Booksellers have publishers 'over a barrel'

07.03.13 | Bookseller Staff

Publisher and former Conservative Party politician Iain Dale has hit out at the big booksellers, including W H Smith, Waterstones and Amazon, saying they have publishers "over a barrel". Speaking at the Independent Publishers Guild conference this morning (7th March) Dale also repeated a call he made ten years ago to abolish "sale or return".

Dale, founder of the political publisher Biteback Publishing, reserved his harshest criticism for W H Smith, which he said was "very willing to take publishers' money and sell no books in return".
He added: "Whenever I have done business with W H Smith they demand a large "marketing fee"—some might call it the book trade industry of protection money— to place our books in their stores. A few months later we get between 75% and 90% of our books returned in boxes that have never been opened! W H Smith has become nothing more than an exorbitantly priced warehouse for books, or as I have heard many people refer to them as 'a lending library'." He said he was now "totally ambivalent about doing business with WH Smith ever again".

Dale also had strong words for Waterstones, which he said had moved to "correct the failings of the past", under its new owner Alexander Mamut. However, despite this he said he was not a fan of its new buying policy, that saw it make fewer orders more frequently. "Whereas a few years ago they would place the order months before publication, which helped us decide print runs, now the order is sometimes not placed until after publication. Fewer risks are being taken, and by their own admission they have become reactive rather than proactive."
He said it "would be a tragedy if it [Waterstones] went the same way as Borders", but he said publishers needed to prepare for the possibility that it might not survive. "As publishers we'd be mad if we didn't plan for a post Waterstones environment."

He also criticised Amazon for demanding high discounts off small publishers. "They do give smaller publishers like us a choice. Never let it be said they don't. And the choice is sell your books to us at 60% discount, or we won't take any of them at all. They are able to do it because we, individually, aren't strong enough to say no, and because the competition rules allow them to." Nevertheless he said the internet giant had changed the book busines for both "good and bad".

Dale also hit out at industry practices such as paying to have books included in bestseller charts, saying it was designed to "deliberately mislead" customers. He said: "Many will say I am mad to break the conspiracy of silence on these business practices, which have gone on for years."
On independent bookshops, he said "the challenge now is to keep them", after customers started to question their own buying habits, after hearing about Amazon's tax policies.

Dale was most positive--as you'd expect--about independent publishers, which he said could still "hold their ground" by being brave enough to experiment and by "discovering new ways to get our material to the customer". He added: "Small independent publishers don't have numerous committees and layers of management, we can make decisions fast. Most importantly with a small team you can adapt quickly to the changing market."
And he added: "The next few years are going to continue to be tough for us small independent publishers. I don't believe the doomsday prophets who claim it is the end of independent publishers and the physical book. We need to restate exactly what publishing is all about."

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