The book selling business that became Angus & Robertson was started in Sydney by Scotsman David Mackenzie Angus, in 1884. A & R published many famous writers and poets that have greatly enriched Australian cultural heritage, including Banjo Paterson and Henry Lawson. Unfortunately A & R publishing no longer exists. Angus & Robertson has been bought and sold by a number of companies in recent decades, including a number that are overseas owned – such as London-based book and magazine seller, WH Smith (2001), and US Office Products.
Angus and Robertson/Whitcoulls (ARW) bought Borders bookshops in Australia, New Zealand and Singapore in June 2008, turning an already uncomfortably large book retail franchise into a virtual monopoly. Should Australians and New Zealanders be concerned by a virtual monopoly in book retail outlets? Here’s a few clues:
– In August 2007 Angus & Robertson sent a letter to all their smaller suppliers, telling them they had to pay A & R an annual fee if they wished to remain an A & R supplier. This wasn’t shelf space – money paid to a retailer to ensure a prominent position on display (as is commonly demanded by supermarket chains) – this was money just for the ‘privilege’ of remaining a supplier on the A & R list (there was no guarantee that the books supplied would be put anywhere that customers would actually find them, and no guarantee of quantities to be purchased). This charge ran from thousands of dollars to tens of thousands, right up to $100,000, according to what A & R decided each independent supplier should pay. This A & R payment demand created a furore but the lack of judgement it displayed was very typical. Bear in mind that standard book supplier terms are already very healthy – bookshops make a profit on all books sold, and if books don’t sell, they return them to suppliers for a refund. Around 35-45% of the supplier’s Recommended Retail Price (RRP) goes to the bookseller. But the book publisher has to pay all the costs – including freight costs to the store, or freight to a distributor and their fees (I’ve never used one, but I gather a distributor costs about 10% of RRP). Books that are damaged or unsold are returned to the publisher for a refund, possibly as long as 6-9 months after delivery. The publisher also pays the author and for design, editing, printing, binding, packaging, marketing, advertising, finance costs etc – and most books will be at least two years in the making, many a lot longer. In other words – the book publisher takes all the risk and pays for everything, and the retailer makes around 40% profit, basically for sitting it on the shelf and paying rent. (Hmmm, it reminds me of farming.)
– Angus & Robertson also sent a letter to all suppliers a couple of years ago advising that their standard payment terms were extending to 60 days after the end of the month for existing orders and 90 days after the end of the month for new orders. That was a surprise to me, because they hadn’t been paying suppliers for 5-6 months anyway, even when they’ve sold all the stock and re-ordered and sold a number of boxes in the meantime. Using small suppliers as a bank is common practice for large businesses – unfortunately, but A & R seem to have turned it into an art form.
– Angus & Robertson also moved their payments office to Auckland (New Zealand). So Australian suppliers now have to ring overseas to chase unpaid invoices – and of course it has to be within New Zealand business hours. Don’t both ringing after 2pm Australian Eastern Standard Time, because no-one is there to answer the call. Angus & Robertson’s Melbourne office don’t have anything to do with paying suppliers any more, so ringing them is pointless.
– Angus & Robertson now sell some books above the supplier’s Recommended Retail Price (RRP). But this extra profit goes into their pockets, not the suppliers. The supplier isn’t even advised if A & R puts on a higher ticket price.
– it is incredibly difficult for small, independent publishing houses and almost impossible for self-publishers to persuade Angus & Robertson to sell their books. Each bookstore is allowed a very small ‘local’ list, so that books by local authors can be purchased and sold locally. If the list is full, then local authors have to wait until someone else drops off the list. More than 99% of each bookstore’s books are generic – i.e. available in every other bookstore, regardless of local relevance. (Dymocks are even worse – they aren’t even worth the bother of approaching.) I am lucky that there are two excellent local A & R managers, otherwise my book would not be in any A & R shops. David Fenlon, Angus and Robertson’s Chief Operating Officer at the time, wrote a damage-control letter to ‘Crikey’ in August 2007 in an effort to explain that A & R has 1200 suppliers and the payment demand letter was sent to only 47 suppliers; he also bleats about falling booksales [maybe they needed to broaden their range, not reduce it?], and states ‘Angus & Robertson remains very committed to selling Australian published books from a large range of Australian publishers, large and small’. Unfortunately this last statement is not backed up by actual behaviour. David Fenlon concludes with: ‘We also have a history of selling self-published books to great success’ . They’ve managed to avoid mine with great success – I’ve successfully sold it elsewhere, instead.
– it is not possible for small publishers to be listed in Angus & Robertson catalogues (produced for special retail occasions such as mother’s day, father’s day, Christmas etc). Offering A & R payment for such advertising isn’t even dignified by a response from them (speaking from personal experience). It appears A & R only promote books produced by the biggest publishing companies – those in which they can negotiate the largest profits, and/or big publishing companies that pay for the promotions through A & R bookstores. Ironic, given that Angus & Robertson was the company that produced the first wholly all-Australian catalogue of publications for sale, in 1895.
Angus & Robertson and New Zealand book and stationery supply business Whitcoulls, were bought from owner W H Smith in May 2004, by company takeover specialists Pacific Equity Partners. In November 2008 ARW was ‘rebranded’ ‘REDgroup Retail’. (Yes, there is no gap between Red and group – obviously the marketing company ARW consulted was allowed to be ‘creative’. Very funny when you consider that they’re in the business of selling literature…)
I just received an email from accounts payable for ‘REDgroup Retail’ (NZ), regarding an invoice they have not yet paid. Imagine my surprise when this slogan appeared at the end of the email:
P Please consider the environment before printing this e-mail | Go Veg! Be Green! Save Our Würld!
Now I’m all for not printing unnecessarily, but should accounts payable staff at the largest book retail chain in Australia and New Zealand – virtually a monopoly – be promoting vegetarianism and the Supreme Master Ching Hai’s ‘Go veg’ marketing campaign, to the thousands of ARW suppliers? To say I was startled was an understatement, my eyebrows nearly fell off the back of my head. Given that I specialise in photographing meat producers, it’s an employee gaffe that fits in hilariously well with ARW’s previous public relations disasters.
It is far more cost-effective for me to run a large website and pay for good quality mainstream advertising, and deal with customers in person, than to hand a huge amount of gross profit over to people who mostly really couldn’t give a toss whether or not my books sell well or not, and who really couldn’t give a toss when (or if) I am paid for sales. I am in the fortunate position to be able to sell plenty of my books direct to people all over the world via this website, so am not dependent on any retail outlets. The quantity sold to date puts ‘A Million Acre Masterpiece’ in the best-seller category. ‘A Million Acre Masterpiece’ would have made it onto published best-selling book lists if it was being sold by bookshop franchises. That’s of course who produces the published lists of book selling figures – so don’t expect to see any independently published and sold books appear in these published best-seller lists.
Unfortunately most self-publishers can’t sell enough books direct, however good their books are, direct selling just won’t work for the vast majority of books – and certainly not for works of fiction. Authors need bookshops. A & R’s huge buying power means they can negotiate with big publishers to buy books in at a lower price, and make a larger profit per book, and easily discount slow moving books to ensure sale. This makes survival difficult for independent bookshops, who are mostly run by people with a genuine love of books and a determination to give the public as wide a choice as possible – as distinct from a narrow range of high-turnover rubbish. Figures quoted on an ABC television programme a few years ago stated that 90% of Australians wanted to read 90% Australian published books; yet 90% of books being sold in large book retail chains were imported (mostly, of course, from the U.S.). I.e. we’re being offered books they want to sell us, rather than what we want (and then they have the audacity to complain that book sales are falling!). Australians – and, I suspect, New Zealanders – are being offered a selection of books that makes the most profit for REDgroup Retail. This means books produced by overseas authors and already best-selling Australian authors. Books by first-time authors and on specialty subjects have been becoming increasingly scarce over the last two decades, and this will continue. I believe ARW are shooting themselves in the foot with this policy of best-sellers only. Stocking a much wider range of books, and on more speciality subjects, would make their stores so much more interesting, and increase their sales.
All minority groups – which includes all rural Australians – and everyone who likes to be informed more broadly than just the narrow mainstream, plus those who are interested in the accurate recording of history and different cultures, should be concerned with the stranglehold that Redgroup Retail has on the Australian and New Zealand book industry. It’s not healthy for any of us.