By Anna Dudek
With the Canadian dollar hovering around parity with the American greenback and much lower U.S. prices to compare with, book lovers are questioning the high Canadian prices.
Even after mark-up, books bought when the dollar was weak are now a burden to storeowners.
“We had a lot of challenges about pricing,” says Craig Poile, co-owner of the independent bookstore Collected Works. “Customers would come in and say this is ridiculous, I’m not paying this.”
So when Poile and business partner Chris Smith looked at their devalued inventory, they did the unthinkable. Instead of raising prices to make ends meet, they discounted them by 30 to 40 per cent.
The promotion – set to last until December 31 – lets customers pay the U.S. cover price instead of the Canadian.
“Now that the dollar is at a par it’s just more apparent to everybody,” says Jane Barton, owner of Books on Beechwood. “But it’s been a really bad discrepancy for nearly two years now.”
The promotion could mean big business for the store or just the opposite, as December grosses sometimes as much as 40 per cent of the year’s sales for Collected Works.
Unlike clothes or other cheap consumer goods, books do not have a high profit margin. The mark-up is normally about 20 to 40 per cent, leaving little wiggle room for retailers who want to lower prices.
“We really won’t know the impact of the promotion until we look at the numbers,” says Poile.
The discount, he adds, is not about gaining new clientele who are bargain-hunting, but to show loyalty to customers who keep coming back over the years.
Publishers have been slow to react to the new-found strength of the Canadian dollar. Some books’ cover prices still reflect the loonie when it was sitting at 65 cents.
Shipping and handling, as well as customs costs are reasons cited to explain the spread between sticker prices.
“That’s garbage,” says George Laidlaw, president of Ottawa Independent Writers. “The public will only accept an excuse for a while – an excuse like money-grubbing won’t last long.”
Barton agrees, saying that publishers should have been expecting parity for months. “As far as I’m concerned, it’s too little too late. They should have done it a year and a half ago when it was obvious how the situation was going.”
But Laura Rayner, co-owner of Mother Tongue Books, sees it differently, never expecting the dollar to top its American counterpart. “We knew it was getting stronger and remaining stable but when it picked up, people stood back and watched,” says Rayner.
Book prices are set months in advance of distribution based on economic predictions at the time of printing.
And with a Canadian market smaller than California alone, publishers avoid printing a separate edition by stamping one copy with both prices.
Rayner got lucky, buying her books at about 95 cents to the American dollar in August.
Because the store carries mostly university textbooks, the majority of her ordering is done in the summer. By then publishing houses that were setting prices had to react to the obvious economic changes ahead.
But Barton says all she can do to alleviate the strain on customers’ wallets is to cut prices by five to six per cent.
Any lower, and Books on Beechwood might not break even.
There is no consensus among the store owners if small or large publishing houses have been quicker to react.
Poile expects that by January, when the books are priced for the spring arrival the dollar’s worth will be reflected.
If the situation doesn’t change, the store will look to American wholesalers rather than Canadian publishers for their stock, doing its own cross-border shopping.