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Navigating the Chinese Publishing Market: An Overview for Independent Presses

Chinese Publishing

An overwhelming amount of information has flooded the ether about business opportunities in China, so much so that the noise seems to drown out the usable chunks of information that are transactional. In fact, the cacophony tends to propel even the most enthusiastic publishers into a corner of inaction, where it feels safe to take a wait-and-see attitude.

Beginning with my first experiences visiting China over the past ten years (fifteen times), and through my participation in dozens of seminars about doing business there, my recommendation is to get moving! It is easy to arm yourself with a base knowledge of the marketplace and then head overseas to one or both of the two important book fairs held there each year: the Beijing International Book Fair held every August, and the China Children’s Book Fair/Shanghai held each November. Or plan to take a separate trip to meet with the most important publishers in Beijing privately.

Following, you will find an overview of the demographic and sociological trends taking place in China and how they play into the current publishing environment, with an emphasis on opportunities for international sales of English language books.

The Urbanization of a Country

Let’s just begin with the word enormous. Everything in China happens to an extent that is hard for most of us to comprehend based on our inexperience with this magnitude of growth. The 2015 population numbers are 1,375,000,000 (yes, billion) of which 73 percent are 15-64 years old. For context, the US population is a little over 320 million.

The largest migration in human history is happening right now in China. Most are leaving the rural countryside and flocking to cities where more economic opportunities exist than ever before. One hundred sixty cities in China have populations of more than one million, and fourteen cities have more than five million (Los Angeles has about four million). Shanghai has nearly twenty four million.

Alongside this urbanization, a majority of transient Chinese will see an increase in affluence. Forecasts estimate that two hundred million Chinese will move into the middle class this year, and they are hungry for Western culture. These households are mostly concentrated along China’s east coast, but by 2020 they will begin to spread through most of the interior as “super cities” are developed to accommodate the rapid urban growth. By then, China is expected to have 29 percent of the world population, followed by India (12 percent), the United States (11 percent), and Russia (7 percent).

The first day of 2016 marked the end of China’s controversial, forty-year-old one-child policy. Although still required to get a birth permit, couples can now request to have two children. Experts anticipate the number of births per year will increase between three and eight million, from the current level of sixteen million. There is already concentrated spending on family education and entertainment, with the average family spending $800-$3,000 per year. The next ten years will be the “golden age” of an already strong children’s book environment (see below).

Moving to the city also means better education. Before 1949, 80 percent of China’s population was illiterate, with enrollment for primary school less than 20 percent and secondary school barely 6 percent. To help boost the literacy rates, the Communist Party switched from complex Chinese (traditional, still used in Hong Kong and Taiwan) to a simplified written form using fewer strokes. By 2008, illiteracy dropped to only 3.58 percent and school enrollment is almost 100 percent. There are 20 million new English speakers created in China every year.

Another trend worth noting is the propensity of the Chinese to quickly adopt digital technology, particularly mobile phones, with 1.08 billion users (95 percent), and 37 percent who own a smartphone. With hundreds of places to connect online, 46 percent of the population has Internet access. 83 percent of Internet users gain access over their phones. 10.5 percent of children 6-14 years old have mobile phones and 68 percent of adults aged 18-29 have a smartphone.

Current state of the book business

The book industry in China is controlled by the government, the State Administration for Press, Publications, Radio, Film, and TV. They control the copyrights, number of ISBNs distributed, imports, and all other book publisher rules. There are 582 authorized book publishers in China, primarily based in Beijing. Regional or individual provinces that publish or print must work with one of these publishers. In 2009 the government implemented a “Go Out” policy, encouraging publishers to expand in the global arena and look for international partners.

While book markets in the West are flat or declining, China is still experiencing phenomenal growth despite a slight slowdown. The Chinese currently produce over 440,000 new titles and re-editions annually. Total book revenue is valued at over $13 billion, and 20 percent of books sold in the Chinese market are imported. The United Kingdom and United States account for 57 percent of those imports.

The newly affluent and aspiring Chinese are readers that have sophisticated tastes for foreign fiction and nonfiction titles pertaining to psychology, lifestyle, and self-help. Children’s picture books account for 29 percent of sales in physical bookstores, followed by study aids at 22 percent. Brick and mortar stores are popular in major cities as hangouts for consumers in China. Shanghai Book City, at seven stories high, boasts up to 9,100 visitors a day and Beijing Book City, five stories high, gets 7,000 visitors a day. Sometimes they have to shut down the escalators at lunch because there are too many people reading on them.

There are currently two e-book markets: traditional publishers producing e-books close to hard copy pub dates comprise a very small portion of the market, while self-published authors who serialize their work for pennies at online platforms reach tens of millions of readers. Tencent Literature is probably the best-known of these online platforms with over 820 million active monthly users. By owning popular social media sites like WeChat and QQ, they control 72 percent of the online market share. Media companies and publishers find it is easy to track the writers who are popular, and then turn this content into games or movie series … possibly even a book. These platforms do not have government oversight like traditional book publishing.

Amazon, which has invested heavily, and works with a partner (required), is beginning to see some traction with the Kindle in China, but the rapid shift to mobile devices makes this an agonizing slog. Chinese Internet giants like Dangdang or jd.com are also now getting into the e-book market. A strong retail market also make the move to e-books slow.

The weakest link for readers is school and public libraries. In fact, there are only 2,925 public libraries. But this may also be an opportunity, as forthcoming libraries have the potential to expand access to books in twenty-one provinces and other rural areas.

Getting your books to market

Outside of a joint venture, exporting, or setting up a local office there, your best chance to get involved in this exciting environment is to sell the Chinese rights of your books to a Chinese publisher. Face-to-face meetings and regular visits lead to the most successful business relationships. Guanxi, which refers to an important system of social networks (who you know, not what you know), is a central Chinese business philosophy.

Book fairs provide an economical way to meet with many publishers in one setting. The Beijing Book Fair, held in late August, hosts 2,300 exhibitors showcasing educational and general trade books. They host 260,000 attendees including trade professionals and readers.

The China Children’s Book Fair in Shanghai is a recent addition to the calendar, but it is emerging as a key event for kids’ publishers internationally. The fourth edition is planned for this November. All but forty or so of the five hundred and eighty two government approved companies in China publish children’s books. With the one child policy no longer in play, China, currently the number-two children’s book market in the world, is poised to move quickly to number one. The CCBF expects 500 children’s book exhibitors and 30,000 trade and public visitors.

Other events that are popular meeting spots for English language and Chinese publishing representatives include BookExpo America, the London Book Fair, and the Bologna Children’s Book Fair. China is invigorating these shows with vast real estate holdings. At the 2015 BEA, 4,721 Chinese rights were sold.

For larger companies with an extensive backlist, a privately organized visit through a co-agent to meet personally with new partners is worthwhile. One Children’s Books USA client of ours spent a week there last fall and sold the rights to 150 titles representing millions of dollars in royalties for her company. She had 350 requests in twenty meetings, saw a 300+ percent increase in revenue offers (over the business she did with Chinese publishers prior to her personal visit), was able to encourage competing bids from different Chinese publishers for the same book, and discovered lots of potential for the e-book licensing of children’s books.

Working with a co-agent also tends to simplify a complex marketplace. They are familiar with the top publishers, can navigate censorship issues, help track payments, and reduce piracy. While piracy is still a problem, it is becoming less of a hazard because publishers are becoming very involved in policing their own titles. Plus, in 2013, a court dedicated to addressing copyright was formed in Guangdong.

The highest number of translations (of the top 100 bestsellers in China from January to June 2015) were for children’s, educational, and business books. Literature, classics, and genre fiction are also popular, as are self-help books. Half of the translations were from the United States and United Kingdom. English as a second language (ESL) is opening doors for distribution deals for books of interest to the Chinese.

Chinese publishers are also looking for award winners, series books for adults as well as children (family and sibling stories), YA, and reviewed books. They watch Amazon and the New York Times bestseller lists, and research rights catalogs.

In Conclusion

Saying you already do business in China is not good enough. Without forging new relationships and fortifying old ones, you’ll be walking away from significant future profit. Competition and shrinking revenue have forced publishers into new markets. In China, through its growing middle class and expected baby boom, publishers are eager to do business to meet their needs. It seems like a perfect opportunity for everybody.


Victoria Sutherland
Victoria Sutherland is the publisher of Foreword Reviews. You can e-mail her at victoria@forewordreviews.com.

Victoria Sutherland

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