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The policy that makes no sense.

There’s a policy in place in publishing that makes zero sense. It’s a return policy that allows all unsold books to be returned to the publisher. Now I’m no authority on this policy, so any professionals who want to provide clarification to this, please do. My understanding is exactly as previous stated. Unused, unsold, or even returned books can go back to the publisher for a full refund. Doesn’t matter that they were ordered, bought, and destined to take up shelf space. If the shop owner doesn’t want them anymore: they’re gone. And via this road, they end up in outlet Christian bookstores in bins which sell them for half of their full retail price or on shelves with sale stickers for $4.97 to $9.97 for softcovers and hardbounds alike—which is super for the consumer. For the author? Not so much.

 

I don’t know how this policy came to be. I don’t know if it’s still in place for all CBA stores or if any retail outlet buying CBA books has the same privileges. Any current information on this policy is welcome here.

 

Speaking strictly of such a failsafe policy, all retailers should be so fortunate to have this kind of guarantee in place for purchasing product. My goodness. This wipes out the shrewdness or wisdom of doing business. It’s like a bailout. If I guess this will sell and it doesn’t, I can just return it for its full value. Easy. That eliminates the possibility of executing true business skills and puts the “manufacturer” at a disadvantage, hoping rather than trusting that the product ordered will be sold and not returned for a refund.

 

What am I missing here?

 

Father, you commend shrewd business practices in your Word. You expect us to ask for and use the wisdom you provide to your people. Help us to be wise and profitable investors on this earth and in the Kingdom of God. In the Name of Jesus, Amen.

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9 responses to “The policy that makes no sense.”

  1. A. J. Walker Avatar
    A. J. Walker

    I don’t think you’re missing anything, its really one of the most broken systems I know of in retail.
    Not sure how or why it was started but it really makes no sense to me either.

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  2. Mike Dellosso Avatar
    Mike Dellosso

    Nicole, it might be good to contact your local bookstore’s manager or buyer and get the full scoop on this. Could be really interesting for your blog readers to know how this whole return thing happens. I know in recent months/years it’s come under scrutiny and some publishers have tightened up on their return policies. I’ve always thought, though, if the store can just return what doesn’t sell, where’s the incentive to try to sell it?

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  3. Jessica Thomas Avatar
    Jessica Thomas

    I wonder when this policy came to exist. I’m guessing the 1800’s???

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  4. Dayle Avatar
    Dayle

    It’s a way to get product on the shelf. Most businesses call it a floor plan or consignment.
    Sometimes I’ll make a deal with a vendor. He’ll beg me to buy a bunch of product, I’ll tell him that I don’t think I can sell it, he says “if it doesn’t move, I’ll buy it back. Presto: his product his on my shelf.

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  5. Dayle Avatar
    Dayle

    One positive aspect of this is that it gives the readers a chance to decide what to buy instead of the bookstore buyers. Which is a big deal because buyers can sometimes be way out of touch with the general public.

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  6. Nicole Avatar
    Nicole

    Dayle, you first. The last small Christian bookstore chain I worked for, one individual did the buying for the stores. As I mentioned in a previous post, a customer could special order a book IF they kept it in their catalogue of wares. Sometimes, they didn’t have a novel I wanted in their computer log, so I’d have to get the book someplace else or online.
    Your consignment offer from the sales rep makes sense, but the objective is to get the product sold. It all comes back to the returns, doesn’t it? That rep isn’t going to look good just for getting the product in the store when it comes down to bonus time for actually selling the product. And when a whole slew of books comes back to the publisher, it doesn’t look good for the rep or the authors.
    Mike, I’ll run up to the Christian bookstore today and see if I can discuss this with their manager. We had two stores of a small Christian bookstore chain close here in my area within the last year. The one I’ll go visit today is in another city not too far away but not as close. There’s an outlet store at the mall nearby where I get some of my books, and I’m on a first name basis with the manager. I’ll talk to her, too.
    Jess, I have no idea.
    A. J., it’s no real help to authors. It really doesn’t make sense, does it?

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  7. Robert Liparulo Avatar
    Robert Liparulo

    Nicole, you’re right. Unconditional returns happen at all levels of book retailing and publishing. As Dayle said, it’s a way of getting books that the retailer is unsure about on the shelf. Unproven authors have a chance to be found by consumers under this policy.
    However, it’s painful to both publishers and authors. Publishers hold back royalties owed authors for a period of time so that future returns can be accounted for and factored into the “true” royalties owed (actual sell-through of the books). These amounts are often in the thousands and even tens of thousands of dollars.
    Some stores (usually Christian retailers; rarely mainstream retailers) will not allow authors to sign their books because the stores fear that then they cannot return the unsold but signed books. But most publishers including Christian publishers WILL accept signed books back. I wish publishers would make their policy of accepting the return of signed books clear to retailers, since signatures help move books and may result in fewer returns.
    The returns are very expensive for publishers. Shipping is one of the most expensive aspect of book publishing and distribution. And it reflects poorly on the author if a lot of his books come back unsold.
    “Lay down” is the term used for the number of books sold into stores (usually prior to their release dates). “Sell through” is the term for this number less returns.
    I don’t think anyone except the retailer likes this policy, but I don’t know how it can be fixed without harming the hundreds of unknown or up-and-coming authors whose careers rely on being in bookstores that would otherwise not take a chance on them. Interestingly, if booksellers carried only bestsellers, eventually there would be no bestsellers.
    Perhaps what’s needed is a program that allows retailers to drastically discount unsold books after a given time in hopes of pushing them out, instead of returning them. But then that’ll open up a new can of worms.
    (An exception to the return policy is when a retailer–often a specialty retailer like Scholastic or Wal-Mart–special orders a large quantity. In exchange for deeper discounts, they agree not to return the books.)

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  8. Rebecca LuElla Miller Avatar
    Rebecca LuElla Miller

    I guess the return policy makes it harder for me to understand why bookstores are going out of business. I mean, they aren’t taking losses. So … if their sales are flagging, maybe they need to ramp up their own promotion. It seems unnecessary to me that they are closing. But then I’ve never worked on that end.
    Becky

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  9. Nicole Avatar
    Nicole

    Excellent point, Becky. Some of them got into everything else (which they charged an exorbitant full retail for) and said their book sales were declining. Much of that claim can be attributed to charging more in person than you can get them for online (shipping included) or at outlet stores.
    Okay, Robert. Thanks so much for explaining this conundrum with the proper publishing terms. I’ll share what I learned from a CBA retailer on tomorrow’s blog. Nothing this detailed though.
    It’s crazy, Robert, because there’s no real promotion for these “unknown” authors at the store itself. Spread across the country, it would be impossible for most debut authors to do the visiting/booksigning gigs in different CBA stores, and without being “known” a lot of those ventures fall flat. I mean, in “normal” retail a new product gets promoted by either the manufacturer or the store itself and is usually introduced with a “sale” price, possibly an end display, or something on the shelf itself to point to it. Most new novels don’t even get a simple “shelf talker” unless they’re featured at a sale price. Some stores place in them in a “New Releases” section at 20% off, but right alongside say Francine Rivers’ new release or one of your novels, I don’t like the chances of getting noticed with an unfamiliar name over that kind of competition without something to set it apart.
    I come from a retailing family–my dad started out in their first drug store and retired as an executive vice president of the company. When something bombed big time, there was a blowout of the product at usually cost plus 10% and if it had to be sold at a loss to get it out of there, it would be.
    I think (and especially in this economy) there needs to be some serious revamping of the publishing business. I think the printers are going to have to reduce their prices and agree to lesser print loads without charging through the nose. Niche books with niche readers will find their markets and not expected to be gathering numbers like category romance or the current craze of bonnet books. How ’bout some fresh innovation to benefit more writers and publishers? As always: my opinion.

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