News Limited yesterday announced to NSW / ACT newsagents that it is permitting a small rise in newspaper delivery fees. NANA called it a CPI rise and rightly noted that it was insufficient:
Naturally, for most Newsagents, the current fees including this new increase do not compensate for the true cost of distributing newspapers.
While News Limited is very publicly exerting control over its own commercial situation with major announcements last week and this, it continues to refuse small business newsagents the right to charge a fair commercial fee for the valued and lovers newspaper home delivery service.
A company committed to the free market system would support newsagents charging a fair fee. News Limited has its own reasons for forcing newsagents to accept lower fees in real terms for delivering newspapers in 2012 than a few years ago. I think their position is selfish and unfair. Yesterday’s announcement, while better than nothing, maintains the insult to newsagents for the fine home delivery service they provide.
What I wrote almost a year ago today in response to a similarly small rise for Victorian newsagents holds true today:
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.
NSW newsagents should take this opportunity to raise their prices a little more than the ‘official’ rate. We had a regional newsagecy in the Hunter Valley with a large run for five years and increased our delivery rate to 15 cents per paper in 2006 and then to 20 cents per paper in 2008. That’s 20 cents per unit thrown, no exceptions. This was obviously only for customers who paid us directly. I stress that this was the only way we could make our run profitable.
We sent a cover note with the monthly invoices explaining the need for the increase due to increased cost of fuel, car insurance, wrapping machine etc. We received three complaints from 600 customers and didn’t lose one customer! In fact, many said, “I thought it was ridiculously cheap to get the paper deleiverd and was expecting a small rise!”.
I received a call from News Ltd about 4 months after the rise to 20 cents saying that a customer had ‘compared prices’ and asking if our 20 cents charge per unit was true. I said the customer must have been mistaken!
If they’d have drilled down any further I would have pleaded ignorance and changed it back to the official rate.
Remember, 99.99% of customers have no idea newsagents are locked into a set delivery fee. As they say, it’s easier to ask for forgiveness than permission. PUT YOUR DELIVERY FEES UP TODAY!
Well said Mark. No surprise that the newsagent associations don’t put it as clearly and strongly as this.
Here here. VANA and the others suck up to news.
I don’t really understand why this is not an ACCC issue. Surely controlling the fees we charge our own customers (contractually or otherwise) is a restraint of trade ?