THIS ARTICLE IS THE SECOND OF TWO PARTS. READ PART ONE HERE.
“We’ve been chatting with people about supply chain for quite a bit,” says Jamie Broadhurst, vice president, marketing, at Vancouver distributor Raincoast Books. “We knew, and most of the vendors knew, by the spring, broadly defined, that there was a real issue.”
The issue Broadhurst refers to is in fact several issues affecting multiple nodes of the supply chain that prints and ships books from the point of creation to the end user. Problems with printer overcapacity and a shortage of paper are conspiring to push costs up and extend lead times for printing from weeks to months, if time on the press is available at all. Labour shortages are also throwing up a challenge for getting physical stock from one point to another along the supply chain. All of this has created a great deal of uncertainty in the book industry as to how – or even if – publishers will be able to ensure their books make it to stores for the all-important holiday selling season.
“I think for the blockbuster frontlist, there shouldn’t be supply issues,” Broadhurst says, citing economies of scale that allow publishers to order large print runs and have them available in the warehouse on time or, in the case of The Madness of Crowds, the latest entry in Louise Penny’s Inspector Gamache mystery series, early. “The challenge will be the black swan titles.”
So-called black swan books – those that are not anticipated as huge sellers but become so by word of mouth, winning an award, or some other unforeseen quirk of the market – pose a particular problem for the industry. The ability to source and reprint is in doubt, given high printer demand, low paper supply, and labour shortages meaning that emergency shipping may be unavailable. “If we don’t know what they are now – and by definition we don’t know what a black swan title is going to be – it’s going to be very hard for the industry to respond,” Broadhurst says. “And the real question is, what does that do to consumer behaviour?”
According to Jason Farrell, vice president, distribution, at University of Toronto Press, most of the concerns about supply chain issues centre around inbound product as opposed to shipping out from the warehouse. “We’re seeing significant delays in U.S. ports of entry, and now even in Canadian ports of entry,” Farrell says. “To give you an idea, Los Angeles right now is reporting a three- to four-month delay. Port Elizabeth in New York is reporting a six-week delay.” Farrell also notes that the U.S. trucking industry is 60,000 to 80,000 drivers short, and rail capacity is also suffering. Farrell attributes the labour shortages to an economy slowly emerging from pandemic lockdowns and other disruptions as well as attrition from workers simply not returning to their jobs.
Warehouse, transportation, and other front-line staffs have been hard hit by COVID, with blue-collar workers often unable to book off time for sickness or to get vaccinated, and the trucking industry in particular had a high median age going into the pandemic. “We were facing these challenges heading into COVID,” Farrell says. “I think COVID just exacerbated the situation.”
“There’s no extra capacity in the system,” Broadhurst says. “So, if an appointment has to be made or something has to get somewhere very, very quickly, it becomes incredibly expensive. And in certain cases, the shippers can’t comply.”
In an ideal world, Raincoast would receive books three weeks prior to a title’s on-sale date; the books are then shipped geographically, with those heading farthest across the country from Vancouver leaving the warehouse first. The goal is to get books to stores before the on-sale date, so that booksellers can receive and catalogue titles in a timely fashion.
This year has not, to put it mildly, been ideal. “Printers are moving out their print-run schedules in months,” says UTP’s Farrell. “If you have a book that sells higher than anticipated, you can’t react as quickly as you could, say, two, three years ago.”
And that has had knock-on effects for distributors. “We have missed a couple of on sales this month,” Broadhurst says. “We realize we’ve made a commitment to a bookseller that your books are going to be there. When we don’t deliver, we’re very, very aware of it.”
In order to ensure that processes run as smoothly as possible, Raincoast has doubled down on its Indie Bank, an initiative begun last year that sees the distributor set aside a portion of key title inventory earmarked for Canadian independent booksellers. Raincoast also has a wholesale division, Book Express, that is able to monitor independent bookstore sales in real time and respond accordingly. “One of the challenges for us is that our wholesale division basically functions as the offsite warehouse for a number of independent bookstores on the West Coast,” Broadhurst says. “People will say, ‘I’ll start with five,’ knowing that Book Express has it and they can stock up. We have been suggesting to people that instead of ordering five times over two weeks, maybe just order the one or two times that [we know we have stock] just to be safe.”
Problems with inbound sourcing of books have led UTP to prioritize shipping titles that have been delayed, and the distributor is taking other measures to make up for lost time with speedy turnaround on delivery. That, however, only helps so much if books are arriving weeks or, in the case of overseas deliveries, months after publishers’ on-sale dates. Farrell is frank in saying that publishers are looking at alternatives in the short run, such as print-on-demand services that might ensure stock is in stores. “That delay in sales, and in some cases missed sales, have had such an impact that they are looking for local printers,” he says. “It’s hurting their margins, of course. But the longer the supply chain on inbound, the riskier it is and the more potentially damaging to the publishers.”
Many of these issues have been on the radar for some time. Publishers like Vancouver’s Arsenal Pulp Press have had to scramble to finish prepping their fall books in order to give printers enough lead time to produce them and ship them on time for the scheduled on-sale date. (And, in at least one case, the publisher was informed this wouldn’t happen.)
At Thomas Allen & Son, a distributor in Markham, Ontario, director of marketing and publicity David Glover says that the major problems occurred in the spring, with publishers shifting their pub dates around to accommodate issues with printers and shippers. “We were seeing titles that were supposed to arrive in August being pushed out to the end of September,” Glover says. “At this point, most of the publishers have been looking at their supply chain, looking at their schedules, and they have adjusted accordingly.”
One result of that adjustment is that crunch times for some distributors have been shifted forward in the year. At Raincoast, on-hand quantities are at an all-time high and their biggest shipping month, which is usually October, is likely going to end up being September this year. “We have seen how customers are responding to supply chain [issues]; I think everybody was reading the same stuff,” says Broadhurst. “Everybody got the same memo.”
Farrell says UTP is augmenting its warehouse staff for the holiday season, but the distributor is also eyeing a shrinking labour market that is sounding alarm bells about the potential to secure workers as the country emerges from COVID lockdowns. They have set aside warehouse space for in-demand titles and have implemented changes to make their picking system more efficient. “We are talking to customers ahead of time to make sure they’ve got the demand on-site and also to see if they have any backup plans,” Farrell says. “Waiting two to three weeks out for domestic books and months for international books is hurting release times and is really jeopardizing the release of new titles in a timely fashion for the public.”
How the consumer responds to these challenges is perhaps the biggest unknown in the entire scenario. Whether book buyers will prove flexible in choosing alternate titles should their first choice prove unavailable is a question that many in the industry are pondering with varying degrees of trepidation. “That bigger pattern is the thing I’m really interested in,” says Broadhurst. “When consumers face the challenge where there is a book that is not on the shelf, whether they buy a replacement title.”