Collins Booksellers in trouble – news commentary by Andy McCourt

Collins Booksellers, established on Melbourne’s eponymous Collins Street (and not connected with Harper-Collins), in 1922 by Frederick H Slamen (and still family-controlled), and now a 57-store national chain and web-commerce business, has closed three stores, stopped ordering new titles and is in need of cash.

With 33 company-owned outlets and 24 franchised stores, which will be affected to a lesser extent as the owners deal directly with publishers, Collins has a reputation as Australia’s pre-eminent bookseller in the traditional sense. Although hosting an excellent website through which to source and sell books, Collins has apparently not managed the pell-mell transition of book supply from a genteel learned person’s profession to commodity fulfillment as well as the likes of Borders, Angus & Robertson, Dymocks and Amazon.

Quality books can also be obtained in K-Mart, Big W and even Australia Post, where to their great credit they display many printed-in-Australia children’s books from publisher Funtastic. A host of online businesses offer books for sale at discounted prices and many newsagents have opened book retail sections.

The Australian reported Collins’ managing director David Dean as ‘sending an email to suppliers last week canceling all back orders, including all April and May new releases.’

Collins Booksellers has a reputation as staunch supporters of local literary talent, holding regular functions and signings for home-grown (and home-printed) books. It states its own philosophy as:
“Collins Booksellers is a specialist, professional bookselling company. Through its long history it has concentrated its activities on one central theme: providing the customer with the highest level of service possible...”

No doubt this is true, as was the almost identical customer mission of WC Penfold when it too stumbled financially. But it would appear that laudable old-style retailing of printed products, but at higher prices, does not win sufficient hearts and minds of the buying public.
Collins Booksellers is seeking solutions to its financial woes and management is confident the firm will survive. A sale is not out of the question.

MY CALL
Sad, sad, sad. But inevitable, inevitable, inevitable.

Old money private print-related companies in Australia are having a stiff time of it at present. The disciplines of having public ownership and demanding shareholders are not there and they take a lot longer to recognise megatrend shifts in consumer and competitor behaviour. The ‘better service’ line no longer washes. People don’t count as much as the system under which the business operates.

Take Borders, it sells the same latest release by Tim Winton or Dan Brown, but the shops are positioned as “Books, Music, Movies, Café.” Café? Yes, a trip to Borders means you can browse and sip cappuccino; it’s a meeting place, well-stocked and everything is discounted. Borders has only 11 stores but they are all huge and well-positioned. You can check titles on their computer terminals, or get one of the young staff to do it. It’s ‘McDonalds’ bookselling.

Angus & Roberston, with 170 stores is Australia’s largest bookstore chain with an estimated 18 per cent market share (of the estimated $1.3 billion Australian book market) and since the 1960s has undergone several metamorphoses, today being owned by Pacific Equity Partners, a hard-nosed merchant bank that also controls New Zealand’s Whitcouls. PEP bought A&R- Whitcouls from UK outfit WH Smith in May 2004. Scots founders David Angus and George Roberston would not recognize the way the company is run these days. Business first, books second.

In those early days of Australian bookselling, Geo Roberston was able to send a letter denying trade supply to one JT Steele, accused of the heresy of discounting books. Steele published the letter in newspapers, reproduced here from George Ferguson’s masterful Some Early Australian Bookmen. It says “I regret to say I cannot supply you with the Goods ordered by you at Trade Prices, in consequence of your underselling the regular booksellers….”

Try that today and you’ll end up with a huge fine and conviction, courtesy the ACCC!

But, some businesses still hold on to the ‘divine right of profit’ belief. They feel that, because of illustrious pasts, qualified staff, good old-fashioned service and reputation, the customers simply MUST patronise their establishments.

There is no divine right of profit, and customers will flock to wherever they can get the best value (not necessarily price), with minimum effort. This applies to printers, booksellers, butchers bakers and candlestick-makers. We all have to adapt, and quickly.

Best of luck Collins, because I for one relish visiting your main store whenever I am in Melbourne. I hope you ride this storm and prosper.