Tuesday, March 31, 2009

Follow the Book Trail

Sharon Wildwind

It’s spring and time we had a talk about the birds and the bees—of book reproduction, that is. Have you ever wondered what happens to that physical object called “a book”? Where is it born, where does it live, and how does it die?

What I’m talking about today is the classic book: pages of printed paper, held together with a cover that is either slightly thicker and glossier than those pages—the paperback—or a lot thicker—the hardback. Books that are produce in print runs of anywhere from a few hundred copies to a million copies at a time.

Somewhere there is a room, usually with a specially reinforced floor, where a big printing press stands. A completed and edited manuscript is fed from a computer to that press to turn out page after page of printed text. The pages are cut, folded, and bound into a cover. If it’s is a hardback, a paper book jacket is usually added. Books are packed tightly into boxes and boxes put on pallets to go to temporary storage in the printshop warehouse.

The publisher does publicity. A warehouse or distributor hears about the book and decides to stock it. Boxes are put on a truck and driven from the print shop warehouse to their warehouse. Tony Burton (June 23, 2007) and Katheryn Wall (June 13, 2007) have both written excellent blogs on the current state of book distribution, and I refer you to them for more information about this stage of the process.

The book is now listed on web sites and in catalogues as available for purchase. Publicity happens and readers go looking for the book on-line or in bookstores and other venues. Stores—both on-line and bricks-and-mortar—decide to stock some copies.

They buy books on consignment from the warehouse or distributor. Buying on consignment means they don’t have to pay any money up front. They essentially get free books to have available for a period of time, say 30 days. The books are sent by mail, courier, or delivery service and eventually reach the store. The box is opened—releasing that wonderful new book smell, of course—and copies go on display on a table or shelf in the bookstore. Extra copies are kept in the back storage area, next to the coffee pot.

A person buys a book, takes it home, and does something with it. Hopefully reads it, or gives it to Aunt Ethel so she can read it, or tells their friends how wonderful the book is and encourages them to read it. A few very fortunate books find a permanent home. They go on a bookshelf and quietly settle in with the other hundreds or thousands of books that the reader loves.

However, many books are now ending up being quickly sold to second-hand stores, so that a second person buys it, reads it, sells it; then another, and another and so on. The problem is that the author gets money for the sale only the first time that book is sold.

Some copies are never sold. At the end of the consignment period—which may be only a few weeks—the vendor either has to pay for the books or return them for credit. Because books are heavy it’s not cost-effective to return the whole book, so the cover is torn off and that returned. Rather like sending in box tops for a decoder ring, in case you are old enough to remember that. Look on the back cover of a book. If there is a triangle, or a triangle with an “S” inside of it, that doesn’t mean this book is endorsed by Superman. It means the cover can be “stripped” and returned for credit.

Those stripped books are supposed to be tossed in the garbage, but check out any used bookstore and see how many books are there without covers. How they end up there is anyone’s guess.

The vendor gets to repeat this process. Order 10 books, sell and pay for 3, strip and return 7 covers; order 8 the next month, sell and pay for 2, strip and return 6 covers, etc. for as long as the vendor wants to play the game. Most of the time the vendor doesn’t want to play very long. Maybe 1 month, maybe 3; longer if the book generates terrific sales every month.

Unless a book is selling like hot-cakes, orders are always in decreasing numbers in subsequent months, and each vendor comes up with their own private formula for what the decrease will be. As an example, one vendor might make an order for X number of copies in the first month, order 50% of X the second month, and 50% of the second month’s order the third month. Unless the book is a consistent seller, most vendors reach a point at somewhere between 3 weeks and 3 months when it is no longer profitable to send in any order at all on this particular book, though they may order individual copies if a customer makes a special order and pays for it in advance.

Tax time rolls around. There may still be books on that print shop’s shelves; on the warehouse or distributor’s shelves, and on the vendor’s shelves, back by the coffee pot. In the United States, anyone with books on the shelves has to pay inventory tax on them, and they are taxed for every year that they are on the shelves. So the impetus is to clear out the stock after a year, or even better just before the year is up.

As we’ve seen, the vendors are already returning books rapidly. They might put a few copies out for a sidewalk sale, etc, but essentially their shelves are pretty clean. The warehouse or distributor returns all their copies to the print shop, who contacts the publisher and says, “We have Y number of copies of this book and tax time is coming. What shall we do with these books?”

The publisher will likely decide to send the book to remainders. Hopefully, they will first give the author a chance to purchase any or all remaining copies of the books, at a reduced price.

With smaller companies, what the author doesn’t want is packaged into remainder boxes. Employees go down the line and pick 3 copies of this book, 4 copies of the next book, 2 copies of the third book, until they can fill a box. The key here is how many books fit neatly into a box without regard for title, subject, or author. It is, if you will a grab bag, or in this case a grab box. The boxes are sealed and sold, closed, as is, with the buyers having no idea what they are getting.

Larger companies participate in remainder sales, like CIROBE (The Chicago International Remainder and Overstock Book Exposition). At these book expositions, books are sold, not by the box, but by the pallet or truck load.

The next time you see you see a big bin of books in your local grocery store, being bought as a remainder is how they got there. Authors get no royalties from the sale of remaindered books.

After a book goes to remainder, it’s dead. The only way for readers to get a copy is to borrow one, either from a friend or on inter-library loan, buy from the author who might have a few of those remainders sitting around, find it by accident in a remainder bin, go on-line or to a used bookstore and hope for the best.

Not all copies are sold, even as remainders. The rest are pulped, which is a fancy way of saying recycled into other paper products. Many people don’t know that, yes, you can put discarded books in the average household recycling, if you take them apart first. Get a sharp craft knife and slice the individual pages from the spine, then put those pages in paper recycling. It’s the covers and the glue that shouldn’t go in recycling.

The difference between the number of books printed and the number of books destroyed is called the through-put. Most publishers are happy at about a 45% through-put and ecstatic at a 55% through-put. That means for every two books printed, roughly one is sold and one is pulped. It’s a horribly wasteful system, and one unique in commerce. Can you imagine stores being allowed to destroy cars or washing machines or denim jackets and return a fragment of the original product for full credit?

Surely someone can come up with a better system.
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A sad quote for the week. Thank goodness most book sellers don’t think like this:

A book is only a widget. The purpose of a bookstore is to sell units. ~District manager, large chain bookstore, reported by mystery writer Viccy Kemp

5 comments:

Julia Buckley said...

Sharon, what an interesting (but rather depressing) post. I used to work at a large chain bookstore, and we were offered the strips as an incentive. There was a box in the back and we could take whatever we wanted. I suppose that's how they end up in bookstores. People read them and then pass them on.

Sheila Connolly said...

Hear, hear! It's an absurd business model, to plan to destroy half your product, and I doubt that it will persist in this computer age. Of course, I keep saying that about terrorist watch lists, and not much has changed there.

Only one addendum--I asked my agent recently about what sell-through (or through-put) editors were looking for when deciding whether to support an author going forward. She agreed that 50% had been the standard, but now they'd like to see something closer to 70%. In this market. Right.

Sharon Wildwind said...

Thanks both of you for those extra details. Yeah, this whole system is interesting, depressing and absurd. My hope it is will break under its own weight and something new and wonderful will emerge like a chick coming out of a shell.

Sandra Parshall said...

The average reader has no idea what returns are and how they affect a writer's earnings. The number of books "sold" to stores may seem impressive, but what counts is the number that are sold on to living, breathing, reading customers, and the number returned to the publisher. Large publishers routinely withhold a hefty percentage of royalties because they know that a lot of books may be coming back unsold. With smaller publishers this is less of a problem, because they don't flood the market in the hope of selling a mere 50% of the books they print. They can't afford to do that, and the successful smaller publishers are pretty savvy about how they market their books, so they're more likely to sell a far higher percentage of them. The big guys could learn something about the business from the indies.

Sharon Wildwind said...

Amen, to that, Sandra. There is a wonderful on-line site called Shelf Awareness (http://www.shelf-awareness.com/), which is a daily (Monday-Friday) electronic newsletter about what's happening with small, independent bookstores. I recommend reading it to all authors.