In my last blog posting, Bad News/Good News, I promised to continue my comments on where the publishing industry stands right now. And the news, generally speaking, is glum indeed—particularly among the giants in the industry. Simon & Schuster’s parent company, CBS, announced that the publishing house had an operating loss of $2.1 million compared to operating income of $14.6 million in last year’s first period…a $16.7 million decline, as sales declined nearly 20%. Harper Collins reported almost the same sized drop in revenue and a $38 million loss. And Bertelsmann reported that total revenue fell 7%, with the company having a net loss of 78 million euros ($106.4 million) compared to earnings of 77 million euros ($105 million) in last year’s first quarter—a net decline of $211.4 million. Though no mention was made of Random House’s performance, Bertelsmann expects revenue and profits to decline for the year.
The good news, though, is that The Permanent Press is doing a hell of lot better than any of the giants, as our income from book sales have more than doubled from the same period last year. Of course, we’re not dealing in the millions, only in the tens of thousands, where total income from book sales came to $105,000 rather than the $42,000 posted for last year’s first quarter. The bad news, for us, is that it is becoming increasingly difficult to collect money from our largest wholesaler, Baker and Taylor, who owe us $101,000—$46,000 of which is more than 90 days overdue. This has produced a squeeze based on success, where our printers are eager for prompt payment and our major wholesaler seems intent on holding on to our funds for as long as possible. My guess is that this is due to the financial pinch everyone is suffering. Hopefully this will be resolved shortly, because B&T has been a much better wholesaler than Ingram, who we dismissed two years ago…along with attempts to sell books to the Barnes & Noble stores.
It’s peevish, I know, to hold grudges and delight when others in the business, who have treated us badly, suffer. But, hey, I’m neither Mother Theresa nor Gandhi, and so the declining fortunes of Barnes & Noble put a special smile on my face. Back in 2004 we published Kay Sloan’s The Patron Saint of Red Chevys, and it was made A Barnes & Noble Discover Great New Writers Selection. That’s when the trouble started. We were told by Jill Lamar, who headed this program, that this would mean a large purchase, display space with other Great New Writers selections, and that B&N would discount all these books at 20% and put flyers all over their stores. But we were urged to reduce our projected $26 publishing price to $21.95 “so that we can sell-through and this should help a great deal.” Well, they were the experts. How could I resist. The upshot was that they order 3,300 copies directly from us which caused us to order 5,000 copies instead of the 1,500 we had planned on. When, four months later, they returned 3,000 copies I was shocked. “What happened,” I asked Jill. “You didn’t get enough publicity for it,” she answered, apparently oblivious to the “sell” that B&N would be supplying that very publicity.
I decided, after that conversation to speak with a publishing friend, Jill Schoolman, at Archipelago who, the year before had a book chosen for the Discover program. It turns out she had the same experience, being told by Jill Lamar to reduce her price, and how this would result in selling most if not all copies. B&N ordered 4,000 copies of her book and, four months later, returned 3,600.
Worse yet, these returns, though purchased from us directly, were returned through Ingram—ninety percent of them in unsaleable condition. The dust jackets were scuffed, or the edges of the spines or book covers were dented, and more than half of them had Barnes & Noble stickers on the front cover. Had B&N returned them to us, I would have rejected them, and so I called Ingram and complained on two grounds: one being that they hadn’t ordered through Ingram and also that the cartons Ingram returned the books in were poorly packed so that book shifted about loosely, causing additional damages. Ingram’s answer was that “We have an open return system and accept books back whether they are ordered form us or not,” and they took a credit for these returns of $33,000. “But they were poorly packed. Do you send books to bookstores loosely packed?” “No, we secure them in boxes with shrink wrapping around the lot of them.” “Then why don’t you do that for returns to publishers?” “It’s too costly.”
I demanded that they take back all the damaged books and credit us back for them. “Sorry, we only allow a maximum of 10% in credits a year no matter what the reasons. That’s just the cost of doing business with us (along with charging us for maintaining our books on Ingram’s website)” Well, the good news that came out of all this is that after a year in which Ingram ordered books from us, and paid us nothing until their chargeback was eliminated, we fired them. And, surprise, surprise, we found that our sales not only were unaffected, but that we were now able to sell to Amazon.com directly, who never over order and pay within 30 days time, instead of having Amazon order from Ingram.
Good riddance to these aggravations—which leads to this piece of advice to small publishers: avoid both Barnes & Noble and Ingram like the plagues they are. (Another ridiculous hurdle that B&N imposes on small publishers is that—unlike the way they treat the giants—their Small Press buyer will order only after seeing finished copy of the book, by which time one has already settled on a print run determined in part by advance orders.) Barnes & Noble is just another superstore, like Walmart, that likes to stock its abundant shelves with merchandise at no risk to them, since everything is returnable, even if it's left in shabby condition, while the Discovery program served their purposes of cloaking themselves, however falsely, with having "literary" sensibilities. But deep down, like Ingram, they treat their suppliers shabbily, for their overwhelming concerns are with their "bottom line" profits. Despite their public gloss and insider reputations, publishers deal with both of them at their own risk. To have any chance of long term success means dealing with booksellers in a mutually beneficial and respectful way, which is why we prefer the small, independent bookstores over the chains, and reject high-handed wholesalers like Ingram.
Okay, enough with the complaints. Here is the unabashedly good news from The Permanent Press:
Chris Knopf’s Head Wounds is one of three finalists for both ForeWord Magazine’s Mystery Award and the IBPA’s Ben Franklin Best Mystery Awards for 2009. Ceremonies in New York City by the Independent Booksellers Publishing Association on May 28 will announce winners in all categories. Also, Chris had a wonderful interview in The Hartford Courant in their Sunday, May 10 issue with Carole Goldberg, a member of the National Book Critics Circle, in which he had sage advice to give to writers. The link to it is well worth reading on line:
The American Library Association nominated Ivan Goldman’s novel The Barfighter (released in April), as a 2009 Notable Book. Ivan, besides his knowledge of boxing, was also a Rhodes Scholar and has a wonderful blog, “Digging Deeper” that nails it politically. His latest, a must read, is entitled Obama Lets Financial Dogs Out, is one of the best takes on Obama’s financial advisers. You can read it by clicking on to his site: http://www.ivangoldman.blogspot.com/
Here’s some other blog news: Louise Young, whose novel Seducing the Spirits will appear in November (one of two first novels we put up for the $10,000 Mercantile Center for the Novel’s First Novel Award and for the National Book Award —the other being J.P. White’s Every Boat Turns South, appearing in September) had her Red Room blog chosen as the best blog of the week a couple of weeks ago by this writers site (http://www.redroom.com/), and Charles Davis (whose classic first novel Walk On, Bright Boy, drew rave reviews, whose second, a satire, Walking the Dog, was published last year, and whose gripping third novel, Standing at the Crossroads will appear in 2011) had his blog chosen the week after that. On our recently updated website, http://www.thepermanentpress.com/, you can see and read about Louise and Jay’s novels listed under forthcoming books. Both are very special. Charles's fiction is in our Backlist.
A last word concerning Award nominations: M.F. Bloxam’s The Night Battles and Amy Boaz’s A Richer Dust are finalists in the ForeWard Magazine’s Book of the Year Awards in the Literary Fiction category.
And another bit of excellent news: Connie Dial’s Internal Affairs (due in July) received an unsolicited and powerful endorsement from one of America’s premier mystery novelists, Thomas Perry, an Edgar Award winning and national bestselling author who called it “A fascinating thriller in which the savage murder of a female police officer with an edgy personal life exposes an LAPD we haven't seen before: the gulf between careerists and crime-fighters; the half-supportive, half-cutthroat coterie of high-ranking women; the undercover surveillance specialists who are never in the news. Connie Dial brings a fresh, authentic voice to the genre… a talented writer with an observant eye and a good ear for dialogue. It was a pleasure to read her first book.”
Until the next posting and, as always, I welcome your comments.