Nearly 1,000 Fed members with lower newspaper and magazine sales are set to benefit from a reduction in their carriage charge from November 1, following an announcement today (11) from Smiths News.
Historically, Smiths News reviews its carriage charge template in July , with any increases taking effect from September. But this summer, the news wholesaler advised that it was deferring its annual review until autumn, so discussions could take place with its retail customers and the Fed.
In a letter sent to its retail customers today, Smiths News commercial director Simon Gage said: “Our annual review has taken longer this year because we are acutely aware of the challenges faced by retailers. We want to ensure that any action we take is responsible and supports the profitability and longevity of the category in stores.
“The objective of this new template is to reduce costs for retailers who have smaller ranges and fewer sales, whilst still being fair and responsible to those customers with larger ranges and therefore higher sales.”
He added that the wholesaler would continue investing across warehousing, technology and final mile services to keep the supply chain as efficient and cost effective as possible.
While larger retailers will see an increase to their charge from November 1, this is well below inflation. Smiths News has advised that all increases will be capped at £6 per week.
Responding, the Fed’s National President Hetal Patel said: “Earlier this year, we were pleased to be told that Smiths News had decided to take longer than usual on its review of carriage charges to enable discussions to take place with its customers and with the Fed.
“This move has enabled Fed officials to have full and frank discussions about the challenges that members are facing. We are pleased that Smiths News has not just listened. but has acted upon some of the concerns that we raised. In particular, the news wholesaler is to be commended for taking action that will help to protect the viability and long-term future of smaller news stores.
“This is a good start. In future reviews, we would ask Smiths News to look in depth at the charges it levies on larger independent news retailers, especially those who offer HND.”
Deputy vice president Craig Etchells, who chairs the Fed’s news operations committee, added: “We hope that newspaper publishers will take note and will take the needs of news retailers into account before any future changes to their cover prices take effect.”