Australian Newsagency Blog

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News Ltd newspaper home delivery fee increase is socially irresponsible

Mark
June 26th, 2011 · 34 Comments

News Limited businesses The Herald and Weekly Times and The Geelong Advertiser this week announced agreement to permit a 5% increase in newspaper home delivery fees for their products.

While any increase is better than none, this paltry increase is socially irresponsible in my view.

How this situation can exist is appalling. This massive multi-billion dollar corporation which derives the bulk of its revenue from advertising controls the entire income stream newsagents earn from newspapers (cover price and delivery fee).

Newsagency distribution businesses, as commercial enterprises, ought to be able to set their own fees and through this control business performance levers. The current situation, where there is no control over revenue and only limited control over costs leaves newsagents to continue to perform as indentured slaves.

The introduction of the Modern Award has significantly increased costs for newsagents. Fuel prices have risen yet News Limited knowingly agreed to a newspaper home delivery fee increase which does not permit newsagents to pass on even these basic operating cost increases.

This right wing organisation which invests thousands of gallons of ink in deriding Julie Gillard and pretty much all Labor politicians as harming Australia and the Australian economy is killing the newsagent operated newspaper home delivery business with this tight-arse decision.

If the company was true to its right wing core it would not approach newspaper home delivery in the socialist way it does today. It would agree to a genuinely free market approach: a fair fee for a good service. Newsagents know that customers would pay. They also know that the market itself would set the price.

News Limited is hurting small business newsagents and their families and employees. They are reducing newsagents to working for less than a basic wage.

But you won’t read about this socially irresponsible behaviour in the News Limited press.

How dare they sit in their high-rise offices and decide what is fair for the newsagent in the trenches managing the delivery of newspapers?

Maybe that is harsh. Probably so. I hope it has got attention.

I sold my newspaper distribution business years ago because I saw no upside in newspaper home delivery for a business my size.

The number of newsagents giving away or walking away from their home delivery businesses has increased. This is a message publishers are yet to grasp. But maybe they have and maybe that is why the percentage fee increase is less than necessary to keep ahead with costs.

I’d love the people in News Limited who were responsible for this decision to front an open forum where they can present the merits of the decision and submit themselves to debate. I would be there for sure!

Newsagents need to put food on the table for their families and the families of employees. The decision by News Limited leaves newsagents financially worse off than a year ago. This is not just. It is socially irresponsible.

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Category: Newsagency challenges · newspaper home delivery · Newspapers

34 responses so far ↓

  • 1 B & G // Jun 26, 2011 at 9:13 AM

    well said mark

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  • 2 DAVID // Jun 26, 2011 at 10:10 AM

    Here Here

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  • 3 Carol // Jun 26, 2011 at 11:01 AM

    Well said but I don’t think the right people are 5 listening. What newspaper will print our complaint. How do we inform the community.

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  • 4 Jeff // Jun 26, 2011 at 11:36 AM

    Well said Mark. Thank you.

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  • 5 John // Jun 26, 2011 at 11:48 AM

    how do newsagents ogranise a general stike against home deliveries for a week.

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  • 6 Jarryd Moore // Jun 26, 2011 at 4:18 PM

    Carol,

    While informing the community about the plight may make distributors feel better, it is unlikely to have much impact on the decisions made by publishers. It could also have a negative long term effect on the industry if it turns people away from home delivery.

    The only options I see are negotiation (possibly forced) or more formal legal action. Large organizations, especially the traditional been-around-forever-old-white-guy kind are notoriously unresponsive to anything that isn’t a legal battle.

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  • 7 Mark // Jun 26, 2011 at 4:28 PM

    The best course of action is to continue to make the case in all available forums. This blog post has already been picked up and republished by several others. Not that that alone achieves anything other than getting the store out there.

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  • 8 averill // Jun 26, 2011 at 5:19 PM

    SORRY GUYS OFF THE TOPIC BUT I HAVE A CUSTOMER WISHES ME TO GET A NEWSPAPER/MAG CALLED GOAL BASED ON SOCCER DO YOU KNOW WHO SUPPLIES IT

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  • 9 Peter // Jun 26, 2011 at 8:42 PM

    A 5% increase is 1.7% more than the CPI which to March 2011 was 3.3% on an annual basis.

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  • 10 Samuel // Jun 26, 2011 at 9:07 PM

    Well done, Mark. I totally agree with what you said. If we don’t have the pricing power of our main products or
    services, the future of our survive is doubtful.

    You are the voice of our channel. Thanks very much.

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  • 11 David // Jun 26, 2011 at 9:53 PM

    While I accept that there is not much we can practically do, given the master / slave relationship, I feel better for having read this. Mark you capture the situation well.

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  • 12 Jarryd Moore // Jun 26, 2011 at 9:55 PM

    Peter,

    To compare the increase to CPI, one would have to increase the delivery fee by CPI each year since the delivery fee was introduced – not just the current year.

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  • 13 BAZ // Jun 27, 2011 at 6:42 AM

    Spot on Jarryd..we said Mark.

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  • 14 Dean // Jun 27, 2011 at 10:30 AM

    It costs me about $2 per week to deliver the paper, not taking into account the payrise next week.

    I get $1.20 per week after the HWT increase.

    With declining circulation, this means that we make less profit every year from a distribution business.

    How does HWT expect the industry to survive? Or maybe they secretly hope to destroy?

    ps Averill if you mean Goal Weekly then it is supplied by All Day

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  • 15 Kevin // Jun 27, 2011 at 10:59 AM

    I don’t think that thye really want to destroy us. Their job is to control cost at every possible point, and we just happened to be in the softest negotiating position. If they were really being fair there would be a discussion about the imbalanced dispersement of the cost of distribution along the supply chain. e.g. The unionised worker at the printing plant earns up to around $60.00 per hour with penalties, the careless truckdriver throwing the bulks on to the footpath gets around $45.00 per hour. The break-up team and delivery drivers at the newsagents'(& customers) end are entitled to $25.30 per hour – and they bear their own vehicle costs. At the new rates the newsagent with his life invested in a 2000 paper delivery area shows a margin of around $5.00 per day in delivery fees (equating to around $1.00 per hour).
    It is ironic that the people directly responsible for taking care of the customers are the ones getting screwed.
    Whats also missing from this deal is a public holiday delivery fee. Our delivery team is entitled to double pay on public holidays and this really turns us upside down.

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  • 16 fred // Jun 27, 2011 at 2:07 PM

    We should be like other industries where they call a meeting and have a none delivery day to attend this important event.

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  • 17 Trevor // Jun 27, 2011 at 2:17 PM

    Thank you mark for taking the risk to publish this. I am a 20 year newsagent and it makes me feel good to at least see our plight articulated this way.

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  • 18 rick // Jun 27, 2011 at 2:28 PM

    just charge what fee you want, i cant see them doing much about it as no one else will deliver their papers for that price

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  • 19 BMFJ // Jun 27, 2011 at 3:17 PM

    When contract are to be renewed by January , News Ltd will be surprised by how many will decide not to sign.
    If the decision makers have their heads so far up their —- or in the sand I am afraid that Newsagents with long & multiple runs are doomed. With no increase in paper price and the so called 5% increase in delivery fee will leave a great many with no choice other than tell News Ltd & Fairfax to screw someone else to deliver their product !

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  • 20 Woody // Jun 27, 2011 at 4:32 PM

    I agree totally with John. Newsagents should band together through the leadership of you Mark, to organise a strike for a week of NO HOME DELIVERIES. This would certainly bring our poor remuneration to the attention of publishers and the public.With the threat of the intention to do this we would probably get no story published and so we may need to take out a series of “Ads”. I am quite serious here as nothing will ever be achieved if we do not unite and bring our story to the public. If the publishers have a hidden agenda with regards to the restructure of the distribution model in the near future, it is better to confront them now than when they are fully prepared to do whatever they plan to do.

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  • 21 ex-newsagent // Jun 27, 2011 at 5:39 PM

    The golden words in all these posts is Deans “declining circulation”.

    The last years in my newsagency it was a very rare event for a customer to start a 7 day a week full price home delivery subscription.

    In fact you could chart my home delivery figures by reading the death notices in the paper each week.

    It was one of the many reasons I decided to get out of the industry.

    In a time when just about every other consumables price is rising steadily, home delivery fees and cover price of newspapers have been comparitively static.

    Unless you guys band together and strike nothing will change. The only other options you have are to get out like me or work even longer hours, if thats possible.

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  • 22 Tim // Jun 27, 2011 at 7:21 PM

    Tend to agree, so why so readily accept the IPS contract warts and all?

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  • 23 John // Jun 28, 2011 at 1:09 PM

    Perhaps Nationwide considers a 5% increase in this climate to be more than generious. Maybe they feel it’s just a matter of time before small home delivery runs (under 500 day) will come to the conclusion that it doesn’t make financial sense. Nationwide would then consolidate and tender out larger territories. I will not be renewing my contract in Jan 2012 and I don’t think Nationwide is concerned at all…

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  • 24 Mark // Jun 28, 2011 at 6:36 PM

    Tim, I think I have explained my position on IPS well across at that post. The brief version is – I see the IPS offer as an agent for change,not perfect but heading in the right direction. By signing I send a message to the others Also, I can get out at 90 days notice so the exposure is not too great.

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  • 25 Helen // Jun 29, 2011 at 2:13 PM

    Well said Mark. I wish associations would say this and show their fighting spirit. I appreciate that politics gets in the way sometimes for them.

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  • 26 John // Jun 29, 2011 at 2:57 PM

    Helen
    what did your association say when you contacted them about IPS or are you a member or did you call.
    I contacted NANA and had my queries answered.

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  • 27 Helen // Jun 30, 2011 at 6:39 AM

    I did John. My comment was not about IPS but about Mark’s robust post about the appalling News Limited delivery fee increase in Victoria.

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  • 28 Ricky // Jun 30, 2011 at 8:49 AM

    Its great that Mark raises these issues and provides us with a forum to express our views.

    It is disappointing that so many of you now expect Mark to be the one to take action.

    That’s nonsense. It’s our responsibility. Nobody else’s. We need to take it up not only directly ourselves but also via our association.

    VANA, as is their role, represented us at the negotiating table. Have we heard from them as to what went on and why they agreed to this outcome ?

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  • 29 Kyle // Jul 6, 2011 at 1:12 PM

    I have attempted to sell our territory. Nobody wants to buy it. It is therfore owrth nothing. Nationwide News CONSTANTLY delivers newspapers outside wat is considered a reasonable time, yet I am stucj in a contract until January 2012. How on earth do I get out of this contract?
    Does anybody have experience in doing so or suggestions as to how they have done things to get out of their contract?

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  • 30 Mark // Jul 6, 2011 at 1:17 PM

    Kyle, if you have requested to leave in writing and they have refused or ignored you then lodge an application to the CTTT for the matter to be heard. Talk to NANA about them helping you build and run this case.

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  • 31 Y&G // Jul 7, 2011 at 9:08 AM

    @ Kyle
    Have you attempted to give your territory away? If it’s worth nothing, and you want to get rid of it, cutting losses might be an option?

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  • 32 Wendy // Jul 7, 2011 at 10:17 AM

    We received notification on July 1 of a home delivery increase to commence 5 July. I’ll bet you can’t guess what that increase was!
    (Well you guys up here in Qld will already know). An increase of 5c ($0.05) on 7 day deliveries and 8 deliveries per week. That is all.
    Whinge whinge sook sook, I know, I know, build a bride. But really? What is that??

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  • 33 Wendy // Jul 7, 2011 at 10:18 AM

    *bridge

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  • 34 Keith // Jul 17, 2011 at 7:57 PM

    Interesting to read this Mark in the context of what has been happening to News International. It all comes back to the ethics of the leadership.

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