The number one market for US trade books in Asia is probably not among your top three guesses: not Japan, not Singapore, not Hong Kong. It's the Philippines. Yet, the Philippines has until recently been the country the Asian economic boom forgot. That is changing, and so is the book market here.
Following the 1986 EDSA Revolution when President and Mrs. Marcos were packed off to Hawaii, the restoration of democratic freedoms, especially freedom of the press, has brought a renaissance in book publishing. An American colony from the turn of the century until the end of World War II, the Philippines keeps close ties with the USA, especially in the book business.
In 1990, $100 million worth of book and magazine imports came into the country, of which 80% were books. In 1994, that total had jumped to an estimated $340 million.
USA book exports to the Philippines jumped 39% in 1995 and 16% in 1996 to $26 million, nearly on par with the Netherlands, America's largest trading partner. And that is just US Department of Commerce figures, which exclude shipments of $2500 or less. Unquestionably, the dominant source of foreign books in the Philippines is the USA.
Unfortunately, this means the local publishing industry must struggle to gain a foothold against an avalanche of American titles. The entire domestic market is not as large as the import market, even when private and government-issued textbooks for a population of 70 million people are thrown in. Some argue that a strong emphasis on local language education would help. Though Filipino (Tagalog) is the language most people speak, there are over 80 language dialects spread across the vast archipelago of 7,100 islands. Since the American colonial period began in 1900, English has been the dominant language of education.
Jorge A. Garcia, president of the Philippine Book Publishing Development Federation (PhilBook) and VP of marketing and sales for Abiva Publishing House in Manila, has been in educational books his entire career. "English is the medium used from preschool to college, except for Social Sciences and Filipino language studies," he explains. "So English is the reader's more natural language."
The Philippine publishers also work uphill here against home-grown disadvantages. Books are imported duty-free, while imported paper and materials needed to make books at home are taxed. Since 1951, an effort to nationalize textbooks and encourage Filipino authors has succeeded in getting foreign textbooks out of the government-run elementary schools and bringing literacy rates up to an impressive 97 percent but since early in the Marcos era the Government has had a monopoly hold on public school textbooks. Local publishers believe that monopoly is holding back the country with substandard teaching materials.
In February here, PW found the Filipinos just implementing a new Book Publishing Industry Development Act. Passed in June 1995, the new National Book Policy contained therein took 10 years for the industry to forge but seems to have support from all sides. Part of the Act calls for the duty-free import of paper used for books and gives publishing a priority industry status with the Government, which means access to Government credit and other privileges.
Another portion of the Act privatizes the development, production, printing and distribution of books to all government-run schools. However, the Department of Education and Culture still issues guidelines on learning competencies for all subjects and year levels and evaluates books before giving its seal of approval for sale to government schools. "Before the passage of this Bill," Garcia recalls. "The 65 private textbook publishers were only catering to the textbook requirements of about 7,000 privately-run schools, colleges and universities. Though there are no official figures to show the true size of the total textbook market, I estimate it to be somewhere around $16 million per year."
Garcia's organization, PhilBook, which was also created by the new bill, will seek to deliver "more affordable, varied, accessible, quality-laden books and related materials by providing assistance to the NBDB in the formulation and implementation of a national book development plan. "This will undoubtedly enhance and ensure the active participation of the private sector engaged in book and electronic publishing," Garcia predicts. "PhilBook members come from nine associations engaged in the various industries of book publishing. From paper importers, paper millers, writers, technical schools, publishers, printers among others. It is composed of more than 800 member companies.
But even with such excellent cross-industry participation, implementation of the new law, the National Book Development Plan, by the new National Book Development Board has turned into a political tussle and it looks unlikely that the full impact of the new Act will be felt before the turn of the century. Answering directly to the Office of the President, this Board is chaired by Dominador (Jimmy) D. Buhain, attorney and owner of the Rex group who publish, printer and retailer educational books. "The law itself is good," Buhain laments. "But so much restructuring needs to be done."
The Retail Scene
While book stores are still few and far between outside of the Metro Manila area and most of them sell more of other products than books, the number of stores is growing, especially outside the Manila area. "Sales are also increasing at 15 to 25% a year," according to Karina Bolasco, another industry leader and Manager of Anvil Publishing.
PW visited some of the newest retail outlets and found them strikingly similar to trendy American shops. National Book Store, Inc. is the country's biggest chain, with 32 outlets and five more planned this year. They are considered anchor stores in malls around Metro Manila and are large, often multiple-story spaces, with the stationery and school supplies sections most accessible. Megastrat, part of the National Book Store group, is the Philippine's number one wholesaler. They also have major publishing (Anvil) and printing (Cacho Hermano) operations.
Running this family-owned business is the elegant matriarch Socorro C. Ramos. She and her late husband, Jose, began National Book Store with one outlet during the Japanese occupation, 55 years ago. "Most of our profit has always come from the stationery items," she told PW. "In 1974 we got the license to print Hallmark greeting cards in the Philippines, as well as college textbook reprint rights from the big American publishers like McGraw-Hill and Prentice-Hall. We pay a 15% royalty." Until recently a Philippine law protected reprinting of foreign textbooks with a very low set royalty fee.
In the stores, best sellers tend to be the successful American titles. In February, The Rules and the Chicken Soup for the Soul spinoffs were doing well, as was Runaway Jury.
"Non-fiction cannot as many copies per title as fiction," says Ramos. "But some titles, such as Seven Habits of Highly Effective People, strike a chord. National has sold 30,000 copies in paperback. Other self-help titles like The Road Less Traveled also continue to sell. Usually business, religion, self-help and reference titles can sell if priced reasonably." National distributed Merriam Webster, Warner Books, Golden Family Entertainment and other publishers on an exclusive arrangement, including tapes and videos. "Some titles we will bring in air-freight just to get them on the shelves immediately," says Ramos.
"In children's books, the most salable are Disney products," says "Mother" Ramos. National is the license-holder for the Philippines for Disney books and one of the largest importers of Disney titles in Southeast Asia. "Other movie tie-ins and books that are related to other forms of media are extremely popular, of course. The young adults love Goosebumps, other R.L. Stine books and X-Files titles."
Ramos' daughter Cecilia Licauco is Vice President of Purchasing and Ramos' grandchildren are also involved. Granddaughter Xandra S. Ramos manages the buying and merchandising and another, Trina, has opened a new kind of retail book store for the Philippines, PowerBooks.
"We found a lot of new ideas from different bookstores in the USA, " says Xandra Ramos over Capuccino on the second floor of the flagship store. A second shop is planned for next year and the enthusiasm is obvious. "We are promoting exciting books, mixing hard cover and soft on the shelves, arranging the titles by category so our customers can easily find the books they need. Our tagline is 'Books. Coffee. Learning. Life.'
"The biggest difference in our store is the browsing it allows," adds Trina. "There are chairs, a coffee shop, and the books aren't shrink-wrapped, as in the National stores, where they have higher customer traffic resulting in a lot of wear and tear on unreturnable books. PowerBooks attracts a variety of people. Businessmen browse through the professional titles, creative people come for our design and art books, authors come for talks and signings, including Richard North Patterson. We plan to have a Web site for online orders, delivering by courier anywhere in the country."
With a conservative, library tone to the decor, and without the stationery products so important to the mix of the National book stores, Mrs. Ramos is allowing the new generation to experiment with this form of retailing in the Philippines.
"It is a challenge expanding the reader base in the Philippines," says Xandra. "A print run of a locally published book or an order for an imported book is barely one percent of the total population of the country." About 10% of the mix at PowerBooks is locally published or local authors. US published Filipino writers like Jessica Hagedorn (Dog Eaters and Gangster of Love) and Ana Marie Pamintuan (Face of the Enemy) are available alongside domestic titles like Manners for Moving Up from local TV talk show host and columnist Julie Yap Daza.
The Publishing Community
"After Marcos left, there was a blossoming of underground publishing here," recalls RayVi Sunico, General Manager of Cacho Publishing House, another part of the National group. "Now we are discovering the niche for locally written works, things Filipinos can write that only Filipinos will read. People used to say poor people don't read. But now that there are books available in Tagalog, romance, sexual advice, children's books...they are taking off. The biggest problem is the space limitations in book stores."
Another thing that has changed in publishing here in the 90's is the sense of design. Quality has improved enormously. Lorenzo (Lory) Tan is another leader in this new generation of book people. General Manager of Bookmark, Inc., he has made Filipino culture his publishing theme, everything from the classics to contemporary art to original children's books.
Bookmark just published a new translation of the great Jose Rizal pair, "Noli Me Tangere" and "El Filibusterismo." The translator, Soledad Locsin, was 86 when she finished the project and knew the Spanish used when the original was written. "I'm really proud of this project, and of the printing, paper and binding. All of it is first quality, and locally produced."
He also has a Filipino Literary Classics series, reprinting authors like Garcia Villa, Nick Joaquin and Bienvenido Santos in handsome paperback editions he can sell for under 150 pesos. (US$6) There are also handsome four-color editions in themes of natural history Tan retails and distributes books throughout the country. "I travel widely and the biodiversity of my country is unbelievable. There are hundreds of books to be written on our environmental treasures alone. It is a great time to be in publishing."
Categorically Speaking
The Philippines is also an important source for animation. Everyone from Disney to Warner Brothers use the talented Filipino artists for producing comics and cartoons right in the Philippines. The local products, called "komiks" represent a $24 million industry, bigger than textbooks, according to Esther Pacheco, Managing Director and Chief Editor of the Ateneo de Manila University Press.
Romance is also taking off, she says. Now selling 1.5 million copies a year and written in the Filipino language, the major publisher is Benjamin Ocampo's Books for Pleasure. For the price of a hamburger, these books sell wherever there is a sizable population of Filipinos, including Hong Kong, Singapore, Japan, Taiwan, the Middle East and Europe.
Pacheco notes that by 1966, some 64 Filipino novels in English had been published and today serious literature is in the hands of relatively young houses: New Day, Solidaridad, Bookmark, Anville and Giraffe, as well as the three university presses, Ateneo de Manila, De la Salle and the University of the Philippines. Scholarly publishing has the longest history in Asia. De la Salle was founded by the Spanish before Harvard.
And then there is the religious books market...very important in a country still 85% Roman Catholic. "In addition to art and coffee table books, we are doing the new edition of the Mass in Tagalog for Cardinal Sin of Manila," continues Louie Reyes. "And we produced and sold 30,000 copies of a special full-color 300 peso (US$12) title, John Paul II We Love You for his visit here."
Looking Toward the Future
"Many of our problems will be solved with the National Book Act, if it can be implemented properly. We especially need to break the paper cartel and we need more commercial outlets for books. More and more books are being published now," says Reyes.
Through the World Intellectual Property Organization (WIPO), Philippine publishers are also encouraging respect for copyright. COMPACT, The Council to Combat Counterfeiting and Piracy of Patents, Copyrights and Trademarks, is closely monitoring the passage of the revised Philippine Copyright Law, now in its third reading, which will add teeth to the current law. Publisher Fernando R. Martin is President of that organization.
Perhaps the most unique position in Philippine publishing is that of the international reps. Nearly every major American trade house has a rep based in the Philippines, some of them covering the whole region.
Rizalito S. (Lito) Garcia covers 10 countries for Bantam Doubleday Dell in the USA and Transworld in the UK. "I am responsible for all of Asia except for Japan and the Indian subcontinent," he tells PW cheerily. "But the Philippines is by far my biggest market. The combines Singapore/Malaysia market is number two, but it is only two-thirds the size. Hong Kong and South Korea are split for number three."
Garcia says he has never had a year when sales declined, in 17 years. "I work on a salary only. We encourage our customers to send their orders directly to New York and they are shipped directly to them. We don't do any warehousing. And still 80% of the books are sold in Manila, though in the last three years we have been working to develop the trade in the south with some success."
One special privilege the Philippines have long enjoyed is lower retail prices for foreign books...lower than the cover prices.
"Our buyers are very price conscious, and by lowering the prices we balance out in increased volume. This is not true elsewhere in Asia, but the economic sacrifice for book purchasing here is three times higher."
In the last 15 years, Garcia has expanded into other Asia markets, where he finds both the titles and the approach to sales vary..
"In Taiwan, we can sell thousands of Anne of Green Gables, Mrs. Doubtfire and Dead P ts Society but only a few hundred here. In South Korea they don't like UK editions, in Hong Kong they prefer them. In Chinese speaking countries, they don't like black covers. Red covers sell better. I keep telling New York, 'Grisham and Ludlum CAN'T be black. The sales are too important to us!
"The bulk of our business is still mass market paperbacks, but in the last five years we have had more hard cover trade editions moving well."
While Garcia says his fastest growing market is Malaysia, which has one of the highest economic growth rates in the region, he predicts the Philippines will also continue to grow.
"There are hoards of publishers' reps now coming to Manila," he complains. "But at the slightest pretext we will all get together. The booksellers and the other publishers' reps are also our friends."