Britain’s book business is getting bigger, in every way. The Henley Center, a London-based consultancy, recently reported that Brits are buying more books than ever (more than 3 billion worth in 1998) and spending more time reading. A record number of titles are being published–more than 100,000 last year. The boom can be attributed partly to the Internet, which has made book-buying easier, and mostly to book prices, which have tumbled dramatically in Britain.
Competition between the new megastores helps account for the latter development. In a pattern already seen in the United States (whence Borders hails), the giants are pressing publishers for volume discounts and selling most of their books at 20 percent below retail prices. The strategy has rocked the high-street chain W. H. Smith, which had dominated the U.K. book market for decades. Waterstone’s, with 202 stores, now has a higher turnover than Smith, which has 730 retail outlets. “Smith has got a bad case of shell shock,” says Paul Barker, a senior fellow at the research group Institute of Community Studies. “Now, it just can’t keep up.”
Neither can publishers, who have had to consolidate to survive the price-pressure applied by the retail goliaths. Five mega-publishers–Penguin, Random House, HarperCollins, Transworld and Hodder Headline (recently acquired by Smith)–now print almost half the books in Britain. With prices falling ever lower, both publishers and retailers tend to promote the best-known authors, whose name value is the most dependable way of making money in a high-volume market.
Smith is fighting back, recently chopping its children’s book prices by 40 percent. Analysts say the chain will have to do more, though. And those small independent shops? They may have lost Janet Heart, but so far they’ve mostly managed to stay out of the cross-fire. Many owners express indifference to the price wars; they can’t offer the same discounts, and don’t even try. “Our customers are looking for a personal experience and find value in a one-to-one relationship with the store,” says Jessica Graham, owner of PrimroseHill Books in north London. Still, it probably wouldn’t hurt to offer a cup of tea once in a while.
