Today I’m going to look at methods of printing: when they are a good idea, and when they aren’t, and why some people seem to think there’s a “new publishing model.”
Offset
This is the way books have been printed for [one] hundred of years—ink to paper on giant presses. The only new twist on this technology is that they use digital files to a transparency (much cheaper and easier to do) and not film, or even lead type. For a black text book, it’s a one-run deal. For a color book, the pages will have to go through the press 4 to 6 times (which explains why color printing is so expensive).
When to use: This method is effective when you need 1000 or more books. The more books you print, the cheaper per book it is—this is called economy of scale. Freight is usually an extra cost item, so it does matter where the plant is in relation to where the books are delivered. Most color printing is done overseas, but this does not affect the freight charge much, since boat shipping is way cheaper than truck shipping.
The downside: In the old days (all of 10 years ago), a self-publisher or small press only had the option of printing offset. (Digital was rarely used, except to print galleys—and the cost per unit was extremely high.) This involves a substantial up-front investment, plus having the carrying cost of 1000+ books in a warehouse, storage unit or garage. This meant that the cost of getting published was too high for many hobbyist publishers and small presses who were trying out rather experimental work or a new genre.
Digital or Print on Demand (POD)
Think of this as a very large laser printer, and you are pretty much there. Initially, quality on digital was pretty poor. It’s much better now – and if you format the pictures right, you’ll get very good reproduction (this was a big problem in the earlier days).
When to use: Typically, this method is best used for runs under 1000. Many digital printers will print as few as 10 books. This makes it seem to be a very economical way for new publishers to start out with little money out of pocket. Note the “seems to be” weasel there. The price per unit is, in many cases, much higher than offset (over 1000). However, since there are fewer books, the freight costs will be lower.
Digital printing and the print-on-demand concept revolutionized self- and small press publishing, in that it allowed fewer number of books to be printed at a cost per unit that was almost acceptable, in lower numbers. Since few self-publishers sell more than 100 books, it was just about an ideal solution. The downside to this was that hundreds of predatory companies sprang up—at first calling themselves Print-on-Demand (or POD) houses, then Self-Publishing companies. They overcharge authors for digitally-printed books which are poorly edited (if at all) and have dreadful interiors and covers.
Where the “New Model” comes in: Lightning Source International (LSI), is the digital printing arm of Ingram. They did print-on-demand for large publishers with backlist books (older than a year) that sold marginally (1000-3000) but they still wanted in print. The books were available to booksellers and Amazon. Then LSI threw open its doors to small presses and self-publishing. This was a win-win for self-publishers, since the barrier to entry was lowered: no more huge upfront costs, storage problems and difficulties finding a way into wholesalers or finding distributors. For small presses, it’s a great way to test a book at a reduced cost. You can always go back and print the book in offset if sales shoot over 1000 units.
The downside: Because economies of scale are what they are, the fewer books you print, the higher the unit cost. So if you are only printing a few books at a time, it may “feel” as if you are spending less, but in fact, you are spending entirely too much to make a decent margin (the difference between the retail price and what you get after costs).
Most people are having trade paperbacks printed. This is a great format. But few of these books are priced over $16.95. For those who are trying to sell to booksellers, they discover that the retailers want a 40% discount (they need to have a discount to sell the book) and Amazon Advantage demands a 55% discount. To pay for the book, many self- and small publishers are raising the price of the book to $20 and more. Then they wonder why no one buys the book. It’s too high!
To combat that problem, some self- and small publishers are going through LSI to get the distribution into booksellers and Amazon, but only allowing a 20% discount and no returns. This is being called the “New Model” of publishing. From my perspective, this is a new way to make sure you fail.
A 20% discount and no returns means that booksellers will never order your book, unless they have a pre-paid special order from a customer. That means, you will spend money and effort driving customers into stores where they won’t find your book. Most will walk out instead of ordering, because folks are on-demand buyers.
Yes, you’ll be on Amazon, but at no- or slight discount. Amazon buyers are value buyers. They like that discount. A lot. If they can’t get it, they’ll buy a similar book that does have a discount. And never forget that Amazon has a history of aggressive moves against those who short discount. While it’s unlikely they will directly challenge LSI (again, their owner is Ingram, the largest book wholesaler in the world and a major supplier to Amazon), they could make up new rules to chop off self- and small presses who use short discounts at the drop of a hat. This leaves your entire business model at the whim of a capricious and often cruel company.
If you are simply printing up a few books for your friends and family and interested observers, yes, the short-discount LSI model can work all right. If you are using this as the basis for a small press, you are not running the numbers and seeing how you are losing money and sales.
In sum: If you want to test the waters at a low cost, you can use LSI for printing and distribution. But don’t choose the short discount or raise your book price to ridiculous heights. If you want booksellers and Amazon customers to get the discounts they want, take the 55% discount and returns for a short time. Price the book in-line with others in your section/genre. Do your marketing and see what happens. If the book never goes anywhere, then you aren’t out a lot. If it does sell in quantity, then you need to get the book printed offset (reducing your cost per unit) and either self-distribute or get a distributor.
I’m sure there will be some debate about this.
10 Comments
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Oct 9 09 4:11 am
This is a timely post, since I’m planning to price my book this weekend. Regarding the new model, I’ve read Aiming at Amazon, which suggests the short discount and no returns. I intend to price the book comparable to others in its niche, and yes, I’ll be using LSI. I think the niche and the buying habits of its readers (online vs. b&m bookstores) does factor in. Books in my niche seem to be priced higher than books in more mainsteam niches, probably because they’re all put out by small presses and self-publishers.
I might try your method of not short discounting and accepting returns for a short while. I’ll decide after doing the math on the weekend. My only concern is that “taking off” in my niche doesn’t mean a whole lot of sales, so I may never recover any losses incurred during that short while.
I guess there’s no one right way to do it, as usual.
Oct 9 09 10:32 am
Hi Sarah,
>I guess there’s no one right way to do it, as usual.
While there are no hard and fast rules to achieving success in whatever niche you aim at, there are rules that tend to increase your chances of making money:
Understand what the general rules of the book trade are
Understand what the general rules of your niche are
Break the above only through calculation
Know how to reach your market effectively
It looks to me as if you are doing your homework and are working toward bulding success. It doesn’t matter if you grow slowly, or don’t make a boodle on your first printing. Learn all you can, don’t be afraid to change if you see a better strategy and you could even surprise yourself!
I wish you success!
Oct 9 09 4:39 am
Jacqueline,
A good post overall, but I’m sure I completely agree with your analysis of the cost-effectiveness of short-run printing with LSI.
A few months ago, LSI began offering volume discounts for digital printing, beginning at 5% for 50 units and going up to 25% for 500+ units. Right now, they are offering even higher discounts for a limited period (up to 35%). Since LSI’s basic digital printing charges are already about the lowest in the industry, even the standard discount schedule makes it almost foolish for most self-publishers or micro-presses to bother with offset print runs.
Before ordering 500 copies from LSI of our latest book, I got offset quotes from numerous printers. The savings for even a 1500-copy run just weren’t enough to offset the up-front expense. Particularly given the speed with which I can arrange a drop shipment from LSI. And I don’t have to store them anyplace!
We have several LSI-printed books that include many photos and graphics, by the way, and have no problems with the quality. Over the past year, LSI has made significant upgrades in the hardware and software. Of course, we do make considerable effort to maximize those images for digital printing.
We have a couple of books that are offset printed, but most are digitally printed by LSI. Some have the 20% discount, while others have a 55% discount. None are set up for returns. Our Amazon discounts on those books has far less to do with the wholesale discount we set than with the book’s recent sales.
And bookstores have actually stocked a few of them (admittedly not many stores and only small quantities). Libraries buy them regularly (I can track that by using WorldCat’s service). Over the years, we’ve experimented with various discount and return combinations. Even if total unit sales are lower without returns and with lower discounts, we tend to make more profit from those sales.
And don’t overlook the additional income from e-book sales in various formats, which have a very low up-front conversion expense (since we can do it all in house) and a zero per-unit production cost.
The old guidance about it being cheaper to print 1000+ units to gain a significantly lower unit cost ain’t necessarily true.
Oct 9 09 10:28 am
Walt,
I am quite fascinated with what you are saying about LSI costs right now. I admit, it’s been 6 months since I got a bid from them. I was appalled at how high they were. We got a better deal with 360 Digital.
I admit I am not really seeing much in the way of a cost effectiveness in offset until one hits 2500 copies. I think offset printers need a wake-up call.
As to discounts, I did not address libraries, since they usually only get a 0-20% discount (if they had the same discount as booksellers, they’d probably be less in the red overall). I do know that many no-discount titles get into libraries. Marketing and needs of the collection dictate what books are ordered.
>We have several LSI-printed books that include many photos and graphics, by the way, and have no problems with the quality
I think you should offer an e-booklet on your methods. We do very well, but I think you are one of the most knowledgeable on this subject. I would gladly post a link to same.
>And don’t overlook the additional income from e-book sales in various formats
That, my friend, is another post!
Thanks for your input. Valuable as always!
Oct 9 09 9:31 am
To what Walt said, I would add that by allowing Amazon to print on-demand titles in their warehouses (which was the reason behind their badly handled “sign up with Booksurge” policy initiated last year), one can get discounts applied.
But yes, the short discount self-publishers and others are encouraged to set by so-called “experts” is short-sighted in the extreme, whether one wants bookstore shelves or Amazon sales. Both bookstores and Amazon are committed to making money for themselves, not publishers or authors. Neither is engaged in charity.
Oct 9 09 10:21 am
>I would add that by allowing Amazon to print on-demand titles in their warehouses (which was the reason behind their badly handled “sign up with Booksurge” policy initiated last year), one can get discounts applied.
I think that allowing vertical integration (they print it and sell it) of your material with one company is a rather bad idea. Again, Amazon has proved in the past that they are not good “playmates.” It’s safer to have other avenues than Amazon (I know you are speaking about Booksurge as an addition to one’s printing agenda, but many stop at this step). Besides, there are really other venues in which to sell.
Thanks for your comment, Elizabeth!
Oct 9 09 12:33 pm
This is great information. When we made our most recent print run of 500 copies/155 pages, we managed to get costs of print/ship down to about 3.50 ea. However, that is nearly twice the cost at 1,000 copies and cuts significantly into what is left when you give discounts to resellers.
Another significant cost, however, is the binding process. No matter whether your book is offset or digitally produced, it still needs covers and the pages shouldn’t fall out from between them. It would be good to know if there are any advances in short-run bindery that are equivalent to the move from offset to digital for short-run printing. I haven’t found anything there yet.
Oct 27 09 10:56 am
Jacqueline,
I can see how much effort went into this post and thank you for that. Others have commented on the practices of LSI and the “numbers game.”
Allow me to just note that, contrary to your statement:
“This is the way books have been printed for hundred of years—ink to paper on giant presses.”
Offset printing is a twentieth-century invention and did not become dominant until the 1950s. It was the “new breakthrough” technology only 50 years ago, the way digital printing is today. And like today, many people decried the loss of quality and the sudden influx of “cheap” products that would result from its widespread adaptation.
Thanks for writing!
Nov 1 09 4:08 pm
Joel,
I am not afraid of criticism, so you don’t have to sugar-coat it.
Offset printing is, indeed, a 20th c invention. I toyed with the idea of pointing that out, but decided to go for the wider meaning of “printing” without amending the offset mention.
Which all doesn’t matter. The post is in error as far as offset being around more that 100 years, and I apologize.
Oct 25 09 12:19 pm
I’m not sure I follow you. There is no difference between POD (Print on Demand) and digital printing. It’s the same, because the only way you can print on demand is with the gigantic digital laser printers. If you have had printing done with poor quality results, it’s because the company is using old technology. The new technology that most printers use in the U.S. is very good quality. In fact, it’s so good, that properly formatted files also reproduce photos excellently, too. Ask printers for samples before you sign a contract. Here in the U.S., I recommend Lightning Source, 360 Digital or Fidlar-Doubleday.
As to your observation that a book that looks like rubbish will be avoided by consumers (and the reviewers), that’s a given. Anyone publishing a book should strive for a book that is no different in quality (editing, typesetting, interior design, cover design) than Random House or any other bog publisher.