UK Shops supplied by Menzies Distribution will see their weekly carriage charges increase by around 3% from April 2024, the newspaper wholesaler has announced.
Letters from Menzies to retailers seen by RN show the minimum charge for seven-day newspaper and magazine deliveries will rise by £1.15 per week to £39.42. The maximum charge will increase by £2.18 to £72.54. All increases are capped at £4.99 per week. In Ireland, the average increase will be lower at 1.7% with a freeze for those on the two lowest bands, according to Menzies.
The annual change in the UK and Ireland is significantly below the current rate of inflation, the upcoming increase in the National Living Wage and last year’s increase from Menzies. Despite the wholesaler’s efforts to keep the increase low, the new maximum rates set by Menzies are nearly 5% higher than those currently charged by rivals Smiths News.
Increases in carriage charges put more pressure on retailers already struggling to maintain the profitability of the category as sales decline. Aberdeenshire multi-site Morrisons Daily owner Shahid Ali agreed: “I’m seriously wondering if it’s worth selling newspapers and magazines any more. They’re just being treated as a footfall driver, but if they’re not bringing in sales, I can’t see how it’s worth it.” The Fed also slammed the increase from Menzies, stating they would ‘pile yet more costs on hard-pressed retailers who can ill afford them.’
Menzies: hundreds at seperate parcel business to lose jobs
Asked by Better Retailing to explain its decision, a statement from the Menzies read: “Menzies Distribution is committed to providing a quality, reliable and sustainable newstrade delivery and collection service for our newstrade partners. In so doing, we continue to invest in our network through technology and service improvements. Like many other businesses, we are facing significant economic pressures which are outside of our control, including an increase in the National Living Wage of 9.8% from April 2024 and current CPI rates of 4.0%.
“These inflationary increases directly impact our cost to serve and, despite considerable efforts to mitigate the increasing costs, we are unable to absorb the full impact. It has therefore been necessary for us to review our Carriage Service Charge (CSC) template. We understand that no increase in cost is ever welcome, and to that end, we have endeavoured to ensure the review is reasonable and fair.
“We remain committed to working alongside our partners to support the long-term sustainability of the newspaper and magazine category, with service excellence and customer satisfaction always remaining our priority.”
Fed national president Muntazir Dipoti responded stating: ““The letter cites significant economic pressures, including rising labour costs, which Menzies Distribution managing director Grant Jordan says it is unable to absorb, yet that it something that it expects its retail partners to do, as we cannot pass increases in carriage charges to our customers.”
Read more news and advice about the newspaper and magazines category and click here for the latest ABC circulation figures
Comments
This article doesn't have any comments yet, be the first!