Eye on Comics

Comics criticism and commentary from Don MacPherson

More Dollars and Sense

Posted by Don MacPherson on September 25th, 2007

With the Canadian dollar (affectionately known as the loonie north of the 49th parallel) slightly surpassing the U.S. buck in value this week, U.S. comics publishers that list separate U.S. and Canadian prices on their publications plan say they plan to address the inaccurate divide between those prices.

U.S. comics publishers such as Marvel Entertainment, DC Comics and Image Comics list different prices in U.S. and Canadian dollars on the covers of their comics, and DC and Marvel list separate U.S. and Canadian prices on their hardcover and softcover graphic novels and collected editions. The Canadian price on their products range about 12 to 25 per cent higher than the U.S. price. The Canadian dollar actually surpassed its American counterpart by a minute margin in trading Monday, and it held steady at that level Tuesday.

Eye on Comics inquired with major U.S. publishers about the discrepancy. Image Comics executive director Eric Stephenson said the company is aware of the issue.

“We’ve been reviewing pricing on a quarterly basis, but I think we’re going to address this fairly shortly,” he said.

A Marvel spokesperson issued a similar statement.

“We’re working on adjustments now that should take effect in a few weeks,” said Marvel sales co-ordinator Arune Singh. Exactly what kind of pricing change might arise on the covers of Marvel and Image titles was not made clear.

A DC spokesman declined to comment, stating the company didn’t want to issue a statement regarding pricing at this time. Each spokesperson was asked how a Canadian price is determined, but none offered a response on that issue.

Talent feels the pinch

Comics colorist Chris Chuckry has pointed out another impact that the booming loonie has had on those whose lives are intertwined with the business of comics. Over in a comments thread on The Beat, he notes that Canadian freelancers have, in essence, seen a 50 to 60 per cent pay cut over the past five years. The loonie increased in value over that time, but page rates paid by American publishers in U.S. dollars have remained static.

Chris Chuckry illustrationWhen reached via e-mail to elaborate on the issue, Chuckry confirmed he’s seen his annual income in Canadian dollars drop by 50 per cent from what he brought in five years ago.

“This is a very significant amount. Most people I talk to can’t comprehend this kind of pay cut,” he said.

Chuckry copes with that economic reality in various ways. He said he’s cut down on costs by moving from a rented studio space to a home studio. Whereas he once used local subcontractors to get his work done, he said, he now contracts work out to the far East. Professionals there will do the work for a fraction of the price.

“I also pay these new subcontractors in U.S. dollars instead of Canadian dollars, so my costs move with my rate of pay, since the publishers pay me in U.S. dollars as well,” said Chuckry, who’s based in Winnipeg, Manitoba.

The colorist and illustrator said he’s also picked up work from a French publisher that pays in Euros.

“This diversifies my foreign exchange risk somewhat,” he said. “I have thought about buying forward contracts with my currency broker to offset the rising Canadian dollar, but haven’t gotten around to it yet.”

Stuart ImmonenCanadian comic-book artist Stuart Immonen said the boost in the loonie over the past five or years has resulted in a 30 per cent reduction, not 50 or 60 per cent. It’s up to a freelancer to take those economic realities into account, he said.

“That being said, royalties, re-use fees, trade paperback collections and other incentives can offset market fluctuations. Again, it’s up to the freelancer to foresee downturns and try to take on, say, work outside the industry (if fees are
higher), or move onto more lucrative projects within comics,” he said. “Sometimes this isn’t possible, of course — for most, I think it’s more like being locked into a fixed-rate mortgage than owning free market shares.”

The Ultimate Spider-Man artist said comic art is a time-consuming profession and he’s always working to capacity, regardless of exchange rates. He said he and his wife, writer Kathryn Immonen, have begun to diversify their work as well, even though the added but more personal work isn’t as lucrative as traditional comics work.

“It’s no secret that, however, that we’ve recently taken on a number of low-income, high-risk, self- and web-publishing endeavours in the past two years, but I see that more as an investment in the diversity of the comic marketplace, as well as in my emotional well-being, which is just as important as my financial state,” Immonen said.

As a freelance colorist, Chuckry said, if he’s not sitting down and working, he’s not earning any money. He said some publishers pay royalties to colorists but it’s not common.

“So I’m also exploring other creative venues with potentially, more attractive monetary rewards,” Chuckry said. “I’m sure that other artists are looking around for other non-comic work as well, as it’s getting more difficult to earn a living in the industry. Thankfully, I’m getting enough work from my customers to keep me from leaving the industry completely.”

He said even after taking those measures, he’s had to cut down on the number of comics, trade paperbacks and art books he buys.

Changing exchange rates are just a reality for non-American comics professionals must contend with when dealing with U.S. publishers, Chuckry said.

“I don’t expect U.S. publishers to negotiate page rates in response to exchange-rate fluctuations,” he said. “The industry is global, and the publishers work with freelancers from many different countries, with separate exchange rate realities. It would be too confusing and not worth the cost to the publisher.”

Immonen agrees.

“It’s not the publisher’s responsibility to offer contracts to the arm’s-length freelance community that ebb and flow with economic markets. They offer contracts (long- and short-term) based on experience, ‘fan-appeal,’ longevity and prior history with the company, and surely other factors. This creates a more level playing field for freelancers than would the anticipation of market trends,” he said.

Conversely, Immonen said, there’s a benefit to Canadian freelancers when the loonie isn’t faring so well.

“Generally speaking, the freelancer approaches the publisher for work, and it is incumbent on the freelancer alone to negotiate the boilerplate contract prior to working,” he said. “When the Canadian dollar is low, for example, I benefit for the period of the contract; if its value rises as the contract expires, it’s up to me to factor that into negotiations and adopt the risk of possible refusal.”

Click here to read the site’s first article on the issue of parity between U.S. and Canadian currency and its impact on the comics industry, as well as a lengthy discussion.

20 Responses to “More Dollars and Sense”

  1. Kevin Hines Says:

    This doesn’t have as much to do with the pay wages, just the cover cost of the comics.

    Is any of the difference in US vs Canadian Dollars based on just getting the product to Canada? does that cost more then say, shipping to Texas? I really don’t know the answer and am curious.

  2. Journalista - the news weblog of The Comics Journal » Blog Archive » Sept. 26, 2007: Daddy says nothing Says:

    [...] [Publishing] Don MacPherson has a bit more on how the currency-exchange rate between Canada and the United States affects the comics industry. [...]

  3. Don MacPherson Says:

    Kevin wrote:
    Is any of the difference in US vs Canadian Dollars based on just getting the product to Canada? does that cost more then say, shipping to Texas? I really don’t know the answer and am curious.

    That’s an interesting point, Kevin, and it’s possible that the publishers hike the Canadian price a bit to allow retailers to recoup the costs of added shipping. However, DC, Marvel and Image remain silent on how they arrive at their Canadian prices, so we don’t know if that’s the case or not.

    Honestly, I think the UPS charges depend more on distance than North American borders, and I suspect the shipping rates vary across the board. Shipping boxes to a hub such as Toronto is probably cheaper than to more rural, remote areas of the U.S., I would imagine.

  4. Paul Stock Says:

    Just a couple of quick notes:

    The US dollar has dropped from roughly $1.50 CDN to even. This means that (all else being equal), artists have taken a 33% Canadian dollar pay cut, not 50%.

    To look at it another way, presuming that costs of living were/are equal (eg a dollar store item cost $1US or $1CDN, during the strong dollar era, “foreign” artists were paid substantially more than their American counterparts.

    One side of the coin is that they’re now earning less. The other side of the coin is that they were earning too much…

    Regarding transportation costs: Diamond has three distribution hubs: Memphis TN (soon to move), Los Angeles CA, and Plattsburgh NY. (There is a UK facility as well, but no Canadian hub.)

    Plattsburgh is about 75 miles from the Quebecor printing facility in Montreal. Diamond/Quebecor uses their own truck to transport goods from the printer to Plattsburgh. Freight costs are not really a factor. Plattsburgh is in the Northeast and generally services the northeast, Memphis the South and Midwest, LA the West Coast.

    Books printed at Quebecor and Sullivan (Marvel), as well as those coming in from the Orient have to be distributed across the continent- doesn’t make much difference where they started from, they can only be close to one of the three hubs.

  5. Kevin Hines Says:

    I figured the same thing Don. I just don’t know if there is any export charges to Canada. For so long the Canadian Dollar was weak next to the US Dollar that I never gave it any thought, but now I am.

  6. Don MacPherson Says:

    Paul wrote:
    The US dollar has dropped from roughly $1.50 CDN to even. This means that (all else being equal), artists have taken a 33% Canadian dollar pay cut, not 50%.

    To look at it another way, presuming that costs of living were/are equal (eg a dollar store item cost $1US or $1CDN, during the strong dollar era, “foreign” artists were paid substantially more than their American counterparts.

    As you were writing this post, Paul, I was updating the article to incorporate comments from artist Stuart Immonen, who made the same points. :)

    Thanks for bringing those points up, though. I’m pleased these features are sparking discussion.

  7. Chris Chuckry Says:

    Well, my income has dropped by 50% over the past 5 years. Of course, having a couple of kids during that time, probably contributed the other 17% drop, not inflicted by the rise in the $CDN. :)

  8. Jay Bardyla Says:

    It’s funny how many “smaller” companies, like Dark Horse and Fantagraphics, gave up on printing Canadian cover prices years ago, realizing that if they were coming up short they were costing the retailers money and if they were too high, they were costing the reades money.

    Then there’s Top Cow which can somehow change the cover price every month and be nearly right on the penny. If they can do it, why can Marvel and DC? Because they choose not to. Marvel has even stated that they will not adjust Cnd prices on trades because they want all of their books to look the same (Friday @ Joe’s article where they spoke with Tom B).

    All companies should just stop and let retailers deal with the prices accordingly, especially if the company cannot act responsibliy enough to print a reasonable price.

    Further, as far as shipping goes, it’s Diamond who bills and pays the shipping to Canadian stores so again, there’s no need for companies to inaccurately bill those Cnd prices. Also, all billing to stores are based on the US cover price so even if there are additional tariffs for shipping, they would be built into the discount structure for purchasing.

  9. Don MacPherson Says:

    Jay wrote:
    It’s funny how many “smaller” companies, like Dark Horse and Fantagraphics, gave up on printing Canadian cover prices years ago, realizing that if they were coming up short they were costing the retailers money and if they were too high, they were costing the reades money.

    All companies should just stop and let retailers deal with the prices accordingly, especially if the company cannot act responsibliy enough to print a reasonable price.

    We shouldn’t assume that publishers such as DC and Marvel haven’t consulted Canadian retailers on this issue. As has been noted in comments threads on this site, there are some Cdn retailers who charge the higher-than-needed Cdn price in order to reap a financial windfall. Given the brief comments provided by some publishers, we don’t know how they arrive at their Canadian prices.

  10. Paul Stock Says:

    Some companies have been consulting with Canadian retailers over exchange rates. DC, for example had/has a group of about six retailers they’d check with on a regular basis. Didn’t seem to matter much what we’d say (unless the other guys were holding out for exchanges much different from the ones I advocated).

    After being a “consultant” (to use a grandiose term for random phone calls) to publishers going back to Valiant, all I can say is that there seems to be a primary desire to ensure retailers don’t get hurt if exchange rates go the wrong way (we can always sell over-exchanged for less, we can’t sell under-exchanged for more), combined with a need to satisfy the demands of newsstand distributors, who do sell in Canadian, and want the biggest possible buck per piece shipped.

    As an historical note, Dark Horse’s decision to drop CDN prices (on TPBs) came after discussion with Canadian retailers. It was e-mail and phone consultations, so I wasn’t privy to anyone else’s input, but I gathered from Mike and Jeff that most of us felt that just letting Canadians handle Canadian pricing was the easiest and best route to take, so that’s what they did.

  11. Sandy Hum Says:

    I can’t believe how vague the publishers are with this issue.

    In my case, I live in Toronto. The books are published around Montreal and shipped to distribution hubs. These hubs are probably farther away than Toronto. And a majority of the books are probably distributed from Toronto to Canadaian cities and I’m sure some American venues also.

  12. Jim Cowling Says:

    I just don’t know if there is any export charges to Canada.

    If you mean a duty or tariff, there’s no duty on printed matter crossing the US/Canada border in either direction. Brokerage fees, if any, would be paid by the individual Canadian retailer, I suppose (and considered overhead), so it shouldn’t affect the printed price.

  13. Paul Stock Says:

    Here’s the Canadian Diamond distribution chain:

    Comics and other merchandise are produced wherever. Could be Canada, could be USA, England, China. Production origin is irrelevant. Diamond either has shipments split at the producer, or splits themselves at the warehouse closest to overseas arrival.

    The shipments are split according to warehouse need:
    – Los Angeles for West Coast USA, Pacific rim.
    – Plattsburgh for Northeast USA, Canada, and (I believe) Europe.
    – Memphis for Midwest, South, backstock inventory.
    (There are abberations- eg Seattle was once (is still?) serviced by Plattsburgh, but the three groupings I’ve listed are basically it.

    Plattsburgh Canadian shipments are trucked (by Diamond) from Plattsburgh to Montreal on Monday mornings.

    Diamond is the importer of record- they clear customs in bulk, rather than one clearance for each retailer.

    Diamond delivers most Montreal area shipments to a drop point. Retailers individually pick up from the drop point on Wednesday. Western drop point shipments (Calgary, Vancouver) are delivered to an airfreight company to bring out west. Toronto drop point shipments used to be (I presume still are) delivered by a truck (Diamond’s or other) to Toronto. All other Canadian shipments are delivered to Canpar (like UPS) in Montreal for delivery to individual stores from St.Johns to Victoria on Wednesday.

    There is no Diamond distribution from Canada to the US (or any other country). Diamond does not have any Canadian facility other than the drop points, which are essentially places that just hold boxes for pickup- sort of like MailboxesEtc. on an industrial level.

    -Paul
    Astro Books
    Montreal

  14. Jay Bardyla Says:

    Don wrote:
    We shouldn’t assume that publishers such as DC and Marvel haven’t consulted Canadian retailers on this issue. As has been noted in comments threads on this site, there are some Cdn retailers who charge the higher-than-needed Cdn price in order to reap a financial windfall. Given the brief comments provided by some publishers, we don’t know how they arrive at their Canadian prices.

    I don’t assume they don’t but either way it seems to make the most sense to just stop printing the prices and let retailers charge what they want to charge. Our store has finally had enough of gouging customers, and we now simply convert the US from what Diamond bills us. It’s the fair thing to do.

  15. Economic Issues Facing Publishers LinkBlogging » Comics Worth Reading Says:

    [...] First, Don MacPherson does some good reporting on the effects of Canadian dollar parity with the US. Makes those $9.95 US / $13 whatever Canadian prices look pretty outdated, hunh? Don asks the publishers what they’re going to do about this (popular answer: “we’re looking into it”, which may mean they haven’t determined yet or that they don’t care enough to make a significant change or that they don’t want to share their decision-making process). Many smaller publishers just print cover prices in US, and let the retailers in different countries figure it out, which seems sensible — why take on headaches you don’t need? Also affected: artists living in Canada have effectively taken pay cuts from this, because they’re paid in US dollars at US rates, which haven’t changed. [...]

  16. Comics Should Be Good! » The Problem with Canadian Comic Prices Says:

    [...] I apologize for not linking to this great Don MacPherson piece sooner (the Countdown weeks were fairly hectic – as you can see by the lack of Judging Books By Their Covers, I’m still catching up), as it is a very interesting look at the effect of the rise in value of the Canadian dollar, which recently actually PASSED the American dollar, and what this means to comic professionals and Canadian comic buyers. [...]

  17. Eric Grant Says:

    At least one of the Toronto retailers has just been charging US cover price, in Canadian dollars, on new single issues for at least a year now, and they usually discount TPBs.

    One factor in these things is that the overhead and wages paid by Canadian retailers is always paid in Canadian dollars, so the “cost” of a given comic isn’t just what the publisher charges.

  18. Matthew Says:

    Comics get to St. John’s on Friday. Or at least they did when I left the province two years ago.
    I don’t know why it takes that long, perhaps it’s the only cheap option available to the retailers there.

  19. Don MacPherson Says:

    Matthew wrote:
    Comics get to St. John’s on Friday. Or at least they did when I left the province two years ago. I don’t know why it takes that long, perhaps it’s the only cheap option available to the retailers there.

    To fill in other readers, Matthew’s referring to the capital of Newfoundland and Labrador, Canada’s easternmost province.

    I would assume it takes longer for comics to get there because it’s so far removed from a UPS hub.

  20. matthew Says:

    from what i’ve read online, I think comics get to like spain and places faster than to newfoundland.
    and any time a holiday happened (either in the states or canada) then stuff would get delayed until the following monday. around xmas/new years it’s not even worth it
    (blah blah, complain complain)