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HarperCollins UK c.e.o. Charlie Redmayne predicts “some adjustment” to book prices, having seen increased costs across the market.
Speaking at the Frankfurt Book Fair, Redmayne said: “My own view is that the cost of books has been incredibly cheap for a very long time. I think that’s partly because of the way we operate our businesses. We operate our businesses on each individual publication, so each individual publication is an event, so if you’re trying to move the price a bit, it’s like ‘oh my goodness, no, because that could impact that particular book and that particular author and that particular author’s career. “I think the prices in the book industry have stagnated for a long time. If you think about what has happened in the rest of the economy in terms of inflation, I do think there will have to be some adjustment.”
He said he has already seen costs go up, with the traditional £7.99 paperback price point increasingly replaced by £8.99 or £9.99, while the £12.99 hardback price point can go up to £16.99, with big brand books rising to £25. “At the moment, from our perspective, we’re seeing sustained sales, so those price moves have not impacted on the sort of sales that we would expect, and have also therefore driven a degree of profitability which counters the cost going up in other parts of the business,” he said.
Discussing the challenging economic environment, Redmayne revealed HarperCollins energy costs have gone up by 250% this year, while paper, printing and freight costs have also risen. “I think across our business the costs are very severe. Like, frankly, all other businesses. I think we’ve been good at making sure we mitigate against those costs as much as possible, that we negotiate the best deals.”
He added: “It’s a serious hit, but all you’ve got is the books and trying to sell those books. If you get those hits and you get that revenue coming through then that’s the way you cover it off.”
Looking towards a likely recession, Redmayne said the publishing industry needs to “fight” the perception that subscription services such as Netflix are of “greater value” compared to books. He said the publisher was in “great shape” to “weather anything that comes” with increased investment in data science and data analytics to power marketing, but warned “what is coming is going to be tough”.
When questioned how HarperCollins would support its own staff, he said: “We understand there is a cost of living crisis, there is also a cost of doing business crisis. And we’re limited in what we can do by that. However, we do think it is important to pay our people properly. We raised our starting salary in London to £26,250; we gave a pay review of 5% recently. We also gave a 5% bonus to everybody in the company who was not on the bonus scheme, which is effectively 10%, which is what inflation was running at. We take it very seriously.”