In a meeting which took place yesterday at the Sydney offices of Haymarket Media (publisher of ProPrint), Australia Post executives Rod Rose and Robert Gomezel told a gathering of figures from the publishing and mailing industry that it would be proceeding with the price hike as planned.
“The board has voted and it’s going through,” said Rose, Australia Post’s manager of Letters, according to Publishers Australia.
The meeting was attended by Publishers Australia chairman Geoff Hird, Publishers Australia executive director Alan Sarkissian, Haymarket managing director Jeremy Vaughan, Pacific Magazines chief executive Nick Chan, Major Mail Users Association chief executive John Gilroy, and Reed Business Information operations director Troy Stevens.
Publishers Australia later issued a statement saying the company’s “refusal to negotiate on their proposed increases suggests that even before the meeting, Australia Post had already made up its mind to ‘dig in’ and weather the storm of protest they are receiving from all sides of the industry”.
Sarkissian did, however, report success in getting Australia Post to consider at least deferring the price hikes. The association has already written to the board of Australia Post, as well as the Commonwealth Print Ombudsman, the federal small business minster and shadow minster, in order to plead its case.
“It’s a disappointing result, in that it sends what the association believes is the wrong message to the Australian publishing industry. And that is, the market dominator can do just about whatever it wants to, whenever it wants to, no matter what the economic circumstances,” Sarkissian said.
Vaughan also criticised Australia Post for the lack of consultation or forewarning over the price hike.
“The communication on this has been very poor,” said Vaughan. “By their own admission they handled the process inadequately.”
“They need a lesson in public relations and customers service.”
“If we dealt with our customers the way Australia Post deals with the publishing industry, we would be losing business”
Australia Post has declared it will lift its rates on July 6 by 3.9 per cent for parcels, 3.6 per cent for Print Post and 3.1 per cent for line-haul charges, with industry figures claiming this will effectively translate into a 4 per cent price hike for magazine publishers.
“The Print Post business is worth $100 million to Australia Post,” said Vaughan. “This increase is going to cause a $4 million dent in publishing budgets, and more to the point, its going to make a dent in future subscriptions for the Australia Post business.”
“Publishers are running their business very lean in this climate so this increase – which is 2.5 per cent above the predicted CPI by the RBA – will result, ultimately and sadly, in further job cuts.”
Vaughan is one of many figures predicting that the hike will have far-reaching consequences for Australian industry.
“Publishers are already looking at the digital option for some of their products and shifting frequencies from weeklies and fortnightlies to monthly, so this increase is going to accelerate this move – all to the detriment of Australia Post revenues and profits.
“This isn’t just about publishing, this is about the livelihood of the whole industry, the print industry, the paper industry, the mailing industry, the finishing industry, transport, consumables, which is worth a lot more than the extra costs of this $4 million.”
“It will mean fewer magazines on the printing press, which will ultimately affect the whole industry.”
Earlier this week, Printing Industries chief executive Philip Andersen agreed that the move could trigger “the demise of print” as publishers are forced online.
Vaughan added that Australia Post also failed to cite any tangible benefits from the price hike.
“They said they were planning some initiatives, but then quoted initiatives they already had in the pipeline before this proposal came about,” he claimed.
Hird also criticised Australia Post for its intransigence in difficult economic times.
“We are living in an economic environment that nobody in business has experienced before, and it seems Australia Post (and in turn the Federal Government) is missing this point by pushing through the price rises,” said Hird in a press statement. “While the SME sector have to cut costs internally (including people), AP insist on dealing with cost pressures externally, via their customers, rather than internally like the rest of us.”
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