Today’s post is very very close to my heart. I had thought of writing this yesterday and posting on the occasion of the International Book Day, but it didn’t happen. It was Nyepi, the Balinese Hindu holy day and a national holiday here. With a hovering preschooler and equally hovering (and towering in his calls for attention to x-y-z things that I supposedly neglect) husband, who could find a few minutes to write? Not I!
Actually, its more than a few minutes because I cannot let go of the topic at hand without doing some research here. Also, I got to know that there are 2 different dates when the international book day is celebrated which took away the thunder of yesterday anyway 😉
The topic at hand is exploring the possible reasons why books are so expensive in Indonesia. Some examples in this regard-
I remember very well, the YA novel ‘The Fault in Our Stars’ became popular in Indonesia around the release of its movie somewhere in mid-2014. The popular book-stores Gramedia and Periplus were displaying its copies everywhere. I haven’t read the novel but I used to follow John and Hank Green, aka the vlog brothers on YouTube back then so I was aware how popular this book was. To say I was shocked to know the price is an understatement. I am sure, the price back then was upwards of IDR 300,000, which is INR 1500. About US$ 21. I came to India for a vacation in May 2015 and noticed the same novel everywhere in similar displays at Crossword and other book shops in India. The price – INR 300, which is IDR 60,000 approximately and US$ 4.29! This kind of 5x price difference was astounding!
Cut to today, when I have to purchase books, I tend to compare Amazon.in and Bookdepository.com for the price difference. Just today, I compared ‘The Fault in Our Stars’ again. The paperback is priced on Amazon.in at INR 193, which is close to IDR 40,000. That’s US$2.75. On book depository, it’s selling for a discount of 40% (!!) for IDR 152,000. That’s INR 744. Meaning US$10.6. This amount is at least acceptable. Interestingly, on Amazon.com itself, the paperback is retailing at US$7.59. This means its cheaper to buy this book in India than in the country where it was written! More on this later.
I compared one more book – ‘The paper dolls’ by Julia Donaldson today. The price on Amazon.co.uk (since it is originally a UK book) is GBP 3.99-i.e INR 365.6 and IDR 74,800. This is selling on Amazon.in for INR 280 (GBP 3 and IDR 57,260). On the book depository, it is selling at a discount of 26% (!) for IDR 134,000 (INR 655 and GBP 7), again making an extremely compelling case for purchase in India.
Not that I was expecting ‘at par’ pricing! Definitely, there will be differences. The most important reason being the existence of the ‘South Asian Edition’:
SA editions are the absolutely legal versions of the original work published in local printing presses in India, under copyright and licensing from the foreign publishers. Cheap local labor means cheaper paper and overall inputs. Also, this paper is of a lower quality since its not export grade. This ultimately translates into cheaper books for the readers. I think students are the best beneficiaries of the phenomenon, going by this question on Quora. In India, given the fact that most of the higher education happens in English, the English readership is considerable- definitely when compared to Indonesia. As a result, demand is higher. Also given the extremely price sensitive market and rampant piracy, it is more sensible on the part of a publisher to license out the printing for local edition. These editions are not saleable outside the subcontinent. Though nothing prevents you from buying these when in India and then returning to your university. It is perfectly legal. A standard practice among the Indian students studying abroad I bet!
I am a big fan of the ‘South Asian Editions’ ever since I noticed the price differences for the first time during my MBA days. I remember my ‘S A edition’ of Philip Kotler’s Marketing Management very well, against the one I borrowed from the library. Clearly, there was a difference in the paper quality etc. But the content was the same. It didn’t matter. For sure I didn’t look upon Kotler as a collectible book anyway. I think the first example of the Fault in Our Stars falls in this bracket. Since the publisher Penguin is also a big publisher in India. So is Bloomsbury who printed Harry Potter books. Out of curiosity, I just searched and realized that all of the big six publishers are operational in India. Most of them have India specific websites. They get the books printed locally.
In comparison, a simple google search did not lead to any information on the presence of the big six in Indonesia. Most publications are done by local players and independent publishers. Kompas Gramedia group is the biggest publisher; but since their publication arm is not listed, much of the data is not available on the public domain.
Why the foreign publishers are not in the Indonesian market is clear – and a topic for another (even more detailed) post.
This is something I wondered for those books that are definitely not printed in India and still are sold for a cheaper price in India. For example, an Usborne Phonics Reader title ‘Snail Brings the Mail’ costs INR 134 on Amazon India. Same costs GBP 5.18 in the UK and IDR 117000 (at 25% discount ahem …ahem) on Book Depository. Since we own a copy of this book, we know that the paperback has been printed in China. The high cost in the UK which is the home of Usborne publications – probably implies import duty? However, what is notable is that in Indonesia its cost is still 4x more than in India. Keeping the import duty part aside, sheer numbers with respect to demand for this particular title are likely to be higher in India than the UK or Indonesia. Which might lead to sales discounts.
Finally coming to duty structure. I confirmed that:
Import duty on books is nil in Indonesia. It can attract VAT of 10%. Which means on a book with the CIF value of USD 100, a duty of USD 10 is likely to be imposed presently. As per my information, no other duty should be charged.
As per this form, a book with of CIF value USD 100, will attract a duty of USD 14.86 in India.
This adds rather than solves to the conundrum because higher duty in India does not explain lower costs of books in India as compared to Indonesia, that too, lower by 4-5x. Reasons could be anybody’s guesses:
Low demand for imported English books in Indonesia. Translates into lower price elasticity. Thus its a sellers market and they are trying to milk it.
India is a very price sensitive market. Good demand means economies of scale possible. Bulk discounts possible and it is possible to be profitable despite selling at low prices.
Unfortunately, up to date data is not available on the printing and publication industries in both the countries. It would have been interesting to compare the profitability of these publishers /sellers to know more.
Hopefully, I will stay interested in this topic to update more!