COVID-19: Recovery ideas for print media industry (1)

By Abiola Ayankunbi

Recently, I wrote an article titled: ‘COVID-19 May Push Print Media Industry to Precipice.’ What I predicted are beginning to surface. Findings have revealed that the industry is hard hit  by the development and no one knows where it is heading towards. Some media firms are considering many options; prominent ones being reduction in salaries and laying off staff. It is just not appropriate to be cutting costs in order to stop the lines from crossing. No business ever cuts its way to growth! This is surely not the best time for businesses in Nigeria. The problem did not start today; it is just that COVID-19 aggravated it. In fact, media firms’ balance sheets over the years are clear pointer to this present direction.

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 It has been established that journalists are pretty good at working the scene of a disaster. They will tell you what happened, who did it and why, where, when, how. But when it comes to the disaster engulfing their own profession, their analysis is less rigorous. A physician that cannot cure himor herself. An uncharacteristic haze characterizes a lot of the reporting and commentary on the poor revenue generation of the industry. To say the least and with every sense of modesty, journalists are bad business managers. This may be due to the fact that most of them mount the saddle unprepared. Mayor Akinpelu, Publisher/Editor-in-Chief, Global Excellence Magazine lends credence to this assertion when he said “journalists are not good businessmen, journalists are idealists but whether we like it or not, one thing I have noticed or have discovered based on my experience is, we have a lot of brilliant journalists. Yes! But they are terrible businessmen.”

The interview was published in the Yes! Internstional Magazine, a tabloid owned by Azu Arinze, on August 27, 2015.

To be honest, it pains me to see how the print media has declined in the recent years. Circulation figures keep crumbling! Advert revenue is equally nose-diving because the heavy spenders like government at various levels and multinational companies are not finding it easy.

Furthermore, telecommunication and banking sectors prefer placing their adverts online business thereby reducing its budget for print publications. Part of the decline is due simply to technological advancement while another reason is self-inflicted, although many higher-ups in the print media would never admit it.

Every business is conducted under conditions of risk and uncertainty. The success or failure of any business is dependent on a whole complex of factors like the economic situation, the readers changing tastes, the extent of competitive activity are just a few of that. There the  possible fear that print media in Nigeria may eventually disappear or the reach grossly abbreviated in the nearest future. It is this that has promoted a resort to survival mechanisms by many newspaper companies. An analysis of some of the measures in this direction by Nigerian newspapers shows a genuine concern, but at the same time, the inadequacy of strategy or the lack of creativity and innovation.

Arguably, media managers are all aware of the problems engulfing the industry but the political will to deal with the situation is not there. The bottom line is that the revenue being generated is not enough to run the business. The business model, if it exists, needs to be reviewed. This piece is to proffer practical solutions to the problems that have been inhibiting declaration of profit at the end of a fiscal year.

THE PRODUCT-NEWSPAPERS.

In any business, once there is a problem of revenue, the starting point is to look at the product properly and do the needful. All the newspapers have identity problems. During newspapers review on air, presenters always say that B newspaper writes the same story that I read in A newspaper and there won’t be any need repeating those news again. Presently, in Nigeria it has been buy one, buy all newspapers because virtually all the dailies carry the same news. Technically, it means readers choice is limited to just one newspaper. The Ps are not equal. One of them, Product (newspaper), is really a strategic choice, and must come before the other Ps. The three other Ps- Price, Place and Promotion are tactics. If the newspaper is not designed to meet readers’ needs, then a terrific price, a convenient place and an exciting promotion will not save it. Marketing includes both strategy and tactics but strategy must come before tactics. The most viable way to get this done is to conduct a scientific marketing research. Peak milk is involved in this periodically. It was one of its findings that led to the adding of another product line leading to the production of Three Crown milk that caters for another target market. Many   disasters in newspapering were failures in marketing! What all these disasters had in common were media managers who thought they knew what their readers wanted when in fact they do not. Unfortunately for those managers, their mistakes of not knowing what their readers wanted cost millions of naira and perhaps their jobs.

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SIMULTANEOUS PRINTING. This has contributed greatly to the near insolvency of media firms. The Punch had printing machines in Ogun and Rivers states and the Federal Capital Territory, Abuja. The Nation prints simultaneously from Lagos and Rivers states and Federal Capital Territory, Abuja. The Sun and Telegraph; publications owned by the same person print in Abia & Lagos states and Federal Capital Territory, Abuja. Vanguard has printing machines in Lagos and Delta states. Guardian has its own in Lagos and Federal Capital Territory, Abuja. The Guardian prints for Vanguard in Abuja while Vanguard prints for The Guardian in Asaba, Delta state. Independent has printing machines in Lagos, Delta states and Federal Capital Territory, Abuja. ThisDay newspapers once had printing presses in Lagos and Delta states and Federal Capital Territory, Abuja but third parties print its publications on most occasions. Tribune has printing machines in Oyo state and Federal Capital Territory, Abuja. Daily Trust has printing machines in four locations viz: Lagos, Kano and Borno states and Federal Capital Territory Abuja. Barrister Jimoh Ibrahim made attempt to print National Mirror, his newspaper from six locations but he succeeded in printing from three plants (Lagos and Ondo states and Abuja) before the newspaper went on recess. Everyone knows that goss press remains the best but some media managers purchased either inferior or refurbished machines that are not goss product. The list seems to be endless. A printing press that has the capacity to print more than 100,000 copies in an hour prints less than 15,0000 copies per day! It is unbelievable to learn that some of these presses print less than 1,000 copies per day and generate almost 1,500 waste copies. The machine is grossly underutilized. To make the matter worse, the machine is not configured in such a way to print textbooks, calendars, diaries, etc thereby increasing the idle time. It is a bad business idea to own press in different sales locations in order to engage in simultaneous printing thereby duplicating costs ranging from printing materials to diesel. As a matter of urgency, the media managers need to consider stoppage of simultaneous printing through their own machines but engage in printing through a third party as a form of strategic partnership just like what Vanguard and Guardian are doing presently. They should go further to configure their abandoned machines in the now idle stations” so that they can use such machines for commercial purposes.

NEWSPRINT: This is the major material required in the production of newspaper. Sadly enough, the three printing mills are not functioning. This has made the media managers to rely heavily on the imported newsprints. Some of the media houses do importation directly. A tone of imported newsprint is about N400,000.00; the locally produced one cannot be up to N150,000.00 per tone. Presently, the newspaper industry relies almost exclusively on imported newsprint at great costs to the foreign exchange reserves.

 The three newsprint mills in Nigeria are Nigerian Paper Mill, Jebba, Iwopin Paper Mill and Nigerian Newsprint Manufacturing Company, Oku Iboku. Nigerian Paper mill, Jebba was established in 1969 with production capacity of 12,000 tons of apex per annum. Aside its best years of 1985 when it rolled out 40,480 metric tons of paper representing 62.3% of its installed capacity and 1986 when it took this up to 42,960 tons representing 66.17% capacity utilization, its story has been one of steady decline until 1996 when it finally shut its gates after output crashed to 2.5%. It was sold to MINL Ltd, an Indian company in June 2006.

Iwopin Pulp and Paper Company, Iwopin, Ogun State that was established in 1976 is even more tragic. The company, designed to produce 68,000 metric tons of various grades of finished fine writing, printing and cultural papers was planned to produce fully bleached pulp. Up till the time it was shut down in 1998, the mill never produced up to 5% of its installed capacity. This was despite attaining 85% completion. First it was sold to an indigenous company- Noxieme Technologies Ltd in December 2006. In 2015, there were reports that the company had found a new core investor  Beaulah Technical Company Limited. Yet by 2017, there was no tangible activity at the sprawling complex.

The Nigerian Newsprint Manufacturing Company, Oku Iboku is no different. The mill that was installed in Calabar, Cross Rivers State around 1989 with capacity of 100,000 metric tons of newsprint per annum, took off with a promise to save billions of naira spent to import newsprint- the main raw material used in the newspaper industry. After turning out 28,927 metric tons in 1989 and 37,581 tons the following year, the company would suffer precipitous decline in the 1990s due to scarcity of funds to refurbish the equipment and purchase raw materials. In the end, it was sold to Negris Limited. It has been in comma since. It stopped production largely due to lack of finance and poor management. The mill was eventually liquidated by the Federal Government as part of the privatization programme carried out by Bureau of Public Enterprise (BPE) in 2008.

It is my humble opinion that NUJ, NPAN, NGE, etc and any other journalism leadership at different levels should show appreciable interests in reviving the ailing mills. This is more profitable than pleading for tax waiver on the newsprint importation or joint inspection of government projects. The government can be compelled to give financial assistance in form of loans with lesser interest rate, for the take-off of the project. Returning the plant to production, would mean that newspaper houses, which rely on imported newsprint would drastically cut down their cost of imported raw materials while packaging industries would have homemade paper products sourced locally. Purchase of inks and plates can also be done locally and where the best quality could not be found, media managers can consider joint importation of these materials.

…To  be continued on Tuesday, May 12, 2020.