Next Friday, newsagents will lose the distribution rights to the major Time Inc magazines in Australia as PBL’s distribution arm, Network Services, continues its campaign to slash the costs of doing business with newsagents. It’s part of the move to push as many ACP and third party magazines directly through the sub-agents as possible, saving Network Services and the Packer empire hundreds of thousands of dollars a year in lower commissions.
Australia has roughly 5,900 newsagents and between 900-1,000 of those who deal with sub-agents have been directly impacted by the Network moves over the past six months. Crikey reported on this initiative last August in ACP’s newsagent “clawback”, but for many newsagents the news came as a bombshell. Some, like one in the far southern suburbs of Sydney, derive up to 30% of their income from delivering magazines to high volume sub-agents like service stations.
ACP started first with its own magazines and it has gradually moved over to the direct drop system that’s currently being run by 1st Fleet (in Victoria and NSW), which has not been working well. Now Time Inc magazines, such as Time, Who Weekly, Sports Illustrated Swim Suit Edition, etc, will be dropped directly at the sub-agents by 1st Fleet in NSW and Victoria, and the regular Network contractors in other states.
The move comes after changes objected to by the agents from Gordon and Gotch to the magazine returns that will add millions of dollars in extra costs, a change that’s part of the escalating brawl between the Newsagents Federation and Gordon and Gotch that could very well end up in court (read more about this on the site: Gordon & Gotch newsagents revolt).