National printing, mailing costs force change with Harvey County Now

By Adam Strunk

If Harvey County Now’s printed product was squeezed any harder, it might just drip ink on your hands.

The costs of printing and mailing the paper have soared by 42 percent in the past two years, according to our accounting data, and these pages are captive to it. In total—with print, mailing, staffing, benefits and office space—it now costs $3.03 to print and produce the copy of Harvey County Now you’re reading. With a year’s subscription, you paid $1.26 to read it.

We are seeing unprecedented price increases and changes in the local economy. Without a change in how we look at the business, we aren’t going to be able to properly provide a high-level news product going forward,” Harvey County Now Publisher Joey Young said.

“No control over it”

The increases in the cost of printing, mailing and producing a newspaper have not just taken place in Harvey County but across the state and country.

I’ve heard more from members about the angst of price increases in the last two months than I have ever heard in all the 22 years I’ve been here,” said Emily Bradbury, director of the Kansas Press Association. The KPA serves 191 news publications across Kansas. “It’s very concerning,” she said.

Bradbury said the publishers’ biggest concern was mailing costs.

We have no control over it, and it’s hitting hard,” she said. “It’s causing a lot of people to look at their operations and say, ‘How do we maintain the same quality while being hit with double-digit postal price increases?’ You put that on top of the inflationary increases already, and that’s staggering.”

According to the National Newspaper Association, since the U.S. Postal Regulatory Commission removed a regulatory cap in 2021, the U.S. Postal Service has increased the mailing costs of newspapers by 24 percent. It will implement another 8.8 percent mid-year hike in July.

Postmaster General Louis DeJoy has previously announced his intention to seek the maximum allowable increases for more of the mail considered captive consumers with the USPS,” it stated.

As the U.S. Postal Service had been the only viable method for delivering weekly newspapers for decades, one of those captive customers is Harvey County Now.

While in the past some publications have used other options such as route carriers to deliver papers, Bradbury said that’s now easier said than done and in some cases less feasible than using the postal service.

“That industry is squeezed by labor market pressures,” she said of carriers. “There’s contract law. There’s wage stagnation. It’s not an easy switch. We are just trading pressures from one solution to the other. “

During the same time period postal costs increased, the cost of printing also jumped due to paper shortages, following paper mill shutdowns during the pandemic, increasing global demand, as well as U.S. tariffs levied on paper.

The Columbia Journal Review stated the cost of newsprint increased by 34 percent from 2020 to 2022. Those increases since have not abated but compounded.

Printing and mailing are two of the three biggest costs with printed paper, the third being personnel. In the last two years, Harvey County Now has also seen the cost go up for employee insurance, rent, utilities, and just about everything else needed to produce a newspaper.

Such factors continue to have a stark impact on the face of journalism across the country.

Teri Finneman, a journalism historian and professor at the University of Kansas, has studied newspapers across the country as well as their business models. She said more than 2,000 local newsrooms have closed in recent years, in part because current business models, with increased costs, are no longer sustainable.

Rather than change their business model, they decided to roll over and die,” she said. “That’s not good for anybody—the community, democracy, the information knowledge sphere, or the increase of misinformation,” she said. “The state of democracy today can be blamed in part on how many local newspapers have died.”

Other Kansas newspapers have chosen to cut staffing to the bone.

The news staff directory of the Hutchinson News, for instance, lists a single editor for the once robust publication “covering the better part of Kansas,” as its masthead states. That scenario has played out throughout the state as ownership groups embraced cost-cutting as a way to eke out a margin over the years. Harvey County Now exists in part due to past corporate decisions of such ownership groups.

Bradbury discussed the importance of local news publications covering a community. She said communities that experience the loss of newsrooms see an increase in government expenditures and less participation in the democratic process.

The number one benefit for a community is the watchdog role,” she said. “Very few people want to sit in a city council meeting or BOE [board of education] or have the ability to sit in there to find out what’s going on in their community and report on them and hold their government accountable. You’re holding people accountable and getting the word out about vital things happening in their community that they can find nowhere else. “

A changing reality

Newspapers historically sold papers at a loss, leveraging subscription numbers toward selling ads to businesses. It’s been a business model slow to change, despite the advent of the Internet and diversified advertising budgets.

It made sense then for advertising to pay the bulk of the bills for the newspaper industry,” Finneman said.

A 200-year-old business model doesn’t really work for any business anymore, but for the newspaper industry, it worked for them for a really long time,” she said.

For better or worse, Harvey County Now opened with such a model in 2015, offering subscriptions that cost less than production value, in hopes of growing circulation and then advertising.

The start-up paper found success in the model. It enjoys more than 3,000 paid subscribers, strong support from local advertisers compared to peers, and a better-staffed newsroom than most newspapers in Kansas.

It’s a large publication,” Bradbury said. “When people ask what they are getting for it, you guys are offering a lot of value for your subscribers.”

Harvey County Now has been named the top newspaper in Kansas’s second-largest circulation category for three of the last four years, in part due to award-winning watchdog journalism and strong community features. It’s added to the services it provides with a newsletter published four times a week with daily updates. It’s seen circulation grow over the past two years while combining publications. Website traffic has averaged 72,000 page views per month since the newsletter service was expanded, representing the highest monthly average total in the company’s existence.

“On one hand, we are getting recognized as one of the best publications in the nation through trade magazines, and Lindsey [Young, co-publisher] and I have been invited to speak at several state press association conventions about our innovations here over the years,” Young said. “On the other hand, it feels like despite some of these successes, we are still drowning in cost increases and problems created that are completely out of our control.”

While these factors spelled modest success in a pre-pandemic economy, the economic reality Harvey County Now occupied has rapidly changed.

Advertising revenue increases have not kept up with increases in costs. Since 2015, the county has experienced consolidation and ownership changes in many industries, including banking and insurance, decreasing the pool of local advertisers.

During the current inflationary period, local businesses across Harvey County have been squeezed by costs of labor, resulting in advertising budgets that have either shrunk or dissolved.

National projections for print advertising also do not lead the Harvey County ownership group to believe ad revenues will see a large, sudden increase.

Axios projected national total print advertising revenue to decrease below $5 billion by 2026. It had been nearly $12 billion in 2017.

The cost to print a newspaper, the cost for mailing, all of those things have gone up,” Finneman said. “The decline of rural communities without as strong an advertising base. People turning to Facebook and email. The decline of classified advertising has whittled away on the revenue of newspapers, making them have to rely on other revenue streams.”

Finneman is authoring a book (with Harvey County Now as the part of the subject) titled “Reviving Rural Journalism.”

Harvey County Now has worked with Finneman as part of her publication and has found itself in a similar position to many other newspapers she interviewed. To sustain the quality and service it’s provided readers through print, it must make a transition to bring in more revenue from those who support it the most, readers.

The options

Harvey County Now’s ownership group, consisting of Joey Young, Lindsey Young, Bruce Behymer and Adam Strunk, met early in May to discuss the reality of increased costs and the current financial model.

The group looked at three options to put the newspaper on a sustainable financial path: continued cost-cutting measures, a transition to a digital-only publication, and making print subscriptions more accurately reflect the cost to produce them.

In the past year, the publication has made numerous changes to attempt to ride out cost increases and impact the reader as little as possible, though none of them were painless.

“I feel like I am working harder than I ever have in this business, as we are doing more and more internally,” Young said. “But at some point, we have to look at each other and say that cutting much more would be a disservice to our readers, something we really aren’t all that interested in doing.”

The company previously made the difficult decision to operate one office instead of two and closed its office in Halstead. The company also plans to move its office from 706 N. Main Street in Newton to find a more fitting location in the city, as rent has continued to increase.

The company delayed filling a fifth open reporting position, using freelance writers and extra staff production to fill the gap. It transitioned from paying contractors for taking papers to the post office and throughout the community to doing it internally. All members of company ownership have routes they now run to get newspapers to the community post office and on racks.

It made the decision to run single-section papers when possible to save between $400 and $600 per week on print editions.

And most detrimental, on a personal level, it has not been able to provide cost of living increases to employees to help them deal with the increased financial pressures of the current economy.

Lindsey and I only take $47,500 combined out of the company a year.” Young said about the couple’s total compensation. “We are able to do that because we don’t have children and live modestly,” Young said. “We both work full-time in this company, so it’s not hard to do the math and see that this isn’t a case where we are taking too much as owners. I love this newspaper, and I have always believed in leading from the front. If we can’t provide raises for employees, we certainly aren’t going to be taking one as owners.”

Staffing costs are one of the few expenses the company can control, and everyone working at the paper has been impacted by this truth.

At the May meeting, ownership ruled out remaining large-scale cost-cutting options.

We don’t want to run a company where we don’t provide benefits to our full-time employees,” Publisher Joey Young said. “We could cut insurance, we could cut staff, we could cut retirement benefits. We could continue to chop away with this over the years until it’s nothing, but we’re not willing to do that. There is a reason we have low turnover in our company, and treating our employees poorly isn’t going to maintain that loyalty.”

Outside of a human and philosophical perspective, ownership has witnessed newspapers engage in cutting staff to save money and is of the opinion that the strategy benefits neither the publication nor the readers it serves in the long term.

We could turn into a ghost newspaper, but that doesn’t help any of our communities,” Young said. “We’ll shut it down before we do that.”

The group also ruled out moving to a digital-only product. Print ads continue to be a significant revenue stream. There is also strong customer support for a printed paper.

In April, Young posed a question to readers, asking what they wanted the future to be.

The column, sent in the paper and in the digital newsletter, elicited a large number of responses, with a majority wishing to keep print publication and expressing a willingness to pay more for the service.

That data was also reflected in readership data Finneman collected as part of her study, as well as what Bradbury has been hearing from KPA members who conducted their own surveys.

Ownership of Harvey County Now eventually settled on a strategy to increase the cost of print subscriptions to accurately reflect the cost of production. Digital-only subscriptions, which do not require the cost to print and mail, will see a small increase in cost and will provide an option for those who do not use or wish to pay for what it costs to produce the printed product.

We recognize what we are asking here. Everyone’s costs are going up—from the grocery store to the gas pump—and now we are just piling on to a readership base that is hurting,” Young said. “We want to provide some cheaper options for readers who are struggling so they can keep reading the paper, and you will see that reflected in our future plan.”

Bradbury said raising subscription costs is an option she’s seen many members considering or undertaking.

She noted that, even with the increased cost of news, it’s still a small price to pay for the benefit it provides.

Look, when you can pay $8 for Hulu and $15 for Netflix and $25 for HBO Max, you can pay for a local business that holds the government accountable and informs the public on what they need to know,” she said.

Finneman said the best way to prevent or reverse the decline in local journalism was to ensure that journalism was funded.

The price of a candy bar is almost $2. Think of the 10 seconds it takes a factory to make a candy bar and the 200-plus hours it takes to get the newspaper together,” she said. “The newspaper industry now needs to correct course and take on a modern business model for a modern world.”

A sustainable path

Starting July 1, a print subscription to Harvey County Now will cost $12 per month, plus tax. A monthly digital subscription will cost $9, plus tax. The price does not increase on existing subscriptions. Renewal notices will reflect the new price.

Print subscriptions include online access and will be billed annually or can be paid for online monthly. They also make print subscribers members of Harvey County Now’s Press Club and entitle them to all the social events and benefits existing Press Club members have enjoyed the past year.

Digital-only subscriptions will be billed monthly through the website as they have in the past.

The increase in print subscription costs will help offset the production of printed papers and put the company on a sustainable path to continue to print papers for years to come.

The increase will also offer the company flexibility in the size of papers it prints and additional resources to cover important news stories in all its communities. Finally, it would pay for wage adjustments to help employee pay keep up with market inflation. Harvey County Now ownership believes these changes are necessary to continue to produce the quality product readers have come to support and expect.

As for the author of this article, he understands that people get what they choose.

He has optimism that a good many readers find enough value in his work and the work of Wendy, Bill, Joey, Bruce and Lindsey to choose to have a comprehensive locally owned paper far into the future.

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