The statement from the NFRN says: “Following the retailer percentage margin cut by Guardian on its Monday to Friday copy, NFRN Chief Executive Paul Baxter has written to both the Guardian’s Chief Executive Officer and Editor seeking a reconsideration of the decision, pending joint commercial activity between the two organisations that would negate the need for a margin cut.
The response? Silence!
As a result, Paul Baxter has written to 27 of the Guardian’s key advertisers pointing out to them that as a result of the Guardian’s refusal to discuss an alternative solution, the NFRN’s membership and Guardian are now in dispute.
Mr Baxter points out to the advertisers that, based on past experience of disputes with other publishers that have cut retailer margins, retailers, individually, have responded in a number of ways, including: surcharging the titles, increasing home news delivery charges, refusing to insert additional material, providing a less advantageous display, reducing copy supply to firm orders only, etc.
Mr Baxter advised that, whilst the NFRN cannot condone such activity, after publishers have been having regular nibbles at retailer margins for more than 20 years, it is not difficult to understand that retailers are extremely frustrated as they see their livelihood being eroded and under threat.
Advertisers have, therefore, been warned that, as a result of retailers’ activity, fewer of their advertisements might reach their intended audience.
Says Paul Baxter: “This is not a situation that retailers want since any of the forms of action described above adversely impact on themselves as well as the publishers and advertisers. However, in an industry where publishers decide prices and margins there are few options other than militancy for retailers to defend their livelihood when their margins come under attack by the arbitrary decisions of publishers. This can only happen in an environment of monopoly control and price fixing, demonstrating why a further review of the news industry, followed by a referral to the Competition Commission, is urgently needed.””
