By Roger Tagholm | @RogerTagholm
When Business is Booming and So Are the CostsAs the world publishing industry arrives ready to get back to business at Frankfurt, we asked several executives in the United Kingdom about their key concerns and outlooks going forward. One word is front-of-mind for everybody: cost. Clearly, the potential is there, but you’ll also find some very cogent commentary about how daunting it looks these days when it comes to balancing the books. One immediate takeaway: You’re not alone.
Juliet Mabey, Publisher, Oneworld
One of our current concerns is something affecting so many businesses besides publishing right now, that of managing rising costs—in our case printing, distribution, energy, staff—and the difficulty of raising prices to cover these costs in the current recession. There are signs that some publishers are putting up prices, especially for high-profile authors, but in the main they’re staying lower than most in Europe.
The other concern for publishers is the ongoing issue Waterstones is having in upgrading their warehouse systems, which has caused problems shipping stock around the country and fulfilling customers’ orders. That’s inevitably led to lost sales for many authors. Publishers are obviously hugely sympathetic and are helping fill the gaps as much as they can, but it’s costly for everyone.
David Shelley, CEO, Hachette UK
In terms of concerns, it’s the huge costs in all areas of the supply chain—paper, print, haulage—coupled with rising costs of living for consumers and rising costs for schools. All of these factors are hitting both trade and education publishing right now.
Despite everything, I believe that books still represent excellent value as gifts, considering the number of hours’ enjoyment each one represents. I think a well-chosen book is also one of the most thoughtful and personal presents anyone can give, and one that can last a lifetime. So my hope is that consumers will still gravitate towards books this autumn.
Nigel Newton, CEO, Bloomsbury
The first concern is the impact of the cost of living crises on our staff. We know that people are very worried about how they can make ends meet with rising energy costs, the increased price of food, and rising inflation. This is going to be a very difficult winter, and we’re looking at this issue.
The second is the overall business landscape. At the beginning of the year, many were talking about a return to normality, but the outlook is anything but that. We’ve weathered the supply chain crises—which have impacted all industries and markets, with publishing no exception—and of course we’ve emerged from the pandemic. We have a more agile and adaptable business based on new hybrid working models, but every business is aware of the impending economic challenges that lie ahead.
The learnings of the past two years have ensured that our business and the industry are built on resilience and strength, which will help us to adjust as we feel our way in a new economic landscape. Connecting with reading communities is going to be important, whether digitally or through our retail channels, and we need to continue to keep those relationships strong and active, built throughout the pandemic.
Consumer habits will continue to evolve, reflecting the new economic realities of our times, as people set stricter priorities and reduce their spending. Great books will always stand out and find a hungry reading audience. We need to position books as ‘affordable luxury’ or ‘affordable necessity’ for consumers, a purchase that’s still within their reach—providing comfort and escape; learning and inspiration; or sense-making and activism—the publishing equivalent of the ‘lipstick effect.’
We expect genres such as fantasy and sci-fi to continue a huge rise as consumers look to find escapism in their reading. Ultimately, the autumn will be about adaptability and innovation as we learn what the new normal looks like.
Tom Weldon, CEO, Penguin Random House UK
Publishers across the country will share the same concerns as all types of organizations and industries in the United Kingdom at the moment: navigating an increasingly challenging economic backdrop, exacerbated by the political instability we’ve experienced in recent months. The costs of doing business have risen hugely this year, with serious implications for everyone, but particularly for smaller publishers and booksellers.
Consumers, too, will have so many different worries heading into the end of the year. We know that in the past people have turned to books during difficult times—COVID-19 is a prime example of that—and that books tend to be an affordable luxury in economic downturns. However, we’re facing an unprecedented set of circumstances, so the outlook is uncertain.
Fingers crossed, it should also be the first autumn in two years which isn’t severely disrupted by COVID. I love the few months in the run-up to Christmas in the publishing world–the author events, the award ceremonies, the spring showcases, the team get-togethers, and of course, Frankfurt. It feels like such a vibrant time of year for the industry; there’s always so much going on and so many great books getting published.
Sharmaine Lovegrove, Managing Director, Dialogue Books / Hachette UK
Among concerns, it’s the economic and actual war with Russia, and the environment. As a publisher, I think about paper a lot, the cost-of-living crisis has me concerned for the economics, and the well-being of many households, along with the post-pandemic burnout for many staffers across the industry is something that needs attention and understanding.
I’ve been busy starting a new division, and so I’ve come back to work after 14 months’ parental leave full of energy and optimism for my new role. I’m excited about what my team and I can achieve at Hachette. We’re launching a new business, hiring a brand-new team, establishing a new imprint with a lot of goodwill from across the industry, authors, and readers so I feel like Dialogue is on fire. I’m proud of our foundations and super-ready for this next chapter.
Nat Jansz, Co-Founder, Sort of Books
We’re hurtling toward a recession, so our immediate worry is the increasingly slim margins on book sales as all aspects of production becomes more expensive, along with the possible scaling-back of book buying as our readers make difficult financial choices. More than ever, we need libraries to help a culture of reading thrive in difficult times. It appalls me that this option has been so willfully and heartlessly decimated.
As for the autumn, at Sort of Books, we have a backlist of classic titles—our Tove Jansson titles are perennial sellers as are titles by Kathleen Jamie, Chris Stewart, Lore Segal and Stefan Zweig. And we have high hopes of course for our brilliant Booker shortlisted novel, The Seven Moons of Maali Almeida by Shehan Karunatilaka. Our fingers are firmly knotted for announcement day. But as the cascading crises of energy bills and inflation hits, we expect some choppy times ahead. Great books will see us through, but it won’t be easy for any aspect of the trade.
Stefan and Tara Tobler, Founder and Senior Editor, And Other Stories
Among concerns: Inflation. Cost of living. Price of printing. Blithe ‘business as usual’ activity in our industry in a time of ecocide and rampant racism. Finding a good bookkeeper. Lack of reading time. You know, all the usual.
As to how we see the autumn and new year shaping up. Badly?
Sara Hunt, Publisher, Saraband
Like everyone I’m speaking to at the moment, rapidly escalating costs are my main concern, combined with the worry that the cost-of-living crisis will hit sales.
Because we’ve seen such a drop in the currency, everything from materials to freight and energy has gone up even more steeply here in the United Kingdom than in the worldwide context, and the margin is wafer-thin or negative. We’ve not had time to recover from Brexit and the pandemic, so it’s hard trying to keep on coping with new blows. It’s almost as though budgeting is pointless—and I’m usually the one with a cautious approach.
Beyond that, I’m worried for the high street and for the squeeze on booksellers who do so much to hand-sell our books. The picture is so much more worrying for small presses than for the large corporates.
We’re in the fortunate position of having a Booker-listed novel: Graeme Macrae Burnet’s Case Study. Sales are robust online and excellent in bookshops, and one bestseller can make such a difference. Graeme is a vocal champion of brick-and-mortar booksellers, having worked in a bookshop himself, and he’ll be out and about on Bookshop Day. … And the reverse side of the currency coin is that our international income is worth more than we anticipated.
This is a story from our Frankfurter Buchmesse Show Magazine which now is out—in print on the Messe Frankfurt for trade visitors and exhibitors, and here in a free digital download for our world readership online.
The magazine has extensive coverage of issues and trends that are leading discussions and debates at the trade show this year, along with interviews, profiles, and commentary in this strongly attended Frankfurt year. Click here for your download (PDF).
More on Frankfurter Buchmesse is here, more on this year’s Guest of Honor Spain is here, more on guest of honor programs and markets is here, and more on international book fairs is here, more on industry statistics is here.
Publishing Perspectives is the global media partner of the International Publishers Association.
More from us on the still ongoing coronavirus COVID-19 pandemic and its impact on international book publishing is here.