My guess would be a combination of normal inflationary pressures, especially in the energy required to ship and store books, and the consequence of declining sales due to fragmenting markets. More titles over supply the market. Manufacturing in smaller runs increases the cost per unit so this becomes a downward spiral.
Shipping books has always been expensive in Canada, where the market is 1/10 the size of that in the US, and shipping distances are greater. As noted by Joy, the standard practices in publishing have long been wasteful, producing large runs to drive unit costs down, shipping them to stores, taking returns from stores and storing backlists sometimes for years. The consequence for small presses has been that so much of their capital is tied up in inventory that they have little money to advertise and promote sales. Accepting returns has meant that retailers have no incentive to even attempt to accurately estimate demand for publishers' products, so the problem spirals out of control. It has not been unusual in the past few years for publishers to get back returns that have not even made it out of chain-store warehouses.
Printing can be purchased more cheaply overseas, as you suggest. Canadian publishers have for some time purchased full-colour, coffee-table style books from Asian printers and shipping by boat is still relatively energy efficient, but once they dock in Vancouver, warehousing and road-shipping to and from bookstores becomes the usual expensive mess.
In comparison POD is much more efficient in energy use, and would be even more so if books could be sent electronically to on-demand printers close to the customers (for instance, a file released from, say Toronto, to a printer in Vancouver for 1 book, to Halifax for 1 book, as and where books are ordered.) Manufacturing cost per unit is higher, but distribution is so much less that prices would remain about the same or be even lower. Working against this are standard industry practices and the absence of a system to control the product escaping copyright protection. Of course, e-books are even more efficiently distributed, but we've already discussed the "horrors" of that process.
Because of its cultural importance much of Canadian publishing, especially poetry and fiction, is government subsidized. Governments are reluctant to subsidize foreign printers, however. As a consequence standard industry practice has tended to support inefficient production methods even as digitization has provided some solutions. There does now seem to be a move to change. At last. Offhand, I can't think of any other manufacturing industry that keeps unsold product in warehouses for years, waiting and waiting for it to sell in dribs and drabs, especially after having once already shipped it to dealers.
----- Original Message -----
Sent: Wednesday, December 16, 2009 2:10 PM
Subject: RARA-AVIS: Re: publishing today
From the article:
<<The major publishers are now forced to deal with these other large players on their terms. In a world of shrinking sales and ballooning costs, they've grabbed on to what appears to be a life raft - the celebrity best-seller.>>
Why are the costs ballooning? That would be a good place to start. Is it paper? Transportation? It is certainly not salaries, or author payments.
And if it costs much more to publish a book in the US than in, say, Canada or Mexico, the answer is obvious... there is free commerce between those three and roads that join them.
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