save the economy! buy more books!

[lagilman]

In case you were wondering how the banking and consumer credit crunch played out in 'real life':

GalleyCat has received a copy of a "special alert" sent from a major book distributor specializing in independent publishers to its clients, warning them that Borders, whose financial difficulties are widely recognized, "now tell us that they will not be paying us for two months due to anticipated excessive returns," a situation the company views with understandable concern. This distributor "typically carries receivables of approximately two million dollars with Borders," the memo continues. "A default of that amount would by no means put [us] out of business, but it would be painful, weaken the short-term health of the company, and would mean we would have to defer some of our plans for future growth."....

The memo emphasizes, however, that this distributor does not actually recommend that any of its clients start denying Borders their titles:

"Borders has been paying [us], they are reported to have cash on hand and access to credit in the future, and the last thing anyone wants is to have only one giant chain in the retail book market. Borders may prosper, and even in the worst case, given [our] uniquely flexible policy, the value of your inventory would be preserved."

more at: http://www.mediabistro.com/galleycat/bookselling/major_distributor_raises_concerns_over_borders_99936.asp?c=rss

Comments

[egret17.livejournal.com]

O noes! Must stop at Uncle Hugo's on way home tonight to help support them...

[mevennen.livejournal.com]

Everyone who works in a British High St has been aware that the crunch started impacting in real economic terms towards the middle of last May. Our wholesalers started noticing the downturn as far back as February. The last folk to notice appear to have been the members of the Bank of England. No surprises there.

[lagilman]

oh, anyone who works in retail has noticed, yeah. The general consumer seems not to understand the workings of daily credit flow (as evinced by earlier discussions here and elsewhere regarding banking).

The less said abut bankers and brokers the better, at least before booze.

[pbray.livejournal.com]

In an odd coincidence, my weekend plans already included dropping $$ at Borders, as part of my retail therapy.

[neutronjockey.livejournal.com]

"Excessive returns" meaning on the retail side (buyer returns)--- or returns as in strippables and TPB and hardcover returns to distributor?

[lagilman]

When speaking within the publishing industry, "returns" means from seller to distributor/publisher. The stores take a credit [or never have to pay], the publisher takes the hit, and the authors starve....

[neutronjockey.livejournal.com]

...this must be absolutely killing small presses that have a no-return policy (most 1st tier distributors won't deal with no-returns anywho from what I understand...as store buyers won't touch 'em).

Now, with mass markets... I guess that means there's a lot of strips happening if there are a lot of excessive returns. Perhaps another look at returning (whole) MMs? Or, I guess by the time you've paid for shipping on them twice the distributor no longer makes any money on them.

Huh.

[lagilman]

Oh god. If you really want the whole breakdown on distribution costs, discounts, payment terms and floating loans, not to mention the rate of default from independent booksellers and wholesalers, I'm going to have to bring in a Hired Expert, 'cause my brain's all taken up with deadlines and revisions....

[neutronjockey.livejournal.com]

No...other than floating loans I think I've got it covered. I can probably Google-fu my way into that one and save your brain (and mine won't handle it right now either) for revisions. ;)

[burger-eater.livejournal.com]

There's a Borders down the street from me. Should I go down there and buy something from them? Maybe the mmpb I buy would put them back into the black.

[lagilman]

Doubtful, but I bet the author would thank you ...

[argillaceous-d.livejournal.com]

Looks like I jumped ship just in time. Then again, working for a .com right now isn't wildly better.

donNA

[lagilman]

so long as you're still working, it's okay....