Millions of readers around the world may be shivering with excitement at the thought of Harry Potter and the Deathly Hallows being released at midnight, remembered as Harry Potter and the Nightmare on High Street. To them, Harry Potter is a loser. That, ironically, may well include Bloomsbury, the publisher who found a diamond in the rockface when it discovered author J.K. Rowling.
The problem is that the seventh and last book in the Potter series is expected to be the fastest-selling book of all time. Supermarkets, never ones to miss a ‘pile them high, sell them cheap’ trick, will sell it way below the cover price. That means trouble for every other retailer, even book chains. Small bookshops, especially, will suffer as they struggle to keep up with the discounts offered by the industry’s big players.
At `A38.87, almost half
the `A317.99 cover price, Asda is treating the book as a loss leader to
tempt customers through its doors rather than those of a rival. Even
Waterstone’s, the UK’s biggest book chain, is feeling the squeeze.
But the traumas that Potter is causing bookshops pale next to the trouble the boy wizard is inadvertently causing Bloomsbury. The publishing house had been transformed from feisty independent with a few big names, such as Margaret Atwood and Will Self, to a stock market star with the world’s most valuable author.
Two years ago, the penultimate Potter novel, Harry Potter and the Half-Blood Prince, sold more copies in one day than Dan Brown’s Da Vinci Code did in a year. Next month’s launch of Harry Potter and the Deathly Hallows will see it top the bestseller charts, with `A317 million sales, doubling the amount normally sold each week. The flipside is that when Potter hangs up his wand, he will also leave a big hole at the publisher. Already Bloomsbury is facing a financial crisis, with shareholders suffering from post-Potter jitters.
The value of the company has fallen by half, from `A3285 million to `A3134 million, because of fears about what will happen when Harry is no more. The first clues of what this will mean financially came in April, when Bloomsbury revealed that its profits had collapsed by three-quarters to `A3 5.2 million. The shortfall was due to last year’s lack of a Potter title and a string of flops. The marketing director of one rival publisher said: "I think Potter has put Bloomsbury under unrealistic pressure. Most publishers operate on a 5 per cent profit margin. So effectively, in non-Potter years, Bloomsbury is being asked to make four times that — 20 per cent."
In search of a new cash cow, the publisher last year was accused of being the Roman Abramovich of publishing, shelling out several eye-watering advances: `A3 2 million apiece for historian William Dalrymple and cookery writer Hugh Fearnley-Whittingstall, as well as the over-sized deal for David Blunkett’s diaries, which did not sell. The one positive legacy Potter-mania will leave behind is a healthy market for children’s books. Rowling proved, contrary to popular opinion, that boys read.
— By arrangement with The Independent