With Invoiced Sales, we aren’t the retailer; we’re providing books to a bookstore, who then makes the sales and collects the taxes and pays us 60% of list price.
First, we should talk a little about list price. It’s something we didn’t really understand when we got started, so we’ll offer some thoughts that might be useful to anyone who’s new. The cardinal rule of list price: it should be high enough to make money on every sale in every channel. And since Ingram has the highest printing costs and lowest royalties, you need to set your list price high enough that you’re making money (ideally at least a couple bucks) on every Ingram sale.
If you do that, you have the flexibility to price smartly and make decent money in every other channel as well. You can set the list price for a short novel at, say, $15.99, and sell it for $12 at book fairs and still make money—and then your customers that “showroom” you and step away to look at their phones will see that it’s cheaper in front of them than it is online, which gives them an incentive to buy it right away if they’re on the fence. (Another direct sales lesson we figured out over time.) And if they do buy it on Amazon, you’ll earn a buck or two more than you would have from an Ingram sale, assuming you’ve set it up through the KDP paperback platform.
And, of course, if you have a good working relationship with a bookstore, you can sell wholesale to them at 60% of list price. So for the $15.99 book, you’re getting $9.59 per copy—obviously less than the $12 you’d get at a book fair, BUT since you’re paying sales tax on the book fair sales (and if you’re not, you should be, you naughty bastard), and possibly table fees, and doing all that extra work, and since the bookstore is going to have your book out on the shelf while you’re off doing other stuff, that $9.59 is actually pretty decent. And if you’re selling, say North and Central, and getting copies printed via Amazon KDP, you’re paying $4.75 a copy after shipping, so you’re netting $4.84 per book, versus the $3.10 per copy in Ingram royalties you’d get if the store ordered through their distribution channels.
Of course, you might have to work for that extra money.
We talked about returns, and how disheartening those can be; we also talked about the lows of direct selling. This channel, too, has its lows—specifically, collections.
Indie booksellers can be wonderful magical places. Certainly we’ve had some great experiences selling in them, and we’ll get into those later. BUT we’ve also had some frustrations. Sometimes you have an event at a store, and you bring books, and the store rings them up through the register with the understanding that you invoice them later, and then maybe—and this is key—you make the mistake of not double-checking at the event how many books you’ve sold, and confirming with the owner how many you can invoice them for. (Because, if you’re lucky, they’ll want to keep a couple on the shelves, too.) Then after a month or so, you might drop them an email and say, “Hey, how many books can we invoice you for?” And you might hear back from them right away, but you might not. Then after a couple weeks or months, you realize you never got paid for those books, so you call the store, and politely ask to talk to the manager, and they may or may not take the call, or they may just tell their employee, “Oh! The numbers. We’ll email those.” And maybe they email, and maybe they don’t. Then maybe you go to an unrelated event at the store, an event for another author, and you really honestly try to have a good time, but you also make it a point to make eye contact here and there with the store owner—either pleading puppy-dog eyes, or a direct stare-into-the-soul I-know-what-you-did-last-summer sort of a thing, depending on your preference—so they know that you know that they still owe you money. And maybe you’ll buy a book or two at the store, because you do really truly want them to do well, and you want to be a good literary citizen, and you do always need more books anyway, but still of course you’re hoping this will somehow unlock the mojo necessary so that your numbers and your payment will be forthcoming. And maybe they’ll finally give you numbers. Or maybe they’ll stall you. Or maybe the numbers will be less than you think you sold at that long-ago-event, which may have been a few months ago now, so you’re stuck wondering: Are they gaslighting me? Am I being an asshole? What is even happening here? Long story short, it may take you a long time to collect, and you may not collect the full amount you think they owe you, and it may leave a bad taste in your mouth.
This is not an indictment of all bookstore owners, or even most owners. Certainly we’ve had plenty who’ve always paid promptly, and some who’ve maybe only ever required one follow-up email, at most. And all of them, even the ones who’ve taken a while on some invoices, seem to be hard-working and decent and fun-to-talk-to people who honestly love books, and who are doing their damndest to eke out a living in a very difficult and crowded marketplace. BUT we do have our favorites, as well as one or two where we’d prefer it if they ordered through Ingram, because that extra $1.74 per book isn’t worth the hours and hours it takes to collect. (We’re not going to name names, both because it isn’t useful to air grievances in public, and because we’ve discovered, through comparing notes with other local indies, that the bookstore that pays us promptly might be the store that someone else has a problem with, and vice versa. Sometimes. Basically, there are three tiers—stores we’ve never heard anything bad about, stores we’ve personally never had a problem with, and stores that we have.) And certainly we’ve learned that we need to do our part, too—to make sure to tell people that the store has our books, and always always always try to get numbers at the event itself.
Still, this channel can be truly amazing. If you plan your local bookstore events well for a new title, and space the events out just a little—every two weeks or so—you can manage your inventory very smartly. If you have a great event, you can order a new batch of books in time for the next one, and if you have a disappointing event, at least you don’t have to put in a new wholesale order—you can take the books home with you. (“Now wait,” you might be saying. “How is that any different than having them order from Ingram and send the returns back? If they order ten and sell three, and you get seven books back as returns, what’s the difference between taking ten books to the venue, invoicing them for three, and taking seven home with you?” As we mentioned, the margins are still better when you invoice them yourselves—but the bigger issue is time, not money. The returns cycle on Ingram may take months to play out, and during that time, maybe you’ve ordered more books for book fairs and website sales, and maybe those sold, but maybe they didn’t, or maybe they sold and you bought a new batch because you didn’t know you had returns coming. Long story short, the returns cycle can leave you buried in inventory for a certain title, whereas handling your local bookstore sales via invoices and hand delivery can allow you to manage your inventory a little more smartly.) And invoiced sales can work out better for the bookstore, too. If they order through Ingram, they have restrictions on how many returns they can make—they can only return 10% of their total annual spend to Ingram, and they only get 50% back in return credit, so Ingram returns aren’t necessarily a great deal for them, either.
PLUS, when you do establish a good working relationship with a bookstore, and you start having regular events, you get something that can’t be replicated online—something like the high of direct sales, but more communal and magical. (We will name names here.) We had a launch party for Jeremy Wilson’s Adult Teeth at the Book Cellar in Lincoln Square. It’s a lovely cozy store that’s always fun for book shopping, and the owner, Suzy Takacs, is really cool. She requested twenty books for the event, with the understanding that we’d bring home the extras and invoice them only for what was sold, but we ended up bringing five extra books, just in case. And lo and behold, the place was packed—Jeremy did an amazing reading, followed by a really fun Q&A with Billy Lombardo, and the store was filled with smiles and good cheer, and we sold all twenty-five books we had on hand, and everyone made money. (As we said before, it isn’t all about the money, but the money makes the other stuff possible, so you do at least have to try and get it right.) We had two more local events, one at 57th Street Books in Hyde Park, and another at Bookends & Beginnings in Evanston (both lovely places to go book shopping as well, with awesome cool owners), and those events weren’t quite as successful, sales-wise—BUT both were warm lovely intimate evenings, and we did still make some sales, and we were able to put the leftover books to good use by selling them online. (More on that next week.)
Given the ease and the simplicity of the online portals for Amazon and Ingram, it may be tempting to avoid Invoiced Sales entirely. But in our opinion, that would be a mistake. A good book—a really good book—is something you want to talk about, excitedly, to others who’ve read it, or others who might. There’s an energy and an excitement in those conversations that can’t be digitized; you can get a facsimile of it with online reviews and eager tweets, but it just isn’t the same. All the other channels we’ve talked about certainly have their advantages—it’s nice to have the Ingram pipeline to connect with stores on the other side of the country, and it’s great to have Amazon’s global reach and technological innovation and prompt payment, and it’s wonderful to get into the world and meet customers face-to-face through direct sales. But you owe it to yourself to establish solid relationships with your local bookstores, and to get your books in their hands in a way that’s mutually beneficial, so your books will be part of the conversation.
Plus, bookstore sales and events give you the chance to get out in the world and talk books with other book people—local authors and what-not. You can hear about their books, and talk about your books; they may end up blurbing one of your upcoming books, or submitting to you. (Or, heck, they might just be awesome people to meet.) Your books don’t have to gather dust in your closet while you wait to plan your next sales event, and they don’t have to remain bright small icons on the undertrafficked corners of the infinite internet; with this channel, you can make sure that they’re on a shelf in the world, waiting to be discovered by people who really care about books.