Borders Bookstores have been clinging to life like a Hollywood diva clings to Botox—with bony, scraggy fingers holding on to a dream.
Just die already!!
Borders announced that they are “delaying January payments to vendors and landlords in a move to co...
Gee, I wish I could do that! “Sorry! I won’t be paying my bills on time because I need to save my cash.”
Frankly, Borders is a reflection of the traditional bookstore system. It’s hardly surprising that they are failing because the economics behind supplying bookstores is totally bogus. Think about it. Bookstores demand huge discounts from publishers to buy books to stock their shelves plus they expect to be able to return unsold books for full credit. And if the bookstore is allowed to strip the book before returning it (while getting full credit) to the publisher...
Don’t know what book stripping is? That’s when a bookstore rips the front cover off the books they don’t sell before returning them to the publisher. It’s like the store says, “We can’t sell this book so we’re making sure no one else can, either.” And, after returning these damage goods, the bookstore is still entitled to a full refund on the books that they purchased at a discount. Did I mention that in many cases bookstores can return books at any time, ad infinitum? Even years later after a book has gone out of print?
This is what publishers must accept if they want their titles in all those stores. Add in the cut that the distribution outlet gets, plus costs for shipping, handling, storage, etc., it’s very easy to see why authors end up getting a very small piece of that SRP pie. Figure in other things like inflation and that the dollar earned in 2010 is worth less than the dollar returned in 2011, and you can see how losses accumulate.
Bookstores use this to great effect because they can, in essence, get free stock, make a profit off what they sell, and then get money back for what they don’t sell or credit for future “purchases.” Time it right, and a retailer can get around paying any kind of real money. This, in turn, trickles down to effect royalties.
What kind of business strategy is that? It’s a canny one if you’re a bookstore, and it’s been the name of the game for decades, and yet, bookstores still manage to go into the red.
This is the dark, stupid side of publishing. And the sad thing is that many authors do not know about this. They will blithely blame the “greedy publisher” if their book doesn’t sell because it can’t be found in every bookstore not understanding that the bookstores have those books on credit—and if they don’t sell, those books go back to the publisher. And if the publisher doesn’t make money off your book, then neither will you, Sunshine.
One of my mentors is an author who has been writing and publishing for over 30 years, and I remember her talking about every royalty statement is laced with excitement and fear. How much money did she earn...and are there any returns?
The publisher will recoup the lost money via your royalties. If you don’t sell out to cover your advance (if you’re lucky to have one), don’t expect another book deal. Or, if your publisher gets returns on your book after paying you royalties, you may have to refund them or future payments will be less until those returns are paid.
Do they teach this in MFA programs? Seriously, I’d like to know. If they did, I think more authors would come into this without rose-tinted glasses.
Can you imagine if other businesses adopted the bookseller method? Take real estate. “Buy” that huge mansion at a deeply discounted price, live in it for six months, trash it, and then say, “No, thanks. I can’t make any resale profit on this. Give me my money back.” Wait a minute...considering the recent real estate and credit bust, in a way this did happen...And you see how many people got screwed.
Other businesses don’t operate this way because it’s a crazy way to do business.
Well I say, stuff it. This is the twenty-first century. Charles Dickens is dead and dust and so it should be for this Dickensian way of doing business.
Being a small, indie publisher, we used to worry about not having a presence in physical bookstores, but not anymore. We’re not going to expose ourselves to this kind of wasteful and idiotic system. Not only does it put our earnings at risk but that of our authors, and it’s hard enough to make money in publishing as it is. We are gaining more steam every month and paying royalties to authors whose books do well. Why should we jeopardize that just so a bookstore can get free books off us or an author can see their book in every bookstore? It’s one thing if they want to see it in their local store(s), but we’re not interested in nationwide scale.
Some people look down their nose at print-on-demand. It’s not “real” publishing. Printing thousands of books at once and storing them in a warehouse—that’s real publishing. Having thousands of books stripped and returned to the publisher—that’s real publishing. Print-on-demand is the equivalent of used toilet tissue in their estimation. These are usually the same people that don’t know that even the major big dawgs are starting to use print-on-demand in some areas to save cost and keep more books in print. Take Random House’s The Random Collection. If print-on-demand technology is good enough for the biggest publisher in the world, surely it’s good enough for any other publisher? We’ll stick to the used toilet tissue method, thank you very much, because it’s paying off.
Borders has been borderline for a long time. Now is the time for it and the “standard” practice of supplying physical bookstores to flatline.