November 28, 2011

Local Indie Bookstores

We’re intimately familiar with the pressures on public libraries, and worried about closures and reductions of service. Independent bookstores have it worse, for a number of reasons. Indie bookstores’ fortunes decline as online retailers thrive, and as people move from print books to e-readers and non-literary, screen-based reading in general, while public libraries are able to adapt to these changes to an extent, by providing electronic services. There is a romantic attachment to indie bookstores just as there is to libraries, perhaps even moreso because they are more threatened. I have some comments to make about this, prompted by a brief article appearing on Salon.com today, titled, “Support your local indie bookstore!

First, if something like indie bookstores, a traditional form or cultural touchstone, needs an appeal for support based on what it represents, then it may be a sign that it isn’t needed the way its supporters wish; otherwise the need for it in itself would lend the support. The article in Salon claims that most people simply don’t realize the role that indie bookstores play in shaping reading tastes, in bringing the good books to the market, but no evidence is supplied to support this claim, and I don’t really believe it. If a high proportion of book sales were through independent bookstores, then this claim would make some sense, although it would still be necessary to sort out whether booksellers market the books that they do based primarily on their own judgment or based on reviews and publicity (and I suspect that reviews and publicity have a more important role).

Is it a sad thing that independent bookstores are dying? Yes, of course. But as a niche publisher, I have a role in killing them, alongside Amazon and e-readers, because I am not able to be profitable and support indie bookstores at the same time. Independent bookstores, and larger brick-and-mortar bookstores for that matter, are based on a business model that is at odds with the growing sector of the publishing industry which is composed of smaller publishers who are focused on topical or geographic niches. In trade publishing, that is, the bigger part of the publishing industry that is based on books for general readers that are sold in bookstores, certain market structures prevail that allow bookstores to be profitable. Among these are a discount rate of 40 to 45 percent off the retail price and the expectation that bookstores will return a high proportion of copies to the publisher for a full refund. Additionally, bookstores and publishers depend on distributors, who generally take an additional 15% off the cover price. Publishers are able to be profitable under these conditions only through high sales volumes. That means that niche publishers, who by nature are going to have very low sales volumes by comparison, cannot afford the prevailing 60% discount or the high rates of returns, at least not without setting retail prices that readers are unlikely to pay. On the other hand, niche publishers are able to sell on Amazon and other online book retailers and give a discount to the retailer of as little as 20%, and can refuse to accept returns altogether as well. Those conditions allow niche publishers to be profitable. And in fact, at present it is niche publishing that is the profitable part of the trade market.

So, with much sadness, I say to indie bookstores that I am sorry to see them go, but I cannot sell to them on their current terms and have a viable publishing operation, and so far I have not found that I need their marketing in order to sell books.

Thoughts on this? I really do wish I could afford to sell to indie bookstores, but I can’t.

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6 Comments »

  1. Like many, I have followed Melville House in forming much of my opinion on Amazon and its implications for publishing/bookselling. My impression was that generally the discounts and terms demanded by Amazon make it very difficult for publishers, even as Amazon’s market share makes it difficult to refuse the offer. You seem much less worried about the discount rates and other terms demanded by Amazon. Is this something that varies widely from publisher to publisher? Or do you think other critics of Amazon in the publishing world are overreacting?

    In the end I am very supportive of indie sellers for the general health of book culture, but I agree with you that if the indies need to even make this sort of pitch/reminder, they have perhaps already lost the battle (or are striking out at the symptoms rather than the cause, etc.). What I have always found more relevant are the arguments about the sustainability of the industry under the indie v. the big-box/Amazon model, so it’s interesting to me that as a small publisher you feel more hopeful about your relationship with Amazon than with the small stores.

    Comment by Evan — November 28, 2011 @ 12:54 pm

  2. Yes, I know it sounds strange and I feel guilty about saying it. But it goes for Powell.com as well. Readers who want to feel good about buying books online can go there, and I am able to sell there on the same favorable terms as Amazon. I’m not sure what Melville House is talking about. Can you provide a link?

    Comment by Rory Litwin — November 28, 2011 @ 1:04 pm

  3. I should add as a side note that so far I have mostly been participating in the academic market and not the trade market. In the academic market, 20% discounts are standard and the rates of return are very low. Bookstores, other than college bookstores, which don’t operate on the same model, are not generally a part of the academic market.

    BUT. I am starting a trade imprint very soon, and plan not to involve bookstores, at least not on the prevailing terms. We’ll see how it goes.

    Comment by Rory Litwin — November 28, 2011 @ 1:37 pm

  4. This article gets at a lot of what I’m thinking, and mentions Melville House – http://bit.ly/dq3SlQ.

    I think the academic/trade distinction does go a long way in explaining some differences of approach, though… and for my own part I must confess that I live in a very skewed world– Hyde Park, Chicago, where the local indie stores are the academic bookstores. So I may be picturing a utopian book industry that isn’t feasible except in certain university towns.

    Comment by Evan — November 28, 2011 @ 3:32 pm

  5. Dennis Johnson and the fine Melville House staff have written about Amazon on their site.

    Amazon has become a vertically integrated business, which is perhaps not the best option for trade publishers. Certainly, the role it can play for niche academic title is perhaps more compelling.

    But it seems like Library Juice should be able to reach some arrangement on returns and discounts with a natural ally like indie bookstores.

    I would love to see your titles in NYC indie bookstores—St. Marks, Greenlight, Unnameable, Community Bookstore, BookCourt, and others are good places to start a conversation, I think.

    Comment by Jay Datema — November 28, 2011 @ 3:44 pm

  6. When I tried to put together my own thoughts about the future of print publishing (“Writing about Reading,” Cites & Insights 11:8, September 2011), it included a paragraph on the right of return, saying that bookstores need to abandon that unique privilege if independent publishers are to succeed. So I’m not going to argue with you here: I think you’re right. I hope what Jay D. says above is true.

    Comment by Walt Crawford — November 29, 2011 @ 10:25 am

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