As the Canadian dollar hit a 47-year high against the U.S. dollar (our
bucks are now worth less than their loonies!), major Canadian retailers
are joining some smaller retailers in making moves to cut prices so
that the differential in U.S. and Canadian prices printed on most books isn't so glaring.
The changes come as frustrated consumers have begun buying ever more products,
particularly books, online from the U.S. As the National Post noted,
"Canada Post's international mail-sorting centres have been swamped in
Vancouver, Toronto and Montreal by packages from the U.S. ordered
online by Canadians."
Yesterday Indigo Books & Music, Canada's largest bookseller, said
that it has begun a Sticker Savings Event, which provides a 10%
discount for any customer and 20% discount for loyalty club members, to
help reduce the price gap. The company said, too, that during the past
four months, the prices of some 25,000 books have been reduced 5%-30%.
(Because of bestseller discounts, most bestsellers are priced at par or
better than U.S. list prices.)
Indigo stressed that many books arriving at stores now were priced six
months ago, when the Canadian dollar was worth 85 U.S. cents.
In a statement, Joel Silver, chief merchant for Indigo, stated, "We buy
and sell books in Canadian dollars and as such do not profit in any way
from a strengthened Canadian dollar. We continue to lower our prices
and we've introduced more promotional offers than ever before to help
close the price gap."
The company continues, it said, "to work with publishers to find
long-term solutions that will deliver the best possible prices to
consumers without crippling the Canadian publishing industry."
Indigo spokesperson Lisa Huie told the Toronto Star that the price
promotion came in response to Canadian customers buying more books
online from the U.S. "We're hearing a lot of movement toward online
shopping [and] we thought it was important in light of the disparity in
the price printed on the [book] jacket, that . . . beyond the fact that
we've already seen prices come down, we have prices today that are at
or better than the U.S. prices that are listed on the cover," she said.
"We've actually ratcheted up the promotional activity since the
strengthening of the dollar--more particularly since it hit par."
Also yesterday Wal-Mart Canada, which has nearly 300 stores in Canada,
announced that it will sell all books, magazines, greeting cards and
gift wrap at U.S. list prices, according to the National Post. "In many
cases the new pricing has not been supported by cost concessions on the
part of suppliers," the Post wrote, but Wal-Mart indicated it is
working with vendors to bring prices down (as only it knows how).
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Boosted by sales of Harry Potter and the Deathly Hallows,
total revenue in the quarter ended September 29 at Indigo Books &
Music rose 14.8% to $209.2 million (C$ or US$, take your pick) and net
earnings increased to $3.3 million compared to a loss of $1 million in
the same period last year.
Sales at Indigo and Chapters superstores open at least a year rose
10.2% while comp-store sales at Coles small-format stores rose 10.7%.
Sales at chapters.indigo.ca, the company's online sales outlet, rose
50.3% to $26.3 million.
Excluding the sales of HP7, revenue at Indigo and Chapters superstores
rose 7.1% and at Coles grew 6.4%. At chapters.indigo.ca, sales rose
14.9%.
During the next year and a half, Indigo plans to open eight new
superstores, in Vancouver, Calgary, Saskatoon, Winnipeg, Stoney Creek,
Milton, Mississauga and St. John. The company also plans to expand
"significantly" its toy business at superstores "due to the positive
reception for its edutainment offering to date."
In a statement, Indigo CEO Heather Reisman said, "Canadian booklovers
continue to show us their passion for books, and our results also point
to their appreciation for our other product lines such as lifestyle
gifts and kids' toys."--John
Mutter