DISASTER HIT IN 1995, when book superstores came to Canada and I first met Larry Stevenson. He was a tough-talking, Harvard-educated former paratrooper with no particular love for books: he once mentioned to me that he could have run any other business just as successfully and with a whole lot fewer complaints. With a group of venture capitalists he had taken over Smithbooks, which already owned the Classics chain, then added Coles to create a mega-chain of bookstores across Canada—all with his own brand: Chapters. His strategy, as he explained to those of us still mired in old-world publishing practices, was to modernize the industry. That included building superstores with children’s play areas and coffee outlets on the American model and demanding payments for “placement,” meaning if you wanted your books to be seen, you had to pay extra. What he didn’t mention openly was his intention to replace all independent bookstores with slick marketing and deep discounts on bestsellers at the publishers’ expense. He installed former Ontario premier David Peterson as chair of the board perhaps to distract regulators’ attention from applying the government’s own competition rules.
Larry’s strategy took a couple of years to gel. Meanwhile, he badgered, threatened, and sweet-talked us into staying quiet. The early orders for the new superstores helped to quell our fears. But worse was to come.
In 1995 the Ontario government under Premier Mike Harris cancelled the loan guarantee program that had been Lester Publishing’s main support with its bankers. Not unrelated to that fact, Key Porter’s bank—bankers don’t see books as assets—decided that our operating loan was too generous and our security insufficient. They demanded repayment at about the same time as we had doubled in size. Sadly, after only five years, our partnership with Malcolm ended on a grim note and Lester Publishing was wound up.
Margaret Atwood, having listened to my whining, decided to give us a little gift that could help cheer us up during the bad times. She wrote a hilarious fractured fairy tale: Princess Prunella and the Purple Peanut. Maryann Kovalski illustrated what was, up to then, our most successful kids’ book at home and internationally. Since the book was also a celebration of the letter P, as in “Princess Prunella was proud, prissy and pretty,” she also gave me a P poem to accompany the manuscript. I still have it framed on my office wall:
AttemPting
to Preserve Pretty, Personable
Porter’s Precarious Publishing enterPrize,
Petite Penperson Peggy Propels
Herself Personally right over the toP
And is Pronounced Possibly Potty.
She went on to write Rude Ramsay and the Roaring Radishes, another hilarious alliterative masterpiece, this one about a boy called Ralph. Illustrated by Dušan Petričić, the book enjoyed several printings, with the intrepid Margaret’s reading in libraries and bookstores to oceans of kids and their curious parents. She ended her alliterative kids’ lit project at Key Porter with Bashful Bob and Doleful Dorinda, a particular favourite of my youngest grandchild, Violet.
But I still think the end of the last century was Larry’s, and I still blame us publishers for our acquiescence. In 1999 he named his warehouse and distribution centre Pegasus and announced it was a wholesaler and would, therefore, be entitled to the same discounts we offered to other wholesalers: fifty per cent. Imagining that he was actually interested in my advice, I agreed to go on the Pegasus board. It never met. Unsold book returns from shipments to Chapters hit sixty per cent of sales, and Chapters stopped paying our invoices in anticipation of more returns from future shipments.I By then, whatever collegial relationship we thought we had with Chapters had vanished. That year The Globe and Mail Report on Business declared Larry Stevenson Canada’s “Man of the Year.”
That was also the year I called Larry to tell him that our new Allan Fotheringham book, Last Page First, had been stuck for three weeks somewhere in his commodious warehouse or in the massive tractor-trailers waiting outside, victims of his firm’s growing inability to process its own orders. Since Allan was touring the country, I could assure Larry that he would mention why his books were not in Chapters stores. Larry’s usual belligerent response hit operatic scales: Julian in the next room could hear him shouting at me on the phone. He threatened he would have his staff return every Key Porter book they could find in his stores, his warehouse, or in those trailers. It’s what he did to Lionel Koffler’s Firefly Books, when Lionel refused to give Chapters the terms Larry demanded. Lionel paid for his courage with more than one million dollars’ worth of returned books. Allan MacDougall, another M&S graduate, now running Raincoast Books in Vancouver, was more successful in resisting Larry’s demands, but then Allan had Harry Potter to perform his magic for him. The first two Harry Potter books had sold more than a million copies each in Canada, and the third, Harry Potter and the Prisoner of Azkaban, was released in 1999.
The rest of us were not so brave.
Our bank, generally skittish about granting operating loans to book publishers, moved us to its “watch” list and demanded both personal guarantees and an additional one million dollars of “key person” insurance to keep them onside. I remember the moment one of the young banking executives looked at me and said, jocularly, “At this point, Ms. Porter, you are worth more to us dead than alive.”
Michael de Pencier, who had remained steadfast throughout our struggles, began to suggest that we search for a way out.
I. Unlike most merchandise, books in Canada are sold fully returnable to all retail outlets.