The Bookseller.com

7th January 2009

Neill Denny

Neill Denny is editor-in-chief of The Bookseller. He will be blogging on the book business and on how the print magazine is produced each week.

Christmas on a knife edge

28.11.08

The bad news is piling up this autumn faster than the falling leaves, so we make no apology for returning to the economic crisis that is enveloping us.

The cosy belief that the book trade was somehow recession-proof has been exposed as ­wishful thinking. For the first time since Nielsen BookScan TCM records began in 2001, book sales have slipped into negative territory. The rolling 52-week sales total this week shows growth down 0.2%—in other words sales over the last 12 months are smaller than sales over the 12 months before that. Over the last five weeks the average decline has been 4.5%, so we are falling well behind last Christmas already.

It’s not hard to see why: rising unemployment, consumers short of money, higher energy bills, a collapse in bank lending. The authoritative footfall monitor Synovate predicts non-food shopping trips in December will be down 7.3% against 2007. That would be a calamitous fall.

All this bad news is already being reflected on the high street, with the Woolworths shop business being put into administration by the Woolworths Group plc. Woolworths sells comparatively few books through its  840 stores, but the group’s ownership of EUK and Bertrams puts it at the heart of the trade’s supply chain.

EUK has gone into administration, Bertrams has not. Either way, it makes sense for whoever is in charge to trade them normally through Christmas.

Problems at Woolworths have been apparent to even casual observers for many months and no doubt prudent publishers have been monitoring the situation closely and considering hedging strategies in the event of any sort of a hiatus. In the case of Bertrams, publishers could theoretically deliver direct to stores or, if capacity was available, switch to another wholesaler. For EUK, publishers could deliver direct into the supermarket’s non-food supply chain and rely on the store staff to merchandise the book sections. Not a good scenario at any time of year, let alone four weeks before Christmas.

For all retailers it is vital Bertrams and EUK function, administration or no. During such a period it is perfectly­ possible for a business to operate normally day-to-day, but clearly that partly depends on suppliers offering, as far as they can, support. These are profitable businesses that no one wants to see trashed

Retail Neill Denny Christmas