about this. Consolidation will still happen.
I think you may be right that it will ramp up a bit now.
From a process/implementation point of view, I would love to know what happened that forced suspension of the trial.
Sometimes biting off too much to chew on in the initial stages can be overwhelming for all parties.
Received this from News Ltd today.
Will post the Q & A in the “Updated T2020 communication…….” thread
7 March 2013
Dear Newsagent,
Whilst the newspaper industry is facing a time of unprecedented change, News Limited continues to believe in print, selling more than 11.5 million newspapers every week and distributing an additional 5 million community papers a week.
As the needs of our consumers change, the industry must also evolve. As a business, News Limited has been constantly transforming our editorial, sales, marketing, circulation and distribution strategies to meet these changing needs as well as leading the industry to address the challenges and opportunities facing newspaper distribution.
In line with our transformation initiatives, in August 2012, News Limited commenced a trial of a new distribution model – T2020 – in the south side of Brisbane. The intent was to develop a more commercially viable distribution network that was sustainable for newsagents, customers and News Limited.
This model had features based on key principles, including:
1. Separating distribution and retail services
2. Consolidating distribution territories
3. Remuneration structure for distribution that is aligned with the effort involved and the commercial realities of the territory
Whilst the trial to date has been a valuable exercise and the principles of T2020 are still valid, we have learned three important things from industry consultation during the trial process:
1. Newsagents are ready for change Many newsagents have told us throughout the trial that they understand the need for change, and many across the country are ready to do this now.
2. There is an appetite for initiatives that improve the distribution model, including the consolidation of distribution territories Many newsagents across the country are keen to evolve their business model, with a particular focus on developing consolidated distribution territories. These newsagents would prefer to speed up the process with this market-led model, rather than wait for the more structured approach that T2020 follows.
3. We have also learned that the T2020 model does not allow us to move fast enough given the current pace of change.
Regrettably, overall the trial did not meet our expectations and as such News Limited has decided to discontinue the T2020 trial process.
On a case-by-case basis, News Limited will consider proposals for consolidation of distribution territories from interested newsagents, across all states and territories. If approved, we will offer new agreements for servicing the consolidated territory on the same terms as our standard distribution agency agreement in the relevant state or territory including as to term and termination. This means they can be terminated at any time without cause, by you on 3 months notice and by us on 6 months notice.
Guidelines will be available for interested groups in due course, however there will be no minimum volume requirements. This recognises the view that some newsagents are ready to collaborate with their neighbouring newsagents to consolidate their distribution services to build greater efficiencies of scale for their businesses.
Given the rapid and ongoing shift in industry trends, News Limited will continue to review and evolve our approach, and may change our strategy. We will keep you informed in this regard.
In the coming months, News Limited will also undertake a complete review of the monies paid for distribution services (including home delivery fees) across all states and territories. We will also review our retail commission structure.
We have already started working with newsagents in the trial region as we manage this process and we will continue to work closely with the industry.
Should you have any questions or require further clarification please contact us using the details below.
. Visit the website from Friday 8 March – http://www.news4newsagents.com.au. A full list of FAQs is available and will be updated regularly so this is your most up to date source of information
. For any specific questions not answered on the website, please email newsagents@news.com.au
. Or for a one on one discussion, please contact your usual News Limited contact
We thank you for your time and effort as we transform our distribution network for the long term sustainability of our industry.
Regards
Jerry Harris
Executive Group Director, Commercial and Operations
Catrin Thomas
Director, Retail Circulation