Friday, January 11, 2008

Remaindered -- And It Feels So Good

Ack! I've just been remaindered!

Let me rephrase that. The science fiction anthology North of Infinity II, has been remaindered.

Having one's book remaindered is usually not a good thing.

For the author having a book remaindered pretty much means the end of any sort of royalties (I double-checked with my friend Rob Sawyer on this -- see his excellent insightful look at remainders from a successful author's POV entitled "Remainders: What do authors get?")

For those unfamiliar with the term, a book is remaindered after it stops selling well in the book trade and the publisher is faced with warehousing a huge volume of copies. Rather than sit on those copies (and pay the increasingly high costs of carrying the stock), they liquidate it at dramatically reduced prices.

Not all remainders, of course, are bad books. I'd even argue that an incredibly high percentage of remainders are great books, in fact. My friend Robert J. Sawyer is a brilliant author, and even his multi-award winning and bestselling novels do occasionally get remaindered once his hardcovers go into paperback. So it's a perfect example that even excellent books can find themselves remaindered. Not always the best for authors, but what a wonderful treat for readers.

Let's walk through the life of a book to understand remainders in a bit more detail.

For example, Stephen King novels regularly get remaindered, and he's a consistently bestselling author. Perhaps you've heard of him. A recent example is his book Cell -- not one of his best, in my opinion, but still a pretty good book that sold fantastically. When the paperback came out a year after it's initial release, retailing in Canada for $11.99, sales of the $34.95 hardcover started to slow down and most bookstores would have returned their hardcover stock to the publisher. So the publisher, now sitting on copies of the hardcover, liquidates it by selling it to remainder wholesalers and bookstores, allowing bookstores to sell it for $9.99.

Now, speaking as a book lover and as a book seller, remainders (also commonly known as Bargain Books) are a win-win situation for bookstores and readers. The margin (difference between the cost and retail selling price of a product) on bargain books tend to be anywhere between 50 and 80%, meaning that if it costs the customer $10.00, the bookstore could have paid as little as $2.00 for the book.

The math is interesting. Normally, books are sold to bookstores as returnable and with pretty limited margins. The margin on most trade books are approximately 40%. Meaning, if the bookstore sold King's novel at the regular retail price of $34.95, they paid $20.97 for it, and made $13.98 margin on it. That margin, of course, usually covers costs such as shipping and handling the product. And handling a book twice -- once to receive it and shelve it then again to pick, pack and return it, pretty much doubles the cost to the bookstore. So that $13.98 margin gets eaten into pretty dramatically once you factor shipping costs and labour into it.

Now in cases like King's Cell, which sat on the bestseller list for a while, large retailers in Canada like Chapters/Indigo/Coles would likely have been selling it for 30% off. Meaning it would be selling to customers for $24.47. Meaning the margin they'd be making would be only about $3.50. (Of course, with bestsellers you make your money not necessarily through high margins, but through rapid volume -- ie, you perhaps only make $3.50 minus shipping handling and labour, bringing that down to maybe $1.00 to your bottom line for each one sold, but if you sell 1000 of them, you've got $1000)

Let's compare this to the same book as a remainder. It lives its life as a hardcover -- then, once the smaller, slicker, cheaper paperback comes out, that poor old hardcover is left behind and stuck in the warehouse. So the publisher remainders it. And the bookstore likely buys it for $2.00 and sells it to customers for $9.99.

From the customer's point of view, ten bucks is significantly cheaper than thirty-five bucks or even the bestseller reduced price of $24. And it's even cheaper than the $12 paperback version of the book. Therefore, the book is all that more appealing to customers, particularly those who like collecting and hanging on to hardcovers. Us book nerds can be funny that way.

And from the bookstore's point of view, they make $7.99 margin on that remainder, which, while lower than the $13.98 margin of the original hardcover, doesn't have some of the additional handling and shipping costs associated with the original (ie, they order it, bring it in and sell it -- there's no picking it and returning it and shipping it back to the publisher -- that one way flow of goods decreases handling costs significantly) -- so if they sell two bargain book copies of it, they'll have made $15.98, which is more than the margin on the original product, and the customers who bought it only shelled out $20.00 for those two copies of the book rather than the original $34.95.

Interestingly enough, the bookstore would usually make a 44% margin on the mass market paperback version of the book, meaning they'd haul in $7.27 for the $12.00 paperback. But that's still less than the margin they make on selling the hardcover for 2 bucks cheaper than the paperback. It becomes a good deal for the seller and the buyer.

As I stated, remainders, or bargain books are a pretty decent win-win situation for both the customer and the bookstore.

But alas, you say -- what about the poor publisher? What about the poor author? As my friend Rob explains on his blog, the author pretty much gets naught.

Except perhaps exposure.

As a giant book nerd, I have discovered many new writers through the joys of remainders and bargain books. I'm not always willing to take a chance on a writer I'm unfamiliar with for $30, but I'll usually be more tempted to try them out for under $10. And I have often gone back and bought other books by authors I've discovered through bargain books and also recommended books by these authors for others to enjoy -- so, hopefully, I've helped increase different author's royalty payments despite their having been remaindered.

And as for North of Infinity II -- well, there wasn't much chance of any of the authors making any royalties off it anyway, so the fact that it has been remaindered is, I think, I great thing.

Now that the book (which used to be $20 in Canada) is available for $4.99 Canadian, it is much more likely to attract new readers -- perhaps folks who might not have checked it out for $20 but will be more tempted now or maybe even folks who never got a chance to see it when it first came out.

Quite simply, this anthology is a steal for $4.99.

It would certainly be worth your while to check it out -- if you do, you'll not only enjoy some great reprinted tales by well known names in the world of science fiction (like Robert J. Sawyer, Andrew Weiner, Nancy Kilpatrick, Douglas Smith and Stephanie Bedwell-Grime) but you'll also hopefully discover the thrill of reading great stories by some writers whose work you might not have seen before such as Robert Beer, Bruce Golden or Zohar A. Goodman. I'm also quite proud to have helped introduce newer writers A.M. Matte, Kimberly Foottit, Karen Danylak and Stephen Graham King to sci-fi readers.

So get out there and buy a copy of this remainder -- then, go check out the other books and stories by the wonderfully talented writers that helps make North of Infinity II a fantastic anthology that Cary Hays of Booklist says is "a good yardstick for the current topography of Canadian sf" or that Elizabeth A. Allen (from Tangent Online) says "deserves a place on your 'To Read' pile."

This week, I'm counting the opportunity to have worked with some truly talented and gifted writers on North of Infinity II and the fact that it's new cross Canada availability at $4.99 will hopefully allow more people than ever to discover this book and enjoy the fruits of their wonderful speculative tales.



lime said...

well that was very informative. i didn't know that's how it worked. it helped assuage some of my guilt about being a cheapskate who spends most of her book money at the bargain tables. i just picked up 3 huge coffee table books normally between $40-$50 each for $30 total and a gardening reference book for my mom for $3. i was so excited.

TK Kerouac said...

Hi Mark

I'm just redoing my link list
I'm going to keep you linked

my blog is private now (private) (new)

if You care to link