My thanks to Janette Ralllison for turning me on to Editorial Ass. Early in November he had a blog that I'd like to share with you . . . it's a great idea for Christmas and one I've already followed. Hands down, all the family gets at least one book from us every single Christmas . . . oh shoot, all year long. Anyway . . .
Thursday, November 06, 2008
C[r]ash Flow (Or What Went Wrong in October in Book Publishing)
It's the only thing I'm thinking about recently, so I'm going to go ahead and kill the elephant.
Let's talk a little bit about what happened in October.
You've heard about the massive layoffs at Doubleday; you've heard about Harper's terrible state of profit, BNN's worst quarter and projected year ever, and the closing of Impetus, an indie press (which, as I'll explain below, I don't think was Impetus's fault even vaguely).
Yes, there's a crisis.
However. Anyone who wants to talk about "the death of publishing" can leave the room. I'm at the beginning of my career and I plan on being an editor for a long time; a lot of you are yet-to-be-published authors and I'm sure you're equally intent on not seeing book publishing fold (not that it's going to; that's ridiculous). So instead I want to talk about what's actually causing the problem--it might help us come up with solutions for protecting what's important to us.
I don't think anyone's being really straightforward about what exactly happened, and a lot of it is not very complicated.* The crux of the problem is that book publishing is a returnable industry. That means that say Big Chain Store (BCS) agrees to stock a book that my company publishes. They buy 100 copies at, say, $1 a piece (to be easy). They give me $100; I send them the books. Two months later, they didn't sell any, so they send them back. I have to give them $100.
Keep in mind a couple of things about this system that don't work in the publisher's favor:
1) Shipping costs. Books are heavy.
2) Production fees incurred by the publisher (because, unfortunately, we can't return the books to the printer).
3) Inflation. Ha ha.
Why do publishing companies put up with this? Yeah, it's stupid. But it's an industry standard, and if we don't let BCS have the option to return books, they simply tell us they won't stock them. They can carry CDs and calendars and greeting cards, instead.
All right, but this has been the case for awhile. So what went wrong in October?
As you MIGHT have heard by now, we're having some kind of economic hardship (or something like that). So people spent less cash in September and October. So bookstores sold fewer copies in those two months, and were hit hard like all the other businesses in the country and in a lot of the world.
However, BCS and all its chain compatriots are counting on Christmas sales to save them. They need to stock up! They need to plump their stores with new enticing merchandise so they can convince customers to save them from foreclosure!
Where to get the cash for all the holiday books they needed to stock in October and November? Three. Guesses.
In October, bookstores returned so many books that most publishing companies had more coming into them than going out of them. For some companies, the incoming number was more than several months' outgoing.
Although bookstores are suffering (and how), it was the publishing houses that had to absorb the cost of this cash flow creator. This is why Impetus, a relatively new indie company without the history to survive this shock, folded. Some houses lost so much money in returns in October that profits from the entire rest of 2008 have been negated. Can you imagine? Losing enough in a month to destroy your entire year? (Keep in mind that publishing is a very low profit margin enterprise in the first place; now see how if one month involves more outgoing than incoming money you can easily undo the good of an entire year or more.)
Now you can see the ripples that are happening, the layoffs, the dwindling advances, the precautions about acquiring anything in this climate. If publishing companies are shelling out money to publish books that bookstores only bother to stock for a minute and a half, we are all going to hemorrhage money until there is nothing left standing.
This would be a bad situation for more than the sake of my job or your future novel. It's about a lot of things--education, hampered information dissemination, conglomerations swallowing mass media, censorship. Whatever. I could extenuate, but I'll spare you. The point is, when you have a problem, the best thing to do is try to solve it.
For anyone who cares about the book publishing industry and wants to do their part, there's one simple action step:
Buy a book this weekend.
Just buy one.
Buy your sister a book instead of a sweater for her birthday; buy your friend who can't even make toast or boil water a beginner's cookbook; buy your company's receptionist a novel you liked because most people probably ignore him/her (it's always a her, though, isn't it?) and you'll make his/her day.
Buy your holiday gifts now. Instead of a CD for your brother, buy him a book on his favorite recording artist.
Instead of going to the library this one week buy the book you were going to read--it might only be a difference of a couple of bucks in the end. One day this week, make a peanut butter sandwich, skip going out for lunch, and buy a paperback.
Got an anniversary? Skip chocolates; fiction is sexy.
Got a non-reading friend with a birthday? Buy them a book and tell them it's high time they got over it. Or, more kindly, that you're doing it to sponsor your own future writing career. Or blame me if you must; I can take it.
It doesn't matter what. It doesn't have to be a literary fiction hardcover. If could be a $5.99 mass market nutrition guide, a $4.99 young reader chapter book, a Harlequin romance. Your money will still prevent returns of other books--literary fiction is usually the first to go--and will trickle down to the publishing companies, who will then be more likely to be able to afford to publish unprofitable literary fiction. Even if it's not by your favorite author or your favorite publishing house, your favorites will be indirectly affected.
It doesn't matter where. Sure, buying at the chains will help against the returns, but you can help out the publisher with your purchase no matter how you get it, even on the internet.
I'm not saying this for purely selfish reasons. I work with books because I love them and think they're important, not the other way around.
**Insert here the eternal and immortal invitation for anyone who knows better to please correct me.
Isn't that a great idea? More can be found within the pages of a book than the latest release of Warcraft. Imaginations are stretched, dreams are sparked, ambitions relit . . . find good authors and you will find that for just a moment in time you will be inspired, uplifted and entertained. The beauty of a book is simply this, it can be revisited over and over without ever paying another dime. It sits on the bookshelves of your home and waits for you to pop in for a visit again.
I crave a good story like other people crave chocolate. I believe I've mentioned that before. One of my all time favorite things to do is simply to curl up on the couch or in my bed and read. So for Christmas this year? Buy someone a book.