Date:05/01/2009 URL: http://www.thehindubusinessline.com/2009/01/05/stories/2009010551470200.htm

Back Fall in sales of books, diaries

Bindu D. Menon

New Delhi, Jan. 4 Books and diaries are the latest casualty in the slowdown saga. Lower footfalls and fewer corporate orders are impacting the organised retail business, with companies reporting nearly 30 per cent dip in sales.

Most book retailing chains earn parallel revenues from items such as music, DVDs, greeting cards and leather items. However, with consumers tightening purse strings, retailers are feeling the pinch.

“Book sales have not been affected, but diaries and planners are the worst hit. There are no fresh orders and this has been the trend since mid-August,” Mr Himanshu Chakravorti, COO, Landmark Bookstore, said.

Most retail outlets in the organised space operate from malls in area of 1,200 to 40,000 sq ft. The footfalls in malls have been falling; this as well as the fluctuating exchange rates had impacted sales.

Industry observers note that book business suffered when the dollar crossed Rs 50-mark, but things are slowly stabilising and returning to normal.

IT/ITES and FMCG companies, which were major clients for diaries, have drastically reduced their orders.

According to Mr Hemant Seth, Director (Marketing), Srinivasa Fines Arts, which retails the popular Nightingale brand, notes that, “Corporates are axing promotional budgets as a part of cost-cutting drive. This means the spend on diaries and other stationery items had taken hit by at least 15-30 per cent as compared to last year.”

Expansion plans

But major book retailers are going ahead with their expansions in spite of being hit by the lower footfalls.

The sector had been witnessing steady investments with several players in the fray. Players such as Apeejay-promoted Oxford Bookstores, Shopper’s Stop-run Crossword, Trent-owned Landmark and Reliance Retail’s TimeOut have announced expansion plans.

“This is right time to acquire property or lease; real estate prices have dropped from 25-40 per cent in metros and State capitals. We see this as an opportunity to expand our business in term of volume. We are opening pilot stores in secondary cities such as Bhubaneswar besides a large format store in Hyderabad,” an Oxford Bookstore spokesperson said.