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The German Solution: Saving Books by Keeping Them Expensive

By posted at 6:00 am on September 13, 2011 33

1.
During a recent visit to Cologne, I avoided the city’s most magnetic tourist attraction – you’ve seen one Gothic cathedral, you’ve seen them all – and instead I explored the city’s bookshops. Large and small, general and specialized, spacious and cramped, there seemed to be no end to the variety. But they all had one thing in common: they were thriving.

How do the Germans do it? When a huge, once-mighty book-selling chain like Borders is going down in flames across the Atlantic, how do the Germans manage to keep their book publishing industry so diverse, so robust, so stable? How do booksellers consistently turn a profit on everything from Goethe to Grass to Grisham? Is it because of careful planning? Dumb luck? Some mystical Teutonic gene? Or could it be a Kultur thing?

2.
Buchladen, a small shop on the north side of Cologne, is as good a place as any to begin searching for answers. It doesn’t look like much from the street – green awning, small display window – but as soon as you enter the shop you’re stunned by the quality and quantity, the variety and beauty of what’s on the shelves. At the front of the shop are new fiction and history books, in hardcover and paperback, by well-known German authors and numerous Americans in translation, including Philip Roth, Richard Price, Nicole Krauss, Paul Auster, and Richard Powers. In the paperback fiction section, 30 feet of floor-to-ceiling shelves, I found books by David Foster Wallace, Jonathan Safran Foer, Karin Slaughter, Don Winslow, and Elmore Leonard mixed in with German, French, Scottish, Irish, English, and Japanese authors. German readers have catholic tastes. They consume crime novels as hungrily as literary fiction, history, philosophy, erotica, and just about everything else.

One thing you will not find on the shelves at German bookshops, large or small, is that mainstay of big American bookstores – signs announcing steep discounts on current bestsellers. That’s because the cost of all new books in Germany is strictly regulated by something called the Buchpreisbindung, a uniform pricing policy that was adopted voluntarily by booksellers in 1888 and became national law in 2002. By forcing all stores and on-line vendors to sell new titles at the same price, the law is, obviously, a boon to small stores that can’t compete with the volume purchasing of the big chains and online giants like Amazon.de and Buch.de.

“The idea [of the Buchpreisbindung] was to eliminate price competition in order to promote the sale of little-known books,” says Simone Thelen, spokeswoman for the Mayersche chain, which was founded in the 19th century and now has 49 stores, mostly in the state of North Rhine Westphalia. “It makes it possible for publishers to publish a variety of books and authors, and it gives us the chance to promote young, unknown authors and books that are not blockbusters.”

This seemingly counter-intuitive strategy – protecting books by keeping them expensive – is actually in line with much of what goes on in Germany today. The country enjoys the healthiest economy in Europe, rising employment, a balanced budget, and an enviable trade surplus not in spite of, but because of, its well-paid workers and their vast network of social services, including universal (that is, mandatory) health care, plus at least four weeks of paid vacation and in some cases more than seven. It makes perfect sense to prosperous, book-loving Germans to pay a fair, strictly regulated price for new books because they believe that the health of the book industry – that is, of publishers, booksellers, and writers, from famous to unknown – is vital to the health of the whole society.

The idea of the government regulating the price of consumer goods is anathema to most Americans, who have bought into free-market gospel and the Walmart mantra that price is everything, and lower is always better than higher. It comes as no surprise, then, that many Americans are wailing about the coming cost of universal health care, our onerous tax rate (among the lowest in the industrialized world), and the need to trim the federal deficit by slashing government spending while preserving tax breaks for the rich. And yet, as the Borders debacle illustrates, allowing booksellers in America to set prices anywhere they choose is no guarantee that even the biggest fish will survive. Pity the vanishing small fry.

Marion Krefting, a sales clerk at Buchladen for the past 13 years, is, like most Germans, widely read, fluent in English, and addicted to foreign travel. Krefting happens to be in love with Australia, which she first visited in the late 1970s and has revisited many times since, most recently two years ago. In Australia she saw first-hand what happens when the government stops regulating the price of books and lets market forces do the job. “The first time I visited Australia, about 35 years ago, they had regulated pricing like we do,” she told me. “When I went back a few years later they had stopped it. What happened was that the bestsellers became cheaper, everything else became more expensive, and there was less variety.” And now the predictable kicker: “The little bookshops don’t exist anymore.”

Australia’s experience is not unique. After price regulation ended in England, the price of books rose by 8 percent; and when it ended in Sweden, one out of four bookstores went out of business. Always willing to go against the grain, the Swiss, who do not now have a book pricing law, are talking about instituting one.

Krefting, the daughter of a bookseller, is a fan of such writers as Tad Williams, Elizabeth George, and William Boyd. But her great love is children’s books, and she points with pride to her personal fief, the large, colorful section devoted to children’s books at the back of Buchladen. When a customer comes in and asks for an appropriate book for a 6-year-old girl, Krefting steers her to a book called Rita das Raubschaf. She gives the customer a concise synopsis of the plot – it’s about a sheep named Rita who gets bored chewing grass and runs off to become a pirate – along with her enthusiastic personal endorsement. The customer buys the book without hesitation. Such crisp professionalism is the norm in German bookstores because clerks are required to study for several years – literature, accounting, and the mechanics of the book business – then pass a standardized exam before they can become certified booksellers. In DIY, blue-sky, go-for-it America, such rigid standards are almost unthinkable. Which is not to say there are no knowledgeable booksellers in the U.S. There are many, of course. It’s just that Americans hope to find knowledgeable employees when they go to a bookstore, while Germans insist on it. To Krefting, the German way makes perfect sense. “This is not a job, it’s a profession I love,” she says. “The pay is not good, the hours are terrible, but I just love books.”

covercoverAt a nearby shop called Agnes Buchhandlung, the display window contains copies, in German translation, of Gary Shteyngart’s Super Sad True Love Story, Lorrie Moore’s A Gate at the Stairs, and Salman Rushdie’s Luka and the Fire of Life. The owner, Uli Ormanns, leaves no doubt about the importance of the Buchpreisbindung for small shops like his. “It’s absolutely critical to our survival,” he says. Another thing that helps, he adds, is the national network of book warehouses and its shipping system. “Of the one million books available in Germany, we can order 400,000 of them overnight, just like the big chain stores,” Ormanns says. “Other books, like textbooks, technical books, university presses – which are not a big part of our business – we can get in a week.” He then leads me to the corner of the shop devoted to books – in English – by American and British authors. Particularly popular with Agnes Buchhandlung’s customers are Stephenie Meyer, Philip Roth, Paul Auster, and Jonathan Franzen. “It’s a small part of our business,” Ormanns says, “but more and more customers are asking for American and English authors in English, usually after they’ve read the book in German.”

Catherine Brull, a native of Belgium who has worked in the shop for seven years, is getting ready to crack open her new copy of Super Sad True Love Story, which is priced at 19.95 euros, about $28, including tax. (The sales tax on books in Germany is 7 percent, compared with 19 percent for most consumer goods.) “The German people like the American way of writing,” Brull says. “Sometimes the German authors aren’t easy to read. They have a heavy heritage – Grass, Mann, Boll – and they’re always thinking about that.”

Discounted books are not unheard-of in Germany. When I walked into the venerable Buchhandlung Walther Koenig in the heart of Cologne, I was greeted by a large table festooned with high-quality art books reduced in price by as much as 75 percent. There are four ways sellers can make such sharp price cuts: if the book is used, if it’s damaged, if it was imported from a country without a Buchpreisbindung, or if the sales are so slow after 18 months that the publisher declares it a “remainder,” thus freeing stores to set their own price. The effect of the rule is that large chain stores tend to offer remaindered books at sharp discounts, which smaller stores rarely try to match. Similarly, there are no price rules on audio books, and therefore it’s almost impossible to find them at small shops. The prices of e-books, which currently account for less than 1 percent of all book sales in Germany, are regulated by the Buchpreisbindung.

3.
coverWhich brings us, finally, inevitably, to the elephant in the middle of the bookshop. I’m talking of course about the differences in reading habits between Americans and Germans – or, to be a bit more broad, between Americans and most of the rest of the civilized world. Simply put, one of the major reasons Germany has a healthy book publishing industry, beyond its pricing law, is because Germans (like the English, the Irish, the Japanese, the French, and many other nationalities) tend to read more, and more seriously, than Americans. I can’t cite statistics to prove this, but after traveling much of the world I know in my bones that it’s true. I became convinced of it the day I boarded an airplane in Dusseldorf and sat next to a perfectly typical German hausfrau who spent the flight devouring Foucault’s Pendulum by Umberto Eco, a novel that has defeated me every time I’ve tried to read it. I remember thinking: Germans are different.

“It’s true that the tradition of reading is very deep-rooted in German culture,” says Michael Roesler-Graichen, an editor at the magazine put out by the Borsenverein, the national society of publishers and booksellers based in Frankfurt. “It’s not the whole population. The so-called higher literature, or belles lettres, is read by a small percentage. But it’s a very vital tradition.”

In 2007 an Association of American Publishers (AAP) survey revealed that one in four Americans did not read a single book – not one book – the previous year. Things seem to have improved since hitting that nowhere-to-go-but-up nadir. In 2009 the National Endowment for the Arts reported that the number of Americans reading literature (novels, short stories, poems, and plays) had increased for the first time since 1982. And this summer a joint survey by the AAP and the Book Industry Group revealed that American publishers’ net sales rose by 5.6 percent from 2008 to 2010, thanks to surging sales of e-books as well as juvenile and adult fiction. Much is now being made of the ascendancy of e-books and the boost they’re giving to the American book industry. I say hooray. But I’m inclined to wonder if this ramping-up of e-reader and e-book sales is an indicator that Americans are suddenly reading more. I suspect they’re merely downloading more. I hope I’m wrong. Time will tell.

None of this is to suggest that the German system of selling books could or should be transplanted wholesale to the United States. Nor is it to imply that all Germans are better-read and better-educated than all Americans. Roesler-Graichen, the editor, is happy to set the record straight on that score. “Whenever I visit America, people say, ‘Oh, you Germans are so well educated, you’re so well read,'” he says. Then, with a laugh, he adds, “I have to tell them it’s not true of all Germans.”

He’s right, of course. But there can be no denying that books occupy a special place in the life of Germany, the country that gave us the printed book. Thelen, the spokeswoman for the Mayersche chain, sums that place up nicely. “Books are not just a commodity here,” she says. “They have a cultural value that has to be saved.”

So in the end, yes, it’s a culture thing.

 

Image credit: chascarper/Flickr





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33 Responses to “The German Solution: Saving Books by Keeping Them Expensive”

  1. malcolm neil
    at 8:02 am on September 13, 2011

    An interesting piece with an error. In Australia the small stores maintained their market share after the abolition of fixed pricing in 1972 and ultimately nearly 40 years later it is the discounters that have closed there are probably more small stores than ever before.

    That is no reason for complacency or smugness however as the market is under threat of contraction, and that is the real issue.. fewer people are using their discretionary spend on the humble book.

    This is exacerbated by high prices at RRP (set by publishers not retailers ) and the capacity of companies with favorable exchange rates to compete on price online (read Amazon and their recent purchase Book Depository)

    Book prices at RRP in this country have been high in international terms before and after the abolition. It’s a nonsense that protecting the the profits of what were almost all exclusively International publishers back in 1972 kept the prices down. It remains a nonsense now.

  2. walfischbucht
    at 8:14 am on September 13, 2011

    Very interesting and well written view from the outside, highlighting the situation over here. Thanks!

    It’s certainly true: While hampering the advent of ebooks in Germany, the Buchpreisbindung is – for the time being – saving the smaller bookstores from sudden decline. Mind you: Times are getting harder and harder for the small shops here, too, even without the rise of ebooks and ereaders. And many had to strike sail during the last years already.

    Regards A.B.

    (An addendum by the way: If the nice vintage postcard (presumably from the late 60’ies) is there to illustrate Cologne, you are mistaken. It’s the Minster at Bonn.)

  3. VA
    at 10:54 am on September 13, 2011

    Bill Morris is a f**king genius.

  4. A Lesson in Bookselling from Germany. « onebookontheshelf
    at 11:04 am on September 13, 2011

    […] Waterstone’s announcing that they are abandoning the 3 for 2 offer, Bill Morris’ article on the German book industry’s pricing policy, (called Buchpreisbindung) is timely. The piece […]

  5. Katrin
    at 1:58 pm on September 13, 2011

    I live in Germany and Mr. Morris did a great job describing the situation here.
    Great essay – very insightful. We have to realize that some things are worth preserving — and paying for!

  6. Marianne Schaefer
    at 3:07 pm on September 13, 2011

    Nice that an outsider can have these insights into the German culture of books and reading. As a German living in New York, I would even go so far as to say Germany is in general a more enlightened country than America – may it be recycling, health insurance, taxing the rich. All Germans believe in evolution, pay a lot for gas… you name it …., but then, why is life in barbaric America so much more interesting than life in Germany?

  7. Verena
    at 3:25 pm on September 13, 2011

    Thank you very very much for this article, because we Germans are also very good at whining, especially the booksellers!

    But it is not true that only because the publisher fixes the price, it has to be expensive. They just do what a bookseller would do in the US: Calculating what price the consumer would be willing to pay and how they can still make a profit (remember: The Euro is more worth than the Dollar, so simply converting makes the books look more expensive than they actually are)
    The problem is, although it is illegal, they sell their books cheaper to the big chain-stores than to the smaller ones. So although the reader pays the same price, not all booksellers earn the same.

  8. DN
    at 4:10 pm on September 13, 2011

    ‘The German Solution’? Certainly has an uncomfortable ring of familiarity, no?

  9. Marianne Schaefer
    at 5:13 pm on September 13, 2011

    DN, you should be ashamed of yourself!!! You are really low!

  10. Steve Fahnestalk
    at 7:56 pm on September 13, 2011

    It’s “Stephenie” Meyer. I’m surprised that there’s no copyediting in this article, apparently.

  11. C. Max Magee
    at 9:22 pm on September 13, 2011

    Steve: Fixed, Thanks

  12. Axel
    at 6:29 am on September 14, 2011

    Hey Bill,

    as a born inhabitant of Cologne I am deeply deeply hurt that you didn’t visit our famous “Dom” i.e. the gothic cathedral ;)

    If you ever think of a new article maybe you should investigate on the people of Cologne and their relationship to the Dom, Karneval and how to avoid the law the “legal” way (called “Klüngel” – but that’s a whole different story)

    Apart from the first sentence it was very interesting to read

    Thumbs up

    Axel

  13. Égide Méon
    at 9:37 am on September 14, 2011

    Unfortunately, publishing in Germany goes wrong.

    As in others countries in Europe, people acquires less and less books.
    Pricing is obviously higher than the reality of market.

    Others cultural goods offers more attractiveness for the customers than books.

    We can observe the part of books in household spending has decreased hugely (divided by three) during the last years.

    Law of a single price for each book was not ordered for having an luxury market of expensive items but only to give a chance for little shops in downtown to survive at the competition with retail markets biggest companies.

    At the end, publishers have commit suicide because of an excessively high pricing.

    Really sorry to break down your dream.

  14. Holger Ehling
    at 11:32 am on September 14, 2011

    A very well reserached and very well written piece – thank you for that.
    It is indeed a wonderous thing, at least to Neoliberals, that what they would call a price fixing cartel serves to benefit everyone involved: The retailers, producers, authors and readres alike.
    One of the commentators said that publishers sell their books at higher discounts to larger retailers. This is not quite so: The German law on retail price maintenace (rpm) allows a certain leeway, but not in a way that would allow the big guys to outgun the smaller competition. Where we see marked differences is in the marketing spending: the big retailers demand and get hefty fees for preferred display locations within the shops.
    Prices have not risen too far over the past 30 years, the period over which I have been involved in the trade, Hardcover fiction hardly ever goes beyond 25 Euros, quality paperback sticks around the 19 Euro mark, mass market sometimes,but not often breaks beyond 12 Euros.
    Over this period, inflation has outpaced book prices quite severely – in fact, books today are relatively cheaper than they were 10, 15 years ago.
    Rpm has also been beneficial in that it has kept the huge retail conglomerates out of the book trade: the German brothers of Walmart or Tesco cannot lure people into their outlets by using books as loss leaders.
    Another commentator said that reading has shrunk as an activity in Germany – this is not borne out by the data. Yes, people have migrated in some ways towards the internet and TV, but reading has been staying in the top 10 leisure activities for donkey’s years and there is no reason to believe this will change dramatically.
    As for eBooks: It is not rpm that slows down the adoption of electronic reading – it is the relatively small number of titles available (approx. 80.000) , combined with a certain cultural conservatism, that has limited the rush to buy eReaders and eBooks. Currently the maket hovers around 1 per cent. I do read eBooks and find it a pleasant experience, but I do not think that eBooks have an intrinsic value that would oblige us to switch from paper to screen.
    As for my compatriot living in New York and asking why life in the US is so much more interesting than life in Germany: Since when has New York been associated with life in the USA? Have you ever tried the flyover states? Bad Berleburg is a heaving thrill of a metropolis compared to Red Dust Flats, Iowa…
    And a last comment for our friend harping on about the “German Solution” – Get a Life, saddo!

  15. Marianne Schaefer
    at 1:17 pm on September 14, 2011

    Hi Holger, well, you got a point about the rest of the USA = everything outside of NYC. I guess I have been around in this country quite a bit. And yes, “outside” it’s just very astonishing. I have not been to Bad Berleburg though. But I have recently visited a very backward family in the Bavarian Woods, no internet or smart phones and such. But they did believe in evolution. AND they were reading books!!!

  16. C. Max Magee
    at 2:00 pm on September 14, 2011

    By popular demand, the image accompanying this article is now the Cologne cathedral. Enjoy.

  17. Axel
    at 2:28 pm on September 14, 2011

    … awsome whish I had this view from my living room

  18. 1. READ. LOOK. THINK. | Jessica Stanley.
    at 7:11 am on September 15, 2011

    […] The German solution: saving books by keeping them expensive | The Millions […]

  19. Helmut Schwarzer
    at 4:19 pm on September 15, 2011

    So – you’ve seen one gothic cathedral, you’ve seen them all, eh? Well, you must be a quintessential fool. The German publishing industry..so robust, so stable? Ask the smaller presses and publishers of literary merit, those that don’t derive their profits from translating bestsellers, and you will hear an utterly different story.

  20. Vom Wert der Dinge. « Ninette Halbbluthobbit
    at 5:02 pm on September 15, 2011

    […] The German Solution: Saving Books By Keep Them Expensive Bill Morris von The Millions hat Köln besucht, die Stadt mit den zahllosen Buchläden, und hat sich einen Eindruck verschafft, wie es um die Lesekultur in Deutschland so bestellt ist. How do the Germans do it? When a huge, once-mighty book-selling chain like Borders is going down in flames across the Atlantic, how do the Germans manage to keep their book publishing industry so diverse, so robust, so stable? How do booksellers consistently turn a profit on everything from Goethe to Grass to Grisham? Is it because of careful planning? Dumb luck? Some mystical Teutonic gene? Or could it be a Kultur thing? […]

  21. Bill Morris
    at 9:46 am on September 16, 2011

    Herr Helmut Schwarzer,
    It’s entirely possible that I’m a quintessential fool, or maybe my subtle American wit is lost on you. When I wrote “you’ve seen one Gothic cathedral, you’ve seen them all,” I was taking a dig at Ronald Reagan, who, when he was governor of California, remarked, “You’ve seen one redwood tree, you’ve seen them all.” Sorry if my attempt at irony got lost in translation.

    On a more serious note, I did talk to smaller presses and publishers of literary merit in Germany who don’t derive their profits from translating bestsellers, including venerable Taschen Books in Cologne, and the story I heard was the story I wrote. Maybe you known something I don’t know, or maybe we’ll have to agree to disagree. At any rate, Vielen Dank, dass Sie The Millions lesen. Please keep reading!

  22. Cologne Book City
    at 10:46 am on September 16, 2011

    […] Das zumindest ist die beruhigende Erkenntnis des Amerikaners Bill Morris. Am Beispiel Kölns hat er für das Online-Kulturmagazin The Millions den deutschen Buchmarkt analysiert. Buchladen, Bild: Kristina D.C. Hoeppner via Flickr (CC BY-SA […]

  23. Jeremy
    at 12:40 pm on September 16, 2011

    As an American who buys only a handful of books a year but devours library books, I would have liked to see some comparison between public library systems in Germany and the U.S. Can anyone speak to the similarities and differences and how those impact the respective reading cultures in each country?

  24. Bookish news and publishing tidbits 19 September 2011 | Read in a Single Sitting - Book reviews and new books
    at 5:19 pm on September 18, 2011

    […] The German Solution: Saving Books by Keeping Them Expensive […]

  25. Leslee Johnson
    at 11:37 am on September 19, 2011

    Wonderful article and a great discussion. While a wholesale adoption of the price regulation of books may not fly in America, I certainly wish we could take a page (so to speak) from Germany and figure out ways to honor and support young authors and independent booksellers.

    Also, I just happened to come across a book published by Taschen Books (here in North Carolina, no less – it was Walton Ford, the artist) and it was an quite an experience. Could be a whole new revolution in publishing (and an end run around the ebook) if books (from novels to cookbooks) resembled works of art more than they do now.

    Thanks for your words, Mr. Morris.

  26. What we are reading « imadvertising
    at 2:43 am on September 21, 2011

    […] The German solution: saving books by keeping them expensive | The Millions […]

  27. Tina Guleria
    at 3:11 am on September 21, 2011

    As another German stumbling upon this very interesting article, which so nicely documents what is wrong with an all-out capitalism in America, I would like to apologize for the harsh words of fellow countryman Mr. Schwarzer. An unfortunate case of German rudeness that can only be pardoned by his obvious passion for the print industry and frustration with the way things are going. After all he does have a point. However, he should have never ever called you a fool, of course!!!! Thanks for treating him so civil in spite of it.
    On the other hand, yes, the “seen one, seen them all” comment was probably lost on most of us (Reagan after all has been dead for some time, and our memories are so short) and did sound like the typical “uncultured” thing an American would say. The Koelner Dom really is spectacular :-) But it made for a good introductory sentence, I guess. It was nice to see this cultural comparison, because Americans seem so rarely able to admit that things are better elsewhere indeed (god’s own country and all that ….) They sure are, but as a German-American I too bemoan the demise of Borders. Best wishes!

  28. Tina Guleria
    at 3:19 am on September 21, 2011

    You may not be aware of the term “German Solution” as it was used during World War II. It referred to the “Final Solution” of annihilation of the Jews. Hence, DM here was a bit perturbed.

  29. David Newton
    at 9:34 am on September 27, 2011

    Where did you get this guy Morris? He’s all over the place. and insightful as hell with the research to back it up. Thanks for the journey into the Tutonic style, something we “Amerukans”would do well to immulate, if we could dial down the gagetnalia of our quotidian rat race.
    thanks.

  30. Felix
    at 9:31 pm on October 9, 2011

    Nice work Mr. Morris. Now how about moving on to China and letting us know how the bookish world is there.
    And then maybe the Arab world: I understand Naguib Mafuz (sp?) more or less invented fiction in Egypt a few years ago. I guess I should say Egyptian fiction.

  31. Snippets « Words and Herbs
    at 12:14 am on October 18, 2011

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  32. Max
    at 7:10 pm on May 20, 2012

    The “net book agreement” was abolished in the UK in the late 90s for a reason. In fact even despite the demise of the NBA, the volume of newly published books has risen continuously in the UK.

    With today’s increased competition from online retailers and e-books, many Germans turn to book shops from other European countries such as Book Depository (UK) or Amazon.co.uk where they are not ripped off but enjoy discounts of up to 25%.

    If “it’s a culture thing” simply means that protecting certain retailers by law is supposedly more important than making books and education in total more affordable, well, then… Funnily it’s not even the small retailer or the publisher that’s profiting most from the

  33. Max
    at 7:12 pm on May 20, 2012

    (continued)
    fixed book price law, but the big chains! Big chains do receive discounts from publishers which is not prohibited by fixed book price agreements or laws. So it’s actually a very poorly implemented subsidy that privileges select few.

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