Indie Houses Navigate Difficult Times

The importance of distribution to the success of an independent publisher has been driven home lately by the well-publicized bankruptcy of PGW's parent company, AMS.

The bankruptcy has renewed debate among independent publishers over the question of whether to keep distribution in-house or to use a distribution company.

Two of PW's nine fast-growing small publishers this year are PGW clients, and both say the company did a great job in selling their titles. Ray Riegert, head of Ulysses Press, says while the bankruptcy hurt, he is excited about the prospects for the company as part of the Perseus Books Group. The weekly checks Ulysses has been receiving from PGW since the Chapter 11 filing have softened the financial blow, particularly since the company currently has the fastest selling book in its history, Mugglenet.com's What Will Happen in Harry Potter 7. Cleis Press's marketing director, Diane Levinson, says PGW has always done a "wonderful job" for Cleis, noting that its reps know how to sell its list, which contains some sexually explicit books. Cleis, like Ulysses, will move to Perseus.

Several publishers that handle their own distribution, however, say recent events only reinforce their commitment to keep distribution in-house. "I can't see turning over customer relations and handling of my money to a third party," says Chelsea Green publisher and president Margo Baldwin. She notes that in many ways it's easier now than ever for indie presses to do their own distribution since consolidation has dramatically reduced the number of bookselling accounts that need to be reached. The major bookstore chains can be called on by in-house reps, and most indies can be reached through telephone reps or over the Internet.

Rudy Shur, Square One Publishers' founder, notes that using a distributor can "take a great weight off a publisher's shoulders." But in his case, with a high percentage of sales coming from alternative markets, he couldn't justify the cost of having his books sold to bookstores in a bag with those of 200 other publishers. "I owe it to my authors to spend a few minutes myself in front of a buyer presenting their books," he says. Shur acknowledged that having a large presence in alternative outlets makes it possible for him to create an infrastructure that can support Square One handling its own sales. The existence of a school division also makes it possible for Charlesbridge Publishers to maintain back-office systems that allow it to do its own distribution, says associate publisher Mary Ann Sabia. Doing its own distribution "allows us to control our own destiny," Sabia says.

The Nine

The reluctance of large publishers to do spoken-word audio editions of books that they believe won't sell in big numbers has been a boon to Tantor Media, an independent audio publisher that can run a business on titles that sell 1,000 copies. "We keep costs down, allowing us to do audio editions of titles [whose print runs] are too small for a big publisher, but nevertheless have an audience," explains Tantor publisher Allen Colebank. One way Tantor keeps a lid on expenses is by using a proprietary system the company developed that lets narrators do their own recording. Tantor sends a book's text to the narrator via e-mail; the narrator burns the audio onto a DVD and returns it to Tantor, where the audio is edited and e-mailed back to the narrator for a final check. In addition, one-third to one-half of Tantor's titles are manufactured in-house, which permits quick turnarounds to take advantage of special sales opportunities, says Colebank.

Tantor's huge jump in sales since 2004 came after success in that year persuaded the company to adopt a more aggressive publishing approach. The number of titles released jumped from 22 in 2004 to 80 in 2005 and shot up to 141 last year; for 2007 Colebank expects to do 240 audio titles. Among the titles that have done the best are The God Delusion, The Worst Hard Time, The Looming Tower and TheWal-Mart Effect. Colebank estimates that about 70% of its list comes from publishers with the balance acquired directly from agents.

In addition to ramping up the number of titles it will release this year, Tantor is looking to expand its sales outside of traditional bookstore channels in 2007, targeting both the library market and special sales. To reach the latter market, Tantor just hired Michelle Brown from Globe Pequot as director of special sales. Prompted by the major bookstore chains to simplify its distribution, Tantor signed on with Ingram Publishers Services last year, a move that has worked out well, Colebank says.

After posting a 19% revenue increase in 2005, Square One Publishers founder Rudy Shur set a growth target of 20% annually for the next several years and in 2006, the company posted a 26% increase in revenue. Sales to the education market rose 25% in the year due to a combination of more school course adoptions, higher library purchases and a doubling of sales of Square One's Bohensky Dissection Series in colleges and high schools. The company's general health titles benefited from a surge in sales through catalogues last year, while sales to organizations—made on a nonreturnable basis—enjoyed good gains.

Shur has focused his publishing efforts on selling specialized titles to niche markets, but in 2007 the company will branch out and add some new categories, including memoir and specialized literary fiction. The latter will be led by The King of Shabbos and Other Stories of Return by Zalman Velvel. Square will develop its fiction list "on a slow basis." Shur expects his big book for 2007 to be in personal finance: Do This. Get Rich! by Jim Britt. Square One will back the Do This launch with its largest e-mail marketing campaign to date, and Shur has set a 25,000-copy first printing. Square One will also get a boost in sales this year from its recent acquisition of the Vital Health series of 40 titles.

Ronnie Sellers Productions, rechristened Sellers Publishing at the beginning of 2007, had another strong year in 2006 with sales up just over 20%. Book sales, driven by gains in both backlist and frontlist, rose 22%. Frontlist stars were Sixty Things to Do When You Turn Sixty, The Bride's Year Ahead Deluxe Edition and two books in a new 500 recipes series, 500 Cookies and 500 Cupcakes.

Sellers, originally a calendar publisher, added 10 calendars to its list last year, bringing the number to 135, and sales rose 20%. Calendar sales were led by the company's new boxed daily calendars, which beat expectations by 50%, according to founder Ronnie Sellers, and the company is doubling the size of the boxed line this year. The publisher's entire calendar list did very well at the bookstore chains last year, and Sellers says the chains have committed to giving him more space in 2007.

Sellers is projecting sales to increase by about 20% again in 2007. Sellers Publishing has long turned popular calendars into books, and that will again be the case in 2007, when one of its top-selling calendars of the last four years, Crack Calendar, featuring cartoons by Eric Decetis, is released as a humor book, The Crack Book. Strong sales are expected for an addition to the 500 recipes line, 500 Appetizers, as well as for The College Applicant's Organizer.

Despite the bankruptcy of its distributor, PGW, Ulysses Press had its best year ever in 2006 and is hopeful that if it can get its distribution issues behind it quickly, it will have another record year in 2007. Growth last year was paced by sales of fitness and lifestyle books, led by Total Heart Rate Training and The Easy GL Diet Handbook. Titles on Pilates, yoga and travel, the segment where Ulysses got its start, also sold well. An unexpected hit came from Courage After Fire, which Ulysses publisher Ray Riegert describes as a reentry manual for troops coming back from overseas. The title has sold 25,000 copies, including a 5,000-copy sale to the Minnesota National Guard.

The Courage title reflects Ulysses's new attitude about broadening the company's publishing program, and that strategy helped the publisher land Mugglenet.com's What Will Happen in Harry Potter 7. Published in November, Mugglenet is now in its sixth printing, with 135,000 copies in print. The title has made January and February the best two months in Ulysses's history. But Riegert said that even if Mugglenet was excluded from sales, revenue is still up over last year.

The acquisition of Cambium Press, which added 15 titles, plus more strategic partnerships helped boost sales at Fox Chapel Publishing in 2006. An agreement with DK and the Boy Scouts of America yielded the Pinewood Derby Speed Secrets, which turned into a must-read for many Pinewood Derby participants. Another Pinewood Derby title is planned for 2007, and Fox Chapel also has an agreement with DK and the BSA for woodworking books. A deal with Reader's Digest resulted in Fox Chapel copublishing Woodworking with the Router and Storage and Shelving Solutions. In both deals, Fox Chapel distributes the books to the woodworking specialty channel, while its partners distribute to the trade.

Fox Chapel moved outside its core woodworking/crafts area in 2006 area to produce The Historical Atlas of Lancaster County, the company's home county in Pennsylvania. Released late in the year and available only from Fox Chapel directly, the $60 hardcover sold out nearly all of the 8,000 units before Christmas. Fox Chapel hopes to do more atlases in the future.

Marketing director Paul McGahren says that rather than significantly upping the number of new titles it releases, Fox Chapel has focused on upgrading the quality of its books. As a result, Fox Chapel has been able to raise prices, build backlist sales, develop more strategic partnerships, and lower returns, which are now below 10%.

Although Chelsea Green Publishing has a number of initiatives in the works, revenue last year was driven by backlist sales of its how-to sustainable living titles, coupled with hardcover and paperback sales of Crashing the Gate, says publisher Margo Baldwin. The company also benefited from the sale of paperback rights of Serve God, Save the Planet to Zondervan. Chelsea introduced the first titles in its new Sciencewriters Books imprint last year, but Baldwin expects a much bigger contribution from the line in 2007, when another five titles are released. Baldwin is scaling back plans for a new separate children's imprint. "It's too much," she says.

At the beginning of 2007, Baldwin revamped Chelsea Green's sales organization by replacing the commissioned rep group with an in-house sales and special sales team. The 2007 list will feature Chelsea Green's usual mix of green living and political titles, including an undisclosed fall title that Baldwin believes will be Chelsea Green's next really big book.

Kathy Welton was hired by the American Bar Association four years ago to expand its book publishing program, and she has delivered. New initiatives have resulted in a significant increase in revenue and titles at the ABA's book publishing arm, and now Welton is focusing on expanding the ABA's audience beyond its 400,000 membership and other legal professionals. To achieve that goal, Welton is counting on an increase in sales from NBN, which handles sales to bookstores, libraries and e-tailers. Sales through NBN contributed 5% of revenue in the last fiscal year, and sales are projected to increase 19% in fiscal 2007. Over half of the ABA's book revenue in the fiscal year ended August 2006 came from its Web store, at ababooks.org. During calendar 2006, orders were up 9% from the previous year, and sales rose 19%.

The effort to broaden its list also involves the development of a new flagship ABA Publishing program. (Most titles now are developed in cooperation with ABA committees.) Ten titles are set for release later this year, including Garner on Writing and Language, The Creative Lawyer and The Little Green Book of Golf Law. ABA will also continue to experiment with digital downloads of titles. Welton says the association could make as many as 20 titles available for digital downloads, which will enable customers to buy a portion of the book online and receive a discount to buy the print edition.

After increasing only 3% in 2005, revenue rose 12% last year at the children's book publisher Charlesbridge Publishing. Revenue last year benefited from the release of Charlesbridge's first line of transition readers for children six to 12. Aggie and Ben and Hey There, Stink Bug were the two top-sellers in the new line, says associate publisher Mary Ann Sabia. The company's traditional picture books also did well last year, led by Little Lost Bat.

In terms of marketing channels, sales were up to schools and libraries as well as nonprofit organizations. "We did a lot with literacy programs last year," Sabia explains, adding that several of Charlesbridge's Spanish-language titles sold well into the literacy market. In general, though, the Spanish-language market "is still tough, but we're committed," Sabia says. Charlesbridge had successful holiday promotions with the bookstore chains and with mass market accounts. Wal-Mart took a couple of titles for Easter and Halloween, but Sabia notes her company isn't counting on a big order from Wal-Mart this year. "It's hit or miss with them," she says.

The sales growth numbers belie the progress Cleis Press has made in building its publishing program the past three years. After a record 2004, sales had a mild slump in 2005, but bounced back in 2006, although gains were curtailed by the PGW bankruptcy. In 2006, Cleis expanded its list beyond its core books on sexuality, erotica and gay and lesbian studies to include the semiautobiographical My Girlfriend Comes to the City and Beats Me Up by Stephen Elliott, which was named a best book of the year by Salon and the San Francisco Chronicle. Deconstructing Tyrone: A New Look at Black Masculinity in the Hip-Hop Generation was the subject of a front-page review in the Washington Post's Book World as well as articles in publications in over a dozen major markets. "We're looking to diversify our list a bit," says marketing director Diane Levinson. In its more traditional areas, Cleis launched two new self-help sex guide series last year with The Smart Girl's Guide to Porn and The Adventurous Couple's Guide to Sex Toys. More Smart Girl's and Adventurous Couple titles are set for 2007.

The company's fastest growing sales are coming outside of the book trade. The publisher's sex guides and erotica collections have done well in such chains as Good Vibrations, Babeland and Castle megastores. And as the sex toys home party business continues to grow, Cleis titles such as Sweet Life: Erotic Fantasies for Couples have been added to the party plan mix.

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