Newsagents must look at increasing their home delivery charge and offering other services to future-proof their HND businesses against extra wage costs and margin cuts.
The warning from industry experts comes as RN discovered confusion over the impact of the National Living Wage (NLW) on the rate paid to news deliverers, which could lead to newsagents unintentionally breaking the law.
HMRC this week confirmed work paid according to output, such as newspaper delivery, must be paid at the minimum wage for every hour worked.
It comes after an adult deliverer paid around £5.50 an hour contacted RN asking whether his employer was legally obliged to pay the new rate, raising the question of the viability of employing adult deliverers.
“It doesn’t matter what size a business is, it is their responsibility to pay the correct minimum wage to their staff,” said an HMRC spokesman, adding any employer not paying the new hourly rate will be held to account.
It doesn’t matter what size a business is, it is their responsibility to pay the correct minimum wage to their staff
Martyn Brown, of News-2-You in Leeds, said. “I doubt many retailers are aware.
“They need to get realistic with their delivery charge. There are a lot that do it as a community service and charge pennies. It should be a minimum of a couple of pounds a week, which many retailers will have to look at to pay NLW.”
Store2Door new business development manager Phil Williams said now is the time for retailers to review their charge and increase it to ensure their business is profitable.
“I know some shops are charging customers as little as 6p a day for delivery, which is simply unsustainable and in no way reflects the true cost of distribution,” he said.
He added with the NLW moving to £9 an hour by 2020, the independent sector cannot be expected to subsidise delivery costs, and while offering other products will help cover the cost, publishers must also take responsibility.