These are questions for distribution newsagents:
How long would it take you to establish an account and supply newspapers to a retail newsagent account where the business is run by a newsagent with six years experience in owning and running a newsagency, a good payment record for newspapers?
My experience is that such accounts are approved and opened in a day or two.
Do you ask for a deposit where the business persons known and has a good payment record?
I have heard of a deposit being required in rare situations.
In a situation this week, a newsagent with a good payment record has had to purchase newspapers at full retail price from the distribution newsagent sitting on the account application. Further, they have been told even if the account is approved a deposit of $2,000 will be required for an account that will amount to $1,000 a week.
Locally here in SA News Corp now take charge of completing account documentation for a new retail outlet.
In the case of a new retail newsagency, this, no doubt, would be expedited by the publisher and I can see deliveries commencing the next day if the draw increase is able to be completed in time and lock up arrangements made. Certainly 2 days would be fine. Having said that, it’s probably advisable to give a little more notice to the distribution newsagent if practicable.
No deposit is sought unless in exceptional and rare circumstances and in any event cannot be contemplated by the distribution newsagent without publisher approval.
In the case of an existing retail newsagent with a known good history of making payments, I would not look to seek approval from the publisher for a deposit.
The only time I worry about non-payment of accounts for a new retail outlet is for very small establishments that can easily pack up and clear off in a day or over a weekend.
In this state, a distribution newsagent could not get away with charging a retail outlet the full retail price. I wonder if in fact the invoice would be legal. Not sure, but I thought there were regulations in respect of invoicing.
Seems to me the retail newsagent is either saddled with a rogue distribution newsagent or the publishers systems and procedures interstate must be quite loose.
Dennis thank you for such a thoughtful and comprehensive response. The retail newsagent I have written about will appreciate this.
I would have approved the new retail outlet in the same day so they could receive papers the following day, as long as they were early enough.
In regards to a bond, in Victoria we are allowed to charge a 1 week bond. I generally do charge this, as I have been burnt before, including once for $5k by a subagent whose account was up to date but went bust and closed overnight without warning.
Dean thanks for your insights. I have been contacted by two other newsagents today about this issue and they are grateful for your feedback and that from Dennis.
I would hope the Retail Newsagent would have contacted either News (SA) or myself (depending on whether a managed account) to ensure newspapers are there on the first day.
No bond would be required.
I would closely watch the first few weeks trading, the first non payment by due date, I would stop supply immediately.
I would have in place a signed credit application by the Newsagent, if paying me.
John thanks for contributing to this. I trust the retail newsagent affected can see the approach of professional distribution newsagents. I have deliberately not named the distribution newsagent. I can only hope they are reading this too. I suspect they are not.