Coronavirus Covid19 & Books & Publishing – In What Ways might Coronavirus affect Books & Publishing?

Firstly, let’s consider the three scenarios

1. Best Case – Covid19 dies out pretty quickly. China, Korea, Japan, and Italy’s attempts to control it are successful. It doesn’t reach and spread in high risk places like India and Africa. A vaccine is developed by summer. Most of the people of the world get vaccinated against it. Covid19 does not mutate
2. Bad Case – Covid19 keeps spreading and we have a small level pandemic. A few million people are affected. 1% to 2% die. Covid19 spreads to quite a few countries. However, there is not a very large pandemic anywhere. It stays away from high risk countries like India and African countries. Covid19 does not mutate. A vaccine is developed within a year. Most of the people of the world get vaccinated against Covid19
3. Really Bad Case – Covid19 spreads wildly and become a world wide pandemic. We get 2 or more of the following
   1. Over 10 million people are affected
   2. Over 100,000 people die
   3. Covid19 mutates
   4. No vaccine in the next 1.5 years
   5. High risk countries such as India, China, African countries, Indonesia, Pakistan start seeing wide spread of Covid19

We should all hope and pray we don’t see the Really Bad Case

Obviously, if we get the Best Case then everything is fine and it doesn’t affect Books and Publishing much at all

However, it is becoming evident that the Best Case scenario is not the most likely

In fact, currently there is a dangerously high probability that we get the Bad Case, or the Really Bad Case. Let’s consider these two scenarios

The Bad Case – How will Covid19 Coronavirus Mini Pandemic affect Books & Publishing

If Covid19 keeps spreading and we have a small level pandemic, we would see many, many countries and many businesses affected. Let’s consider all the ways in which Books & Publishing would be affected

1. Most bookstores would be closed down, usually for months. Book sales would plummet
   1. To give you an idea of how drastic the impact can be, car sales in China fell by 92% in February 2020
2. Device sales would fall, as would device supplies, as most device manufacturing countries would be affected
   1. So there would be far less people getting phones and tablets and ereaders
   2. That would lead to a big drop in ebook sales
3. People would be worrying and spending less
   1. Their spending will shift to emergency supplies, protection, and such areas
   2. Their budget for leisure would go to close to zero
4. Though people would have more free time, it is highly unlikely this would lead to more reading of books
   1. Not just because book stores are closed
   2. Not just that devices sales have fallen and there are far fewer new readers
   3. But Also because they would be stressed out and spending their time doing survival preparation and checking the news and planning for contingencies
5. Book Distribution would be drastically affected
   1. No shipping of books anywhere
   2. Suppliers for Paper and other book making materials would not be shipping either
6. A small but significant percentage of authors and people in the Publishing industry would be affected
   1. Hopefully they all make a healthy recovery as the economic impact of Coronavirus might be severe
   2. It would disrupt a lot of work and delay many book releases
7. Most companies, including most Publishing companies, would have to shut their offices for a few months
   1. So almost finished books would not be finished
   2. The number of new books being published by Large Publishers would drop drastically

Covid19 Coronavirus would massively impact books. We might see as much as a 20% to 40% drop in book sales for the year. We might also see 2021 being slow because of all the shortages and delays and come in 10% to 25% lower than expected

While this scenario is really bad, it is nothing compared to what would happen if there is a worldwide pandemic

The Really Bad Case – How will a worldwide Pandemic of Covid19 Coronavirus affect Books & Publishing

If Covid19 spreads wildly and becomes a worldwide pandemic we would see some truly bad things happen

1. Most bookstores would be closed down for 3 to 6 months
   1. Many indie bookstores would go out of business as they would not be able to pay the bills
   2. 75% of Chinese small businesses are at risk of going bankrupt after a couple of months of disruption from Covid19. Unfortunately most small businesses in the western world also operate on precarious margins
   3. If we get a wide scale pandemic, many small businesses in Publishing will go out of business
2. Over 50% of small publishers and small businesses in Publishing would go out of business
   1. The vast majority of Publishers work on small margins
   2. The same is true for most small businesses in Publishing
   3. A prolonged pandemic which kills sales and drastically reduces earnings for 1 to 2 years would take out 50% or more of small businesses
3. Between 20% and 40% of authors would run into financial troubles
   1. While not as at risk as small businesses, many authors are not financially very strong and highly dependent on incoming book revenues
   2. Between 20% to 40% of authors would run into troubles with their bills
4. Device sales would fall drastically
   1. Device sales and ebook sales would fall drastically
   2. Many of the small ebook stores and the smaller device manufacturers would go out of business
5. eBook Sales would drop a lot – by 50% or more
   1. People would not have money to buy ebooks
   2. People would not have money to buy eReaders and Phones and Tablets to read ebooks on
   3. eBook sales would drop by 50% to 75%
6. Book sales would drop by 20% to 40%
   1. With fewer bookstores and financial concerns, readers would be buying far less
   2. It might take 2 to 5 years for book sales to recover to 2019 levels
7. Many book distributors would go out of business, messing up the whole supply chain
   1. A significant portion of book distributors, book printers, and suppliers of paper products would go out of business
   2. This would lead to significant shortages and many distribution problems
8. Reading of books might go down dramatically for a few years
   1. Combine the fact that people would have far less disposable income
   2. With the fact that many people in the book industry would go out of business
      1. Fewer book stores, fewer publishers, fewer authors, fewer publishing businesses
   3. That would result in a decline in reading. A drop of perhaps as much as 20% to 50% of book sales
      1. It might take 1 to 5 years for reading to increase back to 2019 levels
9. A significant percentage of authors and people working in Books & Publishing would be affected
   1. Unfortunately, 1% to 2% of those affected would pass away
   2. Many of those affected would be left greatly weakened and unable to work for the next year or two
   3. There would be significant impact on nearly all businesses in Books & Publishing

We really, really don’t want to see this scenario, as a worldwide pandemic would decimate the Books & Publishing businesses

Many companies, and many authors, work on slim margins, and Covid19 Coronavirus causes great disruptions. If there is a worldwide pandemic we might see sales and revenues for most businesses and authors drop by 30% to 60% for 1 to 2 years. Even after recovering it would take 2 to 5 years for things to return to normal

One thing to keep in mind is

1. After the tech boom of 1998/1999 went bust, it took 14 years before companies regained the same valuation levels
   1. That is companies which survived
   2. Many companies went bankrupt
   3. The general economy went into recession
2. Currently, after 2019’s spurt in stock prices, we are more overpriced and inflated than we were in 1999
   1. We have seen some signs of mini-corrections with things such as the WeWork debacle and the poor showing of new IPOs Uber and Lyft
   2. However, a full scale correction is long overdue
   3. Covid19 Coronavirus, if it becomes a pandemic, would bring everything crashing down

What can you do, if you are in Books & Publishing, and concerned about Covid19 Coronoavirus?

Personally

1. Make sure you keep youself and your family safe and protected
2. Make sure you stock up on enough water for 60 days, set up a water supply, have a means to boil water
3. Make sure you have enough food for 30 to 60 days
4. Avoid travel
5. If Covid19 spreads to your country or region, avoid work and school and college
   1. From China, we know that the Governments will try to get people back to work early, to avoid an economic crash
   2. However, prioritize your own health over the Government’s priorities
6. Avoid anyone who has traveled, or is unwell
7. Definitely avoid anyone showing any symptoms similar to Covid19
8. Avoid large gatherings
9. Avoid small gatherings
10. Minimize the amount of interaction with others
11. Avoid public transportation if you can

Financially

1. If you have enough for 3 or more years of living expenses, that’s very good
   1. Make sure you cut expenses as much as possible and buckle down for a recession
2. If you do not have enough for 3 or more years of living expenses
   1. Start saving as much as you can
   2. Cut expenses to the bare minimum

All the best and hope the contagion of Covid19 does not spread. If it does, hope you and yours stay safe