Over the past quarter of a century, Publishers Group West (PGW) in Berkeley, Calif.—now a division of Publishers Group Incorporated, which was formed in 1994—has become the largest distributor of independent presses in the U.S., with 140 clients and 50% of the market share. Not bad for a company that began with an investment of $500 in 1976. In 2000, PGW sold approximately 15 million books and grossed $165 million.
Last March it had its second biggest month ever in terms of gross sales, and the following month, in MacDonald's-like fashion, it saw its billionth (net) dollar served. Despite a less than robust economy this year, Charlie Winton, chairman and CEO of PGI, PGW, and Avalon Publishing Group, noted, "We're having our biggest month ever in August. It's not inconceivable on an international basis that we'll have a $20-million month." For the year overall, he predicted "a net increase of about 10%, and we seem to be on course to hit those numbers. We're happy that we're growing nicely in an economy that's a bit more difficult."
Part of the reason for PGW's relatively impressive numbers in a lackluster year is the strategic growth in the wake of the company's biggest bestseller, Charles Frazier's Cold Mountain (Atlantic Monthly Press), which sold 1.6 million copies in hardcover in 1997 and 1998. As a result, PGW has come to more closely resemble the distribution arm of Simon & Schuster or Houghton Mifflin.
Like them, PGW is about to make the most out of its 1999 investment in a state-of-the-art warehouse in Reno, Nev., by adding fulfillment-only customers. Until now, PGW has had only clients that rely on PGW for all its services, including marketing and editorial. "We believe we have an opportunity to leverage our operational side. That's something we've never done," Winton told PW. "That's a business we're planning to get into." PGW's strong in-house sales force will continue to be a help moving forward. Two of its sales representatives were selected as Publishers Weekly Rep of the Year in two of the last three years—Peg O'Donnell in 2001 and Patricia Kelly in 1999.
Structural changes and the growth of PGW's sister company, Avalon, which was formed in 1994 as an outgrowth of investments in clients' books in the late '80s and the purchase of Moon Publications in 1992, have also boosted PGW's revenue. "We're our own largest client at this point," said Winton. "I feel like we've navigated the marketplace and created a new version of PGW that is far more settled, capable and responsive."
Relatively new clients and ones that have been with the company almost from the start say that they are pleased with PGW's services. "We changed distribution just about six months after I joined Taunton, so we've been with PGW for three years. Coincidentally, we stepped up our trade program," said Taunton Press publisher Jim Childs. "Our sales have grown 400% since we've been with PGW. This year we're up 35%—40% over the first five months of last year."
Similarly Marc Allen, publisher and cofounder with Shakti Gawain of New World Library, which has been with PGW since 1979, when PGW had a funky brick office in Emeryville, Calif., and New World operated out of a one-bedroom apartment in Oakland, Calif., called it "a good partnership. We meet with PGW regularly with every list and brainstorm. We touch on editorial and marketing strategy beyond just the sheer nuts and bolts of distribution. We've calculated the cost of doing our own distribution, and it would cost us as much as PGW. We look at that and say, Why do we even want to do what they're doing—getting a warehouse, hiring a staff, and collecting from the chains? It's great that PGW handles all those headaches. It frees me up to acquire and edit."
For Barbara Mead, co-owner of Politics & Prose in Washington, D.C., PGW's books fill several niches. "We have been very impressed with the wide spectrum of books they carry, from graphic novels to erotica, business books and quality fiction. Most publishers can't do that."
Currently, PGW has several bestselling titles, including Don Miguel Ruiz's The Four Agreements (Amber-Allen Publishing), Vincent Bugliosi's The Betrayal of America (Thunder's Mouth Press) and Candace Bushnell's Four Blondes (Atlantic Monthly). Winton also has high hopes for Leif Enger's Peace Like a River (Atlantic Monthly), which shipped in mid-August. "All indications are that it's going to be very significant," he said. "The third printing has been scheduled, which will bring it to 120,00 copies in print."
Despite the strength of these books and other mega-sellers, starting with PGW's first million-copy bestseller, 50 Simple Things You Can Do to Save the Earth (Earthworks), what really matters at PGW, said Winton, "is there's still a fundamental orientation toward the books and clients. We will probably continue to diversify our business a little bit, but ultimately we'll make sure that the values that were central to us when we started are still with us going forward."