Editor’s note: In many world markets, bookstores have been shuttered by lockdown orders, and physical retail has become the supply chain’s most vulnerable sector. Richard Charkin’s recommendation is that publishing overall could be helped if during the crisis Amazon and other major online retailers changed the terms of their payments to publishers, from 60 to 30 days.
As we publish this story, the Johns Hopkins Coronavirus Resource Center sees 11,830 cases in Charkin’s UK, with 578 deaths. Both the prime minister Boris Johnson and the health secretary Matt Hancock have tested positive for the infection.–Porter Anderson
By Richard Charkin
A Message to ‘the Digital Giants’ in RetailA couple of days ago while I was exercising in my back garden and pondering the craziness we’re living through, I had an idea which I shared in a short letter to The Bookseller.
As I suffer from—or enjoy—the essential publisher’s characteristic of optimism, I was searching for some sort of silver lining to the coronavirus woes currently besetting our industry. If not a silver lining, perhaps there could be at least a temporary bandage to relieve some of the pain.
Clearly, traditional bookshops around the world are suffering, and the suffering will continue for an indefinite period. They’re carrying inventory but their doors are largely closed. Offering to supply books to customers by post or delivery will be a boon to a few, but nothing will be able to compensate them for lost footfall in their shops and the normal ability of customers to browse, buy, and take home new books.
And in October, I wrote a column for Publishing Perspectives about measuring commercial success in publishing. In that piece, I wrote that building up cash reserves is not in itself an indication of success. In times like this, however, there’s nothing that can beat a healthy cash reserve: cash flow is the lifeblood of our businesses.
Can our bookshops help publishers with cash flow? No. It would be absurd to expect High Street booksellers to help. They’ll have horribly difficult conversations with their owners, their banks, and in some cases their governments.
Who in the retail community, then, can help with better cash flow for publishing?—the one part of the book ecosystem that won’t be suffering as badly, and that’s the online retailers of digital books, including audio.
Online Retail’s Special Advantage
As people in many parts of the world self-isolate and discover the challenges of incarceration, some are turning to reading as well as to other forms of entertainment and information. And the instant gratification of choosing, buying, and enjoying a digital download has boosted sales significantly. This doesn’t directly help terrestrial booksellers, but at least it maintains reading and the listening habits.
But the problem is that most, if not all, of the global Internet retailers typically hang on to publishers’ cash for long periods of time before paying it over.
In physical retail, this is understandable. A bookshop needs credit to fund its inventory, its staff, and its rent. By contrast, the online retailers’ digital delivery requires none of these.
It would be a simple thing to change payment terms—from, say, 60 days from the end of the month when a customer purchased an ebook to 30 days. This could be implemented in hours and would instantly improve the cash flow of publishers, small and large, independent and corporate. It would even move money faster to independent self-published writers.
The costs of this to companies including Amazon, Apple, Rakuten Kobo, Google would be trivial, while the benefit to the book world as a whole would be significant. It wouldn’t be game-changing for large publishers, but it could well be crucial for the smaller, less cash-rich ones.
We’re all in this together.
And it would be wonderful if the digital giants of our world stepped up and showed they believed that and agreed that they have a responsibility to the world they inhabit. Maintaining a diverse publishing infrastructure is in their interests, and so is maintaining the pleasure and habit of reading–so that those terrestrial booksellers will once more thrive with a wealth of choice, open doors, heaving shelves, and healthy takings at the till.
Over to you, my friends at the big digital retailers. It’s not a big ask and it can be done simply and effectively.
Join us monthly for Richard Charkin’s latest column. More coverage of his work from Publishing Perspectives is here. More from Publishing Perspectives on the coronavirus outbreak is here.
In our Spring 2020 Magazine, Publishing Perspectives has interviewed publishers, industry experts, entrepreneurs, and authors to present a look at the book business for the coming year. Inside this issue of Publishing Perspectives Magazine, you’ll find articles and resources including:
- Publishing and the coronavirus
- Richard Charkin’s view of key industry challenges
- China’s growing comic book market
- Brussels Book Fair debuts its rights center
- Eksmo CEO Evgeny Kapyev on Russia’s book market
- Matchmaking for publishers and producers in Latin America
- Book market data
- A world tour of copyright developments
- Translation sales resulting from Norway’s Frankfurter Buchmesse guest of honor program
- An AI startup creating interactive stories
- An interview with author Andrew Keen
Download ‘Publishing in Times of Crisis’ free of charge here.