The Bookseller.com

1st December 2008

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Publisher concern for Premier future

29.05.08 Graeme Neill

Publishers have expressed fears about the future of workplace book and gift seller Premier Direct.
The retailer announced earlier this month it was suspending trading of its ordinary shares on AIM, pending "clarification of its financial position". It said it was in "urgent discussions" with its lenders and revealed it needed additional support to continue trading. Last week, Premier appointed troubleshooter Aidan Scott Condie as a director, saying he had "in-depth experience of assisting companies facing operational issues, with a proven track record in this field".

Publishers said they believed one of the reasons Premier Direct had been struggling was because of greater competition from direct sales giant The Book People, following TBP's takeover of rival Index Books last year. TBP's sales were worth £82m in 2006, and it is aiming to top £100m in 2008. Premier Direct's sales fell by £2m to £10.7m in the six months to end-January 2008, compared to the same period last year.

"It's far harder for [Premier Direct] to trade because they are a lot smaller than The Book People," said the sales director at a major publisher. He added that his house was continuing to trade with Premier Direct. "We want them to be there because they add another dimension to the retail market," he said. "We are vigilant as to what is happening but we are being collaborative with them."

However, one independent publisher told The Bookseller that she had stopped trading with Premier Direct until she had been paid in full for existing debts. "We are still meeting with them and showing them products, but we won't be trading with them until we are paid back," she said.

Another sales director said that Premier Direct was suffering from changing shopping habits. It has a sales network of more than 520 distributors who sell into schools, hospitals, local authorities and local businesses. "If you look at retail now, people have the option of shopping online on their lunch break and not just waiting for a rep to visit," the sales director said.

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