Further declines for books

books 2Operators in the book stores industry in Australia have struggled over the past five years, with revenue projected to decline at an annualised 8.3 per cent over the five years through 2014-15, according to an IbisWorld report.

Industry revenue is projected to decline by 5.9 per cent in 2014-15 to reach $2 billion.

Industry conditions have been affected by numerous challenges including lower book prices, tough competition from online retailers and external operators, and a shift in consumer reading habits from print books to e-books.

Declining sales volumes are forecast to continue over the next five years, says IbisWorld. While trading conditions are expected to remain intense due to further competition from internet-based operators and other external players, demand for e-books and e-readers is likely to offset some of the fall in revenue.

The performance of the book stores industry will also be influenced by anticipated changes to parallel import legislation that prohibits booksellers from importing commercial quantities of books if they can be supplied by a local publisher within 14 days of their international release.

IbisWorld industry analyst, Claudia Burgio-Ficca, said the operating landscape for industry players has also been influenced by trends in real household discretionary income, consumer sentiment, the IT and telecommunications adoption rate, and demand for online shopping.

“Expenditure on retail goods has been affected by the global financial crisis, which led to a reduction in consumer sentiment and a drop in discretionary spending, as individuals worried about the stability of the domestic economy,” Burgio-Ficca said.

“Bookstores have also been affected by competition from department stores and online retailers, which have sought to attract and retain larger shares of the market.”

The industry displays a low level of market share concentration. Major players include The Co-op and Dymocks.

For more information, visit IbisWorld’s Book Stores industry in Australia report.

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