Unity’s quick recovery is perhaps symbolic of the indie book sector’s recent turnaround.
Since 2008 the sector has been hit by a punishing combination of international competition and a local downturn. The four big threats were our recession, e-books, Amazon, and the strong Kiwi dollar.
As the recession started to bite in 2008, e-books were looming as a new technology threatening to replace physical books. Book dealers could see what happened to music retailers – as digital MP3s replaced physical CDs, physical retailers in physical shops disappeared from our main streets. Today e-reader sales are falling and e-book sales have levelled off at 20-25 percent of the market.
Indie book dealers say Amazon and the like represented a greater threat, with a massive range, economies of scale and sales-tax-free status. And while the recession reduced local spending and confidence, it also gave New Zealanders a strong dollar and made Amazon’s prices very tempting.
The result was seven tough trading years, reflected in some very public store closures and an ongoing feeling of reduced confidence in the independent book sector.
The turnaround has been typically independent, with retailers reacting in ways that suit their local community and personal circumstances. The sector has just celebrated its best Christmas and summer for years, and is now showing renewed faith in itself.
“Christmas lights twinkle for booksellers” ran the January headline in Booksellers NZ’s newsletter The Read. Members reported record-breaking Christmas sales and many had double-digit growth on the previous Christmas. Nielsen data (which excludes Whitcoulls) showed 2014 sales one per cent up on 2013, but Christmas 2014 was 10.5 percent up on 2013. “A strong Christmas saved a so-so year,” concluded TheRead.
Poppies Books spokesman Tony Moores is positive: “The market has seen a turn-around since last September and there has been sales growth across most of the business categories. Most bookstores showed growth on Christmas and summer 2014 but last year was down on the previous year. It’s a reversal, but the market is still down on what it was a few years ago.” Poppies operates franchised stores in Kerikeri, Hamilton and Havelock North, and Moores owns the Remuera and New Plymouth stores.
“For the most part the independents have done well. There are fewer of us, there are fewer bookshops overall over the last four or five years, so the pie is being cut among fewer operators which does have some benefits,” says Moores.
Booksellers NZ chief executive Lincoln Gould agrees the sector has started to recover. “There are very encouraging signs but it’s too early to be absolutely confident in the long term. My view is that turnaround is largely due to increased confidence in the overall economy. Book sales are going up but they’re not back to where they were in 2007/08. But certainly, if you were to include online purchasing from offshore, I’m sure the sales figures in total would be much greater. I would hazard to say overall book sales are no worse than they’ve ever been.”
Booksellers NZ has 301 members in March 2015, with 71 being independent. This compares with 395 members (including 79 indies) in March 2013.
There have been some high-profile closures of indie book dealers, typically stores that have been in the same family for several decades. In many cases, the owners have blamed the internet, but Gould believes the reality is more complex. “Retirement is often a big reason. Failing to react to changing circumstances within the trade is another. It’s is a new world and we have to do things differently.”