ABC raises RR price to Rs 30 per kg, evokes mixed response from publishers

The Audit Bureau of Circulation (ABC) last week decided to fix Raddi Rate (RR), in order to calculate the Net Realisation Rate (NRR) for the July-December 2022 audit period, at Rs 30 per kg. The RR for the January-June 2022 audit period was Rs 26 per kg.

In its statement, the ABC said, “The bureau’s council of management has decided to fix the Waste Rate of Newspapers in order to calculate the NRR for the audit period July-December 2022 at Rs.30/- per kg on an all-India basis.” The bureau also mentioned that its management has decided to continue with the circulation audit for the July-December 2022 period in the same manner as done for the January-June 2022 period, i.e. showing copies “Above NRR” and “Below NRR” with the total.

The new rate has evoked mixed response from publishers, with some of them saying that its ABC attempt to ensure that the waste paper price does not exceed the selling price, others say the new RR could be a challenge for some publications with lower cover price.

The CEO of a major Hindi newspaper, who agrees with the ABC rate, said that the council has determined its charges based on market rates.

He explained, “Trash newspapers often sell for Rs 32-33 per kg on the market. The idea of deciding the rate of waste paper is that no publisher should be selling its newspaper below the cost of its newspaper. If the raddi cost of the newspaper is higher than its selling price, hawkers will pick up the bundle and sell it in scrap, making the newspaper circulation appear inflated. ABC strives to ensure that the waste paper price does not exceed the selling price.”

“Some publishers who are probably not confident that their copy’s worth is more as cover price than raddi would object,” quipped the publisher.

On the condition of anonymity, the circulation head of another Hindi-language paper shared that the ABC calculates NRR after removing the trade commission from the net sale price and evaluates if the balanced cost can be compensated with its raddi value. “ABC makes sure that publishers sell newspapers to consumers and not as raddi to recover costs.”

He too mentioned that there will be no major impact of the new RR and that some publishers might have a problem simply because their cover price is lower while number of pages is higher. He said that publishers have to keep a balance in cover price and their paginations if they want to be audited by the ABC.  

Sharing a slightly different view, a senior executive of a national English newspaper explained that for some publications, especially for those who have a lower cover price, it's going to be a challenge.

He also went on to explain why being audited by ABC is important for publications. “The ABC certificate is important for DAVP rates. The ABC is preferred as it is a more professional body. The ABC wants papers to recover and hence the decision was taken.”

Another Hindi-language newspaper’s vice president shared that they are fine with the rate until it's not affecting their advertising revenue. “Newspapers have started to see growth in business in two years. We are okay with it until it's not affecting our ROI,” he added.