Booksellers around Britain will find themselves believing in magic tonight.

 

For although the glitter that falls from Harry Potter's cloak is not itself gold, retailers have faith that everything it touches will turn at least to silver. Heavy discounts on the hardback edition of Harry Potter and the Deathly Hallows would mean "on that book itself we'll not make money" in the short term, said Steve Riggio, chief executive officer of Barnes & Noble. But with the US chain expecting to sell 2m copies in the next few weeks, "that's a good investment in the future", Mr Riggio said. "Kids are going to be lifelong customers of Barnes & Noble."

 

This weekend's revenues from the book would outstrip Hollywood's entire box office takings for the same period, said Mr Riggio, but experience of the previous six titles in the series suggests the payback will come not just from a more literate next generation. Retailers have been able to sell paperback editions of Harry Potter at full price, and the industry is hoping that new generations discovering the books will be less price-sensitive than the first wave of buyers.

 

"The backlist is the backbone of our business," Mr Riggio said. The Harry Potter franchise has ensured its author, J.K. Rowling, a place at the top of the literary rich list, but it has been a less predictable money-maker for others involved in the phenomenon. "If you ask me what has happened to the money: the money has stayed in the consumer's pocket," said Gerry Johnston, managing director of Waterstones, the book retailer, highlighting the discounts retailers are offering. "To my knowledge, no individual or company is making more money than they were several years ago and the only person who has really gained, apart from J.K. Rowling, is the reader."

 

Bloomsbury, the small publishing house that signed up Harry Potter and the Philosopher's Stone when bigger publishers had passed on the book, has seen its revenues transformed, but the Pounds 53m it had accumulated by last year has not translated into a strong stock market performance. Bloomsbury's shares peaked in 2005, just before the launch of the sixth book, and fell heavily late last year as it revealed delays to rights deals in its reference book division.

 

Scholastic, which holds the US rights to the series, has also been a volatile performer, whose shares have yet to regain the peak they reached in 2002. Analysts have expressed concerns that the performance of both companies may be "uneven" now the last book in the best-selling series has been written. Harry Potter's impact on the broader book trade is indisputable, however. PwC, the professional services firm, estimates the juvenile book market jumped by 35 per cent in 2005 - the year the sixth title in the series was released. PwC is predicting a 25.9 per cent rise in juvenile trade this year, followed by a double-digit decline next year. More importantly, it expects "mid single-digit" annual growth thereafter - faster than the total book industry.

 

Booksellers such as Mr Riggio credit J.K. Rowling's popularity with the creation of "a golden age of children's publishing" that has seen the Lemony Snickett, His Dark Materials and Eragon titles sell millions of copies despite the competing appeal of video games and the internet.

 

Mr Johnston said: "On Friday night we will have 280 stores open, making little or no money, but the prospect of 150,000 or 200,000 in our shops in one night, of having a million extra people over the weekend, has got to be the biggest possible opportunity to show how much more it is worth shopping in a specialist bookstore than a supermarket."

 

Booksellers have recognised they have little choice but to discount the title this weekend. James Heneage, chairman of the Ottakar's chain, said the company's failure to discount the sixth Harry Potter book played a part in the slump that led to the company's takeover by Waterstones.

 

This weekend will be "a singular event in publishing history", according to Richard Robinson, chairman and chief executive of Scholastic.

 

. . . And the deathly statistics

 

*The first six books in the Harry Potter series have sold 325m copies worldwide

 

*12m copies of Harry Potter and the Deathly Hallows have been printed for the US alone

 

*Export orders for book seven are 17 per cent ahead of total export sales for the previous book

 

*Amazon has taken 2.2m orders worldwide; Barnes & Noble has 1.5m orders*The recommended retail price for the new hardback is Pounds 17.99 - Amazon.co.uk is to sell the title for Pounds 8.99 and Asda for Pounds 5

 

*The first four Harry Potter films have grossed Dollars 3.5bn (Pounds 1.75bn) worldwide; the latest film took Dollars 140m in the US and a further Dollars 190m internationally in its first five days

 

*Intangible Business estimates the Harry Potter brand to be worth Dollars 5bn to Dollars 10bn