It was a hot night and the garden was crowded. The debate taking place across the lawn from me was of the forward-leaning, hand-wielding kind that suggested violent disagreement about Franzen’s Freedom or who is the better Bronte sister (Charlotte, obviously). Before long, one of the participants had smashed his champagne glass against a nearby potted palm and was holding it to his adversary’s throat. The topic: the price of books in Australia.
Okay, that’s not quite how it went down… But there’s no denying discussion of Australian book prices can get heated. And these days there are not a lot of places you can go in the world of books without this particular subject raising its head to distract you from the kind of conversations you imagined having in a space full of writers and publishers – discussions about the books themselves, about writing, politics, identity and expression, morality. You know: meaning-of-life type stuff.
This particular debate, between a small but successful independent Australian publisher reputed for his non-fiction list, and a savvy writer/ reviewer with a position on several book-related boards, was a telling example of the genre. In a nutshell, their argument went something like this – writer/reviewer: books in Australia are too expensive; publisher: no, they’re not.
At the time, I had a sneaking suspicion that I had timed my career in the book industry spectacularly badly: just as the people who should be arguing with passion about anything less mercenary are now debating price-points. But it is clear that at the heart of this discussion (and countless others like it) is in fact a great deal of meaning-of-life type stuff, it’s just that many book lovers don’t know it yet.
So why are Australian book prices such a hot topic right now? The answer is The Book Depository.
The Book Depository is not the only overseas online book retailer (the steady tide of consumers flowing to Amazon has been on booksellers’ radars for years), but it is a very popular one with Australians, thanks to its regularly low prices and – a deal-sealer here in far-off Australia – free delivery. In 2009, the company cited our nation as its biggest market outside of the United Kingdom, where its warehouse is based. The company, which doesn’t actually operate a physical bookstore and only supplies books order-to-order, recently reported that its sales in the second half of 2010 grew by over 70 per cent, with overseas sales making up two-thirds of business.
The unpopular (and no doubt doomed) recent campaign by big retailers, including Harvey Norman and Myer, to have GST applied to our purchases of their overseas competitors’ products attracted headlines. But the disparity between Australian book prices and prices in America and the UK – only a small amount of which can be attributed to the GST – has been influencing Australian consumers for some time. The Australian dollar reaching parity with the US dollar in recent months has further contributed to these consumer trends. Estimates of the number of Australians going to overseas online book retailers vary, but the percentage, anecdotally, is around 10 per cent and possibly as high as 15 per cent – and growing. And those purchases from somewhere like The Book Depository represent lost sales for booksellers and publishers here in Australia. So you can see why the conversation raged as it did that hot evening in the garden.
As he has done in several blog posts and articles, the small but successful publisher outlined some well-worn explanations for the price of books in Australia: our small population (which ensures the price-per-unit cost of printing a book will be higher than in the US and UK, where there are millions more readers); the hard, unavoidable tyranny of distance – the distribution challenge faced by any local publisher to get their books to readers across such a wide, brown land; and – and this was one of the publisher’s big bugbears – the quality of life of most Australians. In purchasing books from online retailers in the US and UK, his argument went, Australians are dipping into a foreign economy; one, in fact, where the minimum wage is half Australia’s – with the quality (and inequality) of life this represents. All of this, the publisher insisted, was why $32.95 was not an unreasonable price for a book in 2011. Our writer/reviewer, meanwhile, with all the frustration of anyone who wants Australia’s good publishers and booksellers to survive but is simultaneously seeing the public tolerance for Australian book prices dive, was screaming – in tone, if not volume – ‘it’s still too much!’ Which, when you look at some of the prices overseas, is pretty understandable. A quick search shows the Man Booker Prize shortlisted novel Room by Emma Donoghue costs $32.95 from a local bookseller, $21.80 on The Book Depository and $14 plus postage from Amazon. It’s not that the writer/reviewer himself would necessarily complain about paying the local bookseller’s price (nor receiving the royalties that make up a part of it). He was simply articulating how many buyers now think that price is unreasonable.
I was asked to adjudicate at one point, and I had to admit the unsatisfying truth: they are both right. In purchasing books from Amazon or The Book Depository, Australians are enjoying prices that are a product of an economy few here would wish to live with. Some argue that Australians are also purchasing at prices that are not ultimately sustainable, but are instead part of a ‘predatory pricing’ scheme designed to achieve a monopoly (with Amazon looking well on its way to representing 50 per cent of all US book sales by the end of 2012). On the other hand, the horse has bolted: the overseas prices are there for all to see, and some book buyers are voting with their credit cards.
Early this year, I did something I had always sworn I’d never do. On a quiet, late-night hour I set foot in IKEA, wandered its furnished labyrinth and behemoth aisles, and came away with four Billy bookcases, which my boyfriend and I spent the next day assembling and loading with the books that were overflowing from our other, less-disposable shelving.
IKEA. Now there’s a company that understands price-points, starting with the price range it believes consumers will pay for its items and then working its way backwards to create objects at those prices. As we stood before the rows of bookshelves, I noticed several signs informing customers that, due to IKEA’s buying power and recent negotiations with suppliers, the price of Billy bookcases had actually come down in the past year. Later, we passed full-sized kitchen clocks priced at three dollars. Back at home, once we’d negotiated the Allen keys and drilled in a couple of holes the IKEA-bots had missed, we filled our entire wall with bookshelves for $300. This was the global economy at work, and I was a part of it.
The Book Depository is the global economy at work, too. Don’t get me wrong: I’m not comparing half-baked furniture with books. The similarity lies in the fact that they are both rational outcomes of a global market in which price is the defining consideration. Like IKEA, The Book Depository is incredibly efficient and, like IKEA, it is particularly efficient in terms of price – thanks, in large part, to the power of scale (The Book Depository’s managing director Kieron Smith said in 2009 that his company is ‘a volume-led business, and we can get very good deals with couriers as we are shipping upwards of 130,000 products per week’). The difference is that while I’ll occasionally put up with the many things I don’t like about IKEA in order to get my furniture cheap, The Book Depository and its Amazonian siblings don’t get any of my business. Why? I care more about books than about the furniture they are stacked on.
Obviously, I have a vested interest in my consumer dollars going to local bookshops – I edit a trade journal for the Australian book industry. Without that industry, there will be no magazine. But my interest in this issue extends far beyond ensuring my next pay cheque. My job has given me an awareness of the chain of production for books that I otherwise wouldn’t have had. It’s this understanding of the trade as it currently stands – and what’s in it for me – that influences where I buy books. In this sense, I see my decision to purchase books in good local bookshops, as opposed to online UK megastores, as a self-interested one. I like those shops and the local publishers they support, and I want them to stick around.
So what do I think I’m paying for when I buy my books locally? Well, taking my bookshop of choice, Readings, I’m paying for online and in-person recommendations and reviews; the physical space the store provides to meet and browse with friends, discussing books or the ideas they provoke; an undeniable sense of community which extends beyond the realm of the book; the very act of collation that highlights books I am interested in among the thousands more around; and – through the Readings Foundation – financial support for an adult literacy program at Melbourne’s Western Suburbs Indigenous Gathering Place, educational scholarships for disadvantaged students, a tutoring program for children of migrant families from Sudan, a regional programming stream at the Emerging Writers’ Festival and several Victorian Writers’ Centre residencies (which I like thinking I might experience one day), as well as many other great projects.
My interstate ‘locals’ include the hive of literary activity that is Avid Reader in Brisbane (a bookshop that has produced several authors from its ranks of staff, all of whom have their literary ears to the ground on readers’ behalf), the beautiful Riverbend Books across the way in Bulimba, whose owner Suzy Wilson founded the Indigenous Literacy Project and hosts wonderful author events on the store’s huge deck; Gleebooks in Sydney, which fosters a sense of community around reading – where the launch of a Harry Potter book, for example, might be cause for a special steam-train ride and picnic for young fans (and where owner David Gaunt’s contribution to his community was recently recognised when he was made a member of the Order of Australia). At these and other great bookshops around the country I encounter engaged staff, author events – and in some cases, whole writers’ festivals and book fairs (not to mention the best cards and gift-wrapping going). And that’s in addition to the books themselves.
When it comes to the books, I know my dollars are also serving me in the long term: when I buy from my local bookseller – whether the book I am buying is Australian or not – part of that money is almost always going to a local publisher. They, in turn, are ensuring both that fantastic overseas titles continue to be brought to my attention (such as Every Man in this Village is a Liar, whose author Megan Stack visited Australia for last year’s Byron Bay Writers’ Festival thanks to her Australian publisher), and that books of social and cultural import, like local writer Chloe Hooper’s The Tall Man, continue to be published.
The importance of local booksellers to small, independent publishers was demonstrated recently when the Small Press Underground Networking Community (SPUNC) worked in partnership with a local retailer (Readings) to make its members’ ebooks available to consumers. At a time when small presses are increasingly branching out in promotional strategies, reaching niche audiences through social networks – as so many pundits suggest publishers will need to do in the future – the continued necessity of bricks-and-mortar booksellers is evident in this decision to partner with Readings on their ebook venture.
I’m not saying that some of the benefits provided by Australian bookshops mentioned above are not available online from overseas; I’m saying that, given how much I value them in their current form, and given the broader gains I see along the chain of production, I choose to factor these benefits into my purchasing decisions. And I suspect many who feel the way I do about their local bookshop and local publishers might choose to shop locally rather than on overseas websites if they had the chance to ponder some of the implications of their decisions.
Like looking for local produce at the supermarket or choosing locally-designed and made clothing, I’m shopping for my books with an awareness of the bigger picture. The phrase ‘ethical consumption’ surfaces with regard to a range of other goods, and in the simplest sense it should apply here. I’m not talking about human rights, animal rights, the ethics of life-and-death, but that very simple, individual question of whether my book-buying habits are compatible with my broader life values. Whether my decisions and actions are contributing to the kind of world I’d like to create – or to something else entirely.
To me, the assumption that so long as prices are getting lower the consumer must be benefitting is a pretty naive one. Something that is often assumed when modelling economic behaviour is that an individual has ‘perfect information’ on the outcomes of their purchasing decision. While few would argue anyone can ever have truly perfect knowledge of such outcomes, it doesn’t hurt to try to add to the data.
In the United States (where the number of independent bricks-and-mortar booksellers has reportedly dropped from around 6000 in the 1990s to just over 2000 at present), remaining booksellers have a whole campaign built around this – it’s called IndieBound, a movement that identifies local independent shops (booksellers or otherwise) and thanks customers for shopping in them, using a number of mediums to highlight the wider benefits of their purchasing decisions.
Some will try to tell you that it’s impossible for Australia’s book industry to do any better on prices. It’s not true. There are aspects of the local and international book industries that are incredibly inefficient – the supply chain for non-Australian titles being one example. Too often, local publishers or distributors hold exclusive rights to overseas-generated titles but do not hold stock, preferring to import from overseas. As these publishers wait to receive enough local orders to fill a pallet (and thus save on freight), local orders from booksellers can take weeks to fulfil. Such inefficiencies present a complex challenge, but not an insurmountable one.
When the government announced in 2009, following a report from the Productivity Commission, that it wasn’t going to change Australia’s laws regarding the parallel importation of books (that is, it would uphold the status quo which says a bookseller cannot import a title if there is a local supplier for that book) it made its stance clear: ‘If books cannot be made available in a timely fashion and at a competitive price, customers will opt for online sales and ebooks.’ Put simply: the government didn’t need to change legislation to ensure competition, ebooks and the web were already doing that for them. (Last Christmas, almost half of Australian booksellers my publication surveyed reported sales had dropped compared to the same time the previous year. Many of them also reported customers in-store talking to each other about The Book Depository, or seeing browsers take photographs of the books and their ISBNs – in order, presumably, to go and buy them elsewhere online. And while some in the industry blame the group’s woes on poor management, there’s no denying that the decision by REDgroup Retail, owners of Borders and Angus and Robertson in Australia, to put the bookselling chain to voluntary administration has highlighted some of the pressures facing all local booksellers.)
Certainly, publishers and booksellers will have to lift their game. Any bookshop without an online sales facility and an excellent online search function is condemning themselves to oblivion; those bricks-and-mortar shops that do provide online sales report increases in that area year after year, while exclusively online booksellers here (who, by definition, funnel all their efforts into online business) are reporting exponential growth – with sales up 800 per cent, in one case. Shops that have survived without knowledgeable, egalitarian and friendly customer service (and yes, some have) won’t for much longer.
Booksellers who have entered the game because they romanticised a life surrounded by books and eschew necessary business management considerations will go, if they haven’t already; the rest will need to focus on their points-of-difference in a way they never have before. These stores will also have to get better at thanking their customers. If a result of community discussion of this topic is that a customer makes the decision to buy local, they should be genuinely and regularly thanked for it at every point in the transaction, whether it’s in-store or online (as IndieBound encourages US bookshops to do).
Publishers, on the other hand, face the enormous challenge of shifting a century-old and rapidly outmoded business model while simultaneously trying to stay afloat – not unlike attempting to steer a slow-moving ship around an iceberg. They will be mixing print-on-demand and short-run printing into a business model that was built around the initial multiple-thousand-copy print run necessitated by traditional print technology.
The supply-chain earthquake that ebooks will cause aside, the tide of consumers who don’t care if their bookshop disappears, replaced by an IKEA-sized book factory on the other side of the world, will be enough to force the local industry to change. So have no fear: the book industry will adjust itself. At the same time, those of us who care about more than price should buy with our eyes open, knowing that with our purchases we are also, in part, choosing the kind of local bookish community that is left at the end of that process.
Inevitably, there will be winners and losers. Because even though the industry as a whole will become more efficient, not all the factors cited by the local book trade as reasons for Australia’s prices can be solved. The issue of basic wages, the challenges posed by a small population, the high cost of retail and office space: these factors won’t disappear. Which means, if price is genuinely all we care about, most of our bookshops will.
Instead of subscribing to a position that says price will be the only deciding factor in who wins, I’d like to recognise that I have a role to play in choosing who I’d like the winners to be. I would like to be one of them. I would win by getting to keep my local bookstore, which brings me much happiness, great local publishing and, ultimately, economic benefit. I would like the losers to be the Ikeas of the bookselling world, the ones that offer nothing above and beyond price and convenience. And so I shop accordingly. When it comes to books, anyway.
When I was a toddler my father was a carpenter, making furniture on commission. I remember playing in the wood shavings of the converted stable in Flemington that he used as a workshop. The other day he visited our home, and when he saw our new shelves he stood, momentarily, in that kind of reverie people experience when some part of their former life returns unbidden, like a curious surprise. He ran his hands along the melamine, and began telling us how he used to measure up spaces like our wall, built shelves like our shelves – though out of actual wood and with none of those little IKEA holes.
With his big carpenter hands resting on one of the shelves, he calculated what something like this bookcase would have cost to make back then. Of course, he said, even then he never really made any money, because things had already begun to change. Today, even if we had asked my father to make those exact crappy shelves for us without charging for labour, he wouldn’t have been able to beat IKEA’s price. Such is the bulk-buying power available in the contemporary global market.
One day, the continuing growth in ebooks suggests, I may well choose to have most of my library on my computer rather than my wall. Recommendations and reviews and conversation about books might have moved entirely online, along with most of the books themselves. If that happens, I’ll be considering a whole new set of values and factors in making my book-purchasing decisions. But for now, I’ll continue to spend my money on the thing I value most – which is having wonderful bookshops here in my small part of a very big world.