News

Husain urges publishers: 'act now to keep bookshops'

The c.e.o. of Foyles has called for publishers and suppliers to support bookshops with better terms and consignment stock before it becomes "too late" as in the case of HMV.

In an open letter to The Bookseller, Sam Husain has said the bookselling model is broken and needs "a complete re-think" in the current climate before more retailers are lost.

Husain called for better terms from publishers and suppliers, aiming at an average of 60% discount instead of the average of 40% currently experienced—and "a level playing field" with supermarkets and online retailers, which he said can benefit by discount anything up to 15% higher than that given to booksellers, based on their volume of sales. Bookshops, however, are not compensated from the extra value they add as a showroom and advice centre for published works, he argued.

Husain told The Bookseller: "Let's not leave it until its too late, as is the case with HMV. Bookshops are being used as showrooms for people to browse and have a look at what is out there and then they are going to the internet. We have found that generally publishers and suppliers tend to offer supermarkets and internet retailers better terms because it is
volume-related, they sell more new releases and therefore they are getting more margin and selling books for less money than we can compete with."

He said consignment stock ­ where booksellers only pay for the stock they sell ­ would be an "ideal" situation. Currently booksellers pay for stock and return that which they haven't sold after a year. Only then they do they get their money back.

Husain added: "Bricks and mortar bookshops face a unique challenge in that exactly the same product is often available at a much cheaper price through other sales channels. We try our best to add value by making browsing and discovering books as enjoyable as possible and providing helpful and knowledgeable staff. Many of us go further by making bookshops a cultural venue with events and looking after the essential needs of customers by providing food and beverages. If we are to do more, and even have  ambitions to expand, then we need to finance this through improved terms from all our
partners."

The Foyles chief argued: "We need more of a level playing field. In the last five years, 1,000 independent bookshops have closed, we have to act now."
 

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Hmm. Pushing the blame/onus back up the supply chain isn't the answer either. The publishers will just pass the demands on to the people who supply them, namely the authors. That won't work because a majority of authors are only on a royalty of 7.5% and generally wondering if it's worth the bother.

Can the buck be made to stop with the publishers then? They'll listen if they're given a direct business incentive (beyond the indirect benefit of Foyles staying in business). The c.e.o. needs to describe concretely what extra he will offer in return for 'better terms and consignment stock'.

The millstone around Foyles's neck, of course, is the cost of their physical premises and the crippling business rates imposed by local councils. Aha. There's the rub. Local councils should be decreasing business rates in the current climate, NOT increasing them to compensate for the government's mismanagement of the country's finances over the last few decades. In particular, it should offer reduced rates to businesses involved in the cultural enterprise of literature. Why not? After all, the government has been quite happy to prop up national industries like car manufacture over the years. The UK has been known to dominate the global book industry (although the Brits often don't seem to know it themselves) - yet without some tactical investment soon, we could lose the whole lot.

American publishers seem to offer more generous terms - more time to pay, and one can return books much sooner than a year. There's good and bad about that, but it seems the parties have room to negotiate.

And I am not sure the rates are crippling - Mr. Husain does not say so, and he is actually running a business. I fear you are projecting. Yes, one can suggest rates be lowered for businesses, but, as Mr. Husain is not directly calling for that, I imagine his letter reflects more of the actual pressing issue at hand, rather then a conservative hobbyhorse.

Perhaps you would be in favor of more support for libraries as well?

Well, Husain was writing an open letter to The Bookseller, so his letter will naturally contain points relevant to publishers, rather than real estate. There's no reason why he would ask for subsidies on business rates in a letter to The Bookseller. This is actually a huge problem in the UK and is hurting a lot of retailers. I'm sure Sam Husain would agree.

I'm surprised to hear about US publishers giving better discounts. I have worked for a few publishers with US operations and this wasn't the case with those organisations.

Depends on which publishers you worked for. Borders and B&N would order a ton, and often return them within the quarter to the big houses. Perhaps the smaller houses had stricter terms.

I know local shops here send books back monthly, returning ones they purchased just weeks ago, and to publishers like Macmillan, random house, etc. Payments are often 30 days or more out as well. Discounts can be up to 47% from some publishers.

From the article above it sounds like Brits have much steeper terms.

Excellent piece, Mr/Ms Dalton
Great pity it will fall on deaf ears.

Interesting comparing Foyles latest accounts with Waterstones.

The highest paid Director at Waterstones (presumably Daunt) was paid £120,000. The highest paid Director at Foyles (presumably Husain) was paid £130,000.

Perhaps Husain should look a little closer to home before he starts begging to the trade.

Hmm. Pushing the blame/onus back up the supply chain isn't the answer either. The publishers will just pass the demands on to the people who supply them, namely the authors. That won't work because a majority of authors are only on a royalty of 7.5% and generally wondering if it's worth the bother.

Can the buck be made to stop with the publishers then? They'll listen if they're given a direct business incentive (beyond the indirect benefit of Foyles staying in business). The c.e.o. needs to describe concretely what extra he will offer in return for 'better terms and consignment stock'.

The millstone around Foyles's neck, of course, is the cost of their physical premises and the crippling business rates imposed by local councils. Aha. There's the rub. Local councils should be decreasing business rates in the current climate, NOT increasing them to compensate for the government's mismanagement of the country's finances over the last few decades. In particular, it should offer reduced rates to businesses involved in the cultural enterprise of literature. Why not? After all, the government has been quite happy to prop up national industries like car manufacture over the years. The UK has been known to dominate the global book industry (although the Brits often don't seem to know it themselves) - yet without some tactical investment soon, we could lose the whole lot.

Excellent piece, Mr/Ms Dalton
Great pity it will fall on deaf ears.

American publishers seem to offer more generous terms - more time to pay, and one can return books much sooner than a year. There's good and bad about that, but it seems the parties have room to negotiate.

And I am not sure the rates are crippling - Mr. Husain does not say so, and he is actually running a business. I fear you are projecting. Yes, one can suggest rates be lowered for businesses, but, as Mr. Husain is not directly calling for that, I imagine his letter reflects more of the actual pressing issue at hand, rather then a conservative hobbyhorse.

Perhaps you would be in favor of more support for libraries as well?

Well, Husain was writing an open letter to The Bookseller, so his letter will naturally contain points relevant to publishers, rather than real estate. There's no reason why he would ask for subsidies on business rates in a letter to The Bookseller. This is actually a huge problem in the UK and is hurting a lot of retailers. I'm sure Sam Husain would agree.

I'm surprised to hear about US publishers giving better discounts. I have worked for a few publishers with US operations and this wasn't the case with those organisations.

Depends on which publishers you worked for. Borders and B&N would order a ton, and often return them within the quarter to the big houses. Perhaps the smaller houses had stricter terms.

I know local shops here send books back monthly, returning ones they purchased just weeks ago, and to publishers like Macmillan, random house, etc. Payments are often 30 days or more out as well. Discounts can be up to 47% from some publishers.

From the article above it sounds like Brits have much steeper terms.

Interesting comparing Foyles latest accounts with Waterstones.

The highest paid Director at Waterstones (presumably Daunt) was paid £120,000. The highest paid Director at Foyles (presumably Husain) was paid £130,000.

Perhaps Husain should look a little closer to home before he starts begging to the trade.