Britain’s booksellers are complaining that the seventh and final Harry Potter novel, probably the fastest-selling title in history, cast an evil spell on their profitability and may even drive some of them to the Deathly Hallows. Because of its assured popularity, the title was piled high and sold cheap by supermarkets and online stores, forcing the more traditional outlets into matching price cuts that in many cases meant those monster sales didn’t cover costs.

By snatching sales and shelf-space from other titles they might otherwise have sold at a profit, JK Rowling’s crowning achievement may have put an end to some of her sales channels as well as to her juvenile hero’s improbable education. While Potter worked a miracle for second-quarter booksales around the world, bucking a declining trend for embattled chains such as Borders in the US, he failed to wave a similar wand over the red ink those prized pages left behind as they vanished from the shelves.

The bespectacled boy wizard has gone the way of baked beans and designer jeans, becoming a loss-leader that gets sold at or below cost so as to draw customers into a store where they will splash out on more profitable lines. At the height of the Potter price war, supermarket chain Tesco – whose discount strategy has rapidly raised it to Britain’s biggest book and newsagent chain, alongside purveyor of one-third of its food – was selling the Deathly Hallows at £5, compared with a recommended price of £13.

Supermarkets wrested the sector from traditional bookstores as soon as they secured the abolition of the Net Book Agreement, which until 2001 had banned stores from selling books below the publisher’s stated price. This resale price maintenance had been preserved for books, newspapers and pharmaceutical products, even abolished for all other goods, on the grounds that this would keep shops alive on smaller high streets and allow them to stock slower-selling titles that the superstores ignore. The Publishers’ Association consistently fought its abolition despite bullish predictions of how much book sales would grow when prices were freed, recognising that competition would squeeze the sales of less popular titles and the profits on bestsellers.

Unfortunately for bookshops and other children’s authors, Potter has proved more a substitute than a complement for other contemporary fiction. So while shops’ loss on cheap beans and jeans is recouped on the basket that fills up around them, Rowling’s oeuvre has tended to fill the carrier bag on its own, depriving them of serendipitous sales with a more normal margin.

For UK-based publisher Bloomsbury, Potter’s last chapter has meant a crisis of investor confidence similar to that experienced by pharmaceutical makers when their one blockbuster drug goes out of patent. With no other guaranteed bestsellers in the pipeline, shareholders scarcely waited to learn of Harry’s fate before panicking over the huge volume discounts that retailers were demanding for the latest book, and the lack of comparably coveted products in the pipeline.

Bloomsbury is trying to fill the void by bidding vigorously for new works that might repeat the Potter magic. Among the prizes in their sights are the imminent memoirs of former UK prime minister Tony Blair. But the intrepid independent is bidding against deep-pocketed giants like Random House, HarperCollins and Simon & Schuster. And political memoirs don’t always pay back their authors’ massive advances, rumoured to be £5-8m in Mr Blair’s case - a sum that at present exchange rates would beat the all-time record $12m, secured by Bill Clinton when he signed to Random House in 2001.

Although named and famed as a ‘literary’ publishing house, Bloomsbury proved no better than Random House and HarperCollins at seeing through a trick played recently by British author David Lassman. Presented with slightly re-written first chapters of iconic novels by Jane Austen, including Pride and Prejudice, they failed to recognise their provenance and declared them unsuitable for publication. Mrs Bennet was clearly too unimaginative with her daughters’ education. Embattled publishers will be hoping for a more recognisable version of recent history from Mr Blair, though it is unclear whether his chronicle of a decade in Downing Street will be another Hogwarts-and-all account.