This is a sad time for the Australian Book Industry and the Book Industry in general, but particularly for Australia as we’re so small. I wish I could figure out how it’s going to pan out but I can only speculate. I do wonder if this might be a good time for people to consider opening their own independent book store, but if that happens they should do lots of research first to make sure they can last out the first few years until they’re established.

I’ve known since April 2010 that REDGroup was in trouble and Borders was likely to close down, I didn’t say anything back then and I don’t think it would have made much difference. REDGroup own Borders, Angus & Robertson and also Whitcoulls in New Zealand. It’s a very big business and if they’re in trouble then you’d expect the ripples to be quite big. In November 2010 they started shedding staff and they have just been put into the hands of liquidators. They owe an enormous amount of money that I can’t begin to contemplate, they employ 2,500 staff.

I don’t know how the publishers are going to be able to cope with the large sums of money REDGroup owes, but it will certainly eat into their profits. I don’t know how many of the 2,500 people will be able to get a job quickly and I certainly don’t know what will happen to the books they currently have in stock. I read somewhere the big superstores will be closing down and holding liquidation sales very shortly but can’t remember where or whether that was in the US or Australia.

I expect the ripples on this will be very big. So far discussion from buyers is centreing on two different platforms. Many of them are horrified about the loss of the shops as they like to browse and many are saying it doesn’t worry them as they’ll just buy print books online from overseas or the bulk of the books they buy are ebooks.

Bookshops are very important as so many people like to be able to browse, read the back of the book, feel the weight and just generally wander the shop and look. I don’t think we’ve hit critical mass with ebooks and online browsing of books just yet so I still see bookshops being a very important part of the buying process. A number of the places I’ve heard about Borders, Angus & Robertson or Whitcoulls are the only bookshop in the near vicinity.

What is more important is the publishing side of the problem. The economics of printing mean setting up the print job is the most expensive process and printing a large amount of copies is generally more cost effective than printing a small number. Let’s just take postcard printing for an example as I have those prices to hand. To print 5,000 postcards costs $500, but to print double that number, 10,000, it only costs an extra $300. The more you print the smaller this gap gets. If publishers have fewer places to sell their books then they’re likely to print fewer copies of fewer books which should mean the price of books should increase. This makes me wonder if they will publish fewer new authors as there will be less room for speculation, fewer authors mean less choice so the buyers will buy less and the ripples will continue onwards. We won’t feel any effects now as all of this will take some time happen.

Certainly an interesting time to be selling books.