Independent publishers disappointed by plans for Grantham closure as distributors note tough market

Independent publishers distributed by Penguin Random House’s (PRH) third-party distribution services operation at Grantham said they were disappointed to hear PRH was considering closing the site in 2025 as distributors noted tough market conditions. 

Tom Weldon, PRH c.e.o., told staff that the cost of running the operations at Grantham had risen substantially due to “macro external factors, including supply chain challenges and economic shifts” and it was no longer commercially viable.  

Although no final decisions have been made, around 200 staff are at risk of redundancy if the plans go ahead.

Many trade figures noted the impact of Brexit and rising energy prices on the current book landscape as well as the small margins of the distribution business.

Christopher Hamilton-Emery, director of Salt Publishing, told The Bookseller: "PRH is a tremendous supporter of independent publishers. This announcement is a further reflection of the economic impact Brexit is having on us all. We must hope that a new government with fresh ideas on European trade could offer the country an achievable and honest way out of this mess, reducing operating costs and so much needless bureaucracy—all barriers to growth. But right now, my heart goes out to the tremendous team at GBS [Grantham Book Services]." 

Oneworld publisher Juliet Mabey said the news came as a shock: the firm has been with Grantham Book Services for many years. “Moving distributors is not something any publisher undertakes lightly as it involves an incredible amount of work,” she said. “However, GBS was a very profitable business before facing the additional challenges and costs of Brexit and the recent increased energy prices so we’re hoping someone comes in to take it over. If not, beyond the upheaval for all their client publishers, clearly many jobs will be lost [if closure plans go ahead].” 

Davinder Bedi, chief executive at Glasgow-based distributor BookSource, said book distribution had been “seriously difficult” over the past few years. "[It is] no surprise that PRH is having at look at its options,” said Bedi.  

“Despite high demand for books during the Covid pandemic, lockdowns and staff absences have made keeping the wheels turning in any organisation a challenge. Now, with wage, power, carriage and rent cost pressures, coupled with the clear demise of the high street and continuing Brexit shenanigans, I can see why some of our colleagues are deciding to take the nuclear option and close. We work off very small margins at this end of publishing and some distributors are more sensitive to that than others,” he said. 

“Clearly the book supply chain remains a vital part of UK publishing, as do small independent publishers who bring range and choice to book shops and readers. The sooner the marketplace settles the better for us all; however, I fear that the coming years will see more consolidation in our part of the industry—our high operating costs will demand it. We’re very grateful that BookSource remains strong in this volatile environment—our board, our balance sheet and our staff are behind us and we’re well-placed to weather any storms we may encounter. We’re supremely confident that we’ll continue to help publishers do business well into the future. Right now, however, our thoughts are with the management and staff at GBS while they negotiate their way through their consultation processes.” 

Many members of the industry expressed concern for staff at GBS. Mary Cannam, managing director of Faber, said the publisher was “extremely sorry" to hear the news. “It’s very sad, particularly for the brilliant team at GBS who have supported us so well over the past few years. We have loved working with them, and are so grateful for their friendship and expertise,” she said. 

A spokesperson for Bonnier Books UK said: “We’ve built a great relationship with GBS over the past 15 years and of course wish all the best to the staff at Grantham in what are uncertain times for them. We are currently reviewing our options for future distribution but are yet to make any decisions. In the meantime, we’ll continue to work closely with GBS to ensure our books continue to reach our customers and readers on time.”

An anonymous client publisher of GBS added: “It’s disappointing as GBS have been wonderful to work with and are very good at what they do for a huge range of independent publishers. I’m sure I’m not alone in hoping they reconsider and carry on, or that another publishers acquires GBS to carry on their business. If not, we and all the other indies there will undoubtedly find a home with another distributor over the next 2-3 years before they close.” 

Daniela Petracco, director, Europa Editions UK, said: "It is rather worrying to see how PRH have chosen not to invest in indie talent after their recent failed merger history, while the book world is telling another story. Nonetheless, we are confident that great new opportunities can emerge from this with our independent Alliance partners. We are also very saddened by the considerable job losses that are being envisaged, all the more so because we have always found GBS staff to be most efficient, always helpful, and unfailingly courteous. We will miss them and very much hope PRH will find a way to keep redundancies to a minimum.”