Canadian booksellers and publishers are at odds over who carries the fiscal responsibility for dealing with the effects of the rising Canadian dollar, which has gained more than 40% against the U.S. dollar since January 2002. The strengthening of the Canadian currency has significantly pushed up the price of books to the Canadian consumer compared to the U.S. consumer. Many booksellers are blaming the higher costs on publishers, due to their habit of setting book prices up to six months in advance of a book's sale and printing prices in both Canadian and American dollars on the book jacket.
"These days booksellers often, but not always, will reduce the price, but every time they do, they are losing out of their own margin. Somebody down the line is making the exchange rate difference, and it is not the booksellers," said Susan Dayus, executive director of the Canadian Booksellers Association. "Booksellers know that they have lots of customers complaining, but they don't know how many aren't complaining and just are turning [the book] over, looking and deciding that they aren't going to buy or buying somewhere else." Booksellers, Dayus added, are aware that customers are noticing the pricing difference. "How can they not, when the dollar exchange rate is in the news every day and books show dual pricing?"
David Kent, president and CEO of HarperCollins Canada, explained that price control is in the hands of booksellers. "We can't set prices," said Kent, adding that the Competition Act prohibits manufacturers and distributors from setting retail prices. "Retailers have control, they can sticker over the printed prices. They can do what ever they want," Kent said. But according to Dayus, when the situation has been the opposite (a falling Canadian dollar), "book publishers have very quickly overstickered books."
In general, Canadian houses have been unwilling to sticker over the prices, leaving that job to retailers. Many publishers, however, have said they will print new prices when books are reprinted.
At Indigo Books & Music, Sorya Ingrid Gaulin, v-p of public relations and corporate giving, said Canada's biggest bookseller is using a variety of tactics to reduce the cost of books. "The price of the books will be adjusted through a combination of publishers' adjustments on reprints and through special discount promotions to help raise awareness of the price drops," Gaulin said. Some new prices will be seen at all Indigo, Chapters and Coles stores starting immediately, and over the course of the next few weeks and months in the case of reprints.
While some Canadian consumers are disgruntled at paying an increased amount—more than American consumers for the same book—booksellers are far from the only businesses that have been caught with potentially overpriced products. It remains to be seen if booksellers' inability or unwillingness to accept a lower gross margin in order to move product will mean higher returns for publishers, or if publishers will begin to sticker—or institute other programs—to prevent the possibility of huge returns.
