11-Jul-08

OUTRAGE AT SMITHS NEWS 7.8 PER CENT CARRIAGE CHARGE RISE

 

The NFRN is outraged at an announcement from wholesaler Smiths News that carriage charges are to be increased by a swingeing 7.82% with effect from 24th August.

This follows an earlier increase in carriage charges of 3.65% imposed by Smiths News on 20th January this year.  This latest rise breaches a promise made then that carriage charges would not be reviewed for 12 months.

NFRN officials are now seeking an urgent meeting with senior management of Smiths News.

In a letter received by Smiths customers today (11th July), the wholesaler says the increase is a result “of a period of sustained increases in fuel costs as well as further increases in general inflation.”

NFRN National President Naresh Purohit said: “Whilst everyone is aware that fuel costs have risen steeply this year, why is it that monopoly wholesalers automatically turn to their captive retail customers when they are short of cash, rather than go to the publishers who not only control cover prices but margins across the industry too?  Where are the retailers supposed to find the cash to fund this increased charge?  Newspaper sales are in continual decline, meaning everyone is losing profit and only publishers can inject extra revenue into the supply chain by increasing the cover price of their titles.

And he added: “Isn’t it time that the news industry found a more intelligent way of funding itself, rather than merely abusing retail newsagents and constantly expecting them to deliver more for less?  It can’t be done.  Someone has to take this crazy carriage charge mechanism by the scruff of the neck and decide it must go.  If publishers want their titles to reach consumers it is their responsibility to ensure that the essential component parts of the industry are adequately funded, not allow their monopoly appointed wholesalers to plunder retailers, whilst they sit back and watch newsagents being squeezed out of business.”

Mr Purohit warned that the alternative would be for retailers to seize control over cover prices and added that momentum for this was progressively gathering.

“If publishers allow retailers to be continually squeezed financially, retailers will go into survival mode and actions that may have been unthinkable five years ago may well become reality. It is time that publishers woke up and took control of this madness.”

 

 
Author:
Anne Bingham
Publisher:
National Federation of Retail Newsagents
Date:
11-Jul-08
Categories:
 
Sections:
News

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