Sunday 11 January 2015

Win, win, win on the sale or return issue

The perils of sale or return
This can be a real sticking point for small publisher and book sellers. It can upset a very carefully designed financial plan that otherwise means the publisher doesn’t   pay any upfront production costs until the book is sold. It can leave the publisher out of pocket and can prevent the writer from receiving royalties.
If publishers don’t offer sale or return, they are not attractive to the book seller. The book shop only has so much shelf space. They can’t keep books that are not selling there forever. They need to sell books.

What return actually means
Usually if books are indeed returned they are not sell-able. They may have had stickers put on.  They may have been man-handled. They will have traveled around quite a lot.  It’s relatively common practice for the bookseller to remove the covers and return just those to the publisher as proof that the book has not been sold. If mass printed conventionally, that’s probably 20p per copy, so perhaps bearable. However, if the publisher is using print on demand as many small publishers now do, the unit cost is considerably higher – pounds not pence. In both cases, it’s also common practice to set this loss against royalties earned. The author is not charged for the loss but shares the loss with the publisher. 

An alternative method
We’re experimenting at the moment with authors who set up a signing tour. We’re offering a kit of twenty books which we supply to them. They take them along to the signing. Any books sold go through the retailer’s till at full recommend retail price (RRP). We then invoice the retailer for 65% of the RRP and top up the author’s supply. If there are books left over at the end of the tour, the author may purchase them at 75% of RRP, our normal discount to authors. If they can’t afford that at the moment we’re happy to set the cost against royalties.
We are taking several risks here:
·         We’re supplying 20 books upfront – costing us £40-£80
·         Some book sellers are very slow in paying
·         The author may not be able to afford to pay and may never “earn out” what they owe
However, these are relatively small risks.
Win, win, win
Pretty well all of the risk is removed for the book seller. They maybe just need to spend some time and effort advertising their event. No doubt the author will also help here.   
The author will look after the “return” copies. It’s in her interest, after all.
The risk to the publisher is only small and allows them to offer sale or return in a reasonably safe way.

A few further comments.
We’re not yet sure whether we’ve got the number right. Are twenty books enough? Too many? Signing tours need to be planned so that there is enough time between events to get the orders processed. Ten days to two weeks seem to work.
If this works successfully and we start to get a reliable average number of books sold this way, we may consider supplying all of the books upfront in the future.             


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