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Canadian Customers Not Prepared To Pay More

Canadian list prices

It’s not going to work this time.

The market has changed. Competition is fierce. Customers are much more price-conscious. Most important, Canadian customers have become accustomed to seeing US/Canadian pricing which is approximately the same.

The frightening thing about the picture above is that the wholesaler has made no effort to cover up the U.S. price, which is what I think I might have done in the same circumstances. They don’t see the problem; they don’t see an issue; they don’t have to deal face-to-face with customers.

Canadian distributors are caught in a situation devised by U.S. literary agents — i.e. lawyers in disguise — who decided a long time ago consider Canada part of the U.S. market insofar as it applies to royalties. We’re just another territory like Puerto Rico or American Samoa. So every book sold here that’s of U.S. origin has a price that rises and falls with the value of the Canadian dollar. (Or more accurately, the  difference in value; many of the so-called ‘drops’ in the CDN buck are actually bolstered investor confidence in the U.S. economy.)

Customers are caught in the middle of a war they don’t know exists.

So why don’t distributors here speak up on behalf of retailers and consumers? If there is an impact to the present price increases here — and I believe there will be a measurable one this time around — they may be forced to.

Yes, Canada has a more robust economy. Yes, there is a sense in which retailers here need higher MSRPs in order to cover higher rents and higher labour costs. But all the customer sees, when they look at the example pictured above is, “Why do I have to pay $3.50 more?” That’s 22% (21.8) and as of noon today, buying a US dollar costs $1.135 (posted rate of 1.11 plus 2.5% bank charge).

The consumer thinks, “Dollar is 11% higher; book is 22% higher.”

The Canadian dollar has actually been rising on five of the last six trading days. (It’s down today, though.) Did suppliers overreact by switching to a 20% conversion? How did they all (initially) pick that same number? (David C. Cook backed off its original conversion, $14.99 books that had jumped to $17.99 are now at $17.50.)

We just don’t need this. Not now. The timing is not good.

We need a Canadian market price.

We need Canadian distributors to speak up for us and demand a fixed Canadian market price.

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  1. February 20, 2014 at 8:24 pm

    Thanks for posting this, so important to look at and wrestle with- we have to look at this as to what the customer sees- and offer pricing with integrity.

    • February 20, 2014 at 8:30 pm

      Thanks, Lando. I don’t know if we can change the system, but this way, I can go to work tomorrow and look my customers in the eye and tell them we’re fighting for them; we’re on their side.

    • February 23, 2014 at 9:15 pm

      One thing I’m considering… The difference on the book in the picture is $1.50 (It went from $17.99 to $19.49) which represents profit of 0.75 at 50% or .60 at 40%. What if I just run some “Take $1.00 off this title” stickers? That would bring this down to $18.49 which is only a 50-cent increase for the consumer.

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