Reaction of the Press Distribution Forum
The Press Distribution Forum (PDF) welcomes today’s announcement by the Office of Fair Trading that no further review of distribution arrangements in the newspaper and magazine industry is necessary.
Since its inception in 2010 the PDF has worked to improve the efficiency and transparency of the newspaper and magazine supply chain. It will continue to do so and developments underway include an independently chaired review of the Press Distribution Charter. The PDF would encourage the retail associations to participate in this process and offers an open invitation to discuss ways in which the supply chain might be further improved for all stakeholders.
PDF Chairman, Mike Newman comments, “I am pleased the OFT recognised the work of the PDF and in particular the Press Distribution Charter. The PDF is working to enhance the efficiency of the supply chain for the benefit of consumers and retailers. I would urge all retailers and retailer associations to join in the consultation process which will assist Michel Woodman in chairing the review.”
Reaction of the NFRN
No Surprise As OFT Lets Down Independent Retailers Again
The NFRN today (March 1) expressed disappointment but no real surprise at the Office of Fair Trading’s decision not to carry out a review into newspaper and magazine distribution.
National President Kieran McDonnell said: “Once again the OFT has let down small businesses in favour of the big boys. After keeping us waiting for nearly three months, all it has done is to reiterate its 2009 decision. But as our call for a review had the support of more than 20,000 of our customers, we are disappointed, but not surprised, that it is not prepared to take the time and effort to conduct a thorough investigation.”
In reaching its decision, the OFT said it had been convinced that in-store availability of newspapers and magazines had improved, the number of news retailers remained stable, that average newspaper and magazine prices had declined between January 2009 and August 2011, and that there have been further steps towards self-regulation.
Challenging the OFT’s view on in store availability, NFRN Chief Executive Paul Baxter said: “We are not convinced that overall in-store availability of newspapers and magazines has improved. Indeed, current allocation methods still mean that independent newsagents are starved of best selling titles and during thousands of visits to member stores each year our field force still continue to find a lack of availability of best sellers. These are the titles that most consumers would expect to buy in their local store. If the publication is not there, the customer will go elsewhere.”
Questioning the OFT’s claims that the number of news retailers had remained stable, Mr Baxter said: “In the past five years 11.5 per cent of independent newsagents have either been forced out of business or have given up selling newspapers and magazines in their stores as a result of the anti competitive practices of fixed cover prices and monopoly supply arrangements of all too powerful publishers and distributors. I find it inconceivable that the OFT can count coffee shops and other such outlets as news stores.”
On newspaper prices he continued: “We have provided the OFT with hundreds of examples as to how prices of newspapers and magazines have escalated in recent years, all of which they appear to have ignored, and as to further steps toward self regulation – what self regulation? There is no self regulation in this marketplace.”
Mr Baxter said the NFRN would continue to lobby for a shake-up of the news industry.
“We will now be taking legal advice on our options here and in European law.
We are determined to do all we can to tackle the issues that impact on all independent retailers.”
Reaction of the PPA
The OFT has announced it will not be carrying out an update review of the newspaper and magazine distribution sector, following consultation with trade bodies and companies in the sector.
Nicola Rowe, Director of Circulation & Member Services at the PPA, said: “The PPA welcomes the OFT’s decision not to carry out an update review of the newspaper and magazine distribution sector.
"We are encouraged that among the reasons for not conducting a review, the OFT has acknowledged the advances the industry has made in self-regulation, and also the work that has been done to improve in-store availability.
"The PPA has lobbied on this important issue for a number of years and, as we highlighted in our response to the consultation, we feel the existing system represents the best means of serving consumers' needs.
"We remain committed to maintaining a self-regulated supply chain that puts the breadth of titles produced by our members into the hands of consumers in the most efficient and timely manner, through a broad range of local and national retailers.”
