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Menzies & News International Contract Shame

Tags:  Industry News Menzies NFRN Press Release NI Direct

Published by: Joe Lenane | Published Date: 28th September 2012

Anger as Menzies Distribution are set to apply a £8.50 weekly charge as a flat rate levy (regardless of value or volume) for sending out two extra titles.

Delight at the news that News International was to cease its direct to retail operation everywhere except London will turn to anger today when retailers discover that Menzies Distribution will be applying a £8.50 weekly charge as a flat rate levy (regardless of value or volume) for sending out the two extra titles.  This is in addition to their existing value based templates that have a minimum and maximum charge for other titles that the company supplies.

NFRN National President, Alan Smith, said: “This news comes as an absolute shock to the NFRN and it will anger our members, many of whom are already paying the maximum carriage charge to their wholesaler and had every right to expect that the carriage charge they were paying to News International had gone for good.

“Not only is Menzies prima facie in breach of its own terms and conditions of supply, for failing to give appropriate notice before making a significant change to its contract with retailers, but, by moving the goal posts on how carriage charges are applied, Menzies has re-written the rule book.  Are you watching OFT?

“Yet again such action by Menzies reinforces our long term belief that the two remaining wholesalers are being allowed to bid for and win contacts well below cost, with independent retailers having to pay the price.”

Mr Smith continued: “To make matters worse, Menzies claims to have saved millions of pounds by introducing more hub and spoke operations. If that’s the case why are they not picking up the cost of handling these extra titles, rather than putting yet more financial burden on hard pressed retailers?  At worst, Menzies should be merely adding the value of NI titles that it supplies to retailers existing weekly accounts and re-calculating the carriage charge appropriately.  Adding a new flat-rate charge for NI titles makes a mockery of what is already a wholly discredited and unjustified monopoly rent that is imposed on retailers.

“What we are seeing here is a new two tier carriage charge system being applied without any prior notice, which is totally unacceptable. We’re not talking about small changes to Menzies’ existing terms and conditions of supply; we are talking about a completely new contract. The NFRN is therefore taking legal advice – not just from our contract lawyers but from our competition lawyers too - to advise on the prospect of formal legal action against this latest scandalous rip off.”

There are 7 comments about this article

28th September 2012 at 12:39

Steve Barker

Can I ask how surprsied they were at this ? are we not meeting Menzies before they announce these things ?

The NFRN MUST start to be proactive.

28th September 2012 at 16:04

NFRN Online

Along with all retail groups, the NFRN were advised of this increase only hours before it took place.

The decision was taken without retail consultation and came as a shock to all advised.

At this point in time the NFRN are taking legal advice on the matter.

Members will be advised on the outcome of these conversations and the options open to them at the earliest opportunity.

NFRN

28th September 2012 at 23:51

NALIN KOTECHA

Taking legal advice is great in order to be armed and ready but we should make a trip to Scotland .......

It could save a lot of trouble and money ......

1st October 2012 at 11:31

David Thomas

Can someone please explain what these 2 new extra titles are? Surely we should be able to just say that we don't want them.

Regards
Dave Thomas

1st October 2012 at 12:16

NFRN Online

The Sun and Times. To clarify, by 'extra titles' we mean two extra titles to distribute in certain postcodes.

Kind regards,
NFRN Online

1st October 2012 at 16:38

David Thomas

As our shop is in Holyhead, North Wales will that mean that I am in the postcode area that this charge will apply to and when is this charge going to be introduced from?

If it is then I will stop selling the Sun and Times titles as they are nearly taking away 40% of my current profit for sales over the September period. The problem is that if this allowed to happen then they will do the same with all the other papers and our carriage charges will go through the roof. This is another example of the big multiples being favoured over the independent newsagents.

This needs to be stopped.

Regards
Dave Thomas

1st October 2012 at 17:00

NFRN Online

No, only retailers moving to Smiths or Menzies from News International direct-to-retail are affected.

Kind regards,
NFRN Online

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