The NFRN is not happy with the situation and has released the following statement:
“The report has it, that ASDA’s terms have not been restored, but an accommodation has been reached on advertising spend that, presumably, compensates ASDA for the loss of percentage margin on the Sunday Times, since News International sliced retailer margins from 25% to 23.5% when putting up the cover price from £2 to £2.20 on September 19.
Clearly, delisting the Sunday Times in ASDA stores on the previous Sunday was a tactic that worked. What it shows is that if you have power in this industry publishers can be encouraged to see the error of their ways when they cut margins. If you don’t, then despite having a market share that is significantly higher than ASDA, you can’t. News International obviously thinks that retailers in the independent newsagent sector are second class citizens, who don’t particularly matter, and because the law prevents them from collectively retaliating against those who would adversely affect their livelihood, the publisher knows that it does not need to treat independents on equal terms with the multiples.
Is this anti-competitive? Well, morally speaking, of course it is. But in legal terms, it is a very simple matter to “make commercial arrangements” so that a publisher doesn’t need to overtly show on any invoice that it has a two-tier terms structure between multiples and independents.
Independent newsagents can only watch with envy at ASDA’s decision to delist the Sunday Times, whilst the law prevents any two or more of them from taking action in the same way that ASDA did, quite legally, across its 370 stores. Is there any wonder that independent newsagents are angry and frustrated?
What this does is demonstrate the absurdity of legislation that leaves thousands of small micro retail businesses vulnerable to the vultures in publishing and wholesaling who happily pick their bones, whilst allowing them absolutely no opportunity to defend themselves.
This highlights the need for urgent Government action to introduce changes to the Competition Act 1998 to allow Trade Associations representing micro businesses, like the NFRN, to carry out realistic negotiations on behalf of its members by providing equal and opposing force, similar to that available to multiple head offices.”
