EXCLUSIVE: Newspaper price rises worth £6.4m in retailer margins

The figure is equivalent to more than £128 extra per year for each independent shop stocking these nationals.

Dozens of national and regional titles have announced price rises in the past two weeks, potentially worth millions in extra retailer profits. 

Analysis by Better Retailing based on sales forecasts revealed that the rises on UK national papers alone are worth around £6.4m per year in additional retailer margin at current sales volumes. 

The figure is equivalent to more than £128 extra per year for each independent shop stocking these nationals. 

While most publishers maintained retailer percentage margins, cuts at some national titles will deny retailers more than £100,000 in annual profit compared with if the previously announced terms were maintained. 

The most contentious was the FT weekend, which stated that its increase from £4.80 to £5.10 on 2 December was “pro rata”. However, documents listed the new margin as 20.83%, compared with its previously announced 21% rate. 

Better Retailing understands the FT’s previously stated 21% figure was actually “rounded”, and has been 20.83% for the past year, meaning retailers earned £30,000 less in annual margin than what they were promised. 

Read more: October ABCs: Saturday newspapers witness sales increase

Newsquest increased prices and cut retailer terms across its two Scottish flagship titles, The Herald and The National, on all days, with retailer terms falling to as low as 18.5% on The National’s Saturday edition, giving it the joint second-worst percentage terms of any national title. 

While its rises will still generate more cash profit for Scottish stores, the margin changes will cost them £64,000 in lost profit per year compared with if its previous terms had been maintained. 

In more positive news, The Sun increased its prices by 10p on all editions from 20 November while maintaining its 21% terms, a move that Better Retailing forecasts will generate approximately £5.8m in extra retail margin for stores across the next 12 months, based on predicted current sales levels. 

However, there were initial teething issues with the change, with recycled barcodes causing many till systems, including ShopMate, to initially process the weekday barcodes with a 50p price. 

In Ireland, the Irish Daily Mail and Mail on Sunday were up by 20c every day while margins were maintained, worth an estimated €314,000 in extra margin per year for Irish stores. 

There were also price rises and margin cuts on nine of Newsquest’s Scottish local papers ,including the Grenock Telegraph and Glasgow Times. 

In southern England, Newsquest announced price rises across 32 weekly papers, of which eight had retailer percentage margins slashed, with some falling as low as 15.5%. 

Read more news and advice about the newspaper and magazines category and click here for the latest ABC circulation figures


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