Demystifying Book Distribution: Understanding Key Terms and Concepts for Authors

The process of getting your book into bookshops and therefore into customers’ hands is crucial. It is also complicated. While authors publishing with Troubador have access to frictionless full-trade distribution to all key wholesalers and retailers from our own warehouse and distribution facilities, other indie authors need to unpick the complicated world of book distribution. 

In this blog, we'll demystify key terms authors should understand both if they are managing their book distribution and if they are accessing distribution via their publisher. 

Understanding Key Terms for Book Distribution 

Different Trading Relationships in Book Distribution

Trade sales: Book sales made to retailers (not necessarily bookshops) which are supplied on trade terms, including trade discounts. This will include bricks and mortar and online retailers, but can also include sales to library suppliers and non-traditional book outlets (garden centres, museums and other stores).

Direct-to-Customer Sales: Direct-to-customer sales are those that go from a publisher or author directly to a reader and do not pass via a third-party retailer. The benefit to authors is that they can often get their best return from such sales as trade discounts do not have to be given, and the customer covers all the postage costs. Building up a robust network of customers who buy directly from you is important in an author’s sales plan, as it can help offset those sales made at higher discounts to the book trade. 

Sales Reps: Sales agents who visit bookshops and present a publisher’s book list to gain advance orders (pre-orders) for the titles they are representing. Reps can be publisher-specific or work on a freelance basis for a variety of publishers, and they tend to have geographical regions that they cover, allowing the rep to build up relationships with managers, owners and stores in their area – as knowing the retailers and what sells in those stores is key to supporting their customers and clients. 

Trade Terms in Book Distribution

If speaking to a bookshop about stocking your book or hosting an event, they are very likely to ask you what the trade terms are on your book. Trade terms include Trade Discounts, Sale or Return, Firm Sale, Returns. We look at these in more depth below.

Trade Discounts: All book retailers, wholesalers and online sellers will insist on a trade discount – this is a percentage discount off the RRP (recommended retail price) of the book (its cover price). Discounts vary from 35% upwards, but the larger chains and wholesalers will be looking at between 45-60% trade discount. The bigger retailers and wholesalers will also expect the publisher to supply the books at their own cost (ie., they won’t pay your shipping costs).

SOR (Sale or Return): Bookshops and wholesalers most commonly trade on a Sale or Return basis. This means that unsold books can be returned unsold for credit (ie. a refund) within a set timeframe if they do not sell. Returns periods can be up to 15 months, depending on the agreed terms. SOR allows bookshops to stock and take a risk on a wider range of books, because in the end, if they can’t sell a book, they can return it for a credit. Bookshops work on small margins, and without SOR they would stock a vastly reduced range in store. 

Firm Sale: In contrast to SOR, firm sale means just that. Books can’t be returned if unsold (unless faulty). This model shifts the risk from the publisher to the retailer, who must ensure they can sell the books they purchase – and often, Print on Demand (PoD) books are only supplied on a firm sale basis as they are printed to order. Sometimes, when negotiating on price, by giving an additional trade discount, a retailer might take books on a firm sale basis and not on sale or return.

Returns: Returns occur when retailers send back unsold books to the publisher or distributor for credit. The retailer must request advance permission to return books (Returns Notifications / Authorisations) and, once approved, the books are returned to the publisher or their distributor, who checks the inventory, adjusts the royalties owing and the sales reports, and issues credits for the products returned. Returns are an important part of managing book distribution and one that authors representing themselves can often find hard to manage.

PoD (Print-on-Demand): Eliminating the need to hold stock of a printed book, PoD means that books are printed as needed. This can work well for publishers not wanting to invest in inventory, but some retailers are more reluctant to stock print-on-demand titles if they are only available on a firm sale basis, if they cannot get favourable terms. Note also that few bookshops will stock titles available from Amazon KDP as PoD titles.

Types of Order and Fulfilment in Book Distribution 

Core Stock: A central range of stock always held by that retailer, and automatically replenished – this will include front and backlist titles. 

Event Stock: Stock brought in for an event (like a book launch, signing or a festival appearance). Sometimes retailers ask for additional trade terms (ie. a larger discount!) on event stock and may not keep any unsold copies in store after the event. 

Front List: Newly published or not yet published titles that are still being actively marketed.

Backlist: Books that have been published and available to buy for more than six months. 

Dues/Back Order: If a book is not immediately available for supply, a retailer can still place an order that will be fulfilled once the book is available. Orders that cannot be fulfilled within a set time frame are then cancelled. Any agreed trade terms will usually state if dues/backorders are to be held, and for how long.

Pre-Order: The orders taken for books that are not yet published and fulfilled once the publication date, or release date, is reached. 

Shipping and Fulfilment Terms in Book Distribution

Purchase Order: This is an official order from a retailer or wholesaler that contains all the information needed for supply and invoicing, including the Purchase Order Number, which is used on all documents (invoices, delivery notes, credits, etc.) to link the original purchase with the supply of the product. Bookshops might be less formal in their ordering, and often won’t always issue a Purchase Order number.

Invoices and Credits: An invoice is a document sent by the seller to the buyer, detailing the products or services provided and the amount owed. Without issuing an invoice, you will not get paid for the goods you have supplied. Credit Notes are issued when the supplier must credit the buyer for returns or damages so that this can be deducted from the amount owed by the retailer. In both cases, these must contain the agreed information – usually supplier details, Purchase Order numbers, ISBNs and quantities, and show all trade discounts. Again, the invoice and credit processes can be harder to manage for smaller suppliers, which is why the wholesalers and big retailers prefer to deal with bigger publishers such as Troubador direct.

ASN (Advanced Shipment Notification): Many retailers, especially those working out of large warehouses and distribution centres, such as Amazon, require ASNs. An ASN tells them in advance what is being shipped to them against each order and invoice number. Often this will also tell the retailer what ISBN is in each box being shipped. This facilitates the processing of the books in the retailer’s warehouse upon arrival, but it places a great burden upon the supplier (the publisher or distributor) in preparing the associated paperwork and ensuring that boxes are packed accurately, to tally with the ASN information.

Finally, all books need to have full and up-to-date metadata. This is accurate and detailed data, including title information, description and keywords. This is crucial for effective book distribution, helping books get discovered by retailers and readers alike. You can read more about ensuring you have good metadata here.

Summary

Understanding the intricacies of book distribution is essential for authors. We hope that having demystified key terms and concepts will help you navigate the distribution process more effectively. Remember that at Troubador we offer fully managed distribution to the book trade from our purpose-built warehouse – contact us if you wish to learn more. Further to this handy guide of terms you might encounter in distribution, we have also put together an in-depth guide on how book distribution works.