Anderson Suspends 'Normal Business Activity'

As a former ANC employee fully aware of the flaws of the industry, this is still a sad day for thousands of people. Everyone in the supply chain has some guilt to bear, and yet every party continues to wholly blame the others. When symbiotic entities revolt against each other, disaster follows. For all the employees and their families of this industry, let us hope that there can be some common ground found to minimize the impact for the Publisher's sales, the ND's cash flow, the Wholesaler's operations, the Retailer's sales and displays, and the Customer's enjoyment of periodicals. For any of you reading this from within the industry, please take a few minutes an reflect on how a towing chain (like a supply chain) best works...each link needs the other for strength. Every link is important and necessary, if the load is to be moved. The key/attachment links (the hooks on each end, in this case the Publisher and Retailer) are the flashy ones, but all the links in the middle bear just as much weight without the fanfare. Does this mean everyone in the supply chain should be making the same profit and treated the same? Clearly, no. But it does mean that for the whole structure to work, all the links must at least be maintained. One failure in the chain could be catastrophic. Of course, I have left the industry (because of the likelihood that the chain would not be maintained sooner or later), so I could be wrong. Maybe there are better, more efficient ideas out there...but after 10 years of arguing about it, it would seem like now would be the time to put those ideas to action, or risk the survival of the supply chain. Good luck.

If this is true, then we are all in a world of hurt, Prologix East also runs The New Groups copies. Prologix East is a joint venture between Anderson News and The News Group. This essentially would dry up all magazines on the east coast. Mr. Anderson might be right when saying the publisher's do not understand the situation since this will affect more than just Anderson and Source now. We can thank everyone involved, including ourselves for not understanding the entire situation.

I can guarantee that as I was walking out the door on Friday, my boss knew I would not be back on Monday and he/she would. I can't believe we were told to call and listen to a voice mail that basically left everyone in limbo. Do I still have a job? Will I be able to feed my family? Is this temporary? Will the News Group want me if Anderson closes? So many people are left not knowing. It is entirely unacceptable that a company's representatives cannot even face you, but only asks you listen to a recording. I, for one, will be actively looking for a company that has a little more consideration for people's lives.

I as an Anderson Employee can tell you this is in fact very true. We are all suspended from work until further notice at this point. Let's all hope and pray for the best because if Anderson goes out of business it is going to be a HUGE loss of jobs, not just for Anderson News, but the trickle down effect is going to have a huge impact of the economy as well. Publishers, please just pay the fees. You continiously raised the price of magazines over the years even though Source and Anderson didn't raise their cost to you. Raise the price of your magazines 7 cents if you must. Let's all just get back to work, please.

As another former employee of Anderson News Company, let me add that this turn of events probably didn't have to happen. Anderson was a fine company, peopled by experienced and smart magazine lifers. But an attitude developed that placed ANC and the publishers and national distributors in an unnecessarily adversarial position. ANC spoke about 'publisher partners' but instead of building stronger links in the chain, they butted heads. They built an infrastructure that was the talk of the industry, but neglected the relationships that mattered. This is the sad (but predictable) end of a good company.

It didn't have to come to this. This is huge and it seems some folks think one or two wholesalers will be good for publishers and retailers. Think again. Competition is gone. Don't the publishers think the remaining wholesalers will be in more of a position to make demands. I think .07 will look like a bargain (in hindsight). Some publishers will probably go out of business. Some retailers will remove/reduce the category. Can we get a mediator involved?

I as an Anderson Employee do see both sides of this. No one is getting rich in this business now. But now that it has all come to a stand still absolutely no one is making anything. As a consumer who is already strapped with rising prices I hate to say, "just raise the price". But ultimately isn't that the only solution? We at Anderson don't have any control over the price of the magazines. I believe that is up to the publishers. I have been involved in union labor disputes and often wondered at what point you have lost more than you can ever regain. If this continues that will be what is on the headstone of more than one company. Yes I am very disappointed in the way we were told not to come to work Monday. I would have gladly driven in on my time for the chance to ask a few questions about things that matter to my family. Unemployment, access to our 401K money, things like that. Instead I got to hear a recording telling me that my access to the building has been restrictd and I am being put on vacation and personal time. I'm lucky, I have that, some people don't, what are they to do? I have been at Anderson for years and have always said that they are one of the better companies I have worked for. They have always been fair with us. Of course some of your "whiners" would disagree with that so I sincerely was shocked by the way they handled this. Can we please just be adults and get this settled?

I have been working in the magazine wholesale business over 20 years.The last 10 with Anderson. And Anderson/Prologix the most self destructive outfit I have seen.They create the "Marketing Manager" position and then put a hiring freeze at the retail service level causing more travel and fuel consumption. I think they will survive despite their selves if they can get the publishers to absorb the SBT inventory. They would then most likely drop the 7 cent surcharge demand.

I as a Prologix East Employee can not belive this. This is unreal. We had half of are employees cut about 3 months ago and the ones that was still with the company including the Supervisors worked hard for there jobs and now this????? All I can say is that someone needs to get it together and do something we have familys and we cant take care of them without your help. So someone PLEASE re-think and PLEASE get us back to work.

i understand companys have to do things to survive i am or was an anderson employee and for them to just put a blanket call out to us that there was no more work made me understand more that big companys dont care about those they employ... but only how much they can line there pockets

Why would every publisher all at once decide to risk their entire business model? I would think many of the smaller publishers will have to close down. Over 50% of the market is being effected. Some regional and local titles will lose entire circulation unless this is fixed. The only people truly affected are the workers. These people put your product on the shelves weekly 52 times a year. They don't make a ton of money, however they do it every week, all year long. Publishers, National Distributors, Local Wholesalers and Retailers are all to blame here. Let's all agree there's way too many titles, too much product, useless fat in this industry. The industry needs a full house cleaning from the top. The decision makers are completely lost. This proves that the publishers have no idea of what the wholesalers do. National Distributors are clueless about Retailers. We can't afford to lose folks that truly make the industry. The workers, those under valued, poorly compensated, incredibly devoted people that put your self centered industry on the shelf, 52 times a year.

I guess I am one of those "whiners". I think this whole mess is just that a BIG MESS! I was not an original "Anderson News" employee but a news group person. We had things a whole lot better before the pologix invention. Maybe now things will go back to the news group. We can all hope

Imagine waking up to your husband saying "I don't know if I will have a job after tomorrow, they called and said they are shutting down for now." That is what I heard this Sunday morning as I was getting out of bed. Please remember there are real people and real families out here that are affected by this. We can only hope and pray that this is resolved quickly.

I was late into the email informing to make the conference/prerecorded call and now it looks like I don't have a job. Will someone please tell me what Charlie's message said

Until the mid 90s, the "implied franchise" agreements kept this business in check. The problem was there were no standards to take care of the retailer. Wholesalers, NDs, and publishers were all getting fat, tooling around in their boats, and eating at the Four Seasons. Nobody was consistently taking care of the customer. Chain retailers would all go out of business if they couldn't offer consistency in their stores. Wholesalers weren't consistent and retailers became frustrated. You know what happened next. To this day I see the value in the retailer, the wholesaler and the publisher. The only way I can see value in the National Distributor is if they have a geographical franchise agreement and they dictate the pricing to the retailer. This would make the wholesaler a pure service company that had guidelines how to do business and was paid a service fee. I know the wholesaler would lose some identity, but so does the franchise owner at Chik Fil A. Somebody needs to put the egos aside, get the lawyers together, and figure out how to fix this thing. Everything else has been tried since 1996 and it appears nothing else works.

The yes men who have been feeding Charlie Anderosn and Bo Castle BS should be the ones not working today instead of the employee's who have been the backbone of the company. I will list a few ways you could, or could have cut operating expense.1- If it still exists lose the Apien routing team and program it's a waste of time and money.2-Shelve the handheld program in area that dont have 3PL customers it runs up payroll.3- reduce the number of invoices printed ( as many as 17 per store per delivery??)4- Trim from the top not the bottom, cutting merchandisers will cost sales, adding a vp wont increase them.5-Be proactive not reactive, prevent the fire dont rush to put it out.6- Focus on sales not product placement fees. An upfront payment from a title that doesn't move will in the long run shrink your market. 7-Evaluate talent. You have a number of great people who are not being utilized and some that appear over matched by their responsibilities.

Somewhere all the people Anderson/Prologix let go last year and the small or mid-sized distributors they have bought up, along with the joint venture partners they shoved aside, all those have a big smiles this morning.

As a current employee of Prologix East this is a very diturbing time for me and my family right now

Why should publishers have to pay the 7 cents per copy being distributed? Anderson wasn't asking for 7 cents of SOLD copies, if that were the case I am sure that most of the publishers would have agreed to paying ME included. But... I am not willing to just add an additional 7 cents per copy to my production costs. We publishers are not being given any promices of additional sales or promotions. Now I am a small publisher and I can't afford to go along with this. Maybe publishers should tell their readers that future issues will only be available through subscriptions.

Clearly, the publishers and retailers are the shiny links on the end of the chain, as someone above put it. BUT they are also the only two links that are guaranteed to exist in whatever new form this beast takes. Are wholesalers intrinsic to the process, or simply the process as it now exists?

How about this for a model: Publishers sell to the Retailer; Publisher distributes to the Service Provider (currently called 'wholesaler'); Service Provider delivers all services that the wholesaler currently provides except the buying-selling part. Discount is a discussion between Publisher and Retailer. Delivery to the Service Provider is up to the publisher; may or may not involve a national distributor. Service Provider is paid per unit delivered by the retailer for services rendered. Competition between service providers, then, is on quality of service, and other considerations, but not discount. They're Service Providers, now, not Wholesalers. Payment by Retailer to Publisher is their discussion; Retailer doesn't like the terms, they don't carry the magazine. This is not a new idea, by the way. Ask Charlie Anderson.

I was one of those employees that was laid off last year from Anderson News and I had been there for almost 10 years. I was a very devoted employee and never ever laid out of work but yet they kept the employees that were lazy and really didn't care about there job. Who Figures!!! Anderson laid off a very large amount of employees and I can't see that they cared how we are suppose to feed out families. I thought this was to help Anderson to cut cost soooo, what are they doing with their money they saved from payroll cuts. They shouldn't need 7 cents per copy. So right now I really don't care what happens to them. I will never buy a book or magazine where Anderson News distributes. Good suggestion, I will buy through subscriptions.

By doing a little investigating of the Anderson News website, I found a statement, dated 2/1/09, regarding Anderson's take on this crisis: http://www.andersonnews.com/anderson/docs/Top_10_misconceptions.pdf Now as a current (former?) employee of ProLogix, I don't necessarily take all that I hear from my employer or 'the other side' to be the complete truth, but I find it interesting that only the barest information has been released to us. "More will be known by Thursday" is the mantra stated and while I'm willing use my vacation days to have funds coming into my household, I'm dusting off the resume' and looking around for other employment opportunities. That is, if they exist.

First let me say the way ANCO chose to handle this is weekends turn of events is unacceptable. They knew Friday what was happening and were cowards waiting until Saturday to tell people without having the courtesy to face their employees and tell them what is going on and how it will effect their families. They can't even get in the buildings to get personal belongings. Now let's clear up some things. Every time the publisher raises the cover price, everyone including the wholesaler makes more $$. Everything is done on a %. So all those cover price increases have helped Wholesalers too. ANCO is not asking....THEY ARE DEMANDING 7 cents per copy and gave the publisher 3 weeks to come up with the $$. A weekly that distributes 500,000 copies per wk is looking at additional costs of $1.8 Million per year. The average magazine would have to increase it's cover price a minimum of 60 cents just to break even with ANCO's demands. Before you scream at me remember the wholesalers gets a % of that cover price increase too on every magazine sold and the 7 cents ANCO demands is not on sold copies, rather every copy they put in the stores, sold or unsold. How did we get in the mess? People got greedy. When we changed from regional wholesalers to chain contracts, things got ugly. Wholesalers wanted to secure big contracts so they gave away their profit. It was an ego thing! Many smaller & very efficient wholesalers closed their doors because they just couldn't compete. They actually were smart business people who didn't want to get involved in what everyone knew was a house of cards that would coming crashing down someday. In many cases, the wholesaler gave away too much of their profit just to secure the contract and now expects someone else to pay. It is much like the mortgage meltdown and now they want a bailout. Then came along Scan Based Trading...thank you very much Walmart. This is not a good busines model for ANYONE who is a supplier to a store....great for the store but the suppliers take the hit for damaged goods, theft, etc. all while fronting millions in products at no cost to the store. The supplier doesn't get paid until the item is scanned for purchase. Yes all those items that you purchase that don't scan are 100% profit for the store! The real victim here is all the workers for the wholesalers. Mr. Anderson has millions, a lovely home, a jet, fun expensive cars and he still has other businesses. The little people living pay check to pay check...now they will suffer. The publishers have some very bright and resourceful people. Those that still have jobs will developfind avenues and channels to distribute their product into store. I am sure there are already those knocking on their doors more than willing to work with them in this economic downturn. Are wholesalers necessary to the process. Perhaps we are about the find out.

Basically the recorded message said that he is still in negotiations with the publishers but since Anderson had NO product to deliver and to continue the negotiations, he needed to reduce all the expenses he could. To do that all magazine distribution would stop effective immediately. There would be skeleton crews and those that were to work would be called. If you were not called do not come to work. You will be paid any vacation or personnel time you had while these negotiations were going on. He gave his hope that there would be a successful end to this issue. Anderson had survived 2 world wars and the great depression and hopes to survive this. He said that it was not the fault of any of the hardworking employees of Anderson. That is all I remember. I had to listen twice I was so shocked.

While it is sad for the employees and folks connected to them, Anderson was a nightmare to deal with. Nightmare. Even if small magazine publishers wanted to distribute magazines individually to stores, Anderson would bully the stores and magazines and keep us from doing it. Local store managers would have to give cash to receive hand delivered magazines from individual publishers! I recall seeing my publisher get a sheet with all of Anderson's chargebacks and such, and at the end, there was no profit from his sending thousands of magazines. Our magazine had a thriving business selling back issues, but woe to us when we tried to get any mags returned. Instead, they were all destroyed. I hope the magazine publishers can take back their own distribution with this fiasco. While one national wholesaler might be helpful for marginal publications, wholesalers are NOT needed for most distribution. Just an extra mess.

Has anyone heard where news group is in all of this? IS Patterson buying out Anderson? Sounds like a good idea to me. Go back to the good ole days.

"The employee said the news affects Anderson employees at Anderson News, Prologix East, Anderson Services and Twin Rivers Technology. In the meantime, a “skeleton crew” will remain in place." Nice of Charlie to assume The News Group would not want to deliver to their customers. Thought Prologix was supposed to be a joint venture? I guess Charlie wants support from Jimmy's boys.

Sounds like Charlie Anderson made an industry mess quite personal for his employees. Yes, the industry is in turmoil, requiring many very tough choices at the moment. Unfortunately, Charlie chose to give a whole lot of people some of the worst news of their lives via a pre-recorded phone call. That is perhaps the most classless thing I've heard in 22 years in this industry. I hope if he opens his doors again, they all have found other options and tell Mr. Anderson exactly what to do.

IT DOESN'T MATTER IF THE CUSTOMERS SWITCH FROM ANDERSON NEWS TO NEWSGROUP, THEY ARE STILL NOT GOING TO GET A DELIVERY, BECAUSE THIS TWO COMPANIES MERGED TO FORM PROLOGIX DISTRIBUTION SERVICES, SO IN REALITY IT'S A 75% SHUTDOWN, NOT A 50%, THE ONLY THING LEFT IS HUDSON NEWS, AND THEY ARE NOT GOING TO BE ABLE TO HANDLE ALL OF THOSE CUSTOMERS.PUBLISHERS ARE GOING TO HAVE TO NEGOTIATE A DEAL OR ELSE THEY WILL LOOSE MILLIONS JUST IN A WEEK, MAINLY THE WEEKLIES. I HOPE THIS MESS GETS FIXED.