HarperCollins boss Murray opens the door on price rises in book fair Q&A

HarperCollins president and c.e.o. Brian Murray has signalled that an increase in book prices is on its way, suggesting it was “overdue” amid a climate of rising costs.

Speaking in a Q&A conversation at yesterday’s (18th April) London Book Fair, the global HC boss also said he “was not surprised” by the Penguin Random House/Simon & Schuster acquisition ruling and though his company may pursue S&S, “the bar is higher”.

Asked by LBF non-executive director David Roche, who chaired the “Shaping the Business and the Art of the Book Industry” session, about the future of pricing, Murray said an increase had been “delayed” up to now. He said: “The prices of books have not moved over the past 10 years, they have not kept up with the CPI [consumer price index]. Many of our distributors point this out to us all the time because our distributors operate on such thin margins. Their costs have been going up and they’re operating on a thin margin because of the prices of our books. They’re really feeling the squeeze.” 

Murray added that the relative value of a book “stands out among many entertainment choices… they are tremendous value per minute, per hour”. He said: “We have seen that prices have started to move that needed to move, with the kinds of paper increases, the freight increases, the supply chain costs... Big, double-digit increases have happened. When you look at these increases in fuel and energy and labour, everything has gone up, and the [book] prices need to adjust to offset some of that. I think we are seeing that in the marketplace and I think it’s been delayed and is overdue for some of those changes.”

On PRH/S&S, Murray said: “I was not surprised [that the merger was knocked back]. Anti-trust is such a dark art of the legal profession. It was not going to be an easy case to win, but it’s very hard to predict what will happen when you go to court.” The judge’s ruling, he believes, still might allow another player to acquire S&S, but “the bar is higher. The door is not closed. But there is a whole new set of data that would have to be collected for anybody, whether it was us or another publisher. I think it would take time to get a deal to close, but it’s not impossible.”

In February, HC reported that its global sales contracted by 14% to $531m (£439m) in the three months to 31st December 2022 against the same time period in 2021, largely owing to the slowing US market. Murray contextualised those results, saying that after the “pandemic party” the industry experienced over the past couple of years—with booming sales owing to people having “a lot more discretionary income [and] time”—the end of 2022 “is the hangover, and we are just getting through the hangover right now. I hope 2023 is more of a return to normal”.

He added: “We have sort of stabilised and the industry has stabilised, and I would expect our traditional growth now going forward, of 2% or 3%. But it was an unbelievable ride. I don’t think any of us have ever seen growth in the industry of 10% to 20% [annually]. That’s been unprecedented. We just have to enjoy that, and now we’re kind of back down to the growth rate that is a more typical rate for our business.”