Hi Jamie
I’m really enjoying your posts: to the point and insightful as ever.
I wanted to pick up on a point in your first article, which I think may recur and which I think it would be helpful to unpick a little for readers who may not be familiar with the labyrinth that is the book industry supply chain.
You described Bertrams and Gardners as “distributors”. In my experience there’s a whole load of confusion in the book industry about what is a “distributor” and what is a “wholesaler” — a confusion compounded by the fact that some people use the terms interchangeably, some industries use the terms differently, and some wholesalers also offer distribution services.
I always found it helpful to come up with three types of distributor, none of which is a wholesaler …
- “Pick-Pack-Dispatch Distributors”: who warehouse publishers’ books and send them out to customers in response to instructions from a publisher (who has dealt with the financial transaction directly with the customer). The fee for this service may be a per unit fee, or may be a commission on net sale value)
- “Full Service Distributors”: organisations which warehouse, pick, pack & dispatch, and provide customer services, invoicing and credit control. Full service distributors may be supply chain specialists (Marston, NBN, Turpin, Booksource et al), or they may be the supply chain arm of a very big publisher, which also offers third party distribution to other publishers (for example TBS, GBS, Wiley, Bookpoint). The fee for this is usually calculated as a commission on net sales before returns, although per unit fees are not completely unheard of.)
- “Distribution plus providers”: organisations which provide full service distribution plus sales and marketing services. (A couple of examples of distribution plus suppliers working with independent publishers are Inpress who outsource the physical distribution to a third party, and Turnaround who have their own warehouse). The cost of “distribution plus” is usually a commission on net sales, and is usually at least 10% of net sales value more expensive than “full service distribution”.
All of these distributors like to offer their services to publishers on an exclusive contract (we supply all of your customers big and small), but the reality for most small independent publishers is that they are not financiallu viable without the benefit of direct sales to customers at low discount (and no commission paid to a distributor). Therefore — from the publisher’s point of view — the ideal is for full service or distribution plus for book trade sales that are very difficult to make without a recognised distributor — and self-distribution for non-book trade sales. This works fine until your list reaches a size where it is impossible for you to keep sufficient stock of each title to hand to service direct orders yourself. For many independent publishers this is a real pinch point in their business — where they have to make the “stay small or scale up” decision.
So, you may say, what about Bertrams and Gardners? In my view they are best described as “wholesalers”, not “distributors”, notwithstanding that from the outsider point of view they do “distribute” books to the trade. The transactions that take place between a publisher and a distributor are quite different to those that take place between a publisher and a wholesaler.
In the UK the main wholesalers are Bertrams and Gardners, who supply much of the the retail trade, and other bulk book purchasers outside the trade. They often have contracts to provide fulfilment for some of the better known online bookshops. But usually they source those books from distributors: in this way wholesalers are a customer of the publisher — just not the end customer. This distinction is beginning to become blurred with Ingram’s ongoing march into the realm of being a one-stop supply chain solution. But that’s a whole post, and for another day.
This is not in any way intended to be pedantic — it is in the spirit of adding to the generosity with which you are sharing your knowledge and insights. In the final analysis, you are bang on the mark: profitable independent publishing is only possible if you are creative, clever, and are brave enough to sometimes say “no” to doing things the way everyone else tells you they should be done.
