In all truth, the only part of the article that I'm interested in is the last two paragraphs, which are included almost as a throwaway:
UK supermarket Asda has announced it will sell the book for £5 - just over a quarter of the recommended retail price [of £17.99].
Bloomsbury had originally cancelled Asda's order, with the supermarket calling the price "potty" and accusing the retailer of "blatant profiteering".
Given current exchange rates, the UK recommended retail price is roughly the same as the US cover price of $34.99, and Asda is selling the book for the equivalent of $10.
As an old bookstore employee and assistant manager, I'm interested in what people are selling Harry Potter for. Both my bookstore and the local branch of B&N are selling the book for $20.99. Amazon is selling for $17.99.
Standard retail markup, as many of you know, is 100%. Thus you can fairly safely assume that when you buy an item at full retail price that whoever is selling it to you bought it for half the price that you're paying. Books are an exception to that rule because bookstores have the ability, in most cases, to return unsold books to the publisher for a full credit of the invoice price. Because bookstores bear less of the risk, they keep less of the profit—generally 30-40% as opposed to the 50% of a standard retail sale.
Now of course, the power of the market plays a role. Thus, large single-item buyers like the big box stores (read: Wal-Mart, Costco, Target, etc.) can negotiate a better price from the publisher and offer deeper discounts. I don't shop at Wal-Mart, so I don't know what they're charging for HP7, but word from Target was that their price was closer to Amazon's than my bookstore's.
The kicker is that my amateur reporting indicates that my local bookstore, even at $20.99, is making about six cents on every copy sold. You read that right. Six cents.
This is a continuing frustration for independents and even small chains; while no one (except Scholastic and JKR) are making much money off Harry Potter (and other similar headline-grabbing titles), customer perception is often that the store selling for $20.99 is either greedy or gouging. I understand the benefits of retailers who can take advantage of market efficiencies. I just wish that people wouldn't take it personally when my market isn't as efficient as someone else's. We can't all be Wal-Mart, and, in the end, I think that's a good thing too.
Wal-Mart never has the new Rick Moody title I'm looking for. :-)