Tuesday, May 06, 2008

In Lieu of a Comment Elsewhere

GalleyCat doesn't have comments, so I couldn't reply to the following lede there:
In 2005, 31% of the roughly 1.5 billion books printed in the US were returned to publishers. Guess what: that not only doesn't make sense for anyone's bottom line -- people don't buy more books because they see big luxuriant stacks of books on offer, it seems!-- it's bad for the environment!
First of all, this is what the Scottish courts call "not proven." It may be so that big piles of books don't induce more sales than merely having one copy always available -- though I tend to doubt that so many publishers would pile books so high for so long if there was no evidence that it worked -- but no evidence has been given to support that assertion.

And that attitude, which is very common among publishing observers (though less often among those who sell books into accounts and track title sales) ignores a simple fact: if there are three books on a shelf, and two customers come looking for it, two sales will result. If there is one book on a shelf, and two customers come, one of them is out of luck -- and so is the bookseller.

You end up with returns because it's impossible to always have precisely one book for every purchaser in the right place at the right time. I've been tracking sales of one particular book closely lately, and watching various branches of one chain place single-copy orders with my employer when there's stock of that book in at least one of that chain's own distribution center. Does that annoy me? Hell, no -- those are books running right back out onto shelves to refill space after sales, and I want to see them get back in stock as quickly as possible.

Sure, online sellers don't have this problem in precisely the same way -- they can have books drop-shipped from a distributor or printed on demand -- but, for a physical person in a physical location, a book can only be in one of two states: available or not.

I look at the 31% figure for returns, and I first wonder where it came from and what's included in it. And then I say that's pretty low, unless it includes a lot of nonreturnable sales. If the universe of returnable books had a 31% return rate, then a lot of potential sales were lost due to lack of books.

Like most things, book publishing has two failure modes. The first is when would-be buyers find an empty shelf: let's call that a "false negative." The other is when books sit idle at retail without would-be buyers: that would be a "false positive." You can manage a business to minimize one of those, but doing that, either way, is dangerous. The smart way is to keep an eye on both measures, and balance them out across a publishing line.

I could go on and on about this, but...I need to get dressed for the Wiley "Prom." Honest to Ghu. So that'll be it for me for today.


Johan Larson said...

The question of how much to overprint seems eminently suited to some kind of formal modeling or simulation. And since there are more MBAs and business professors in this world than we know what to do with, I presume it's been done. Any useful results?

Andrew Wheeler said...

Johan: There might be some academic work done on the subject, but I don't know of any. The people who most commonly model returns are publishers and booksellers, but those models are all proprietary.

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