End of the Malaysian book industry as we know it?

There was an interesting SMS from a reader in an English daily recently. Referring to a recent warehouse sale, she said that she bought a (presumably brand new) book for RM8.00 that would normally cost RM40 in regular bookshops, and suggested that if book prices came down and bookshops reduced their profits, perhaps more people would read in this country. The implication here was that a retailer's profit on a book amounts to some 400%! How we wish that were true. Unfortunately, is quite far off the mark; the retailer's profit barely covers his overheads, but we don't expect customers to understand that. When a book sells for RM8 in one place and RM40 in another, what else would a customer think?

The warehouse sale in question was the recent Big Bad Wolf sale by BookXcess. Unverified sources have informed us that this was, in fact, a Pansing sale in disguise. And judging from the imprints on offer at the sale (and the observed appearance of Pansing staff at the warehouse over the period), it does appear to give that report some traction. Market talk appears to suggest it, anyway. (Established in 1974, Pansing is now a member of the Times Publishing Group. They are the sole distributors in Malaysia of several 'literary' imprints like Vintage, Picador, Harvill and so on.)

Here is a book industry primer for the uninitiated. The distributor is the wholesaler who acts between the publisher (the manufacturer) and the bookseller (the retailer). The publisher determines the recommended retail price, and the distributor buys the books at a discount from the publisher and then sells it to the retailer, who deals with the public. The publisher does not undercut the distributor and the retailer by selling the books directly to the public at ridiculously low prices, and the distributor does not, likewise, undercut the retailer to ensure a healthy industry and fair competition.

If a wholesaler does indeed sell his books to the public directly (or through an agent) at a ridiculously low prices it would be a serious breach of ethics, and probably be in violation of a whole host of anti-competition laws in quite a few countries in the world including, possibly, even Singapore. (Ask Microsoft about it.)

According to the same source, Pansing supplied more than 100,000 books for the warehouse sale, with the unsold books designated to Carrefour hypermart. (We have been wondering about the appearance of several 'Pansing' imprints, selling for RM5 each, in the hypermarket bins for some time now.) Where did all these books come from? Some, seen from their condition, are evidently returns from bookshops. But, quite a large number were in 'mint' condition. Why Pansing has chosen to dispose of its books in this manner is, currently, a matter of conjecture and some fanciful speculation. But, it has generated a quite a bit of unhappiness in the industry at the moment, with words like 'boycott' being bandied about. Perhaps, there is a need for all parties to clear the air including publishers like Pan MacMillan and Random House (UK) whose books Pansing distributes here and Singapore.

In the meantime, we have reduced our order of books from Pansing (unless absolutely necessary). American editions are nicer, anyway. Some major chains might even consider returning all books, and look for alternatives sources for the same titles. Or, maybe, even buy them back at their next warehouse sale at a fraction of the cost! That would be a good way of reducing prices!

And, to answer the SMS lady who complained about book prices: the reason imported books cost so much in Malaysia is due to our lousy exchange rate. Simple. And, the reason local books are not cheaper is because of our extremely small market size. But right now, the entire book industry in Malaysia has been put in jeopardy. We have had warehouse sales before, but not like this, where such a large quantity of books in very good condition have been dumped at between 10 and 20 percent of the RRP. The Malaysian book market is too small to absorb too many shocks of this nature. We don't have the diversity.