A series of articles in which Valley Press founder Jamie McGarry reveals his tried-and-tested formula for making a living as a self-employed literary publisher. This article is a addendum to part one of the series, responding to feedback from other publishers in the four days immediately afterwards.
In the first article of this series, I gave a detailed breakdown of a book’s RRP, explaining who gets which bits of (an example) £8.99 once it is sold to a reader — and suggested that a new ‘small press’ publisher could expect a net profit of £3 per copy. In part two, I am going to explain how to build a business around that figure; but we’re not ready for that yet. We need to talk about discounts.
I confidently wrote in the introduction to part one that I would explain how to ‘hang on’ to the £3 no matter what; and I when I shut my laptop after finishing it, I felt I had, by touching on other ways a book might sell (like at book fairs or through direct online selling). I wasn’t prepared for the reaction of the small press community; it turns out a lot of people aren’t getting their £3. But they should be. We need to get this sorted.
First of all: let me describe what it takes to seriously penetrate the retail market, to publish the way a company like Penguin does. It takes an army of sales reps, wholesale discounts of 50% at least, a publicity campaign running into the thousands of pounds, a catalogue, a hundred review copies minimum, probably an author tour (with associated expenses), and definitely another level of distribution taking an extra 15% of any money you make. It takes print runs of a thousand copies at least. And it takes putting up with returns; ‘sale or return’, a system where a bookshop can order 300 copies, sell two, and send back 298 with a bill for all their money back, please.
Can this work? Sometimes. It’s a reasonable model for those at the top of the tree; and I occasionally do those things at Valley Press — it’s great to be able to walk into a bookshop and know, for certain, you’ll be able to find a copy of one of your books. But I’ve been going for almost eight years; these articles are about starting a new company which you are going to make a living from. At first, you’ll be publishing books — maybe even pamphlets — by poets who haven’t won big prizes; or difficult literary fiction that a dozen other publishers have turned down; or non-fiction on super-niche subjects by writers who aren’t household names.
So look at yourself in the mirror. Is the next book you’re publishing going to be able to seriously penetrate the national retail market? Even if it is, do you have the thousands of pounds to invest to make that happen — knowing that it’s a bet, like any investment, and you could very easily lose that money?
If your answer is ‘yes’, congratulations — you don’t need this article. If the answer is ‘no’, you shouldn’t be doing any of those things in paragraph three.
Keep looking at yourself in the mirror. Now say this: I have all the books. If you want one, you have to pay me. If you’re publishing new work, you’ll have exclusive rights to the volume; if you’re re-releasing public domain stuff (which can be fun), then your edition is unique at least. No-one else has this book, just you.
So next time a wholesaler or retailer gets on the phone, demanding a bigger discount than you are comfortable with, you can say to them: I have all the books. If you want one, you have to pay me. (Or maybe a slightly politer version.) Then, they’ll either agree to pay you a suitable amount — firm sale, because we’re not getting involved with returns — or they’ll go away. And if they go away, what have we lost?
The book won’t be sold through Amazon!
Yes it will. Recently, anticipating this series of articles, I changed the settings for a half-dozen older Valley Press titles (ones that had settled into a pattern of sales) so the distributor would only sell them on at 80% of the RRP, and not accept any returns. There was just the slightest murmur of discontent from other parties involved, which could be summarised as ‘we’d like a larger cut, please’, to which my reply was ‘not this time’.
I then asked my wife to order a few of these books directly through Amazon UK, ones where the status said: ‘not in stock, delivered in 1–2 weeks’ so a new order would be necessary. Two weeks later, she got her books, and in due course the distributor got their 80% — and I got my £3 gross profit — on exactly the terms I’d dictated. No issues at all. Amazon work on volume, so even if they only make 5% on a transaction, they’ll still do it to keep the customer happy. The sales patterns for those older books haven’t changed.
Even if I’m wrong, or if they change their policy on this, we can always sell through Amazon as a third party. That’s the bit where it says: ‘available from these sellers’, or ‘new and used copies available’ — it’s pretty high on the page. And if we’ve got all the books, and no-one else has any, then we can sell there for full RRP plus postage to our heart’s content. So Amazon is fine.
The book won’t be sold in bookshops!
Remember, we’re not going for retail penetration — that takes thousands of pounds of investment. The ideal readers for the niche books published by our small press aren’t going to stumble upon them on a table in Waterstones; that’s not how discoverability works at this level. There are hundreds of thousands of new books published every year, and there’s not enough shelf space to go around; not for the big names, even.
So our bookshop sales will be at events, or in a few cases, through direct customer orders. Continuing my experiment with the 80% books, I went into a bookshop (where my face wasn’t known!) and ordered a copy of one, knowing that they’d probably get it from one of the big wholesalers, and the big wholesaler would still have to pay 80% of the RRP. They did: I got the book, and my £3 too. The bookseller only made 10%, but then, it was a risk-free transaction. And the wholesaler still got 10%; don’t feel sorry for them! These are huge companies; in our example, we are a tiny small press. And we can set our own discounts.
The book won’t be sold in … um …
That’s right: we only need other people’s permission for those two outlets, don’t we? So I rest my case: we can fix the system so we always get £3 per book. Now hit the comments and tell me why I’m wrong.
(I should end by saying, I love bookshops and have no intention of making them survive on 10% of the RRP: nor should you. A small publisher can sell directly to retail at a 35% discount and still make the £3 described in my model last time — everyone can have a fair share, my point here is only that we have more negotiating power than we think.)