The National Federation of Retail Newsagents (NFRN) said rival networks will likely slash their prepay top-up commissions as well, following Vodafone’s decision to cut commission for resellers by one per cent.
The NFRN said newsagents would lose around £100 per year each as a result of Vodafone’s action, and stand to lose much more if other networks ape Vodafone. The NFRN has 1,200 members.
An NFRN spokesman said: "It has always been the case other networks follow suit. Vodafone’s cut will cost each newsagent an average of £100 a year, but if other networks cut their rates it will cost them much more."
Vodafone is now the lowest paying network operator for prepay top ups. It said money saved through the cut to commissions will be ploughed back into non-voice and text services to drive footfall.
Vodafone head of channel partnerships Nick Birtwistle said: "This is a decision that hasn’t been made easily. It is part of a strategy to invest in products and services that will encourage people to use their phone more and so top up more. Ultimately it’s about acquiring more customers and getting them to spend more."
Birtwistle also pointed out that is the first commission cut in two years. Vodafone guarantees there will be no more cuts for a further two years.