When I first started publishing, I would approach bookstores and have them order my books, which they happily did. I had prepared the book sheet with a cover image description and an ISBN number (not Amazon’s but one I purchased; more on that in another post. I would approach the store manager with a copy in hand and my book sheet, and explain what the book was about and why it would sell in their store.
I had books placed in Barnes & Noble as well as independent stores. They would usually order 5 at a time. I always left them the copy I brought, signed. And one day I received a letter asking if I would be interested in placing at 150 airport bookstores. I was excited until the mail arrived and IngramSpark had sent me back a book. And an invoice.
Now you have to understand how book distribution works.
First rule: bookstores will not buy from Amazon. Aside from their dislike of Amazon’s monopoly, Amazon offers no wholesale discount for ordering. So they buy through a distributor such as IngramSpark, where they get a discount (assigned by the author during setup). This could be anywhere from 40% to 55%. Obviously, the higher the discount, the better. In addition, they get the right to return the books at any time, with shipping paid. This is to minimize the risk to the bookseller.
This creates RISK for the author. Here’s why:
For argument’s sake, let’s say your book is listed at $16.99 and costs $5.75 to print. You offer a 55% discount, which brings the wholesale price to $7.64, and your cost is $5.75, which means your royalty is $1.80, a sad royalty amount to be sure. The bookseller orders 10 copies. Your royalty is $18.00
You also select whether you want returned books destroyed or sent to you, or no returns allowed. If you select no returns, it is unlikely a bookseller will order your book. At first I thought I could sell them myself if they came back to me, so I opted for return to me.
The bookseller sells 5 copies and returns 5 copies to Ingram. Ingram sends me the 5 copies and charges me an adjusted return. Some copies are damaged. I cannot resell these.
5 copies x wholesale rate (since the bookseller paid that), plus postage (approximately $1.50 per book. That means 5 x 7.64 + $7.50 (postage). That means I am billed $45.70 for the returns, and I earned $18 in royalty, so I am in the hole $27.70.
And that is for ONE bookseller. Imagine this happening across 150 airport bookshops? Could you survive that loss? I couldn’t. I declined the offer.
So what is the solution to this problem?
There is a clean solution.
Do not sell to bookstores through IngramSpark. You can do signings, but do not convince the store to buy. Instead, do the following.
- Drop your wholesale discount to 40-45% and select no returns on IngramSpark. The bookstore will not order it UNLESS someone comes in and asks for one. Then they will order the one copy. Even if the order falls through, you will not get charged, as the store will just put it on their shelf or sell it at a discount.
- Adjust the price on Ingram, if needed, so you get a royalty equal to Amazon. Example: List price $17.99 less 40% discount = $10.79; less cost $5.75 leaves a royalty of $5.04 with NO RETURN option. BUT, you say, no one will buy from Ingram then. Maybe. But if someone goes to the bookstore to buy it, it is what it is. Otherwise, and most people do this, they look to see if it is cheaper on Amazon and order from there.
ANOTHER OPTION: More difficult to achieve.
Buy wholesale copies from Amazon, usually less than IngramSpark, and sell to the store directly.
If your book author copy is $3.50, order 10. Shipping is a flat $8 so $43 for 10 books or $4.30 per book. Still cheaper than Ingram. You create a contract for the store to take X number of books at 50% wholesale and right of return. Net payment 30 days. $16.99 x 50% =$8.50 less your cost $4.30, meaning your profit is now $4.20 per book. And you have a store relationship.
INDIE vs BIG PUBLISHER
Big-name authors with publishing contracts do not have to worry about this. They have an advance against sales. If books are returned, publishers remainder them out. The author is not charged. Big publishers have better distribution channels that include Costco, airport stores, chain stores, and so on. Daniel Silva doesn’t sweat his returns. He has his big advance and gets to work on the next book.
As much as being an indie author is good- faster, full control, distribution of your book- it is always the tricky part. Hopefully this helps you navigate where to sell.
I have followed my own advice. With the bulk of sales coming from Amazon (70%+) I have listed IngramSpark as suggested above. I still find books sell there. I do not get returns.
In another column, I will discuss KDP Select (Amazon’s exclusive for ebooks) versus wide distribution.
Until then, share your experiences.
~William
PS: My latest novel, A BOY CALLED SWIFT, is now available (free for KU, Kindle $4.99, Paperback $13.99, Audiobook $4.99)
This is an inspirational story about the meaning of life and not wasting any of it. It is the life story of a boy who ages ten times faster, physically and mentally, than normal, so his life is only about nine years. But he makes the most of it, finds love and happiness, and ensures that his life has meaning. Readers have raved about it.
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