Tag Archives: fiction

The Wholesale Market Collapse

So, I completely misunderstood what a post on someone else’s blog was doing, and did a quick summary of the wholesale market collapse in book publishing in the 1990’s, which is what I thought on passing glance that the post was talking about. Since I am having life stuff and not being very efficient about getting my own blog posts together lately, I figured I might as well repeat it here as possible interest. 🙂 So here it is, a bit cleaned up and adjusted:

 

In the early 1990’s, there was a big recession in the U.S. and various forms of economic distress elsewhere, (plus the Gulf War in the U.S. messed things up for a few critical months.) It was the first of the big recessions, which occur at the end/beginning of each decade (we’re due for a new one in the next few years.) In the wake of that recession, which hit retail hard in a number of countries including the U.S. and the U.K., non-bookstore vendors for books, magazines and newspapers such as grocery stores, drug stores, department stores, newsstands, music stores, etc. made some changes. They cut drastically the number of items they sold, first off — fewer books (they sold mainly paperbacks.) And they also reduced drastically the number of wholesale vendors supplying them that they ordered from. As Tom Doherty of Tor told me, in the U.S., the wholesale suppliers for books and sundries went from about 600 different companies to 6 large ones within a few years. This devastated most of the magazine market as well and led to the beginning of the end, etc.

Mass market paperbacks are not big moneymakers for publishers because they don’t make enough profit with shipping and printing costs and the price discounts on top of the list price. When unsold mass market paperbacks are being returned, vendors rip off the front covers to return them to the publishers for credit and pulp the rest of the books because that’s cheaper than trying to ship them back for the full refund from the publishers, who pay the shipping costs for returns. So unlike hardcover and trade paperback returns, which are returned as full books, returned mm paperbacks can’t be returned to inventory and resold. What makes mm paperbacks useful is that they can be sold in bulk in wide distribution through the wholesale market, which makes up for the costs. When the wholesale, non-bookstore market radically shrunk in terms of distributors and buys from vendors, it was an enormous loss, especially for sectors of the market that do well in mm paperback, such as genre fiction and self-help. The entire fiction market went into a slump from which many sectors still haven’t fully recovered. (Fantasy was spared more than most because it had a bunch of big books doing well in hardcover in bookstores during the time period and was in the middle of an expansion.)

With the mammoth losses in the wholesale non-bookstore markets, that meant trying to get more mm paperbacks moved into bookstores for sale. And the bookstores didn’t really want them because they don’t make money for them because they don’t sell most of their stock in bulk. Which is why a lot more fiction started coming out first in hardcover and trade paperback than they used to do — to get the bookstores to play ball and make decent margins, as well as to get more reviews and library sales. The bookstores are also fewer in number, so even if they wanted to, they couldn’t make up the loss of market. The big chains were opening up their superstores in the 1990s, so they did take some large numbers of mm paperbacks in bulk, but they also deliberately wiped out a lot of the independent bookstores, so that the overall number of bookstores decreased throughout the 1990’s. That meant even fewer vendors for publishers since the wholesale market didn’t come back and in fact got worse. And the big bookstore chains were owned/bought by corporations that didn’t really care about their success in the weird world of book-selling but instead pressed for constant growth beyond what the stores could do, saddled the big chains with debt they couldn’t keep up with, and milked the chains for cash/stock buybacks by slashing staff, etc. That’s what took out Borders and it’s currently killing Barnes & Noble.

When Amazon lit up the tiny e-book retail market a decade ago, that helped since e-book sales took the place of some of the lost mm paperback sales. But e-books, requiring electronic equipment, Internet hook-up, etc., were always going to be more limited a market, and when Amazon kept trying to keep a monopoly on the whole market — largely successfully — that even more limited the market. So e-books have leveled off in sales, especially as Amazon has less and less interest in them (e-books only make up a tiny part of its sales, like 3% out of the 7% total of their revenue for all their book sales.) Neither e-book sales, nor fishing the best self-pub products for reprint opportunities were going to save book sales fully. The YA and middle grade book expansion — which was largely in hardcover and trade paperback — in the early oughts did boost those sections considerably but that has also leveled off somewhat. A pricing war between WalMart, Target and Amazon — all wholesale accounts — helped things in the U.S. for about a year. Renewed Hollywood interest in adapting books for t.v., streaming and film helped, (that sort of thing had also declined previously in the 1990’s.)

Book sales have improved, a lot of indies have done well, smaller chains that can manage their inventory and store rent or mortgages have done well. The U.K. market is actually a lot healthier than the bigger U.S. one. The industry is basically doing the sort of growth rate that it did before corporations kept pushing for bigger returns in the 1980’s and 1990’s — low, small percent growth, narrow margins. More books are put out now than before and the market got much better globally. But there are fewer vendors, bookstore and non-bookstore, than there were in 1990. The wholesale market is still shrunk, hurting lots of different products. They need more places that sell books and that they can sell to in bulk amounts. And they haven’t figured out a solution to that yet. They can’t go to China for sales like the movies or music. And it doesn’t help that book readers are marketing resistant, especially for fiction, and tend to not buy ancillary merchandise to books, unlike other entertainment and info products. (Piracy doesn’t help either.)

 

So that’s not a finished essay, obviously, but may provide a bit of helpful information.

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Interesting Articles for a New House

Instead of just dusting cobwebs out of me old blog, how about some cobweb art from artist Emil “Rocky” Fiore, who takes actual spider webs and funkily preserves them:

I’m happy to say that my new house seems to be mostly spiderweb free, not that I mind them in the garden. Instead, it is filled with boxes. Really far more boxes than one should have. And all apparently have to be unpacked.  So for the moment, here are some interesting thoughts by others about book publishing and fiction publishing:

Laura Miller uses the saga of Harry Potter in “The Making of a Blockbuster” to give one of the most accurate portrayals of how fiction publishing works that has maybe been done in media. No Hollywood bombast, no books are just like fill in the blank failed metaphors. Instead, it talks about the realities of fiction readers and how that translated to a small children’s book purchase becoming the behemoth of fiction.

Richard Parks muses on different ways that people categorize the fiction they love in “Time for Some Name Calling.”

My online pal, author N. E. White, looks at some of the realities fiction authors are grappling with these days in “What It Means to be an Author in the Internet Age.”

We’ve been talking about how one of the things that publishers would eventually start doing with the development of the e-book market is bundling — putting print and electronic material together for sale. Angry Robot Books outlines how they are now doing a bundling program and doing it in partnership specifically with independent booksellers. This and the increasing removal of DRM from e-books marks the beginning of the e-book market headed out of the Wild West of childhood into a solid adolescence and the next stage of development.

Author Charles Stross looks at differences between how e-books and print books operate from different focuses in the market (no, not the price and cost thing,) in “Why E-Books Are Not Like Paper.”

 

 

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We are not two islands

It is a fact of fiction publishing that you will regularly find yourself in a conversation about literary versus commercial fiction or literary versus genre (commercial) fiction. These are artificial and extremely unhelpful terms, the theory of having two islands, one for the nobles and one for the peasants. The idea is ingrained that the fiction for the nobles (literary) is poorly understood by the peasants and doesn’t sell well, and the fiction for the peasants (commercial, genre,) sells wonderfully.

And it often does. But many “commercial” titles don’t sell well at all. And the exact same pyramid pattern occurs with titles that are sold as literary and/or considered literary by media, etc.  Because the term literary in the marketplace is a marketing term meaning certain marketing channels will be used for promotion, and not a reliable predictor of sales or just about anything else. (And it has nothing to do with arguments in academia either.) Over on his blog: nihilistic kid, Nick Mamatas, as tired of the two islands mythology as many others who can pay attention to a bestsellers list, got irritated by reports of novelist’s Lee Child’s assertion of superior commercial sales power over acclaimed writers like Martin Amis and Ian McEwan in an interview:

http://nihilistic-kid.livejournal.com/1473470.html

Mamatas ran the numbers and discovered that McEwan is selling more than Child. Both McEwan and Child sell well, as does Amis. And that’s the point. Maybe hard figures will put the two island mythology to rest, but I doubt it.

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