Wednesday, July 14, 2004
Stick it to the consumer
Time for another round of Stick it to the consumer
While reading scimon's journal on my friends page, I came across a link about second-hand books that led me to a NY Times article. (You'll have to sign up to read the article, but at least that's still free.)
I'm surprised and I shouldn't be, especially when greed is the main focus of business these days.
When it's all boiled down to basics what remains is publishers upset that they're not getting the original price for books and that second-hand bookstores and resellers are making a big profit and asking for more books. Amazon.com is the focus of much of the article because, since 2000, Amazon has had the audacity to list second-hand books at bargain basement prices right next to the full priced books. *Gasp of horror* What's even worse is that people are buying the cheaper books. Is it any wonder publishers are beginning to worry about their profits leaking to co-ops and second-hand bookstores like Abe Books, Alibris Books, and other private sellers listed on eBay and Amazon? Their profits are being diverted to intelligent people who know the market.
Text book publishers thought they had the problem of second-hand books being resold licked by putting out new editions every two years, forcing poor college students to purchase new books in order to complete their education, but even they have noticed a dip in their profits, a dip of 3%. *another gasp of horror*
Publishers want the whole thing stopped. They want their profits and consumers, canny customers that they are, refuse to play by the publishers' rules. They are seeing the book equivalent of Napster haunting their bottom lines.
What publishers need to do is buy a clue. If they paid attention to the trend in second-hand books, books that someone bought at full price and is reselling or books that publishers gave up on and sold to a remainder bookseller, they might see greater profits. Of course, that would cut off the supply of available books to second-hand and remainder booksellers, but business is business and publishers expect to make a big return on their investment.
If you're not into publishing, here is how it works. Publisher decides to buy a manuscript from an author and print out many copies of the books. If the author is considered a mid-list writer (someone whose books sell about 30,000 - 100,000 books) they order a small print run. If all those books sell they order another print run of a similar amount (or larger if the books are selling quickly) and sell those. If, however, all the books do not sell and remain in their warehouses, they sell the books to someone at a much reduced price (usually for the cost of materials and labor, which is very cheap) and that buy resells the books at rate that includes a small profit margin, but is still much cheaper than the cover price. Those books are called remainders.
However, lots of people buy books at the cover price, or on sale at bookstores when they can't move the stock in a specific amount of time, and they read the books and sometimes sell them again to a second-hand book buyer for half the cover price or less. Those enterprising booksellers then resell the books and make a little profit on it. With the advent of the Internet and eBay and easy access to advertising and information, regular people who bought the books at the cover price or on sale are reselling those books themselves and making back some of the money they spent to buy other books or even other things, like paying rent and utilities or saving for a trip to the grocery store. And publishers do not like this trend. They feel they have been cheated out of their profits. Right!
Second-hand bookstores have been around since the beginning of publishing. The problem is not the secondhand bookseller, but the fact that s/he is making a hefty profit from what has always been a marginal living at best. Stores like Half-Price Books, Abe Books, Alibris, etc. have latched onto the Internet and turned a marginal business into a multi-million-dollar enterprise that is taking small bites from publishers' caviar and now publishers are sitting up and taking notice. Well, I have news for them, if they want a bigger piece of the pie there are other remedies that do not include lining up second-hand booksellers in their sights.
First, they should keep authors' books longer instead of dumping them after a few weeks. It also wouldn't hurt to actually publicize the books and give each author the attention and publicity they deserve and which will result in more sales of those books. Second, they should consider charging more realistic cover prices for their books, prices more in line with what they spend to produce the book and not try to make all their billions in the first batch. This will mean they will have to print more books at the outset, but it's better to sell a million books for a dollar than it is to sell one book for a million dollars. The amount is the same, but the impact is greater and more noticeable. Third, if they can't get with the first and second programs, they should continue what they have been doing and let second-hand dealers and individuals make a little money at the expense of the publishers' short-sightedness and stupidity. What's next, forcing libraries to charge for each book checked out? After all, this is America and the name of the game is FREE enterprise.
Publishers have no right to complain that books are being bought and resold and sometimes even resold again. It is a sure indication the book is worth reading and consumers want their own copies. Pay attention, publishers. If a book is being sold and resold and resold again it means people really like the book and they should have kept selling them in the first place. Such sales is an indication that a mid list writer, someone who has performed well over a long period of time, is worth more than the publishers gave them. Publishers should rethink their strategies and put out new and inexpensive editions of books that are hot tickets on the second-hand shelves. The wheel does not have to be reinvented all the time. If it works, use it. If it sells, make more of them.
Publishers should realize they can't have it all and if they are going to let big pieces of food drop to the floor with the crumbs the food will be eaten.