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If books are valuable, then what about remainders?

One of the common explanations for the Agency 6 raising the prices of ebooks is that they cost money to produce. They don’t want people to get used to paying to little for ebooks.

You know, if they really felt that way then they should do something about the sale Barnes and Noble are having today. Right now B&N have 100 former bestsellers on sale for $3,99.  These are hardcovers, too. This is basically a remainder sale on the part of B&N.

I was at BEA a few weeks ago, and I was astounded at the vast number of booths run by remainder vendors. These are companies that don’t do anything other than buy large volumes of books for 10 cents on the dollar and sell them again for 20 cents on the dollar.

There were more remainder vendors at BEA than booths in the IDPF zone. There were more remainder vendors at BEA than indie publishers (almost). And you could find almost every publishers books in one of those booths.

Did you know that I buy hardbacks? I buy quite a few, and they’re all remainders. Why not? Publishers don’t value the books more than the 3 or 4 bucks I pay for them, so why should I pay more?

Also, if publishers will take $4 for a hardback, why would I pay $12 for an ebook? It really makes no sense.




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Tyler June 15, 2011 um 7:38 pm

This is a stock liquidation sale to get rid of inventory. It’s the same as the big pile of books they have in the middle of the store to close out.

Nate Hoffelder June 15, 2011 um 8:00 pm

Yes, but the odd thing about books is that B&N can send them back for a full credit. The only way that B&N could sell them for $4 is that the publishers credited B&N for the difference.

Carly June 16, 2011 um 7:29 am

Actually, true remainders are non-refundable. Basically the bookstore and the publisher play hot potato until someone gets stuck with it and has to liquidate for cheap.

A typical hardcover remainder lifespan goes like this:
1) New hardcover comes out; B&N orders, say, 50 for one store.
2) 25 hardcovers sell, the rest get sent back to the publisher for credit.
3) Publisher is stuck with sunk cost of the hardcovers, and recoups some of that by selling the books to a remainders company.
4) Remainders company sells the books back to B&N, B&N has to sell them or trash them…no one will take them back once they’ve been tagged as bargain books.

I don’t disagree that publishers have really effed things up, but remainder/bargain titles are a whole other beasty and typically are not returnable and can be a loss to the bookstore if they aren’t liquidated.

fjtorres June 16, 2011 um 8:47 am

One way to look at it is that publishers don’t sell books.
They sell print runs.
Each print run is a separate upfront investment decision that has to pay for itself. So, in their worldview, the price of individual components of a run is irrelevant. The fact that one print run (ebook, trade Ph, or mmpb) might be compiting with leftover dregs of another is of no concern to them. That is, at most, a matter for the retailers to worry about.
A perfectly reasonable attitude in the balkanized markets of the pre-internet era when price comparisons involved physical travel and it didn’t much matter that a retailer in one area was liquidating a batch of HCs while a different site was still trying to get full price or had moved on to a paperback release.
It’s been pointed out repeatedly that publishers don’t understand consumers because they never sold to consumers; their customers, whose needs they *used* to understand, were distributors and B&M retailers. Nowadays, the industry has changed so much they can’t even claim that much.
The issue of remainders is one that won’t be with us much longer anyway; pretty soon the market for pbooks is going to both start shrinking and getting more volatile. Publishers will curb or end full credit for returns. And remainder clearances will end.
And the deathspiral of B&M pbook retailing will accelerate.

Sherri June 15, 2011 um 8:48 pm

I’m in a 'I hate publishers' mood today. There’s a book I was looking for last night, that I’ve been meaning to get for a couple of years but haven’t yet. Unfortunately, I didn’t get it in time; it’s published by Random House, who’s now gone Agency. This book was published in hardcover in October 2008, and is long gone in that form in bookstores and Amazon and B&N; I can get it (NEW) for $1 in the remainder market. It’s available in trade paperback, but the ebook is still priced at $11.99.

I understand the historical reasons for remainder pricing, but it’s absolutely insane from a consumer point of view the hardcover is effectively free (the shipping costs 3 times the price of the book), while the ebook costs more than the trade paperback, for a book that’s been in trade paper for a year and a half.

Nate Hoffelder June 15, 2011 um 9:00 pm

Yep. Pretty much my point.

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