Adam Fein of Pembroke Consulting passed along an article to me today on the consolidation of the newspaper and magazine distribution industry. According to the article, posted at crosscut.com, the industry has gone from 400-plus family-operated magazine wholesale businesses to being dominated by four corporations. This article profiles a few independent newsstands that depended on one larger distributor -Source-Interlink -for their vast array of magazines and newspapers covering unique hobbies and news from every corner of the world. Those newstands will no longer be served by the distributor.
Source-Interlink bought competitors throughout the country and serves more than 114,000 retail outlets. It also publishes some of the titles it sells -a sort of private label I suppose. The company is cutting out smaller newsstands because, the CEO says, the distributor is no longer making money on companies in certain geographies partly due to their distance from its distribution centers. Part of the issue is that publishers won’t subsidize the shipping costs to smaller customers, but will to the larger retailers, such as Wal-Mart. Not surprisingly, larger customers will stay in Source-Interlink’s fold.
Here’s the article