When the Jim Pattison Group, owners of the largest wholesaler group in North America, first became a co-owner of the Comag Marketing Group, one of America’s four major national distributors, benefits that were mentioned included “reducing redundancies.” I didn’t have a clue what that meant, unless it was a special code for triggering layoffs.
Last week I got an announcement from Glenn Morgan, President of Coast to Coast Newsstand Services. Coast to Coast isn’t on the radar of a lot of U.S. publishers, but it is a major Canadian national distributor. Also, its ownership structure has some things in common with Comag’s. Namely, the Jim Pattison Group.
Coast to Coast announced that it’s going to outsource its billing, collection, print order and galley prep, and other back office functions to Genera, the Pattison- and Hudson News-owned company that does Comag’s back office.
Coast to Coast is also contracting with Comag for their North American field work. Some Coast to Coast field reps will join the combined team.
So this is a step in the reduction of redundancies, and it makes sense to me. I’m not a fan of consolidation for consolidation’s sake—or, in fact, consolidation at all, necessarily—but believe me, I am a fervent convert to taking costs out of a wildly expensive newsstand distribution system.
How will this partnership affect the relationship between Comag and Coast to Coast? Will the two companies grow ever closer, with C2C eventually acting as Comag’s Canada arm? Will the savings implied by the reduction of redundancies find its way back to publisher clients? Will all this vertical integration give Comag/Coast to Coast an edge over the other national distributors?
I don’t really know—I just read the press release, and am passing it along to you. But as soon as I have inside knowledge—at least the kind inside knowledge that a blogger is allowed to pass on—I will share that knowledge with you.