I don’t have much time for this argument, if you lose money on sales through amazon, stop selling through Amazon and develop a new model that doesn’t cost so much! That said, it IS a clear illustration of the tough economics of small publishing!
Here are the scary sums:
Amazon takes 60% of my RRP (in the book trade, the bigger the sales outfit, the bigger the discount they demand from the publisher: Amazon 60%; Waterstones 50%; independent bookshop 35%). On a £11.99 book, Amazon’s takings are￡£7.20. Mine are £4.80.
Out of this comes £2.50 to pack and post the book to Amazon, and the author’s royalties on a heavily discounted book reduced to 50p. My writers lose out on an Amazon sale, too. That leaves 82p for Linen Press, but the book cost £4 to produce. So I lose £2.18 on every sale by Amazon.
via Amazon’s profits are small publishers’ losses | Books | guardian.co.uk.
3 thoughts on “Go Read This | Amazon’s profits are small publishers’ losses | Books | guardian.co.uk”
“I avoid looking into the abyss of financial disaster.”
And as long as the owner of Linen Press (was their some deep-rooted subconscious message going on there in the mind of the owner when the name was chosen!) continues to avoid this abyss, their press will continue to hemorrhage profits.
While I do sympathize with someone running a small press for the love of literature and promoting obscure or neglected manuscripts, there is basic common sense missing here. Amazon, as mighty as it is as an online retailer, remains an optional sales channel for a publisher – not an obligational sales pathway to their consumers.
You don’t need economists like McWilliams or Lee to tell you that selling 20 books a week through Amazon at a £2.80 loss doesn’t stack up against making a 50p profit on 5 five books through a small sales channel. That kind of ‘loss-profit’ economic strategy is for the heavy honchos like Tesco, Target, Wallmart, Sainburys et all, who can afford to wager ‘lost-leaders’ against increased footfall.
The best thing Linen Press can do is develop multiple small sales channels rather than bitch about retail Goliaths like Amazon. It is what it is. And it’s why five of the big six publishers in the US introduced the Agency Model for ebooks.
Agreed on everything except the Agency Model!
Looks to me like Linen Press is a pretty incompetently managed business to me. It also seems to be run my someone who has little experience of or knowledge of business !
She seems resentful of the retailer taking their cut and knocks them for making a profit out of her earnings ? What kind of nonsense is that ? And then comes here to whine and whine !! WTF
What is really the problem is that this company’s business model is seriously rubbish, and needs a business person to get a grip on it.
And while I’m here the comment above about the Agency Model is rubbish.
As the original poster wrote: I should be grateful that I’ve been given the same space as the big boys to display my covers and my reviews. I should say thank you for the sale.” Indeed she should be.