Reach raises prices, cuts margins

Sunday People and Sunday Mirror

Newspaper publisher Reach has accompanied cover price hikes for two of its Sunday titles with a drop in retailer margins.

From this weekend (Sunday 2 June), both the Sunday Mirror and Sunday People will rise by 10p to £1.70, but the margin will fall from 21% to 20.5%.

Reach also cheekily wrote to retailers telling them their profit per paper would increase to 34.85p, omitting that this represents a cut of half a percentage point. The letter also concluded: “Many thanks for your continued, much valued support for all of the Reach titles.”

NFRN National President Mike Mitchelson did the maths: “Had our terms been maintained we would actually have been receiving 35.7p for every copy sold.”

Mitchelson slammed the cut in margins as “the second body blow that Reach has inflicted on us in just two months”.

He continued: “Back in March the price of the Daily Mirror rose 5p but our margin fell to 20.80p. Now the margin on its two Sunday titles are falling to a new low.

“If Reach really did appreciate our continued support it would be taking on board the needs of independent news retailers. We have ever increasing costs which we have to fund. To do so we deserve our fair share of any cover price increases.

“To say we are disappointed is an understatement.”