It may seem odd to think of the bargain book business in biblical terms. But several lines from Ecclesiastes may, in fact, best describe the incremental changes that have occurred over the past decade in how wholesalers market and sell bargain books. "What has been is what will be, and what has been done is what will be done." Or, as longtime bargain book purveyor Mel Shapiro, president and CEO of Book Sales Inc., more prosaically sums it up, "There's not much new. You still go out and bid on books and sell them."

From Shapiro's vantage point, the one change that stands out is that "the bigger players aren't owned by large corporations." Book Sales is among the last large bargain book houses to be corporately owned, by Quarto in England. Shapiro also observes that "most of the larger companies like Smithmark and Outlet have left the business."

More Channels/More Books
Albert Haug, president of Book Club of America in Hauppauge, N.Y., concurs with Shapiro's assessment. "The fact is," he says, "there aren't that many changes. Ten years ago bargain books were traditionally sold to the bookstore market. Back then, most of the major wholesalers were focused on that market, and very little was sold to the nontraditional bookstore market." Singling out discounters like T.J. Maxx and Marshalls, Haug adds, "today the distribution channels are much bigger. On the supply side you also see some changes. Every year more and more publishers see the value of remainders and recognize the financial potential of remaindering rather than destroying. It gives us a much wider list of publishers, and new categories of books that were only on the market on a limited basis, like travel and computers."

The biggest change that Robert Wilkie, general manager of Dallas-based Texas Bookman, has witnessed in the last three or four years is that "there are just so many books available--the lists include more titles and more quantities. The number of books available now on the bargain level is pretty astounding." He attributes the increase in hurts to the need to feed superstores with lots of stock, much of which gets returned to publishers and resold as hurts.

In addition to having access to more books, Wilkie is bidding on more good books. "Given the quality of books that we're able to put on our list," he says, "it seems like there's nothing but good times in the future." Further contributing to his rosy view, he says, "there is less talk about major changes in the industry. I don't see any changes in the way we get books in the pipeline. There had been a lot of talk about print-on-demand, but that's died down. Technology isn't going to overtake us anytime soon."

Robin Moody, president of Daedalus Books in Columbia, Md., singles out the hurt effect as a major change, too, although his company continues to sell mostly remainders. "More publishers are not putting their returns back into stock," he says. "There are a lot of titles in the marketplace." But Moody's also found plenty of inventory on the remainder side, which is strictly publisher overstock. "People keep worrying that there will be fewer books," says Moody, "that publishers will publish fewer books and publish them smarter. I've seen no manifestation of that. Right now there's more inventory in the remainder marketplace than I can remember ever. Our title base has just exploded."

Moody also notes that with fewer independents left, "there seem to be fewer remainder companies focusing on the independents, and more on the big companies--not just Borders and Barnes & Noble, but beyond the book trade." Another longtime trend, he says, is that "as publishers like Penguin Putnam, von Holtzbrinck, HarperCollins and Random House buy each other up, there are fewer companies with larger inventories, and there is only one book club. Now when you bid on Harper, you bid on Ecco and Perseus. It just keeps getting more concentrated."

For some bargain book wholesalers, the mergers of the '90s have meant even more business today. Three-year-old Kudzu Book Traders in Cartersville, Ga., for example, recently finalized an agreement to handle all of von Holtzbrinck's hurts, including those for St. Martin's, Henry Holt and Farrar, Straus & Giroux. "Previously," comments Kudzu president Stina Forsell, "the trends were toward a great deal of promotional printing and acquiring inventory through bidding. This has a tendency to waste a lot of time, energy and resources, while only giving publishers a limited amount of control over their product. Under the current situation, such as our newly formed alliance with von Holtzbrinck, wholesalers and remainder dealers can bridge a gap between publishers and the marketplace by finding alternative markets for hurts and remainders."

The sheer number of channels of distribution is one change that concerns Ed Grossman, president and owner of 21-year-old Marketing Resource in New York City. "We're running harder and faster than ever before," he comments. "I think there's increased competition for the same inventory." Despite the fact that remainder sales are organized so that no one knows who they're bidding against, he is certain that "we compete with many of our customers for available product." And those customers are also facing increased competition. "You find books everywhere," says Grossman. "They're in toy stores, grocery stores, dollar stores. The increase in retail outlets bodes well for us so long as we can find quality merchandise." Grossman estimates that he spends most of his time sourcing, and only bids on 10% of what he sees.

University Presses in Print
When it comes to reducing inventory by remaindering, university presses have instituted few changes over the past decade. For the most part, they continue to sell overstock much as they always have through white sales, at which they offer limited quantities of books at a percentage off list price, and bid lists, which give them a chance to auction off large numbers of a specific title. Nor has interest in university press remainders waned. Booksellers continue to begin each CIROBE Friday session by making a mad dash for their favorite university press tables. This tradition was born of necessity, since many books are in short supply and remainders are sold on a first-come, first-served basis.
In recent years, inventory manager Doug Wilcoxen of the University of California Press in Berkeley, Calif., has had more overstock to sell than some of his colleagues, which he attributes to two key factors. "My own experience," he says, "is we've done more ambitious print runs and more trade titles--the two are interconnected--without additional warehouse space. So there's more pressure to make room for the new ones." He does not regard this as a change for university presses per se, but rather as a problem specific to California. "There are other university presses with larger warehouses that aren't as hands-tied," he says.

Among them is the University Press of Mississippi in Jackson. Associate director and marketing manager Hunter Cole remarks, "We do sell a large number of overstock at CIROBE. But the market for me has not changed. My experience with CIROBE is that we see the same buyers every year, and they know our books. When I go to CIROBE, I know that there are buyers whom I must see." In addition to CIROBE, Cole still relies on seasonal white sales and reps bringing sales lists with them when they call on accounts.

The one change that Johanna Grimes, sales manager of the University of North Carolina Press in Chapel Hill, has observed is that "in the last eight years, where we used to do cloth printings only, we do more simultaneous printings. We will do a small cloth run and a larger paperback one. So that prevents hardcover overstock." In addition to trying to print smarter up-front, changes in technology have enabled North Carolina to do smaller reprints and keep books in print longer. Even so, Grimes is quick to point out, "We have never relied heavily on income from remainders. We use remainders as a way to get rid of overstock. We might sell off some of the stock, but the book would stay in print."
--J.R.

Going International
One plus with all the new channels of distribution is the increase in international sales, even in countries where wholesalers have no representation. "I'm amazed," says Grossman, "at where in the world our books go. We sell books in English to a tremendous number of foreign countries. We're able to sell into England, Australia and Europe despite the strength of the dollar. We buy so well that even though the exchange is not so good, it still provides enormous opportunities."

Grossman's not alone in finding increased business from abroad. "We sell just about anywhere," says Rick Perritt, co-owner of 36-year-old S & L Sales Company Inc. in Waycross, Ga. "We shipped into the Beijing Bookstore right about the time the Chinese had that airplane they wouldn't release." Although some of S & L's overseas customers come to them through their www.slsales.com Web site, a number visit the S & L warehouse in the U.S. and handpick their books. "People come here from all over the planet," says Perritt.

Today's shaky retail climate is one of Jeff Press's concerns. During his tenure as president and CEO of 17-year-old World Publications, he has seen not just the demise of many of the key players since he started out, but also the loss of many retailers. "We've certainly seen a batch of bankruptcies this year with Crown and Zany Brainy," he says. "Creditwise things are so shaky. All the major people here in New England have gone bankrupt--Lauriat's, Buck-a-Book and Bookland. It's very scary."

Hand-in-hand with fewer customers, Press finds that buyers are more selective. "If something was a bestseller when it came out, it will be a bestseller as a remainder," he notes. On the other hand, he says, "if something did poorly at $25, it may do poorly at $4.99."

Promotional Books
One recent change that Press is especially pleased with is his own company's purchase of Brompton Books late last year and the addition of its backlist titles to World's own promotional publishing division, JG Press. "That's what we're really concentrating on this year," says Press, who singles out the new value-priced edition of The History of the American Presidency, by John Bowman, as one of the books he'll be promoting heavily at CIROBE for the fall.

Despite good summer sales, Lynn Bond, president and publisher of Random House Value Publishing, which handles remaindering for Random House in addition to reprinting value-priced books, is concerned about how limited display space is adversely affecting promotional books. "There is a distinct difference between a remainder, which is overstock, and reprinting a book," she notes, and the problem comes from retailers displaying the two side-by-side. "What has happened," she says, "is there's a lot of remainder inventory out there with promotional books, and there's a rub-off effect. The remainder, as fabulous a deal as it is, tends to negatively affect a promotional book. When people see a former $25 bestseller priced at $5.99 next to a very attractive book priced at $9.99, it makes the promotional book look overpriced. I think it's happening more now," she adds, "because space has become an issue at the store level."

Amy Simon, sales director, remainder products at Advanced Global Distribution, which handles bargain and remainder wholesale for Advanced Marketing Services (AMS) and its promotional book publishers and client lines, has also experienced fierce competition for space. When she started with AMS 10 years ago, customers were willing to buy and store Christmas titles in January for the following holiday season. Now, no one wants to tie up that much money and warehouse space. "The way the major accounts buy promotion has changed," she says. "It's almost like you're competing for a planogram."

For her, the market is definitely growing. The warehouse price clubs, which have been AMS's bread-and-butter accounts since the company was founded in 1982, are also doing well with bargain books. And so are department stores. According to Simon, department stores, which had gotten out of the book business decades ago, are now selling books. "More people outside the book business are looking to make money with books," she notes. "We did a promotion with Lord & Taylor for a Rockwell book, and we did a table setting book with Bergdorf's. It might be a bargain to me, but it's new to them."

How Are We Doin'?
While most of the ways that bargain book wholesalers do business remain unchanged, that doesn't mean that sales have been stagnant. On the contrary, most bargain book wholesalers report that business is up. "Book Club is doing absolutely phenomenal," says Haug. "Business is continuing to grow. We added some more product categories and expanded our staff." Book Sales's Shapiro also characterizes this as "a very good year." So does Press of World Publications: "We had a fabulous year last year, and this year we're running the same."

In fact, business has been so good for the Texas Bookman and its parent company, Half-Price Books, that the two have just completed moving from the warehouse facility where they've been for the last 10 years to one that Wilkie describes as "double the size, upwards of 120,000 square feet. I'm feeling very positive about the books that we've been able to win. I expect to have an incredible CIROBE."

At S & L, Perritt is also pleased with his company's business. "Sales have gone up," he says. "Our best growth is when the economy is doing really bad. With a little bit of luck, we should be up 20% overall. My dad, who started the business, told me the harder you work, the better your luck is."

While it may not be true that when the economy goes down, all book sales go up, there does seem to be a definite correlation with bargain books, as Perritt suggests. One off-price discounter uses the ad tagline "Don't you just love a bargain?" Add the word "book," and wholesalers and their customers would answer with an enthusiastic "Yes."