Dear Member,
We recently met with News Corp to determine aspects of our submission for greater remuneration and efficiencies.
It was clear from this meeting that decisions are taken upstream in Sydney and that their Victorian counterparts were advocating strongly on behalf of VANA and its member base. They understood the urgency to express elements of the submission to key decision makers at the highest level.
It was pleasing to learn that components of the submission, which centred around the weekly returns process, was viewed favorably amongst other items that could draw out efficiencies in the supply chain.
We made it clear to management that the industry now resides at a critical junction of viability and sustainability from a distribution perspective.
No longer can members be asked to distribute publisher product with a negative return on their investment, whether this is time or capital that is invested.
There are clear parallels with current franchise operators whose model is based on squeezing franchisees/contractors, with a view to extracting an adequate market return on their operations. Clear examples of this have been expressed in the media of late.
Two well-known franchise businesses in Australia have experienced a challenging time this week. Caltex announced it was stepping away from a franchise model just as a Fair Work Ombudsman report called its operating model “unsustainable”. We would argue that our industry is also in this grip of what I call an ROI squeeze, with no end in sight unless a more balanced revenue share model is implemented.
Although our industry is not governed by franchise agreements for distribution of publisher product, it is fair to assume that current agreements are out of date and similar challenges continue to stifle the growth of members who distribute publisher product.
To this end, VANA continues to fight for a collaborative environment where a legacy culture of top-down discussions continues to exist. Remuneration and innovative growth should be a collaborative effort which finds efficiencies in the supply chain and delivers a growth linked remuneration offering to those who connect with the end consumer.
As this determination evolves over the next week or so VANA will keep members informed of developments.
Regards
Chris Samartzis | General Manager
VANA Ltd
