The feasibility of getting books into South African supermarkets
Thesis (MBA)--Stellenbosch University, 2012.
The book industry in South Africa is under severe pressure the last couple of years. The reason why the book industry in South Africa is under severe pressure is because of various reasons; one of the reasons is that the South African Government is spending less each year on education, specifically on school text books. As per the Willem Struik (2009) during the SABA conference in Durban, government has spend by more than 87% less on school text books. There is a further challenge for Publishers in order to generate more sales and that is that digitalization has a big impact on the turnover of publishers. The study is not doing an in-depth research on digitalisation and the impact thereof. The biggest impact that digitalisation has on the book industry and specific to publishers is that the gross profit is less for a digital book than a physical book. The main reason why the gross profit (GP) is less for a digital book is because all input costs remain the same for a digital and physical book, it is only the logistics where there is a cost saving (no more warehousing and physical distribution). The study analysis the potential additional revenue there is for publishers if they were to decide to supply to Supermarkets and not to the traditional book outlets only. The study as per Appendix A clearly indicates that there is definitely more revenue for the publishers to make if they were to supply books to supermarkets. The study also identifies that there are basically four role players in the business concept of supplying books to supermarkets and they are the publisher, retailer, logistics company and the end-consumer. The study indicates that in order for the business concept of supplying books to supermarkets to be successful all four role players have to believe in this concept and agree on the terms conditions from the various parties.