Educational Development Corp. posted a record performance in the fiscal year ended February 29, 2016. Total revenue soared 95% over fiscal 2015, to $63.6 million, and net earnings jumped to $2.1 million from $859,200 a year earlier.
The increase was due entirely to gains in EDC’s direct sales division, Usborne Books & More, which saw revenue jump 151%, to $52.8 million, from $21.0 million in fiscal 2015. EDC attributed the strong performance to its decision in 2012 to discontinue sales to Amazon.
The move resulted in a dramatic increase in the number of home sales reps at EDC, which rose 151% over fiscal 2015 and the company had 19,600 sales reps at the end of fiscal 2016. (EDC paid out almost $18 million in sales commissions last year). A significant increase in the use of "Facebook parties' also helped to drive sales, with revenue generated through the Internet up 598%. The jump in the size of the sales force, in turn, helped to drive earnings growth as did more efficient software systems and warehouse equipment, an increase in the minimum shipping charge, and more favorable shipping rates.
Sales in EDC’s retail division fell 6% in the year, to $10.8 million, which the company said was due to “an internal shift” between the two divisions of the corporation. Sales to smaller retail chains rose 4$ in the year, but sales to the large chains fell 14.4%. EDC’s publishing arm has discontinued wholesale business and will supply its books directly to the retail market in order to give its direct sales force an opportunity to better compete in the school and library market.