Independent retailers served by Menzies Distribution are incensed after hearing that their carriage charges will rise on the same day that mandatory new staff wage increases take effect.
This double whammy, on April 1, will see the carriage charge base rate go up by an average and eye watering 3.97 per cent while national minimum wage rates will rise by nearly 5 per cent.
Commenting, NFRN National President Mike Mitchelson said: “It is absolutely appalling for Menzies Distribution to put up its charges at a time when so many of its retail customers are fighting to survive. To time it so it coincides with inflation busting increases to national minimum wage rates is even more insensitive. But Menzies Distribution is a monopolistic wholesaler so it knows it can do exactly what it likes and introduce another uncomfortable hit at a time of year when small businesses can ill afford it.
“As if this move was not already unpalatable, in a recent cost saving move the news wholesaler closed its Chelmsford branch but the savings it will make are obviously not enough as it continues to raid the purses of retailers who have no opportunity to pass on these increases to their customers.
“When the sale to Endless was first announced we were hopeful that the new owner might see sense and review carriage charges, especially as it claims on its website that it exists “to make business better for everybody”.
NFRN national vice president Stuart Reddish added: “Sadly, with Endless and Menzies Distribution showing no desire to prevent the closure of news accounts nor offering any alternative service options, more retailers will undoubtedly be considering their future participation in the news category.”
He added: “Just recently the NFRN relaunched its campaign against carriage charges and in a matter of days, hundreds of members had filled in cards opposing carriage charges and insisting that a review takes place.
“I would ask all members to fill in and return these cards as a matter of urgency so we can share our members’ disgust with the offending parties.”
Menzies Distribution has said it would be happy to receive retailer feedback on these increases. To make views known NFRN members are asked – in the first instance – to contact NFRN Connect by calling 0800 121 6376 or emailing firstname.lastname@example.org
Mr Mitchelson continued: “While the Competition and Markets Authority said last month that due to its workload and prioritisation principles it was unable to launch a market investigation into the news supply chain at this time, however it noted the NFRN’s concerns about absolute territorial protection contracts.
“We will, therefore, be advising the CMA of this latest move and will be telling publishers in no uncertain terms that no longer can they turn a blind eye to the way news wholesalers penalise retailers and that they must intervene before even more retailers exit the news category. Publishers must take more responsibility for the future of the news distribution system. This means improving the margin that news wholesalers get for handling their newspapers so they do not continually squeeze retailers. We need to see an end to outdated and unfair carriage charges.”
The NFRN is meeting with Menzies Distribution executives on Thursday (February 21) when members’ disgust at the increases can be shared face to face.