Small Business Minister Nick Sherry labelled “irresponsible” for saying book chains will be dead in five years: Retailers

Small Business Minister Nick Sherry has shocked retailers by tipping general bookstores outside the capital cities will disappear within five years.

Jon Page, of Pages and Pages Booksellers in Mosman, describes the prediction as irresponsible.

“For the Minister for Small Business, who’s supposed to be looking after small business, to ridicule a sector and say it won’t be around in five years, it’s pretty irresponsible,” Page told SmartCompany this morning.

Page, who is also the president of the 800-strong Australian Booksellers Association, says Australian booksellers have had a good decade, despite a contraction in 2010, and things were starting to look up again.

While the stronger Australian dollar and the higher savings rate among consumers are pressuring the industry, Page says it was ignorant for Senator Sherry to suggest the industry is not tackling these challenges.

Peter Strong, book shop owner and executive director of the Council of Small Business of Australia, says bookshops, including those in regional areas, are embracing the challenges presented by rising online sales and a shift to eBooks.

“We will have a decrease in bricks and mortar, but nobody knows what that means,” says Strong, who is also director at Smiths Alternative Bookshop.

“Plenty of people still love their bookshops and love dealing with human beings.”

Daniel Jordon, the managing director of Collins Booksellers, says the comments demonstrated a lack of understanding about retail, in particular bookselling.

“To assume that bricks and mortar retailing won’t exist in five years is just plain wrong,” Jordon says.

“There’s no doubt there will be significant change in book retailing, but to say that consumers won’t be frequenting well-run stores with knowledgeable staff is fanciful.”

Senator Sherry told a Canberra audience yesterday, “I think in five years, other than a few specialist booksellers in capital cities we will not see a bookstore, they will cease to exist.”

After the event, Sherry told SmartCompany that “bricks and mortar bookshops and book printers around the world are feeling the pressure of the changing environment more than any other part of the supply chain.”

“Book retailing in particular is feeling the presence of large international organisations in the Australian market through online sales.”

“Bookshops – like many other businesses – will have to adapt to the new digital reality and will no longer be bookshops as we have grown to know them.”

“Many bookshops are being proactive by building their capacity to sell online and to sell eBooks.”

His comments follow the collapse of Australia’s biggest bookseller, REDGroup Retail, which owned Borders and Angus & Robertson.

While all of the Borders stores have been earmarked for closure, after Ferrier Hodgson failed to find a buyer for the business, no announcement has been made yet on the company-owned A&R stores.

Bruce Billson, the Shadow Minister for Small Business, called Sherry a “prophet of doom”.

“Rather than get behind retailers at a time when consumer confidence in being battered by cost of living pressures and erratic Labor government policy, the minister charged with supporting small business chooses to sink the boot in.”

“This insulting and damaging attitude reflects the Gillard Government’s disinterest in the fate of small business and is yet another example of a Minister who is more of an adversary than ally to small business and family enterprises,” Billson said this morning.

“Senator Sherry’s defeatist and demoralising commentary adds insult to the injury of his lack of support for retailing as small business adapts and innovates to respond to market trends and difficult trading conditions.”

Don Grover, head of Dymocks, told SmartCompany it was “bizarre” for Senator Sherry to predict the demise of bricks and mortar booksellers.

“He’s out of the touch with the consumer, who love physical books and being able to shop in stores, as well as enjoying the convenience of online sales,” Grover says.

Grover, who says Dymocks is likely to increase its market share from about 15% on the back of the REDGroup Retail collapse, says the book industry is under pressure.

He argues the Government needs to look at parallel importation laws and GST payable on online purchases, rather than dismissing the industry.