N3 says: This follows an announcement from the publisher that halves cover prices and retailer margins.
Members of N3 have given autonomy to control their news supplies to the multiple company whose Board of Directors has unanimously decided to take this unprecedented step. This follows approaches to Northern and Shell demanding a restoration of terms which has been rejected.
Said N3 Director of News, Brian Murphy: “This is an unwilling step by N3 which has been created to improve the trading strength and profitability of its members. But at the same time, N3 is not going to stand idly by whilst publishers slash its members margins to fund price promotions.”
In a move that is likely to reverberate across the industry, this is a unique step by independent newsagents who have hitherto been prevented by competition legislation from joining in collective actions to protect their position. This has been ruthlessly exploited by publishers over the years through successive margin cuts since the late Robert Maxwell first slashed retailer margins on the Daily Mirror in 1990. However, as a single entity with authority from its members to control news supplies over the Groups stores, N3 is in a position to make decisions as would any multiple head office.
N3 Chairman, Ray Monelle added: “N3 is in the business of making money for its members and business partners by adopting the highest standards of retail to increase sales. But we are not a cash cow for publishers who want to use retailers to fund price wars on their competitors. Meagre retailer margins have to fund operating overheads, wages and ever-increasing carriage charges. Whilst this action is not our preferred choice of doing business, it was not a difficult decision for the N3 Board to delist titles offering uneconomic terms of trade.”
