Nathan Bransford, Author


Tuesday, December 16, 2008

HarperStudio and Borders: No Returns

The HarperStudio cavalry is on the march.

Via the (indispensable) HarperStudio blog and the WSJ comes news that HarperStudio and Borders have reached an agreement on a framework for ending returns. In exchange for a discount ranging from 58-63%, Borders will buy HarperStudio books on a nonreturnable basis.

On the HarperStudio blog, Bob Miller writes that they had originally hoped to have a more expansive non-return program, but after six months of discussions they decided they needed to have a mix of returns and non-returns because some accounts can't or won't go the nonreturnable route.

The returns model has long been a problem for publishers, who often end up having to print (and pulp) twice as many copies as actually sell, an economic and environmental mess. While it allows bookstores to be flexible with ordering and theoretically allows them to take chances on unknown commodities without being stuck with the bill if they don't sell, some have called the process, well, sloppy and inefficient. It's a system that few people have any affection for, and now Borders is signaling a willingness to tweak the model (of course, at a steeper discount). (For more background on returns, please see this essential Richard Curtis post, via Moonrat).

Questions remain. Will booksellers grow more cautious in taking on new titles when they know they can't return them? Will they stock fewer titles? Will it be harder for first timers to break out because of cautious print runs? Or will the system make booksellers put more care into the titles they buy and make sure they sell?

It's going to be interesting to see how this shakes out, particularly if it is adopted in a more widespread fashion. But BRAVO for experimentation in a time when we desperately need to see some new ideas in action.






67 comments:

Ink said...

That's fantastic. I'm interested in seeing how this plays out.

Nathan, I tacked a question on at the end of the last thread, and wondered if I should reprint it here... something I'm curious about, and thought others might be too. I'll leave it up to you... (you're a busy man - married, yes, just you wait... - and might not have time to answer all my odd questions).

My best, as always,
Bryan Russell

Deaf Brown Trash Punk said...

I'm nervous as hell about everything, due to the economy, but this should be good to watch and see what happens.

MzMannerz said...

I think it's ridiculous to return a book. Experiencing art is not refundable. You don't receive a refund from the museum if you didn't care for the paintings, or a refund from the theater if the film wasn't up to snuff. Just rankles me. Not that you could tell. :P

Lady Glamis said...

I agree that this is exciting. I sure hope that if I ever break into print that this will not affect my work in too bad a way.

I'm anxious to see how fast this makes a difference, and whether or not others take it on.

Anonymous said...

Does this ring a bell, Nathan?

http://www.ereads.com/2008/12/behind-publishings-wednesday-of-long.html

Morgan

BarbS. said...

Nathan, are returns in this context the books that the seller returns to the publisher, or the books that customers return to the seller?

Thanks!

Juliana Stone said...

A question Nathan...HarperStudio...is it the only imprint that is doing this? Are they a part of Harpercollins? I'm asking because I've recently sold to Avon and was wondering how this might affect me....I see this as a positive move...now if we could only stop all the ebook pirates out there stealing from authors....

Madison said...

I'm open to new ideas. If they work, keep 'em. If not, trash 'em. :)

Nathan Bransford said...

Morgan-

I wanted to link to the Richard Curtis article, but it wasn't loading earlier. I'm going to add it in now.

MzMannerz said...

"Nathan, are returns in this context the books that the seller returns to the publisher, or the books that customers return to the seller?"

Whoops, great question. I recently read a blog post about customer returns which has me up in arms. Completely different situation from books the bookstore didn't sell.

Susan Helene Gottfried said...

This is going to be neat to watch.

My hope is that we'll wind up with a return to the days of hand-selling and bookstore staff being the valuable resources they were once highly regarded for being. I found more than one fantastic author via a great and knowledgeable bookseller.

Nathan Bransford said...

barbs-

Booksellers are able to return un-bought books to publishers for credit. It's a consignment system.

Nathan Bransford said...

JuliaStone-

As far as I know this is just for HarperStudio.

T-Anne said...

I'm OK with it. That's what libraries are for.

T-Anne said...

Oh Dear.. *sigh* you weren't talking about customers were you.

BarbS. said...

Thanks, Nathan!

Ohmy, this certainly will be interesting to watch...

Dan said...

If the booksellers are receiving a steep enough discount, I'd think they could take the same chances as they have in the past with new authors.

If they guess wrong and order too many books, they'll be able put them on the SALE table and at least break even on the remaining copies due to the lower cost.

This method seems more efficient and as though it would also encourage more thoughtful decisions by the purchasers.

RW said...

I read recently (don't know if it's accurate) that the custom of publisher returns started during the Great Depression as a way for publishers to keep retailers, which had more cash flow problems, buying their books, and the arrangement just never went away after the financial crisis had passed. Ironic that it's getting its most serious re-think during the most serious economic crisis since the Depression.

Dan said...

On that note, I know you've mentioned a little about the purchasing process from the retailer's perspective - but perhaps a little more information about *how* exactly the process works could be helpful for the readers?

Do purchasers read the books, or just what the publisher's marketing team gives them to read? It seems in this day and age, product research is something that shouldn't be neglected in ANY industry.

dara said...

This will be interesting to see--hoping that it doesn't make it even harder for us first-timers to break into the market. But I suppose time will tell!

Mim said...

I think that this system will work, but maybe the books should be easier to print on demand. If that makes sense. That way you can be consistently restocking titles that are moving faster than you predicted. Overall it means that less paper is wasted, but I worry about book availability for the sleeper hits.

Netanyahu said...

I think some form of hybrid system would be workable in the short run: enable booksellers to return a portion (say, 20%) of their purchases. That would create some discipline - and additional risk - for the bookseller and give the publisher some cost certainty. This could be a transition to a no-returns system.

Robena Grant said...

This is a lovely holiday gift. I'm anxious for it to work and love that Borders and Harper Studio are willing to try something new. Makes me want to head over to Borders and buy a few more books.

MzMannerz said...

Totally confused, someone educate me: this means that instead of the existing 'consignment' system, Borders will buy the books at an upfront discount and agree not to return them for credit?

dale - lvcabbie said...

Maybe this is off-topic but doesn't that mean that more emphasis will be put on e-books and/or Print on Demand?

Anonymous said...

...and yet another reality check link from galleycat. Nathan, what are your thoughts on the literary agents/agency suffering the same fate as publishers.

http://www.mediabistro.com/galleycat/publishing/welcome_to_the_death_of_publishing_take_forty_103547.asp

Morgan

Mechelle Avey said...

Having independently published my work, returns were something I dreaded. Once I got a huge check from my distributor only to have that cut in half six months later because of returns!!!! That money was long gone. Suddenly, I owed the distributor. Small publishers have it even worse than the big guys. If you're big, at least you can throw some weight around. Kudos to HarperStudio, although soon, one wonders if writers and publishers will do all of the work of getting a book put together only to receive a small gratuity for their efforts. Where will agents be in this brave new world defined by a faltered economy and a preference for digital media?

BarbS. said...

Mechelle Avery,

Oh, how my heart goes out to you! I saw that happen to a friend. It was dreadful...worse than ugly.

I'm not sure that readers prefer to go digital. There's something about curling up with a book-in-hand that a literary prosthetic device can never replace.

MzMannerz,

That's what it sounds like. Eek.

Marilyn Peake said...

In terms of being less wasteful, it’s great that someone’s finally experimenting with ending the returns policy. I imagine this will be a mixed blessing for new authors if publishing houses are less willing to take them on. On the other hand, someone who worked in a major chain bookstore once told me that they had agreements with publishing houses to accept shipments of books by unknown authors along with big-name authors, and they often just returned whole boxes of books by the unknown authors without ever putting them on the shelves. If the Kindle becomes more popular, maybe new authors could be published first in eBook format?

Kristin Laughtin said...

Will booksellers grow more cautious in taking on new titles when they know they can't return them? Will they stock fewer titles?

Ahh, just the question I was going to ask after the second paragraph. I'm interested to see how this plays out. I've long done most of my book shopping at Borders, and I'm wondering how it will affect their selection.

Juliana Stone said...

Marilyn....OMG that's insane.....taking books from new authors and never even stocking them? honestly, that makes me sick...I'm shaking my head as I type....

Scott said...

Bravo for experimentation, indeed. The environmentally conscious angle is a nice touch, too. It does give me some pause, though.

I guess bookstores wouldn't change their buying policy too much as the discount would cover their losses, which would then force booksellers to accept only those titles that they feel will accrue further orders. One hopes, however, that that won't lead to publishers choosing primarily those titles with a strong track record and that the know for sure will appeal to the widest profit base. Kind of the "Hollywood model".

In other words, we could lose a lot of fresh voices.

sex scenes at starbucks said...

Though I agree with the no return policy in general, I thought they also could have eased into it with a "restocking" fee system. It's worked in the hard goods/design industry for years.

lotusloq said...

It's exciting and scary at the same time. I'll be following how this plays out pretty closely. I'm afraid it will mean there will be less space for the new break out authors. Alas! It seems to be getting harder and harder. Maybe this sort of thing will lead to more newbies breaking out in the e realm until they get enough clout to get a print run.

Bethany Hamilton said...

Being an author attempting to Break In, this is scary as well as logical.

I can definitely see the need for a system like this, and why it would be great for the evironment, and the economy.

But...where does that leave new authors?

I pray it's not in eBook format!

Perhaps the tride and true authors should be bumped to eBook since their followers will go there with them, and the book stores should be filled only with new authors.

That way, the eBook reader sales will go through the roof, the greatu authors will continue to thrive, and the new authors will still get their books in a bookstore. Everyone wins!

Yes...that was completely snark.

pseudosu said...

With the onus for selling their stock now resting on the booksellers, perhaps it will encourage them to be more creative and assertive in their own marketing strategies.

I think the buying public (ahem) will have to demand new voices and a varied selection to make bookstores / publishing look how we want it to. As in all things democratic- we seem to get what we deserve, for better or worse.

Janet said...

I think it's a fantastic idea. A more realistic business model should mean a more rational market in the end, and I think one that will ultimately be better for authors.

Anonymous said...

Never mind my earlier post, Nathan. I do not think you can top Janet Reid's response...Classic.

http://jetreidliterary.blogspot.com/2008/12/oh-just-shut-fuck-up-already.html

Morgan

Scott said...

Well said, pseudosu.

I wonder if publishers will end up paying attention to e-book trends in order to gauge what new authors the "buying public" seem to want? Can't figure out another way the word would get back without marketing efforts on their part (surveys, online feedback, responding to press releases, etc.). Perhaps bookstores can stock promo copies or some form of excerpt catalog with the idea being to order from the counter.

Then again, maybe it's up to the agent to sell a little harder? :)

Bea said...

I think all book buying should be through "print on demand." The bookstores could order one copy of everything to keep on their shelves. People walk in and browse. If they want to buy a book they see, they fill out a little card with title and author and their shipping address and take it to the cashier, who orders the book for them. If the book is a blockbuster hit, it might take a couple of weeks for it to arrive, but hey -- people were happy to sign up on a waiting list for the Prius when it first came out, right? Just think of all the trees that would save, not to mention author $$ for print runs that don't sell.

BarbS. said...

And well-said, Scott!

Promo copies and excerpt catalogs are good things, but I sometimes think any kind of printed matter is no longer the way to generate interest in a book, because the market is cluttered and consumers are overwhelmed by choices.

So how does a publisher spread the word?

Consultants are working on the problem as we "speak," and the solutions are going to involve some pretty creative hype-making.

Nathan Bransford said...

Bea-

That already exists -- it's called Amazon.com

Anonymous said...

Bottom line this is good for the publishing industry. Not so good for writers trying to break in and develop a career. Just as you posited, stores will be more loathe to carry a new writer and when they do, it will be a pittance, making it difficult for the new writer to get the 'numbers' on his sales that will ensure his career. There may be many more 'one book' writers because of this development.

MoJo said...

The Perfect Bookstore

Verification word: readdeth

Spooky.

BarbS. said...

Mojo,

That bookstore says it all! :0

My wordver is something I'm about to indulge in at the local B&N: spree. ;)

That, too, is spooky!

disorderly said...

The whole returns/no returns system is a nightmare. I'm inclined to believe giving deeper discounts and disallowing returns is the way to go, based on years of experience in the magazine biz. I'm not sure how book publishers handle returns, but in the mag biz distributors and retailers don't actually return the merchandise -- they send only "affidavits," which are signed statements attesting that a certain number of copies didn't sell and were destroyed. Sometimes they attach partial front covers to the affidavits. In cases where they don't, the system lends itself to corruption (read "lying"). One publisher for which I worked caught a BIG distributor inflating its returns in such a way that at the end of one year, the distributor's return affidavits indicated the company returned more magazine issues than it had gotten. (Issues could be returned for up to six months after their shelf date, so six months down the road often several "surprise" returns of an issue suddenly would appear on an affidavit.)

Seriously, maybe a no-returns policy would encourage booksellers not to bite off more than their customers are interested in chewing. In addition, if books can't be returned, maybe they'll be marked down (which would be good for consumers who can wait a while after the initial rush) or donated to reading programs and the like.

No-returns policies are likely to make things a little tougher for new voices, though, and it seems like publishers would be more likely to clamp down on first runs.

Avily Jerome said...

Amen to that! Yay for breaking the mold!

Thanks for the post!

pjd said...

... BRAVO for experimentation...

You're just saying that because you live in San Francisco.

I was about to post something similar to Bea's notion. Are there any statistics on how people buy books? Specifically, I'm thinking that most people buy a book and then don't actually read it right away.

I know a number of people browse a bookstore, then go buy through Amazon. They like browsing, but they don't need to walk out with the book that moment.

Whatever ends up happening, it is likely that the big-box bookstore will be next decade's dinosaur. I am not smart enough to know for sure what the new model for the next 20 or so years might be (I have an idea), but whoever gets it right stands to make bank.

BarbS. said...

Nathan,

Is it common practice for on-demand publishers (e.g., Ink Water Press) to charge writers a fee?

(Oooo...gotta run. B&N closes in an hour! :0 )

BarbS. said...

PS: Thanks!

Bea said...

Nathan, but Amazon.com is not a place where you can take kids to pick out a book to buy with the gift card that Grandma sent them for Christmas. "Oh, let's all huddle around the computer monitor and find you just the right book!" Doesn't work. You need brick and mortar, some music, little kid-sized chairs, a balloon sculpture artist, maybe a counter selling cookies and coffee, a partnership with the local SPCA so you can have PUPPIES to adopt on display. Amazon doesn't have puppies.

Liz said...

I'm wondering more about the on-demand model for books, too. The bookstore experience is definitely part of the product. Just ask B&N. I have no idea how feasible it is for publishers to do incremental print-runs of books. I'm hoping technology is making that more of an option, so that bookstores can shift to a no return policy, buy in smaller lots at a steep discount and get *smart* (you daytime software engineers - here's a product opportunity) about managing inventory. I agree that many trees would breathe a collective sigh of relief if returns went away. But I'm more motivated by the sheer inefficiency of the returns model. When fuel prices are high and the cost of shipping exceeds the cost of what's being shipped, that's a tough inefficiency to subsidize with shrinking profits just because that's the way it's always been done. And as far as honesty re destroyed inventory - contracts in other industries (music and video game cd's) have an inspection right for the publisher, if they want to, to come count and audit the remaining inventory prior to destruction and opt to reclaim it at the publisher's cost for shipping if they want to. They never do, but having the right helps distributors stay honest.

Bea said...

How's this for a business model? Instead of a publisher trying to place books in dedicated bookstores, place sample copies in different businesses -- travel books at travel agencies, books about cars in the auto body shop waiting room, YA books in HotTopic and Claire's outlets, genre romance in the beauty salons. No books for sale, but all could be ordered right there. If you can't get the people to the books, take the books to the people. (Of course it would mean the demise of chain book stores.)

Bea said...

OOh. Even better. No complete books, just partial samples so they can't read the whole thing right there. Like the "search inside" on Amazon. They want to find out the ending, they have to order the book. And people would be less tempted to walk off with a sample that explains how to take a transmission apart, but doesn't have the chapter on how to reassemble it. (And if they did, it would serve them right.)

Leis said...

My take on this whole new world is grim: as difficult as it has been to break in as a new author, it will be close to impossible from here on.

Which is why I've trunked my wips and MS and I am now writing only short stories. This way I can still write and enjoy the craft, and at least some of it is likely to appear somewhere...

Olivia said...

I think everyone has brought up some good points here. This news is both good and scary.

I don't think we should give up our endeavors as novelists, though. Our industry is going through some big changes right now, but that doesn't mean that we will become obsolete, or that there will never be opportunities for new voices to be heard. Embrace the changes you have no control over and make the necessary adjustments. It's the only way to keep your head above water, and you may just find yourself surfing these new waves one day.

emmadarwin said...

Back here in the UK returns are a bit lower than in the US, but still a huge issue. A year or so ago Hachette Livre, Britain's biggest (15% of the market) and most profitable publishing group, went to firm-sale-only of all backlist (i.e. any title more than a year old). The idea is that new and untried titles still need the bigger exposure which only being physically available on bookshop tables can give them, while on the other hand any bookshop worth its salt should know enough to be able to make sensible decisions about how much to order of established titles, and absorb some of the risk which at the moment only the publisher takes.

As far as I know there's no extra discount involved, but as it applies across all Hachette's customers, it's not a case of a special deal. It all seems very sensible to me.

Bethany Hamilton said...

I'm amazed at how many people are ready to let the bookstores go, or don't think there is a need to have books available for immediate purchase. If that's your perrogative, fine, but I'm sure I'm not the only one who would have a nervous breakdown if B&N stopped carrying books.

I browse through Amazon, or even the website of favorite authors when I'm looking for backlists, and then I do my research on the book online. If the reviews are good, if the plotline is interesting, and if the sample provided is a writing style I like - then I immediately do a check of which of the local bookstores carry the book I want and drive there to buy it.

I don't want to wait days, or worse WEEKS to get a book. When I want to read one, I want to read it then. If I purchased books I planned on reading in the future, I'd be even deeper in debt than I am now. Heaven forbid!

I'm also a sinner of the worst kind...I have to read the last chapter first. If I don't read the last chapter, or if I can't, I simply won't buy the book. I've been unhappily surprised one too many times. I have no problem purchasing old favorite authors over the web if the B&N doesn't have it in stock, but I'd *never* do that with a new author.

If publishing ever went into POD only, or bookstores stopped carrying books...I think they'd have to institutionalize me. I'm sure I'm not the only one who feels this way, either.

Bob Miller from HarperStudio said...

Just to clarify for some of the people asking questions about our Borders news: yes, this is HarperStudio only at this point, and yes, this is about returns from booksellers to publishers, not returns from customers to booksellers. The issue shouldn't really be that visible to customers, since most of the books that currently get returned never made it out of their boxes at the bookseller's warehouse in the first place. In terms of presence in stores, my belief is that our titles will get more prominent display, since the bookseller will have an additional incentive to merchandise them.

BarbS. said...

Mr. Miller,

Thanks much for stopping by and clarifying some points.

As you may have seen, readers are enormously interested in the amount and kinds of books that will be available to them, and new writers are terrified that their work, in the long run, won't have a snowball's chance in Mr. Satan's House when it comes to being sold in a bookstore or getting published in the first place.

The strategy may be HarperStudio's now, but who's to say it won't catch on?

All the best--

A note to other posters: Wordver is "boloist." Appropriate, since I've played oboe as a soloist. ;)

emmadarwin said...

"our titles will get more prominent display, since the bookseller will have an additional incentive to merchandise them."

This is the trade-off, of course. While sale-or-return encourages lavish (because safe) ordering by the bookseller, there's a powerful argument that booksellers try harder to sell books they can't return, even if there are fewer of them on the shelves.

And, arguably, publishers' sales forces will have to work harder to persuade booksellers that their books are worth the financial commitment. In a rather brutally capitalist way, it should concentrate everyone's minds, but in an equally capitalist way it will be the tricky books, the unpredictable books, the books which can't be described in a sentence or two, the books by publishers who can't afford much of a sales team, which will suffer.

Marc Vun Kannon said...

Not sure what's new about it. My publisher's been offering a steeper discount for non-returnables for a while now.

Ink said...

I know a lot of writers are worried that this model will inhibit the publication of new authors, and yes, I think this is a possibility... but the other possibility is that this model will encourage a greater diversification of titles and authors. Say right now a bookstore is looking to load up on what is supposed to be a "hit", and so they order 120 copies. Great... and if they only sell 50, no biggie, that's still 50 books sold and they can return the rest. But in the new model, hey, maybe we don't want to take on 120 books when they're not returnable. Let's take 50 or 60 and see how it does, first... and what about the spaces that used to be filled by the extra copies of the "hit" book? Well, other books will have to fill those spaces, and that means opportunities for other authors. In this sense, Risk might equal diversification. Why should bookstores overbet on a single horse when they can't refund their ticket afterward? It might be better to spread the wealth and play the odds a bit.

We shall see, anyway...

My best, as always,
Bryan Russell

Mechelle Avey said...

Barb S.

Thanks for your kind response regarding my experience with returns. The story I related happened about four years ago, but the lessons learned have stayed with me. Seeing the industry from the perspective of an independent really makes you value the agents, publicists, publishers, and all of the hard work they do. In addition to the "don't-get-excited-by-the-check" lesson, I no longer have dreams of fame and fortune. I write because I am a creative. Sometimes that's good enough; sometimes I wish my last name was Grisham. For those unpublished authors of Nathan's community, if you read this, I encourage you to take note of the information Nathan shares and then use it in any venue presented to you. We spend so much time focusing on traditional paths to publication, but there are alternative paths to building a name. Thanks Nathan for your willingness to share opportunities for writers.

MoJo said...

Hey, Mechelle, I looked for an email address on your site, but couldn't find one.

Could you email me, please?

Sara Thacker said...

Good business is good business. The publishing industry is way behind the times in production, inventory and returns.

Zoe Winters said...

Ack, I've gotten behind on blogs lately, but this is fantastic! Kudos to Bob!

It's a step in the right direction.

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