HOW BOOKS GET INTO STORES – THE BOOK DISTRIBUTION MODEL

The way book distribution works has been called everything from baroque to bizarre. Curious to know why? Read on!

FROM PRINTING PRESS TO SHOP SHELF

It’s easier to do a quick run-down, so you can understand the sections that follow:

·         The publisher creates a book and prints a large quantity of it.

·         They need to get these books into a hundred different book traders across the country but don’t have the time or means to pitch to every single book trader out there.

·         They pick a distributor they like and hand these books to them. (They are only allowed to pick 1 distributor.)

·         The distributor stores the books in a warehouse, catalogues them, and sets about getting them into all one hundred book traders.

·         The book traders are all kinds – online stores, physical bookshops, wholesalers that sell to other bookstores etc.

·         The wholesalers further pitch it to other book trading shops.

·         The book traders accept the book from the distributor (or from wholesaler who got it from distributor) and put it on their shelves for people to buy.

·         The books that don’t get sold are returned to the distributor, who returns it to the publisher. *Note: these unsold books are often returned in non-sellable condition.

·         Profits go from bookshop, to wholesaler, to distributor, to publisher, and eventually to the author, who ends up only gaining little of it.

·         The publisher then needs to supply the distributor with a different book to make up for the books that shops bought from them and couldn’t sell.

·         Repeat process endlessly.

HOW DO BOOK WHOLESALERS AND BOOK DISTRIBUTORS DIFFER?

A distributor acts as an agent from which book traders (book stores, online stores, wholesalers etc.) can get the book. The distributor works for the publisher and aims to be the ONLY/EXLCUSIVE place from which traders can get the book (a publisher can therefore only have 1 distributor). If books are unsold they can be returned to the distributor and then to the publisher (there will be less confusion as to where the book came from and who to return it to if there is one distributor.)

A wholesaler is a non-exclusive seller of books but the books they sell to the book store had to have been bought from the publisher’s exclusive distributor, as this is the only place to obtain it. i.e. Multiple wholesalers can sell a publisher’s book. However, all the wholesalers get their book from the same place – the exclusive distributor.

A big publishing house can serve as its own distributor for its books. Book traders can therefore only obtain the publisher’s books from the publisher. Smaller publishers can choose to distribute its books through the big publisher’s distribution department, and this will be the only place from which traders can get their books. (This saves the small publishers costs on warehouse, storage etc.)

HOW DO BOOK DISTRIBUTORS AND BOOK WHOLESALERS MAKE MONEY?

The wholesaler gets the book from the publisher at a big discount. The wholesaler then sells the book to the trader at a small discount, then keeps the difference in the money for themselves.

Example:

A publisher lists a book at R200 and gives it to a distributor. A wholesaler approaches the exclusive distributor to buy it. The wholesaler gets a 50% discount on the book’s list price so only pays R100 for the book. The wholesaler then sells this book to the book trader at a 40% discount of the list price – the book trader therefore buys the book for R120. The wholesaler keeps the R20 difference. The book trader sells the book at R200 and therefore makes R80 profit.

So in this case:

The book trader makes R80.

The wholesaler makes R20.

The publisher only makes R100 on a R200 book. Because author royalties are paid based on the net sales the publisher receives, the author only walks away with R5 per book (based on a 5% royalty).

The distributor makes its money by charging the publisher for distribution fees (they charge 10-26% off the list price if they sell the book to a trader), storage fees, cataloguing fees etc. So realistically the publisher ends up with far less.

WHAT KREST DOES DIFFERENTLY

KREST Publishers breaks rules. We’ve identified problem areas for authors specifically, and changed our model to benefit these hard-working creatives. The reason we’ve done that is because we’re writers too!

KREST Publishers has an online bookstore which sells books on behalf of independent publishers and self-published authors. We’ve become a trusted book trader for these independent publishers because we bypass the distribution model that – quite frankly – purely South African publishers can’t afford. We are happy for anyone to approach us directly and we do not charge them storage or distribution fees.

We work out of a love for books, but have the business surety of our parent company LOCHAN MEDIA PTY LTD, so that writers out there can focus on their talent while we sell for them!

If you have any opinions about the book distribution model, or any contrasting views – let us know in the comments. For anything else, we are always reachable.

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