posted
I have the discount cards to both B&N and Borders so I get their emails with downloads of coupons for 15% off. 20%, 25%, all the way up (so far) to 40% off of either some title they're pushing or even just any book in the store or online.
My question is this: Who's losing that money which I "save?"
Is it a reduction in the author's pay or the publisher"s or the store chain? Or some variable of all three?
posted
Most coupons are accounted to a line item for promotion and marketing in the companies books. Grocery store coupons on the other hand are manufacturers coupons so they get clipped from Kellog and other such manufacturers.
So you shouldn't worry about the author not getting their cut.
[This message has been edited by Bent Tree (edited February 12, 2009).]
posted
Well they are losing the money in that instanc,e but the reduced price is expected to sell more books and the way the math works out, on net, they're probably not losing and possibly gaining. So I agree with Bent Tree.
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posted
I think it's easier to sell the "bestseller" at 40% off in the hopes that someone will pick it up immediately, as opposed to a year later when it's on the remainder shelf for $5.98.
Like Zero and Bent Tree said, they're hoping to push units in the hopes that the math works out in the end.
For Borders, I don't think the math will work out.
posted
The truth is, as artifacts, books cost pennies to produce---excluding what you pay the writer and the editorial staff. You can mark them way down because they're marked way, way, way up to begin with. They're not losing money at even fifty percent off. In most cases they're not even losing money when they're remaindered for $5.98.
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posted
Most distributors (ie Penguin, Random House, etc.) sell books to vendors at discounts. Standard discount is 40%, but sometimes distributors will give smaller or larger discounts based on how many books the vendor orders. That's why the big vendors like Borders & Barnes can give major discounts without cutting into their own profit margins on the books.
The moral of the story is that if a vendor is giving a discount it cuts into their profit per book in hopes of selling more books overall, the distributor, publisher and of course contributors (author, illustrator, what have you) aren't taking the hit.
There is a darker underside to the big vendors, but that's a bit of a tangential rant.
posted
Publishers pay author royalties based on their book sale price and the contracted royalty percentage minus author-related expenses. The forumula is complicated, but in essence a standard industry forecast method expects 20% of sales directly through publisher channels at 100% of cover price, 20% of sales discounted 20%, and 60% of sales discounted 40%. In bestseller or languishing sales situations there's also a 60% discount.
A new release, mass market trade paperback with a cover price of $8 will sell at .2(8) + .2(6.4) + .6(4.8) = for an average of $5.76 price. The average author royalties of 10% calculated on that basis come to $0.57.6 per sale. In order to earn out an average low advance of $1500, a book would have to sell 2600 copies.
The actual average royalty is 10.7%. The actual average advance ranges between $1500 and 7500, according to Dan Poytner of Para Publishing.
Whatever additional promotional sales discounts a retailer offers have no effect on royalties. However, most of them take advantage of discounts the publisher offered to begin with.
Books are rarely remaindered anymore. Return shipping is too expensive for a failed sale. A retailer who doesn't sell a book forwards an affidavit claiming unsold books back to the distributor/wholesaler/publisher for credit on future purchases.
posted
Nothing official here, but I've noticed that the 40% off offers tend to happen on hardcover novels either by established authors or authors the publishers seem to have a lot of confidence in. I think some of the discounting practices are an effort to move a larger quantity of books in order to get their author onto the NY Times bestseller list (Or any best seller list--didn't want to leave you out USA Today). I don't know if anyone's noticed, but that "NY Times Bestseller" tag can help move paperbacks and trade editions.
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