A collaborative post with Nooroongji Books

 Why non-returnable terms can help the book biz: What you don’t know about bookstore returns

I believe that the book buying public knows little about bookstore returns and how the books they buy are actually sold. Knowledge is power and knowing how common industry practices are hurting the folks that make the books we love and enjoy can help us consumers make more informed buying decisions. In my quest to bring transparency to the book buying industry and pulling back the curtains on how things actually operate, today we’re diving into bookstore returns. We’re not talking about when a consumer returns a book to a store, but when bookstores return the books they don’t sell. Individual books can end up going on quite a journey back and forth before they’re sold, or in some cases, before they’re ultimately recycled or destroyed. 

The importance of transparency in bookstore returns

Part of knowing more about what happens behind the scenes as a consumer and book lover, means that you can make more informed buying decisions and support businesses that are more aligned with your values. Now more than ever, where you spend your money matters!

I spoke with Jennifer Kim, owner of Nooroongji Books on Granville Island, Vancouver to include a bookseller’s perspective on this topic. Nooroongji operates on a non-traditional non-returnable policy. Read on to find out why this is a groundbreaking practice that’s helping the book business!

Click to visit Nooroongji on instagram and support this amazing store! Now, let’s dive in!

How do bookstore returns work?

• Bookstores order from distributors who work with publishers to sell their books
• The terms of the order are agreed upon between the bookseller and the distributor at time of set-up, and the terms remain fixed. The terms may be able to be renegotiated but it is difficult and may only be able to be changed a couple times during the life of the business relationship.
• These terms include the wholesale price of the book and the return policy. The wholesale discount price of a book is the price that booksellers buy the book for. The discount can be anywhere from 40-60% of the suggested retail price of the book. Booksellers get a better discount when they order with non-returnable terms. This is because the publisher knows the will not be assuming the extra fees that are incurred with returns.
• Most bookstores order books with returnable terms.
• This means that if the bookstore doesn’t sell the books within a specified period, they are able to return them to the distributors for a full refund, who will then return them to the publisher.
• Other retail sectors don’t operate on this model. Clothing stores order clothing items from brands and if they don’t sell, they have to discount them at the end of the season in order to try to sell them off before new stock comes in for the next season. This is why buyers and trend forecasting is big business. It’s important to be informed about what consumers want, but it can be a gamble.
• Since sales are never a guarantee, bookstores opt for returnable terms to mitigate financial risk.

A stack of books, A Safe Girl to Love by Casey Plett, hot off the press from the printer. Non-returnable terms can prevent the books we love from ending up in the recycling bin.

You may be wondering, what is the real downside to returnable terms?

• The publisher, whose margins are already very low, is on the hook for the shipping and handling fees. Say a big box store like Costco orders 10,000 copies. If only 1,000 are sold, they can then return the other 9,000. Returns like this can ruin publishers.
• As an author, you may ask what happens to the royalties on those 10,000 copies. The publisher, wary of the returnable terms, may hold a portion of the authors royalties until the books sell through (are sold to the end consumer) in case there are returns. 
• Holding onto income from big orders becomes critical for a publisher’s survival. A big return could run a publisher out of business if they don’t hold onto some income from the original sale. 
• Many of the books returned are damaged, so they are unsellable and end up getting pulped (recycled) or destroyed.
• Returnable terms have a high environmental cost, leading to waste and a higher carbon footprint due to the extra back and forth shipping.
• These terms can also lead to a toxic cycle of buying, returning and re-buying. A bookseller can put in an order, then return that order before the end of the return window, only to re-order those books again to restart the clock and try to sell them once more!

A book I designed, My Volcano, sitting on a bookstore bookshelf.

What can we do about it? Non-returnable terms for the win!

This is a decades old practice that doesn’t serve the publisher or authors well, which is why it’s remarkable to see some booksellers taking a stand and buying books on non-returnable terms such as Nooroongji on Granville Island in Vancouver. This can be daunting since as mentioned, they are assuming all risk if the books don’t sell, but bookseller Jennifer Kim at Nooroogji is betting on her customers. Booksellers who are community oriented (not buying books for huge box stores like Indigo) have a beat on what their customers are shopping for and the things they care about. Making smart informed decisions about what to buy, carrying only books that the bookseller truly stands behind, and not over-buying needlessly to keep up with trends that are over in the blink of an eye could be the recipe to success. Nooroongji is doing things differently and the book industry thanks them for it! 

The Case for Non-returnable bookstore terms by Jennifer Kim of Nooroongji

Saving Time

• By operating on non-returnable terms I save a lot of time. Consider the time lost on:
  • The initial order (and the money locked in on something that we’ll eventually return)
  • Inventory reports analysis and decision making on which books to send back
  • Trying to sell them at some discount first before finally deciding to return (which many bookstores do, I think)
  • The physical work of collecting all books to return
  • Packing, generating, and printing the packing list, shipping label, and dropping cartons off to the carrier or arranging for pick-up
  • The time needed for documenting processes and training for all staff
  • Incorporating these additional workflows for returns requires periodic maintenance as well in terms of process review and training; as details, terms, and access periodically change per supplier. 

Commitment

• By shifting my perspective on buying (all purchases being final) my choices require more research and commitment. But this does not mean I don’t take risks. By keeping our selection tight, I feel I am more free (in both funds and time) to take risks on books no one will buy for 5 years, but that I know will elevate the shelf it sits on and make an incredible emotional impact on the handful of people it will have deep resonance for. 

Deeper discounts

• Most returnable terms offer a 30-40% discount. On non-returnable terms you can gain 5-20% on your margin. A pretty significant difference.

The beautiful storefront of Nooroongji Books on Granville Island.

What do return mean for self published authors?

As a self published author, you can select your terms based on the costs (financial and environmental) you want to bear when setting up your print on demand publishing and distribution services. 

• You can choose non-returnable terms, but bookstores may not want to order your book from your print-on-demand distributor with these terms. 
• If you select return-deliver, books can be returned to you but you must pay the return shipping,
• If you select return-destroy, returned books will not be shipped to you, they will be destroyed.

Before making your decision, consider if your marketing strategy includes bookstores. Are you planning a big marketing campaign to reach out to bookstores to carry your book? If you aren’t doing a marketing push to get the awareness out there about your book and if you haven’t connected with a distributor or sales rep, it’s not likely your bookstore orders will be high. If this is the case for you and you’re going to be selling directly to readers, you can confidently select non-returnable terms to make a wise environmental choice, knowing it’s not going to have a huge impact on your sales. You can even make mention of this choice on your social media and website, to let your community know you have set non-returnable terms to do your part in creating a more sustainable future. Often being transparent will lead to your community having your back. You may even want to include a disclaimer that notes if readers are dissatisfied with their purchase they can reach out to you personally to rectify the issue.

Read more about bookstore returns with Ingram Spark at this link.

The return policies through Kindle Direct Publishing (KDP ) are a bit more unclear as Amazon is notoriously opaque, but you can read more about it here.

What’s next?

Next time you’re shopping at your local indie bookstore, ask a bookseller about their terms. Booksellers at the store level in indie stores are extremely knowledgeable about the book business. Now that you’re informed on the topic, you can have a conversation with the store. If we all demand and expect better terms for the industry, maybe it will move the needle on the waste in this industry (time wasted as well as financial and environmental waste). Shop at stores that care about the community and the industry! As I said, where you spend your money really matters, every single book you buy at an indie store (even if you only buy one book a year), and not off Amazon, matters!