Augsburg Fortress faces $1 million loss

Lutheran, The, Dec 1999 by Brooks, John

Publisher develops new women@ magazine despite financial crisis

Sales are down and expenses up, reported George Poehlman, Augsburg Fortress, Publishers' vice president for finance and treasurer, at the house's Oct. 21-23 board meeting in Minneapolis."We will wind up with an operating loss of about $1 million [at the end of 1999]," he said.

Poehlman also reported the company's balance sheet remains "very strong" because it has good credit ratios and inventory control.

"Can Augsburg Fortress jump start its revenues? Absolutely. We can do it," said Charles Halberg, executive vice president and chief operating officer. Under a plan adopted at the board's spring meeting, the company will reorganize into specific market and business groups as of Jan. 1.

Marvin Roloff, president and chief executive officer, said he is committed to the reorganization, which will require "budget reductions."

It will likely result in a reduction of positions, Halberg said. Specific information on how the reorganization will impact the workforce was not available at presstime. Augsburg Fortress employs 380 part- and fulltime workers.

Magazine sparks controversy

Augsburg Fortress is in the early stages of developing Sunday/Monday Woman, a magazine that may compete with Lutheran Woman Today. Produced by Women of the ELCA and published by Augsburg Fortress,

Lutheran Woman Today is an award-winning magazine with a paid subscription of 180,000.

Since being told of the plan in early 1998, Women of the ELCA has "repeatedly expressed serious concerns" about the new magazine to Augsburg Fortress, said Catherine Braasch, executive director.

"Women of the ELCA and Lutheran Woman Today want a strategic partnership with the ELCA publishing house," she said. "Our concerns about Augsburg Fortress' proposal for a second women's magazine go much deeper than the matter of future competition for readers. We are concerned that the new venture is already competing for the publishing house's attention to research, growth and development of Lutheran Woman Today, as well as to customer service.

"We want readers to be confident that Women of the ELCA is committed to Lutheran Woman Today, to serving its current and future readership, and to addressing the changing needs of women in all ages and stages of life and service in this church, in society and in the world."

The board held a wide-ranging discussion of the publication but took no action. While Karen Albers-Sigler, Bloomsburg, Pa., said the magazines "are two different animals," Paul Wee, Alexandria, Va., said there were questions as to whether there was sufficient communication with Women of the ELCA. "The question is do [the magazines] complement each other, parallel each other or compete with each other," Wee said.

"The mortality rate for new publications is high," said Fred Korge, Houston, adding that he was concerned about the publication's timing amid the house's 1999 deficit. He asked whether sufficient market research was done for Sunday/Monday Woman.

Dana Dreibelbis, vice president for publishing, said extensive research was conducted. At least two years ago, he said, Augsburg Fortress representatives asked Women of the ELCA to work together on "market research" to address Lutheran Woman Today's declining subscriptions. "That overture was declined by Women of the ELCA;" he added.

Later, Dreibelbis said, the women's organization again declined when asked if it would be interested in developing a "complementary" magazine. Augsburg Fortress has remained in regular conversation with the women's organization about the new magazine, he said, adding, "Our position continues to be, 'please work with us.'We don't want to be banging heads."

"LWT editors are mystified at the statements that Women of the ELCA turned down opportunities for 'market research' and cooperation on a 'complementary women's magazine,'" said Nancy Stelling, editor. "From our perspective, these statements don't reflect the discussions we've had with Augsburg Fortress."

Brooks is directorfor ELCA news and information.