Morris Rosenthal is the author of Print-On-Demand Book Publishing and the owner of FonerBooks.com. His website provides fantastic information on using POD, but also provides high-quality information on Amazon sales rankings. Below is a recent interview with the blog. The second half of this interview will appear on Monday.
1. What do you see at the future of publishing?
I don't think there's any question that the Internet is the future of publishing, and it's a good chunk of the present as well. I'm not predicting the disappearance of books any time soon, but the nonfiction business which makes up the majority of titles published is in for a complete overhaul. Just a decade ago, a person looking for information about anything under the sun would look for a book on the subject, or maybe call the information desk at their local library. Today that person starts with Google, or calls the library, where the librarian starts with Google.
That's good news for small publishers, since the Internet remains more of a level playing field than bookstore chains, particularly in reference tot he investment required to break-in. It's possible (though not recommended) to create an Internet presence without spending a dime, through blogging or social sites. A website with the publisher's own domain name (and the key here is own - as in ownership) only costs $5 or $10 a month to have hosted, and publishers are the last people in the world who should have trouble coming up with text content for the site. On the other hand, a publishing business plan that starts with a hoped for sell-in to the chains requires an investment of at least $10,000 upfront, from all but the most extraordinary corner cutters.
2. Many of the experts in the field recommend that new publishers commit to printing 2,000 or more copies of their first book. What is your take on that recommendation?
I think it's nuts, and I say that as a publisher who once printed 1,000 hardcovers and spent a couple thousand dollars just giving them away. That 2,000 copy recommendation is based around the old model of bookstore sell-in and full-service distribution. New publishers who buy into the concept that they need a big sell-in and a full service distributor are stuck with a big print run, and frankly, if you're going to print 2,000 books, there's a reasonable argument to be made for printing 5,000 instead. But the majority of publishers who start out printing thousands of books will never sell them at any price, and will end up paying to have them taken to the landfill or recycling facility. A print run of a few thousand books does nothing to help a book sell. That's a faulty extrapolation by small publishers and consultants who are trying to emulate the big trades, and see that announcing an initial print run of 50,000 or 100,000 helps convince bookstore buyers that the publisher is seriously committed to the book and will spend six figures on promotion.
But the small publisher version of printing 2,000 copies just tells everybody that you're a small publisher taking a big risk. It doesn't give them a reason to take a risk on stocking your books. Small publishers can compete with the largest NY trades on individual titles, but not on the business model, it simply doesn't scale that way. It's like a small retailer declaring that they are going to compete with Walmart by taking a big risk and buying 2,000 of some widget to get a lower price and have plenty in stock. Walmart can buy 200,000 of that widget, get a much better price on it, advertise it, and has an industry best warehouse and transportation network. The small retailer just has 2,000 widgets in the garage and a second mortgage. New publishers have to be smarter than that.
3. Print-On-Demand is increasing in popularity. How can a publisher, new or not-so-new, be successful using that framework for their publishing efforts?
There are two main tracks for publishing with print-on-demand. One is the experimental track, where a publisher can bring out a new title with print-on-demand, sell into distribution at the 55% off industry standard discount, and plan on transitioning to offset if the book "gets legs." The reason for transitioning to offset if the sales justify it is, with a 55% discount, the cost of printing has a tremendous effect on the bottom line. A $10 book sold at a 55% discount to Ingram (the largest distributer/wholesaler in the U.S.) that costs one dollar to print on offset and three dollars to print-on-demand through Lightning Source means netting $3.50 on each offset copy sold and just $1.50 on each print-on-demand copy. But the upfront costs for Lightning Source are trivial compared to a practical offset run, and the Ingram relationship is automatic. If orders start to pour in, you can meet the demand with POD while setting transitioning to offset, and then reap the larger profits. But that transition won't be necessary for most titles because most titles fail in the marketplace.
The track I advocate for print-on-demand is to publish at a short discount, which equalizes or even exceeds the profits earned with offset printing, and forgo the goal of sell-in and bookstore stocking. You can set a higher discount for special orders to fill demand from bookstores or specialty distributors who won't order at the short discount, but it's not necessary to run a successful publishing business. There's an excellent book out by Aaron Shepard titled Aiming at Amazon in which he describes a business model summed up by the title. That said, I've been growing orders by both bookstores and schools for one of my short-discount print-on-demand titles over the past three years based on customer demand, which is the only demand that matters in the end.
Stay tuned for the second half on Monday.