Distribution Diary

Book distribution remains one of my favorite topics. When I was working as a book distributor, I spoke to literally hundreds, if not thousands of publishers, many of them new or relatively new to the business. Almost all of them had misconceptions or misunderstandings about how the distribution business works. Distribution and book distributors of all types continue to play a critical role for publishers, especially if they want to reach the core retail book marketplace. Certainly, specialty publishers, with very focused programs continue to find better alternatives for reaching their markets. And online direct to consumer and other alternative distribution channels continue to grow.

But the distribution function remains critical, and over the next few weeks and months I will do more posts here about this subject and working with Publishers Lunch and Publishers Marketplace, will try to lay out a pretty comprehensive dataset and description of all of the distribution options available to publishers (and authors who publish), along with a running commentary and some predictions about the future of book distribution and retailing.

Posted by David Wilk on 09/15 at 09:47 PM
DistributionPublishing and business in general • (55) CommentsPermalink

Book Business and Environmental Economics: Change is Needed

Busy as we all are it is very difficult to pay attention to the many serious issues facing our world. The problems created by our industrialized economy are of such magnitude as to make it seem almost impossible to make significant changes quickly enough to make a difference. And what the Bush administration has done to block, undo or undermine longstanding laws and regulations to protect our natural environment is simply criminal.

Things have gotten bad enough that it’s just impossible for us to continue to go about our daily business without taking some meaningful action to make positive change.

Lately I have been thinking a great deal about the environmental impact of the book business. I read somewhere once that taken as a whole, the printing industry is one of the largest causes of industrial pollution in the United States, even with all the changes in monitoring and controlling environmental effects of industry. And of course books are made of paper, and paper is made from trees. We like to think that the trees used for manufacturing paper are all environmentally stewarded tree farms and managed forests, but that is, of course, not the case.

I would like to commend and recommend The Green Press Initiative (http://www.greenpressinitiative.org/) for their work in addressing issues relating to production and paper use in the book industry. What they are doing is hugely important and can and should have a truly significant impact on downstream environmental effects of the book industry. From their website:

The mission of the Green Press Initiative is to work with publishers, industry stakeholders and authors to create paper-use transformations that will conserve natural resources and preserve endangered forests.

Additionally, North American Publishing Company (NAPCO) has created a website devoted to environmental issues in the printing and book industries called Environmental Sustainability in Print and Publishing (http://www.sustainprint.com/), which is described as “a central source for information and resources for publishers and printers across all segments of the industry.”

What I have been thinking most about is the waste that is built into the publishing and distribution system. More books are printed annually than can possibly be absorbed by the retail stores that account for the bulk of trade book sales. And of the books that are “placed” in stores by publishers and distributors, at least 30% of them or more are returned unsold by retailers. What happens to them after they are returned? Some of the largest publishers do not bother sorting or putting any returned books back into new inventory; it’s less expensive for them to sell them as remainders into the secondary market, where they are redistributed at lower prices. For most smaller and medium sized publishers, and their distributors, systems have been developed to sort through returns. Some are discarded or sold as “hurts” because they have become too damaged or shopworn to be sold at retail as new. The rest are returned to new inventory to be re-sold and shipped to buyers unless or until demand subsides, at which point they will be sold off as remainders or recycled or dumped into landfills if, as often is the case, the secondary channel is too full and these books are deemed as completely unsalable.

For years, many in the book business have questioned whether this system is efficient or effective, and there have been endless discussions about how to limit returns, or eliminate them altogether. This is not something that publishers can initiate by themselves. Since retailers ultimately control the distribution channel, it will be up to them to determine whether the traditional returns system can and should be changed.

I would argue that reducing or even eliminating waste in the book business is not simply a matter of measuring the direct costs to the enterprise, although direct costs must be a primary element in any business decision, but that all of our actions and decisions must include a measurement of environmental and social costs. This is not a form of soft economics, but rather a correction in the way traditional economic analysis has been applied to business decision making. Environmental costs are not directly on the balance sheet, but they are always there indirectly and they are a real cost to any enterprise.

My next post will explore both direct and indirect costs and environmental impacts of book business practices, focusing on returns, and will explore simple systematic changes that can make a positive difference to publishers, distributors, retailers and the natural world we all inhabit.

In the meantime, I would welcome input, especially by those who have been actively trying to make environmental and ecological analysis a part of everyday business thinking, planning and decision making.

Posted by David Wilk on 05/15 at 09:50 PM
DistributionNew Business ModelsProduction and printingPublishing and business in general • (66) CommentsPermalink

Distribution Basics

The latest news regarding the PGW component of the larger AMS bankruptcy is promising, at least for the PGW clients. Perseus will purchase Avalon, the largest PGW client, and has enlisted Charlie Winton, Avalon’s principal (and also the founder of PGW), to come on board. Perseus then reportedly made a very favorable offer to the remaining PGW client publishers - proposing to take over their contracts and in a relatively short period of time, make good on something like 70% of the money owed to them by the bankrupt PGW.

This is a far better outcome than any of the publishers could possibly expect from PGW either in liquidation or any reorganized version of it, so it would seem likely that most, if not all of the PGW publishers will make the move to what will now be a powerhouse distributor in Perseus (which already had absorbed CDS and Consortium).


This seems as good a time as any to talk about book distribution, how how it works, and will work in the future, and what publishers and even authors should know about the dynamics of working their way through the supply chain to market and sell their books to readers.

Over the past several years, the overall landscape of the book business has changed considerably. There are still many, many places to buy books in the United States and buying books online has become big business (Amazon alone now represents as much as 10% of total books sold), the number of entities buying books for resale has declined. Something like 90% of all books sold by an average book publisher will go to fewer than 10 customers - including wholesalers!

Faced with hundreds or even thousands of book publishers, retailers and wholesalers rely on distributors to help them rationalize their supply chain. It’s more or less impossible to sell books to Barnes & Noble, Borders, Books-a-Million or Costco without a distributor, and while anyone can sell to Amazon, it’s alot easier utilizing the services of a professional book distributor.

And while there are still a fair number of distributors in business today, along with larger publishers and university presses that offer distribution services to smaller client publishers, recent bankruptcies and purchases have clearly narrowed the field.

With a more concentrated retail marketplace, distributors are rationalizing their business models, some are specializing in certain types of books or publishers, while others are setting more stringent size requirements for publishers they will work with. Since it has become relatively cheap and easy to publish books, distribution is now much more of a buyer’s market, as there are simply so many books and so many new publishers. It has clearly become more difficult for a new publisher to find a distributor, even as distributors compete amongst themselves to sign up the relatively few publishers whose sales volume or sales profiles makes them highly attractive as clients.

Publishers of different sizes and profiles have very different choices available to them. Generally, the size of the publisher dictates the distribution models available - smaller publishers have fewer options, the largest publishers have the greatest array of models to choose from.


In our next post, we will cover the different distribution options available to publishers of varying sizes. One note for all publishers who currently are distributed by another company - no matter the size of the distributor, you should file a UCC-1 form memorializing your ownership of inventory consigned to your distributor with the Secretary of the State within which your books are warehoused. If you have not done this yet, do it immediately! If you need specific advice about distribution contact Booktrix - we can help.

Posted by David Wilk on 01/13 at 10:51 PM
DistributionPublishing and business in general • (54) CommentsPermalink
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