Download Sally: Several issues need to be addressed

A Comparison Between
Selling to Bookstores and
Non-Bookstore Buyers
Did you ever wonder why our business is described as the book-publishing industry and not the
book-selling industry? In 2013 Bowker issued new ISBNs at the rate of more than 1400 per day,
defining an industry that focuses on publishing more books as the strategy for increasing sales.
However, you may find that that publishing fewer books and selling more of the ones you have
can be a more lucrative business model.
One way to implement this concept is to sell your books to people where they buy, rather than
waiting for consumers to come to retail stores in physical locations or online. The essence of this
strategy is selling books in large, non-returnable quantities to professional buyers in companies,
associations, schools, and the armed services.
The dissimilarities between traditional retail book marketing and non-retail marketing are
defined in the chart below. Use this information to craft new sales efforts and sell more books.
The result can increase your sales, revenue and profits.
Characteristic
Traditional Retail
Book Marketing
Non-Retail Marketing
Books are purchased by retailers from
distribution companies to sell off the
shelf in chain, niche, or independent
bookstores in physical locations or
online
Books are purchased directly from
publishers by buyers in corporations,
associations, the armed services or
schools in large, non-returnable
quantities. Books are used or given
away, not resold.
Publishers rely on distributors to move
product to bookstores, then promote
books so readers go to the bookstore to
buy it (sell through)
There are no middlemen so the
author/publisher sells directly to
prospective buyers (sell-to)
Purchasing Criteria
Bookstore buyers seek increased store
traffic, inventory turns and profit per
square foot. They choose books based
on marketing, not literary, criteria
Professional buyers seek books to use
as promotional items that will help them
increase sales, revenue and profits
User’s
Buying Strategy
Books are sold to individual readers
who purchase nonfiction content based
on their need for information, and fiction
based on individual tastes or for a gift
Professional buyers purchase books to
use as promotional items to reach their
goals (increase sales, motivate
employees, increase membership,
educate students)
Decision-making
Process
Retailers and distributors have a shortterm perspective because they need to
show sales results quickly.
The publisher must have a long-term
perspective because books are used in
promotional campaigns that can take a
year or more to plan and implement.
What’s the Difference?
Publisher’s Selling
Strategy
Seasonal Demand
Bookstore sales decrease during slow
economic periods and increase during
holiday or gift-giving selling periods.
Non-retail sales are stable or increase
during slow economic periods because
companies use promotional items to
increase their revenue. There are fewer
seasonal variations and that helps level
the publisher’s income.
Concentration of
Buyers
Consumers are generally widely
dispersed, with some geographical or
regional differences
Prospective buyers are concentrated in
industry, geographic or demographic
segments, making it easier to reach
them with targeted promotion
Availability
Broad availability, particularly through
Internet retailers
Controlled availability since buyers in
companies and at associations
purchase books and give them to
employees, customers and members.
Purchasing Quantities
To sell 10,000 books you would sell one
book to each of 10,000 people
To sell 10,000 books you would sell
10,000 books to one person
Product Form
Standardized printed or electronic
books
The form is customized to the needs of
buyers and could be a printed book,
ebook , booklet, DVD or audio book
Sales Opportunity
Sell one book to each customer and
unsold books are returned.
Sell large quantities of books to each
customer, usually on a non-returnable
basis
Source of
Relationships
Personal relationships are with people
in the distribution channel (suppliers,
distributors, retailers), not with the
consumer
Personal relationships are with the
people who actually make or influence
the purchasing decision.
Duration of
Relationships
Personal relationships are short term,
lasting as long as your current book is
selling or your next title planned.
Personal relationships are more long
term, lasting for as long as you can
continue providing quality content that
meets buyers’ needs. The opportunity
for recurring revenue evolves from the
same source.
Author’s Impact on
Sales
The author’s name recognition is
important to the sale, and It is difficult
for an “unknown” author to penetrate
the system. The author’s involvement
with promotion is important to sales.
The author’s topic credibility is more
important than name recognition since
books are purchased for their content.
Shorter life of a title due to title churn
and control is yielded to retailers who
decide if sales are sufficient to maintain
market presence.
Longer life of a title because copyright
dates is not as important as applicability
of content to buyers’ needs. The
publisher has more control to extend a
title’s growth stage with sales to new
markets and buyers, and for new uses of
the content.
Life Cycle Planning
Acquisition Costs
The retailer’s acquisition costs are
higher because of distribution and setup fees as well as costs related to
displaying books and rotating product
assortment periodically. Unsold books
are returned, further increasing costs.
Unit acquisition cost is lower because of
large-quantity purchases, no shelf-space
is required, books are used and not
returned, and bulk-shipping discounts
lower transportation costs.
Publisher’s Selling
Costs
Costs are high due to selling small
quantities of books to many different
customers. Publisher pays the shipping
charges. Returned books must be restocked or discarded. And the
publisher’s promotion can be
expensive.
Cost-of-sales is lower because larger
quantities are sold to fewer customers.
There are no distribution fees and
promotion is more targeted and efficient.
Sales groups can represent books on a
commission basis
Promotion
Uncertain of the message received due
to reliance on uncontrollable reviews
and publicity. Advertising is usually
cost-prohibitive. Blogging and social
networking can communicate to large
segments of consumers.
Concentration of buyers permits pinpoint
accuracy in targeted direct marketing.
Communication is controlled through
two-way interaction among interested
buyers at trade shows and in personal
selling
Sales Opportunity
Sales are dependent on uncontrollable
factors, such as the skills of distributors’
salespeople, the position of books on a
shelf or circulation of positive publicity.
One-on-one meetings with prospective
buyers to personally deliver the intended
sales message consistently, and close
sales directly.
Publishing Decisions
The choice of which book to publish is
usually a literary decision based on the
quality of a manuscript.
The choice of which book to publish is a
marketing decision based upon the need
for the content among buyers in a target
market
Title Churn
Emphasis is on publishing books. A
revolving frontlist is deemed necessary
for new revenue. Production may be
hurried in order to meet artificial
deadlines, or to reach a self-imposed
number of titles to publish annually.
Emphasis is on selling books. The main
criterion is relevance of the content to the
needs of the buyer. There is no frontlist
and backlist as long as the content is
current and applicable.
Pricing Flexibility
Prices must be competitive due to direct
comparison on the shelf and online. The
wide variety of books available on a
specific topic creates a price ceiling in
many categories. High unit costs from
distribution fees and low-quantity
production may force prices higher.
The selling price is negotiated and is
typically based on the quantity
purchased. There is no direct
comparison of prices of competitive titles
nearby on a shelf, allowing more valuebased pricing.
Potential for
Profitability
Profits may be reduced due to
distribution discounts ranging from 55%
to 70%, and by shipping small
quantities of books to many different
locations. Printing books in small
quantities can result in a high unit cost.
There are no distribution discounts since
books are sold directly to buyers. Buyers
pay shipping charges. Large quantities
may be printed via the offset process.
Promotional expenses may be minimized
due to the concentration of targeted
prospective buyers.
Cash Flow
Payment for books sold may be
received in 90 to 120 days from the
shipping date. Money due to the
publisher may be held in escrow by the
distributor to cover potential returns.
Payment (including shipping charges) is
typically made in full to the publisher
within 30 days of the receipt of books.
Other terms may be negotiated.
Returns
All sales are made on consignment and
unsold books may be returned at any
time in any condition. The return rate
could exceed 30% of sales.
Sales to non-retail buyers are usually
non-returnable.