Retail Sales (Firm Sale) - National Newspapers

Back to index

Retail Sales (Firm Sale)

A copy sold to a retailer, on a firm sale basis, intended for resale as a single copy to a consumer.

Principles

1. Single copy made available for purchase by the consumer from the retailer

2. Copies are purchased from the publisher by the retailer, on a firm sale basis, either direct or via the distribution chain (typically distributor and/or wholesaler)

3. Cover price must be published on or inside front or back cover of the publication

4. The price paid for the publication by the consumer must be clear and conspicuous

5. The retailers’ ability to vary supply must not be unduly restricted

6. If the final rate classification is not known then estimates must be made 

7. Reported by rate, comparing price paid by the consumer with the Basic Cover Price

Requirements

1. Single copy made available for purchase by the consumer from the retailer

1. Contractual arrangement with the retailer must make clear that copies are for resale to the consumer.

2. Contractual arrangement with the retailer must make clear that data of sales to consumers must be made available to ABC on request.

3. The purchase by the consumer may be in cash or by other means agreed by ABC in writing.

4. You cannot claim back issue sales to the retailer.

Guidance Available

2. Copies are purchased from the publisher by the retailer, on a firm sale basis, either direct or via the distribution chain (typically distributor and/or wholesaler)

1. ‘Firm sale’ means that unsold copies are not returned or reported for credit.

2. The total trade discount must not exceed the current published newstrade margins.

3. If you make any reciprocal payments, or the retailer makes any reciprocal charges for goods or services as part of the deal (for example: for distribution or marketing) then you must take these into account when calculating whether the trade discount exceeds this level.

4. Where you sell copies of a publication directly to a retailer on both a firm sale and sale or return (or limited sale or return) basis, then the trade discount must be the same for each.

5. Copies can only be claimed in relation to retailers that have not previously received supplies of national newspapers on a Sale or Return basis, either directly from the publisher or from one or more of the following wholesalers:

   1. Smiths News

   2. Menzies Distribution

   3. Newsflash

   4. EM News (Belfast), EM News (Dublin)

   5. Newspread

   6. Independent News & Media Ltd

   7. Dash of Redruth

   8. News UK Distribution Ltd

   9. Whites (Isle of man)

   10. Le Gallez (Guernsey)

   11. Jersey Evening Post (Jersey)

6. The claimed total average Retail Sale (Firm Sale) must be limited to a cap based on the publication’s claimed Retail Sale (Sale or Return) for the relevant Reporting Period, as set out in the following table:
   
   

   Retail Sale (Sale or Return)	Firm Sale cap
   0 – 200,999	4,000
   201,000 – 400,999	8,000
   401,000 – 600,999	12,000
   601,000 – 800,000	16,000
   801,000 – 999,999	20,000
   1,000,000 – 1,249,999	22,500
   1,250,000 – 1,499,999	25,000
   1,500,000 – 1,999,999	27,500
   2,000,000+	30,000

7. You must account for sales on an issue by issue basis.

Guidance Available

3. Cover price must be published on or inside front or back cover of the publication

No additional requirements

4. The price paid for the publication by the consumer must be clear and conspicuous

1. If a voucher from a publisher controlled promotion is used the amount paid by the consumer is deemed to be the total of the cash paid to the retailer and any cash they paid for the voucher.
   
   
2. The value (or perceived value) of gifts or cover mounts to the consumer have no effect on the price paid for ABC purposes. However cash reimbursements to the consumer must be taken into account (excluding limited low chance lottery style promotions).
   
   
3. You must retain details of promotional or special offers during the reporting period.

Guidance Available

5. The retailers’ ability to vary supply must not be unduly restricted

No additional requirements

6. If the final rate classification is not known then estimates must be made

1. If at the time you submit your circulation claim you are running a promotional scheme where the final position (e.g. the number of discounted sales via redeemed vouchers) is not known you must make an estimate of the final classification. In this case you must adjust your claim in the following period to reflect any difference between the estimated classification and the actual classification.

2. In relation to promotional schemes utilising voucher redemption: If you are reporting on a monthly basis and the effect of not making an estimate is judged to be unlikely to affect the figures claimed by more than 2% of the total average circulation then you can account for the vouchers on a wash through basis (i.e. as they are redeemed).

Guidance Available

7. Reported by rate, comparing price paid by the consumer with the Basic Cover Price

1. Copies sold to the retailer can be claimed as sales at the cover price unless there is evidence to the contrary, in which case claims should be adjusted as follows:

   1. The retailer distributes copies free to the consumer (these should be removed from claim)

   2. The retailer sells copies at less than the Basic Cover Price (these may be claimed in the appropriate rate band).

   3. The consumer makes part payment using a voucher from a publisher controlled promotion (these may be claimed in the appropriate rate band unless acceptance and redemption of vouchers is explicitly not allowed in the agreement between the publisher and the retailer in which case the voucher can be ignored).

   4. The consumer makes full payment using a voucher from a publisher controlled promotion (these should be removed from the claim).

   5. For the avoidance of doubt: copies disposed of by the retailer (not provided to a consumer) do not need to be deducted.

Reporting

You will report Retail Sales (Firm Sale) as follows, which will be broken out on the ABC Certificate (note: the term Full Rate will replace full or Basic Cover Price for reporting purposes):

1. By geographical type:

1. United Kingdom;

2. Scotland - as a subset of UK;

3. England, Wales & N. Ireland – as a subset of UK;

4. Republic of Ireland (ROI)

2. By rate band:By total average circulation over the period.

1. UK, UK subsets and ROI each by:

   1. Full Rate

   2. Lesser Rate

Guidance

G1. Single copy made available for purchase by the consumer from the retailer

1. Cash means legal tender notes and coins, cheque, credit/debit card, wireless payment systems.

2. This doesn’t preclude a retailer selling more than one copy to a single purchaser (without the publisher’s knowledge).

3. Details of sales to consumers made available to ABC on request may be in the form of EPOS reports or other means such as signed third party affidavits.

G2. Copies are purchased from the publisher by the retailer, on a firm sale basis, either direct or via the distribution chain (typically distributor and/or wholesaler)

1. You will need to ensure all records required to support the retail sale claim are available for audit. This will include: 

   1. Full issue by issue details of all financial records and contracts with distributors, wholesalers and retailers, with specific regard to normal and recognised trade terms. These must be reconcilable to the distribution records on an issue specific basis and to the average retail sale claim.

   2. Details of any change in trading terms from firm sale (if allowed) to sale or return (either temporarily or permanently) or vice versa.

   3. Details of discounts or special offers.

G4. The price paid for the publication by the consumer must be clear and conspicuous

1. As the price paid may be affected by promotional schemes you should keep details of purchases and promotional spends so you can demonstrate copies are purchased and that sales under incentives/offers are classified correctly, or disallowed as necessary. You can contact ABC for confidential advice, supplying copies of the promotional material and offer wording. The information kept may include:

   • Title/s involved

   • Issues involved

   • Duration of promotion

   • Retail outlets involved

   • Wording of the promotion displayed at the retail outlet/s

   • How the resultant copies are claimed

   • How the promotion will be paid for

2. Treatment of bundle/package promotions

   1. As each case can vary we recommend you contact us for advice before carrying out your promotion.

   2. How the price of the publication is presented to the consumer will affect how or whether the copy may be claimed for ABC purposes.

      • If the price of the publication appears in the promotional material and it is legible (taking into account its presentation and prominence (including the size of the font used) and assuming a reasonable speed of reading) then the price is likely to be considered clear and conspicuous.

        • Stating the publication’s price in relation to the promotion/bundle in the main wording of the offer will provide most clarity.

        • The further away from the main offer wording and/or less prominent in the promotion the price of the publication becomes, the more likely it will not be considered clear and conspicuous.

        • If the price of the publication is linked to the main offer wording with, say, an asterisk - this would make it more conspicuous.

      • Merely stating the price of the publication without reference to the bundle/package could just be a statement about the normal price of the publication and so will not necessarily render the price clear and conspicuous.

      • If there is conflicting information about the price, then the lowest price assessment would be taken for ABC purposes (which might mean it is free).

      • The absence of a clear and conspicuous price would render the copies as free, as would explicit wording stating the publication is free.

        1. Promotion “Buy the publication and a bottle of water for £x”. The price of the publication is not clear and conspicuous. 

        2. Promotion “Buy the publication and a bottle of water for £x” which is accompanied by the statement “The price of the publication in this promotion is £y”. The price of the publication is likely to be considered clear and conspicuous if the accompanying statement is either within the main body of the promotion, or is in a footnote that is asterisked to the main body and is legible.

        3. Promotion “Buy the publication and bottle of water for £x.” Elsewhere in promotion “Publication is £y Monday to Friday and £z on Saturdays”. The price of the publication is not in the promotion and is unlikely to be considered clear and conspicuous as this statement appears to be the normal price of the publication.

        4. Promotion: If a publication ‘ABC News’ is promoted as ‘Buy ABC News for £x and get a free bottle of water’ then the bottle of water is treated as a free gift and it is clear the price paid is solely for the purchase of the publication.

        5. Promotion: If the promotion is ‘Buy a bottle of water and get a free copy of ABC News’ then the publication will be treated as free for ABC purposes.

3. Per section 4b: “The discount or cash reimbursement must be taken into account. Examples:

   1. 1. 1. Promotion: “Buy publication and spend £5 and you get £1 off your publication”. The publication is discounted by £1.

         2. Promotion: “Buy publication, spend £5 and get £1 off your shopping basket”. The publication is discounted as it is part of the shopping basket, but it is difficult to determine how much it is discounted and will be considered on a case by case basis. In this example, using the minimum spend requirement of the offer gives a 20% discount and would seem a reasonable treatment.

         3. Promotion: “Buy publication and get £1 off a jar of coffee”. Or “Buy publication and get the money off the rest of your shopping”.The publication is full price, provided that the publication is sold at full price and the reimbursement does not exceed the cost of the items being discounted.

G6. If the final rate classification is not known then estimates must be made

In relation to promotional schemes utilising voucher redemption a wash through basis means vouchers are accounted for as they are redeemed. The specific point at which they are treated as redeemed is not prescribed but you should use a reasonable and consistent basis.