Think Volume
September 2018 by V. R. Duin

VOLUME BUSINESS
HIGH VOLUME SALES
LOW MARGIN PRICING

It isn't smart.
To become part
Of the landscape.
We must escape.

There are highs and lows in the volume business of publishing books, because high volume sales must offset low margin pricing in order for books to be profitable.

In the retail book industry, high volume sales must offset low margin pricing. Book sellers typically add a small percentage of retail price markup to the wholesale cost of each book. Buyers will not pay a lot for any single book. Therefore, low margin pricing is critical to the sale of books.


Volume is another name for book. Books selling in the single digits generate very little income. Cumulative profit from books comes with fast-moving inventory, printed on cheaper presses. Low margin pricing and high volume sales can lead to substantial earnings for writers and publishers.


Self-published writers may sell 200 books. Writers must reach beyond sales to their own networks to achieve word-of-mouth promotion. Sales of 2,500 books may defray startup costs. This number may earn agent representation. Sales of 7,500 books may lure mainstream publishers.


It can take over a decade to build a writing business. Commercial value increases each time purchasers take a chance on a writer. Books can float in cyberspace, while writers use another source of income to build opportunities. Writing and promotion often start at night or on weekends.


Payments should not be called “royalties”. Royalties from book sales are treated as earned income, from which contributions must be made to Social Security and Medicare. The tax system in the United States reduces net incomes and complicates writing businesses.


Software programs may help financial operations and business planning. Writers may need to file estimated quarterly taxes. Deductions for outside suppliers, equipment and space may be allowed. Taxation and accounting may require help from an expert in bookkeeping, auditing or taxation.


Buying books for give-aways may not be a sound business practice. People rarely value things that are free. These gifts may not benefit from word-of-mouth promotion. Writers should order their own books to sell them or test the integrity of sales reports, turnaround times and quality control.


A publisher makes a generous profit when books are selling by the thousands. Bulk orders are printed less expensively on offset presses, including at many self-publishing houses. Independent printers may cut corners or fail to report sales of books printed in small numbers on demand.


The strategy used in the high-volume book publishing business is being used by established influencers for content generation. This high volume approach can raise interest in past, present and future content. It works best for known, authoritative writers with an existing audience.


It helps to be a participant. On social media, it is important to engage with people and businesses that share interests. The average social media account has about 300 followers. On major social media sites, the participation rate of followers in post activities tends to be low (1-2%).


It is important to select connections carefully. It is not necessary to connect with everyone. Unknown writers have to connect with influencers to expand their reach. Writers should be looking for blogs and links that are compatible with their platforms. Networking matters.


Agents rarely represent creative individuals with fewer than 3,000 followers. If a writer manages to reach 10,000 followers on social media, traditional publishers may accept this number as a “ticket” into their “stable”. Social media can be a great place to engage. Beware of friend “fatigue”.


There are few guarantees in the fickle and rapidly changing, business of publishing books. Per-click and per-impression advertising may gain followers. Crowdfunding may help expand and distribute content. Neither may achieve fund-raising or profit-making goals.


Writers must remain alert to developing trends. Trending tastes and digital technologies keep tension on every aspect of this mercurial business. Evolving technologies may influence or limit the future size of the volume business of publishing books.


Organizations are turning to blockchain technologies. The purposes include accountings of receivables and payments, tracking and recording of ownership rights, certifying transfers and contractual agreements and preventing the corruption of financial transactions and databases.


Blockchain is a huge drain on electricity. This is spurring expansions of power grids and studies of renewable resources. The power demands may have prompted an end to net neutrality, allowing Internet service providers to charge differently for different users and uses.


Cryptocurrencies eliminate middlemen and third-party institutions from financial transactions. They are currently private, unstable and subject to fraud. In the future, blockchain may create a simpler and more stable solution to global finance than sovereign currencies and currency exchanges.


The future role of cryptocurrencies is unclear. The question is not if, but How soon blockchain technology will change currency as we know it.. Expect changes in data storage, identity, content protection and in payment methods to reach every aspect of the volume business of publishing books.

Highs and Lows of Publishing

  • high volume sales V. R. Duin says:

    In businesses with high volume sales, mistakes are common, making it important to audit for failures and efficiencies in the sale of books.

  • Low margin pricing V. R. Duin says:

    Low margin pricing is typically found in highly competitive fields with inexpensive products, like publishing books, in which large quantities sold can make up for low profit on each book.

    • volume business of publishing booksV. R. Duin says:

      A volume business, like publishing books, will avoid costly press resets and focus on building a mass market following for the fewest possible titles.