OPINION: Crisis point for the newstrade

With a year of falling sales and supply issues eating away at the profitability of newspapers for independents, it is time the newstrade puts its house in order and retailers try some new ways to trade, writes Neville Rhodes

 It’s been a difficult year for the newstrade, with publishers, magazine distributors, wholesalers and retailers forced to come to terms with the financial effects of the continuing fall in sales.

The closure of the distributor Comag following heavy losses and the withdrawal of support by its publisher owners showed the depth of the magazine sector’s problems.

The most high profile casualty was the Condé Nast women’s fashion and lifestyle title Glamour, which ceased print publication as a monthly and announced plans to become a twice-yearly ‘collectable’. 

As recently as 2011, Glamour was the UK’s best-selling monthly, with sales of more than half a million copies per issue.

In the newspaper market, numerous local weeklies either folded, merged or became freesheets, while the decline in print sales of regional dailies seemed to be accelerating. Many weeklies had already left the ABC circulation auditing system, and in the ABC’s release for the first half of 2017, some regional dailies did not declare the circulations of their print editions, showing only figures for various forms of readers’ digital engagement.

For the national newspapers, the overall performance was grim. Newstrade sales, as measured by RN each month, were down year on year by 9.5%, from just over 40 million copies a week in 2016 to 36.2 million in October this year. The biggest losses were in the Sunday market (down 10.5%), while Saturday sales (down 7.8%) suffered the least.

The red tops were the biggest losers, while the quality sector held up better than the rest.

The 36.2 million copies a week figure is significant because for the first time the average sale per outlet for national newspapers has fallen to fewer than 100 copies per day. If sales through HND, at busy travel points and in some supermarkets are excluded, average sales through the rest of the retail trade must be considerably lower.

This means that with sales falling, trade margins shrinking and carriage charges increasing, the newspaper category is no longer profitable for thousands of retailers: that is why I’ve been calling for reform of the distribution system. Publishers and wholesalers really do need to grasp the nettle – even if it means getting stung a little – before it’s too late.

National newspapers probably need 40-50,000 outlets to maximise their sales potential, but I doubt if there are that many retailers willing to stock them if their 20-22% margin continues to be gobbled up by wildly excessive carriage charges.

Sub-retailing is probably the best solution to this dilemma and the publishers should do all they can to encourage it, using the database for their Deliver My Newspaper initiative to build up a national network of ‘super-newsagents’ to act as sub-wholesalers for their patch.

The newspaper publishers also need to put their own house in order by sticking to their scheduled arrival times at the wholesalers. Press breakdowns and adverse weather or road conditions are excusable, but these don’t happen very often. 

Most lateness occurs because the perpetrators know they can get away with it. This is insulting to their retailers, to their own readers, and to the readers of other titles whose papers are delayed as a result.

The issue of lateness needs to be given a much higher profile. The data is in the National Distribution Monitor, and the NFRN (which works tirelessly on the issue) should produce a national league table of lateness, with a Laggard of the Month booby prize (a parcel of unsold copies?) presented to the chief executive of the worst offender. 

Merry Christmas and successful trading for all independents in 2018. 


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