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How does the life of a book change as it goes from publisher to bookseller?

By December 12, 2017No Comments

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Three publishing professionals explain some of the intricacies and irrationalities of book distribution.

Anish Chandy

(Clockwise from left) Anish Chandy, Manas Saikia, Ajay Mago

How do books reach stores in the farthest corners of India? Why don’t publishers get paid on time by the distribution and retail parts of the business? What kind of bookshop works best: the big chain, the online behemoth, or the local independent player? A publisher – Manas Saikia, Managing Director Speaking Tiger Books – a head of business development – Anish Chandy, Head of Digital Business Development and Offline Sales, Juggernaut Books – and a bookseller – Ajay Mago, CEO, Om Book Stores and Om Books International – offer some insights. Excerpts from a three-way interview:

Why do publishers struggle to make newly released books available in all the bookstores at a given time?
Ajay Mago (AM): In the run-up to the publishing date of any new title, a publisher beams out the AIS (advance information sheet) to the entire downstream distribution chain, highlighting the tradeworthy talking points of the title. The publisher mounts a parallel reader sensitisation programme on social media for each title. Alongside there are pre-publication press releases and author interactions. The distributors aim to get the book to every bookstore across the country, but they face logistical problems such as warehousing, transportation, inventory, recovery of dues from bookstores and bookstore locations that are difficult to access. Fortunately, because of our own retail network, Om Book Shop, we are able to remedy some of these problems.

Anish Chandy (AC): If you calculate the ratio of books published and imported into the country to functioning bookstores, you will find that India is an overpublished market. Big books by famous authors or a trending subject are generally distributed widely, but the smaller ones have to fight for in-store real estate. Too many books are being released every day. It is pretty easy to get a book published in the country, but hard to get the entire publishing and retail ecosystem to commit resources to it.

Manas Saikia (MS): India is a large country and stocks take one to three weeks to reach different areas. With GST and the lifting of border barriers, and the improvement in National Highways, I expect this transport time to be reduced. Simultaneous release is impossible as booksellers who have already received the book will not wait for it to reach the rest of India. At best you can arrange with a chain to release on a particular date, which they can do by blocking sales of a particular ISBN on their connected computer systems till that date.

I believe it’s even more difficult to ensure availability of books at the airports. Do they operate differently?
AM: Ideally, the airport bookstore network should be a significant part of Indian retail chains. One can then make sure that the discount structure, the special display terms, and visibility remain uniform throughout the country.

AC: They don’t exactly operate differently, but the real estate is even more precious there because of the high visibility. Airport stores need to be confident that a book will sell, which means the package and messaging around it needs to be incredibly strong. Otherwise the store manager will rightly say, why don’t I stock a few extra bars of chocolate that I know will sell instead of a book that may or may not sell? Authors and publishers have been willing to pay for space in airports.

MS: Yes airport bookstores can be a problem. Thisis because airport operators take at least 20% to 30% of each sale made. Hence those running the bookshops want bigger discounts and full return facilities.

Many publishers don’t supply books to some of the prominent bookstores because of payment delays and even defaults. How rampant is this problem?
AM: This is a genuine problem that needs to be addressed very seriously by a publishers’ association. Any delay in payment has a direct effect on the entire production and distribution chain. So timely payments are of utmost urgency.

AC: The last decade or so has seen many changes in the real estate landscape in terms of rent agreements, market structures, rise of online platforms, etc. This has led to a lengthening of credit cycles and payment problems. The offline retailer is the most vulnerable entity in this cycle because he has to pay high street rents. It is unfair to solely blame retailers for the problem. At the same time the publisher needs to be paid. So publishers and retailers are constantly tweaking their models to keep the show on the road.

MS: Selling books is easy in India. Collecting the money is the problem. One of the reasons for this is that the entire publishing and bookselling industry is undercapitalised. So if a bookseller faces a delay in collecting somewhere and is unable to pay his dues, the whole chain is affected. Bank finance is difficult as bankers will not lend against printed books as collateral . They would rather accept blank paper. If bankers read more maybe they would be able to value books better. But who is going to bell that cat!

Why are publishers struggling to supply books to some of the major bookstore chains?
AM: The main reason is that publishers are not able to recover money from retailers. From the retail point of view, a retailer reserves the right to take an economic and logistical decision on whether to stock a particular book or not.

AC: Same answer as to the previous question.

MS: Publishers struggle with the chains because it is hard work and requires perseverance, politeness, and patience. Remember that the buyers at these chains get hundreds of books displayed to them every day.

Is it even possible to keep tabs on the stock in all the bookstores? How do booksellers replenish their stocks?
AM: It would mean an additional expense for publishers and distributors to send agents regularly to do inventory stock checks in order to encourage the retailer to procure more copies of a book. This is something that needs to be handled directly by retailers, so that they can generate better business for themselves.

AC: Currently there are no real time analytics that give publishers visibility of their stock in bookstores. These solutions won’t be built anytime soon because the underlying model of selling books offline is shaky. So there’s no incentive to invest in something like this. Stocks are replenished when the retailer places orders or the publisher receives information that a particular store has run out of copies.

MS: No, it is normally difficult to keep tabs on bookshop stock unless there are lots of reps working very hard. Booksellers will replenish their stock when needed or when a smart salesman reminds him or her that they have sold the previous stock. Distributors can provide their stock figures more easily from their interconnected computers.

Do bookstore chains buy differently from the way independent stores do?
AM: The difference lies in the volume and the penetration. Additionally, bookstore chains demand higher discounts owing to their overheads. An independent store may rake in consistent profits, but lacks penetration and volume.

AC: Bookstore chains have more clout in terms of economies of scale, while independent stores will sell titles that come out of a deep understanding of customers in a local market. These don’t have to be bestsellers. They constantly sell titles that surprise the publisher.

MS: Yes, chains buy differently from individual bookstores. In the case of individual bookstores it is often the owner or the floor manager ordering. They are in direct touch with what is selling or will sell. The chain-buyers depend on their own point-of-sale data analysis, Nielsen data , or the Amazon scale. They are not always in touch with the ground action, but do respond to feedback from their stores.

Several publishers ask their disgruntled authors to direct their readers to Amazon and other online retailers “since that is where most books are sold these days’. Don’t you think this is a very convenient and short-term solution?
AM: Selling books is the cumulative responsibility of the publisher, its sales team and the author. Worldwide, online retailing is major for the front-list and bestsellers. So it is an important vending possibility, but not the sole possibility because it cannot substitute the advantages offered by a brick and mortar bookstore: window displays, book signings, book launches, book readings, etc.

AC: Amazon pretty much guarantees the availability of a book that a bookstore can’t owing to space constraints. And if a bookstore doesn’t stock a book, discovering the book is a challenge. It’s a chicken-and-egg problem. But when the publisher directs customers to the store and the book isn’t available, the author is left disgruntled.

MS: Referring an author to Amazon or Flipkart is the safest bet as the potential buyer is most likely to get the book there. Generally it is believed that 20% to 30% of books are sold on Amazon, Flipkart etc. (This is not true for all segments.) We always offer to sell from our own website in addition to Amazon. If you recommend that the author try a particular bookshop, then there is the risk of getting an earful if it is not available.

Why can’t publishers have direct accounts with booksellers? Why are distributors necessary?
AM: There is no need to reinvent the wheel. A distribution system is already in place across the country and needs to be more efficient and proactive alongwith the retailers to make it a win-win situation for the publisher, distributor and retailer.

AC: Distributors are needed because they provide warehousing, transportation, sales support and credit. Distributors consolidate books across publishers and supply to stores. The logistics would get too expensive for publishers otherwise.

MS: Publishers have difficulties opening multiple accounts as it is not easy to collect money from lots of small accounts. Some of the big distributors do have big publishers working exclusively with them. As the bookseller needs those books, they pay the distributor’s bills. This means the other publishers in the distributor’s product mix also get paid. If the judicial system in India were more effective things would be simpler. Right now it takes an average of 16 years to enforce a credit contract and 6 years to get action taken against a bounced cheque. Solve that, and everything else will become easier in distribution.

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