Wednesday, November 9, 2011

The Pledge of Allegiance Convenience

Effective February 2, 2012, home delivery subscribers of The Grand Rapids Press, Kalamazoo Gazette, Muskegon Chronicle, and Jackson Citizen Patriot will have their delivery schedules cut from 7 days to 3 days per week. This plan is a bit different from what was done on the east side of the state with the Bay City Times, Saginaw News and Flint Journal back in June, 2009, and using the MLive Media's FAQ page - I will clarify some of these differences.
3) Q: What will happen to my subscription to my local paper?
A: All subscriptions with the exception of Sunday Only customers will automatically be converted to the new 3-day home delivery and 7-day electronic service. “Sunday Only” subscriptions will remain Sunday only.
"Wait just a minute!," you might be thinking. "Just when I thought you couldn't possibly be any dumber, you go and do something like this... and totally redeem yourself!"

That's right! You'll be BETTER off! You see, Mr. and Mrs. Core Subscriber, you currently only receive ONE paper per day, for a total of 7 measely copies per week. Come February of next year, you will receive 3 print newspapers AND 7 e-editions (one per day of exact electronic replicas, complete with the same typos, misspellings and clunky story jumps to which you have grown accustomed) for a total of TEN "papers" per week!


This e-edition represents one of the differences I eluded to in the above. When delivery frequencies were cut on the east side of the state, we did not yet have an e-edition in place to back-fill the lost publication days and allow us to "count" these e-editions as "paid" copies with the Audit Bureau of Circulation.

The biggest difference in strategies, however, is the decision on the west side to print and distribute single copy editions to selected stores and gas stations on the non-home delivery days. This is more in line with what was done in Detroit with the News and Free Press, and a strategy I had wished we would have been allowed to do in the east. (Tuesdays have since been added back, and I expect the other days will follow suit shortly).

Why? Because there is revenue to be had with single copy as opposed to home delivery. For example, the newspaper carriers for the Flint Journal had to drive almost 7,000 miles per day collectively to deliver to every subscriber in Flint, Genesee County and the portions of the surrounding 6 counties of the distribution footprint. Let's assume each vehicle achieved 20mpg (if you were ever in the backyard while trucks were loading, you know I'm being generous here). Let's further assume the price of fuel per gallon is $3.50 for the sake of easy math. Fuel costs with those numbers in a 7-day delivery model comes to just over $447K per year (not counting vehicle maintenance expenses). Yes, carriers are independent contractors who have to use their own vehicles and buy their own gas. But if enough money is not built into their rates for these purchases, how long would they deliver do you think? Single copy, however, has minimal delivery expenses with their bulk drops, making for almost pure profit to the company.

"How much," you ask?

Let's say that the retail price of a daily single copy edition is a buck, and the company pays a dime per copy to the distributors that plop them in bulk at the stores. Let's further assume sales of about 15,000 copies per day for these daily editions. That equates to a profit of $2.8 Million annually to the company (90 cents * 15k sold * 4 daily editions * 52 weeks) LESS Dealer, production and other costs associated with printing these 16-page newsletters, still leaving a healthy profit.
You might be asking yourself, "If that's true, then why didn't the east side immediately print single copy editions for the other four days?"

To answer this, you have to travel back... waaaay back to the days of the infamous Newhouse job security pledge. A pledge that Advance Publications repealed on February 5, 2010 - one day prior to my February 6, 2010 layoff coincidentally. Weird.

If my memory serves, the pledge went something like this:

"We provide job security to all full-time, salaried employees who are not covered by a collective bargaining agreement. This means that no full-time, salaried employee will lose his job because of new equipment, technological advances or lack of work. Once you have satisfactorily completed a probationary period, you will become a permanent employee. Then, this unique job security pledge applies to you as long as you continue to perform your assigned tasks satisfactorily, do not engage in misconduct and this newspaper continues to publish."

The link above falsely quotes that the pledge "applied only as long as the newspaper 'continues to publish daily in its current newsprint form.'"

Not to put too fine a point on this, but the caveat after "continues to publish" was added after the fact (if my memory serves).

Don't worry! I didn't lose my place. To answer the question above regarding why Flint didn't produce single copy editions for the four lost home delivery days, it is my understanding that the revenue left on the table was worth the talking points that could be used in court if the breaking of the pledge were challenged. A touchy subject the west side need not concern itself with, apparently.

But I probably don't know what I'm talking about.

To be continued...

7 comments:

Chuck said...

Isn't that a bitch.

These pledges aren't worth the paper they are printed on. We had two of our hospitals merge in GR. When they went before the federal government to allay fears of a monopoly they promised a lot, like they would do a lot with charity. It's been about 15 years, were still waiting for the promises to be fulfilled.

WomanHonorThyself said...

aw its a shame they arent worthwhile. Have a blessed week my friend.:)

Smakutus said...

My Astro van got 13 miles per gallon delivering the Flint Journal.. They are only paying the carriers 8 cents per paper now, not 10 and that includes dealing with all those Sunday paper and insert bundles. Can you say "rip off?"

DaBlade said...

Smakutus- I was only guessing. I wouldnt ask, and i certainly dont presume they'd tell me :)

DaBlade said...

One other thing Jeff, the paper I worked for last summer in Wisconsin was paying their carriers an average of 9 cents per home delivery. Unless those rates have been reduced drastically in Flint, they are still making a lot more than their counterparts at other papers. 8 cents for bulk drops is a lot when compared in those terms. Just saying. I understand it isn't what it used to be and that's why you moved on. And I didn't mean to insult the Astro! Sounds better than the beast I'm driving!

Smakutus said...

For the most part I never had a problem with what we were paid.. You get what you pay for, and this is the reason the Flint Journal had so many carriers working for decades and decades. It was good for everyone involved.

The reason I finally had to give it up was that the FJ wasn't doing much to keep or get new subscribers and they still aren't. If I had started working that Tuesday morning home delivery paper it would have cost me money away from my "real" job, and because of the 230 customers that had quit taking the FJ on my routes since June of 09 I would have made less per week delivering four days than I was when they switched to three days...

Once they screwed all my driver friends that only delivered to the stores and boxes, the writing was on the wall and I didn't want to have anything to do with a company like this.

The Journal has lost another longtime carrier this week (actually early December) with more to come.. I told him he should deliver that crap weekly paper to your old "lawyer" friend in Western Hills each Saturday as a goodbye to him and the FJ but he won't..

DaBlade said...

I believe I know the carrier of whom you speak (another one of the all-stars), but I've been wracking my brain trying to figure out what lawyer friend I have over there?