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Have independent bookshops worked out how to survive in the age of Amazon?

Philip Pullman's new book is expected to be a literary sensation. So why aren't small bookshops stocking it? 

In his 1936 essay, "Bookshop Memories", George Orwell gave a warts-and-all account of the bookselling trade. “Given a good pitch and the right amount of capital,” he wrote. “Any educated person ought to be able to make a small secure living out of a bookshop."

He continued:

“Also it is a humane trade which is not capable of being vulgarised beyond a certain point. The combines can never squeeze the small independent bookseller out of existence as they have squeezed the grocer and the milkman.”

Orwell was wrong. In the last ten years, the “combines” of Amazon and Waterstones have contributed to the demise of 557 independent bookstores, or nearly half of shops overall. It’s a state of affairs that Philip Pullman, whose new instalment in the His Dark Materials series comes out this autumn, is keen to address.

La Belle Sauvage: The Book of Dust - Part One has already attracted literary hype ahead of its release in October. So you would expect it to be a shot in the arm for independent booksellers – except that the vast majority won’t be stocking it.

The recommended retail price for the hardback edition of La Belle Sauvage is £20. Both Amazon and Waterstones have been taking pre-orders for months at half that price. It’s a discount which smaller stores are simply not privy to, because they cannot follow the chains in buying in bulk from wholesalers and publishers. This has been the case since the scrapping of the Net Book Agreement, which existed from 1900 to 1997 and ensured that all books had to be sold at roughly the same price.

Now, Pullman is leading calls to bring it back.

“There is an insane, inhumane and perverted belief that the market knows best, and that it is something natural, like gravity, which we can do nothing to alter,” he told The Times. “But of course we can alter the way the market works. It’s a human construction.”

His comments have reignited the debate about independent booksellers, and how they should be valued. “This issue of the Net Book Agreement and discounts is, I would say, the single biggest thing on most people's minds,” says Susie Nicklin, owner of Dulwich Books, an independent book shop in South London. “It's creating a two-tier bookselling industry in which it's not even worth independent booksellers stocking most of the best sellers.

“We're never going to be able to compete on price, certainly with the hardbacks. It would be pointless for me and my colleagues to offer all the new, brilliant, great hardback books at 50 per cent discount. First of all, we don't get that kind of discount from the publisher: it's the big bulk orders that attract big discounts. Secondly, it would just be a race to the bottom.”

Similar arrangements to the Net Book Agreement still exist in other European countries. In Britain, though, the Restrictive Practices Court deemed it illegal in 1997 for being “contrary to the public interest”. In a decade obsessed with free market competition, where the internet was still a niche pastime, the hope was that bookselling would become an economically vibrant trade. 

Two decades later, the business is largely monopolistic. The outlawing of the NBA coincided with the rise of Amazon, and as the American retailer bought more and more in bulk, discounts became more and more pronounced. Smaller independent stores were unable to keep up. 

It’s an experience familiar to Ron Johns, who owns and runs four south coast independent stores under the banner of Mabecron Books. “I started bookselling in 1969, opened my first bookshop in 1974, and now I have four bookshops,” he tells me over the phone from his warehouse. “I had to close an academic bookshop two years ago, which was a big business for us. So I've seen both sides of the story.”

For the booksellers who have succeeded in the Amazon age, they have had to adapt their business model. For Johns, that required embracing the local tourist culture around his shops in St Ives, Falmouth, Dartmouth and Padstow. The shops compete on stock selection, knowledgeable staff and the ambient environment in the shops. 

“They’re destination towns”, he says. “Which has worked out pretty well really, because since the NBA went and the rise of Amazon, the bricks and mortar bookshops in the large cities have increasingly been driven out. They cannot afford those rents with their reduction in turnover."

Indies’ efforts in becoming part of the community, as well as giving personalised customer service, has helped to provide some promising signs of growth, which Johns sees as part of a wider resurgence of physical media.

"There's a lot of dead Kindles in cupboards now," he says. "Our book sales over the last two years have grown.” This backlash against e-books is partly because readers care about where they source their books, he suggests: “Responsible people are saying, 'I want to know where I'm buying my books from'."

That’s been the case across the entire publishing industry. From 2015 to 2016, physical sales have increased by eight per cent to a total of £3bn – the highest figure since 2012. Johns, though, is still struggling to match the turnover he enjoyed before the recession. “We're getting near it now, but it's taken nine years."

Retail chains are also benefiting. In recent years, Waterstones has pursued a mock-independent model, by giving power back to their shop managers to tailor their stock to their customers. The business is now back in profit. It has even opened plain-clothes shops which don’t bear the Waterstone’s logo. 

Johns finds this covert approach “strange”.

“It means they're not proud of their brand,” he says. “How can you have a major UK company and not be proud of your brand? I can't see Marks and Spencers doing that.”

Like Johns, Susie Nicklin of Dulwich Books prioritises the personal touch in order to grow her business. Her shop, which was shortlisted for the British Book Awards 2017 Independent Bookshop of the Year, has an impressive 12,000 followers on Twitter, and is a firm – and proud – part of the community.

“We compete on things like service,” says Nicklin, the former director of English PEN and former director of literature for the British Council. “But we can only compete on service with customers who come and find us. And the vast majority of customers these days don't even know what an independent bookshop is, because there are fewer and fewer of them around."

Pride seems to define the profession. Nicklin is adamant that she doesn’t want pity as an indie. “I'm not a charity," she says. "I don't expect my customers to have to come into my shop saying, 'Oh, let's help poor Susie out because she's an independent bookseller'. I'm proud of what I do. I'm as proud as Selfridges or Liberty or the BMW showroom down the road. I think we do a great job and I don't want people to feel somehow that they're helping me out by doing this.”

Nicklin is positive about the trade at the moment. “There's a lot of good books around at the moment." Nevertheless, she believes the independent booksellers who have survived tend to be the ones who are good at their jobs in the first place. "They have loyal customer bases and they have very good relationships with the publishers.”

When it comes to the technological changes ripping through the publishing industry, Nicklin points out that despite inflation, book prices have hardly risen in 20 years. "I've got hardbacks here that were published 20 years ago that are the same price as the hardbacks now," she says. 

When discussing the "huge publishing event" of La Belle Sauvage, Nicklin uses the example of new iPhones. No stockist would dream of discounting them on release, she argues, despite the high cost.

“There's no need to sell it at 50 per cent off,” she says. “So, in a way, the question is not for me, but for the other retailers, which is, 'Why do you want to do this? Why do you want to halve your revenue from this book?'"

She does not believe it is possible to simply turn back time and bring the Net Book Agreement back. Nevertheless, she feels "very strongly" that those discounting books should explain why they are doing it. "We know they can sell the books full price. We absolutely know that. People would, and people do in other countries, buy the books at full price.” 

Ron Johns of Mabecron Books agrees that simply resurrecting the NBA won't do. “We shouldn't call it the NBA anymore," he says. “I also think we shouldn't call it fixed price." He notes that books are alone among products in having the price printed on them. "Some publishers will put an inflated price on the cover knowing it's going to be cut price. It's so shallow and all wrong.​"

He suggests instead a scheme where a book must be sold at the cover price for the first six months, after which it can be discounted. "That would be totally fair on everybody. Then you're not getting the craziness over a book like the Pullman book."

La Belle Sauvage seems to be emblematic of indies’ fight for market share. Both the booksellers I interviewed suspect Amazon, which has opened eight physical bookshops in select American territories, of being primarily motivated by its aim of building its customer base. Indeed, Amazon began as an online bookseller before diversifying and becoming the internet giant it is today. 

The reasons for independent booksellers to oppose discounting may be obvious. But writers too can share their antipathy. 

Some authors' contracts state they receive a share of the sales, which means that they lose out from heavily discounted books. The Society of Authors even warns that being associated with too many discounted books can damage an author's professional brand. 

Nicklin describes the market as an “incredibly fragile ecosystem”. 

“It’s a bit like a coral reef,” she explains, referring to author royalties. “It's not like a manufacturing industry in which you manufacture a product and then your bit's done." She fears that falling income will discourage writers from trying to pursue their careers. 

Pullman, too, is proud of the products he produces. “I'll just say that writers have to be very careful not to let their books be sold for prices that are too low,” he wrote to a fan in 2012 when asked why his books didn’t appear on Kindle.

“Everyone likes low prices, but this is how we make our living. Just suppose you were in business making some piece of machinery that was important and useful, and you charged a price for it that let you earn enough to live on.

“Then along came a huge great retail company and said:‘We don't think people ought to have to pay all that much for your machinery. We think they ought to pay much less! So we're going to sell your machinery for a tenth of the price, and you'll have to put up with it.’ Does that sound fair to you?”

Indeed, he is using the literary sensation of La Belle Sauvage to speak on small booksellers' behalf. “It’s not exaggerating to say that [independent booksellers] are the lantern bearers of civilisation," he wrote recently. The lights are staying on in the bookshops - for now. 

 

 

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Universal Credit takes £3,700 from single working parents - it's time to call a halt

The shadow work and pensions secretary on the latest analysis of a controversial benefit. 

Labour is calling for the roll out of Universal Credit (UC) to be halted as new data shows that while wages are failing to keep up with inflation, cuts to in-work social security support have meant most net incomes have flat-lined in real terms and in some cases worsened, with women and people from ethnic minority communities most likely to be worst affected.

Analysis I commissioned from the House of Commons Library shows that real wages are stagnating and in-work support is contracting for both private and public sector workers. 

Private sector workers like Kellie, a cleaner at Manchester airport, who is married and has a four year old daughter. She told me how by going back to work after the birth of her daughter resulted in her losing in-work tax credits, which made her day-to-day living costs even more difficult to handle. 

Her child tax credits fail to even cover food or pack lunches for her daughter and as a result she has to survive on a very tight weekly budget just to ensure her daughter can eat properly. 

This is the everyday reality for too many people in communities across the UK. People like Kellie who have to make difficult and stressful choices that are having lasting implications on the whole family. 

Eventually Kellie will be transferred onto UC. She told me how she is dreading the transition onto UC, as she is barely managing to get by on tax credits. The stories she hears about having to wait up to 10 weeks before you receive payment and the failure of payments to match tax credits are causing her real concern.

UC is meant to streamline social security support,  and bring together payments for several benefits including tax credits and housing benefit. But it has been plagued by problems in the areas it has been trialled, not least because of the fact claimants must wait six weeks before the first payment. An increased use of food banks has been observed, along with debt, rent arrears, and even homelessness.

The latest evidence came from Citizens Advice in July. The charity surveyed 800 people who sought help with universal credit in pilot areas, and found that 39 per cent were waiting more than six weeks to receive their first payment and 57 per cent were having to borrow money to get by during that time.

Our analysis confirms Universal Credit is just not fit for purpose. It looks at different types of households and income groups, all working full time. It shows single parents with dependent children are hit particularly hard, receiving up to £3,100 a year less than they received with tax credits - a massive hit on any family budget.

A single teacher with two children working full time, for example, who is a new claimant to UC will, in real terms, be around £3,700 a year worse off in 2018-19 compared to 2011-12.

Or take a single parent of two who is working in the NHS on full-time average earnings for the public sector, and is a new tax credit claimant. They will be more than £2,000 a year worse off in real-terms in 2018-19 compared to 2011-12. 

Equality analysis published in response to a Freedom of Information request also revealed that predicted cuts to Universal Credit work allowances introduced in 2016 would fall most heavily on women and ethnic minorities. And yet the government still went ahead with them.

It is shocking that most people on low and middle incomes are no better off than they were five years ago, and in some cases they are worse off. The government’s cuts to in-work support of both tax credits and Universal Credit are having a dramatic, long lasting effect on people’s lives, on top of stagnating wages and rising prices. 

It’s no wonder we are seeing record levels of in-work poverty. This now stands at a shocking 7.4 million people.

Our analyses make clear that the government’s abject failure on living standards will get dramatically worse if UC is rolled out in its current form.

This exactly why I am calling for the roll out to be stopped while urgent reform and redesign of UC is undertaken. In its current form UC is not fit for purpose. We need to ensure that work always pays and that hardworking families are properly supported. 

Labour will transform and redesign UC, ending six-week delays in payment, and creating a fair society for the many, not the few. 

Debbie Abrahams is shadow work and pensions secretary.