Nine criticised over newspaper price rise and newsagent’s share

• The new prices, to take effect from next Sunday September 2

Nine has announced to retailers a 20 cent (6%) cover price increase for The Sydney Morning Herald yet only a 1 cent, or 1.6% increase in margin for the retailer, reports Mark Fletcher on his Newsagency Blog.

“In my opinion, this further downgrade of margin for newsagents is disrespectful and offers retail newsagents encouragement to ditch the product category,” he writes.

The new prices, to take effect from next Sunday September 2, see the weekday Sydney Morning Herald newspaper rising to $3.40 (from $3.20), Saturday will jump to $4.40 ($4.20) and Sunday Sun-Herald will cost $3.90 ($3.70).

Fletcher notes the percentage retailers receive will drop:

“They will get 31.5 cents from a $3.40 item sold. That is 9.26%, down from 9.68% on the current price.

“The massive Nine corporation is showing what it thinks of small business newsagents in this move.

“What Nine is doing here, in my opinion, is like the federal government move to cut penalty rates. It is shameful, disrespectful and preys on the weak and vulnerable.

“The question newsagents have to ask is: Is it worth stocking Fairfax titles or newspapers more broadly? The trajectory of margin is clear. The latest decline in real terms continues the trend.

“For me, this Nine announcement encourages the decision to quit the category.”

[Read the Newsagency Blog here]

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