For years now, newsagents have been waiting for new newspaper distribution contracts. News Limited has finally delivered theirs this week.
Having refused to negotiate terms with newsagent associations, newsagents are having to make their own assessment. I have received a bunch of contracts over the last 24 hours and will go through these in the next week.
Looking at a contract last night for the first time, it is clear that we are transitioning the newspaper distribution model. It makes me ask what initiatives have newsagent associations taken to develop a new model? I stand to be corrected but I suspect not much.
A smart association would have funded an international study on newspaper distribution, a study from all angles – publishers, wholesalers (in the UK), newsagents, delivery drivers (newspaper carriers in the US) and consumers – and had the various newspaper distribution systems professionally assessed.
The resulting report would have ensured that newsagents today would be better informed about the likely future of the model from a publisher perspective as well as the best model for newsagents themselves. Newsagents could have contributed to the shape of the future as enshrined in the contracts – the quality of the research and analysis would have driven this.
Instead, associations have left publishers to take the lead and the best they can do now is respond – as newsagent associations have done, poorly, for decades.
It is not too late for newsagents to have a say in the future of newspaper distribution. The new contracts provide a few years for newsagent funded and owned research on what the future of newspaper distribution looks like. Newsagents will only take this step and ownership of their future if they want a say in this.
In a practical newsagency sense, I am disconnected since I sold by distribution business three years ago. However, my software company, Tower Systems serves 1,600 Australian newsagents and is committed to dhelping newsagents improve distribution efficiencyand returns.
As a newsagent with a large distribution territory who is about to go distribution only, I am disappointed with the performance of VANA and ANF. They should have been on top of this a long time ago.
I think we would be better served by forming an informal network of distribution agents, and leaving VANA / ANF.
I think I could get everything I get from VANA by joining VECCI instead, and most likely more.
You can’t blame the newspaper companies for trying this on. I approached a publisher with 7 options a while back to change the model so that both parties benefit but got a one liner in response – essentially that they don’t do that sort of thing. To break the existing model is scary for the big publishers and while they have a supine and complient distribution network why should they?
My major disappointment is that we ALL know that the sales are slowly slipping away and yet the majors appear willing to accept that. To cop it on the chin and not even experiment with a fresh approach to address it. That is not only extremely sad but may also contain a message that we don’t want to hear.
Yes Brett the sad thing is you may be right
Dean, The associations have a track record of little real achievement for newsagents when it comes to negotiations on cover price, distribution fees and other terms. They rely of publishers to support their events. Too few newsagents support them or engage with them and this makes them weak.
Newsagents get the representation they want.
Surely the need for publisher support of events can’t be the reason. That would mean NewsXpress is subservient to the suppliers who sponsored your conference?
Why is it that we as Newsagents just accept what News Ltd put in front of us ? It’s not a contract it’s a dictatorship.
If we had a united association we would band together and demand proper business to business change that suits both parties.
I suspect the standard we provide across the board is considered too low for News Ltd and they want to lift the barrier and at the same time hurt good family run businesses.
Tell me please – Who owns the customer when OUR customer operates face to face with us and we buy on a sale and return basis the newspaper product ?
I cannot see how News Ltd consider that they own MY customer and can dictate to me how much in fees I charge when that same customer does book ups, has The Age delivered and has a business relationship with my shop.
Ted, I have presented one reason associations may not have been able to more successfully represent newsagents when they have negotiated in the past.
My comment had nothing to do with newsXpress.
Are we just giving News Ltd two years to find a alternet delivery system and then get given our 6 month notice
Colin, That is a reasonable position for a newsagent to take. The right now is to not sign the contract just yet. Take time to consider it carefully from as many perspectives as possible.
Mark i agree with you . Its a great help reading other newsagents comment with their views on the subjects and i thank you for that
I have received my contracts and read them completely. I am concerned for the implications because I have been in this business only for a year and bought it based on a multiple of three. I can see now that I will not get this back if I try and sell the run. This is just one of many issues swirling through my head at the moment.
Thanks Mark for opening this thread. I await your comments on the contracts.
David,
This is not advice just information. In real estate (housing)the short term it is better to sell on the same market as you buy unless there are special circumstance . In Business the short term rule is to sell what you bought. Preferrably if you have built it up at a higher price. If you bought with a run sell with a run or else if the opportunity areise to “sell” the run do the sums and make sure that what’s left will give you back your return. Especially in this market where banks are really check the “sale” and looking for anomalies, ability to repay and equity.
If you do “sell” off the delivery then you may need to have 12 months trading under the new business model before you cah sell the rest.
Off topic, but why are us QLD Newsagents being shafted by both News and the QLD Government.
In todays Sunday Mail (page 11) customers are offered a free CPR Sign from the QLD Govt. when they cut the token… Only problem is that they can collect from participating Australia Post outlets.
A brief fax from News Ltd (one sentence) says its not our fault blame the government…
Logically the channel that distributes the coupon should also be the channel that provides the reward.
Cheers
Peter
Had a stranger ask us while we were setting up this morning (outside the shop) whether we had them. I just told them we knew nothing about it. It’s not like they were customers.
I also read this morning in the Sunday Telegraph about the Britney tour, where News refused to comply with her management’s “restrictive” agreements regarding photographing concerts.
Ba-bowng!
And what is with this survey QNP wants us to fill out regarding our delivery run?
If they’re concerned about their papers getting to agents on time, surely all they need to know is when WE need to have them delivered by.
The time it takes for our runs shouldn’t be relevant. Why would they need to know what time we wrap, or when our first and last throws are? I’m wondering (forgive any suspiciousness of News’ motives for anything…) whether or not they want such information in light of present contract discussions, in relation to the value and cost/investment of our paper runs.
Yet, they say that “We would also like you to document several other factors that determine the final delivery time of each run. …The accuracy of this data is cruical if we are to successfully formulate plan to help all parties”. If that’s the case, all they need to do is ask us when we need to have them. How long it takes us to process and deliver papers is none of their business, unless we deliver outside their guidelines. If our data means that we’ll get them later, because we’ve got a good routine going, it’ll suck big time. We work to a pretty tight schedule, mainly because there’s only 2 of us, and we open at 6. I’m assuming that would be what they mean by ‘other factors’. If we were on the same run, but were getting our papers on the way back rather than on the way down, it could mean the difference between getting the job done, and not. So, their ‘solution’ would probably be simply still disadvantaging some agents, but in a different order.
Interesting times are ahead.
What can ACCC do for all the delivery newsagents? It is a unfair contract terms for newspaper delivery. We can’t raise the cover price or delivery fees even to cope with inflation.
Samuel,
Newspaper distribution was deregulated in 1999 by the then Federal Government. It used the ACCC to guide the deregulation process. Newsagents represented themselves – a decision by the ANF – and the publishers were represented by their legal teams.
My view is that newsagents should lobby the government to have a Productivity Commission Inquiry into the deregulation, as a review of the the impact of the policy of deregulation on our network of small family run businesses. The implications of deregulation go beyond our businesses and impact communities. An inquiry would be most useful
The ACCC is bound by the Trade Practices Act. My understanding is that what you are looking for and what I propose fall outside their current jurisdiction.
The ACCC administers the TPA and can introduce new laws if found to necessary or even re enterpret current ones such as ‘UNCONSCIONABLE CONDUCT” as being changed to “UNFAIR” conduct So far they have done nothing and it is my guess they won’t do anything.
I know we can debate the topic, however what are the views of the QNF and others who represent us… Ann know you will be reading???
As it will only be through a concerted group effort that a reasonable outcome could be negotiated. As individuals we do not have scale, however as a group we can…
Cheers
Peter
Mark and other readers
The more Newsagents write to the ACCC re their grievences about the contracts the more notice they will take.
For information in Victoria the address is
the Regional Manager
A.C.C.C.
P.O.Box 520
MELBOURNE vICT 3001
As an indication of comments to complain about you can go no further than VANA’s memo to members of last week re their perceived concerns.
If you wish to view these comments, ask and I will post them so that non VANA members can view them as well.
Just a pity that as this is so important an issue that VANA do not let all Newsagents know their views instead of looking after a select minority.
Hi proactive,
I am in QLD, but would be interested to know what other bodies are saying…
Cheers
Peter
Peter,
I am unsure as to whether your contract is similar to Victoria BUT telephone the QNF and I am sure they will assist.
I am aware Mark is comparing all contracts forwarded to him, so maybe also tune in here when Mark has had time to review what he has been faxed.
Does that mean the only go forward is like to get NANA to represent NSW Delivery agents and negotiate the delivery contracts on our behalf? Or Can NANA consult any legal team (the same as Bill Express Case) to get involved in this case to get a fairer result for delivery newsagents?