Today, a rather interesting commentary on the distribution system in India, was made in an article on The BookSeller:

Examining the Indian market, Pan Macmillan Asia m.d. Daniel Watts, who is based in New Delhi, said the main challenge for publishers selling in India was payment collection, with distributors under pressure from retailers to provide better service, availability and prices, and retailers wanting to deal directly with publishers.

He said: “The market has also opened up and the retailers have multiple choices from where they can source their books. This has facilitated a credit culture. The retailers will take 150-210 days credit. They’ll withhold payment for impending returns which are usually made within three months. They’ll withhold payment as it suits them because there is always another source ready to supply books. The backlog in payments goes all the way up the chain. Most publishers operating in India are not able to collect inside 210 days and they face the same challenges with regards withheld payments for pending returns.”

He said there were ongoing talks between the major publishers operating in India, including HarperCollins and Pan Macmillan, over whether to work together through a central warehouse to supply retailers directly, a move which may be a possibility within the next “two to three years”.

He estimated that the online bookselling market, led by Flipkart.com, currently has a 15% share of the market, with physical book chain Crossword c.o.o. Kinjal Shah telling him that his board of directors no longer have the confidence to open new stores.

That the distribution system in India needs a revamp is a no-brainer. Publishers across the spectrum will tell you that the distribution system is an evil they have learnt to live with. Payments are slow, discounts are high and books are almost always taken on an SoR (“sell or return”) basis. All that might have been bearable if books travelled the last mile and reached the eager reader. Poor road infrastructure and distributor apathy ensures that that does not happen.

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What is interesting is the comment made by Kinjal Shah on the reluctance by his company to open more stores. If other bookstore chains, like the one he oversees, also feel that way, that leaves the field wide open for online stores to take their place. The increasing internet penetration in the country will only help their case, already buoyed by features such as Cash on Delivery (COD). That cannot be good news. Most online bookstores also carry other products and, more often than not, use books as loss leaders. That means many books are often sold at extreme discounts, a practice that does not bode well for publishers.

The archaic distribution system that exists in India has prompted many publishers to engage in retail, Penguin included. Other models are also being attempted, like the book club model by LeftWord Books. These are desperate attempts, and the degree to which they succeed will ultimately decide whether bookselling in India goes the Amazon way.

For publishing to truly thrive in India, efficient and viable bookstores are a must. Online platforms simply do not have the reach that physical stores can potentially have. Even these stores will not fulfil their potential if the distribution system does not ensure that the reader’s wants are met. That means distributors have to understand reader tastes and preferences and study the market for certain types of books. Books in the languages (other than in English and Hindi) must be available not only in the states that these languages are spoken but also elsewhere, where a diaspora speaking that language exists. Unfortunately, such a scientific approach to book-selling isn’t taken and books are moved to markets going by just instinct.

The my-way-or-the-highway approach that retailers seem to have taken will not help the industry. If publishers will ultimately suffer because of these practices, they will be loathe to bet on books that serve a niche market and whose demand might materialize over a period of time. Only “blockbusters” will be published, dumbed-down fiction that appeals to all. The more intelligent reader, not to be impressed by such titles, will seek a good read elsewhere. All to the detriment of that cocky retailer.

Over the past few years, more than just a few bookstores have started operating online. Flipkart, of course, is the most reputed of them, having started operations in 2007. This proliferation of bookstores is seen by many as an efficient and convenient way to get books delivered at one’s doorstep, often at prices that are highly discounted as compared to the local bookstore and at zero shipping costs. With most stores now offering customers a cash-on-delivery (COD) option, not having a credit card or being reluctant to use one on the Internet is no longer an issue.

More than triggering sales and, in the process, posing a huge threat to physical bookstores, these webstores have changed the dynamics of the publishing industry itself. Here’s how:
a. Online sales, coupled with print-on-demand, means that books can never go out of print. After they are ordered, hitherto out-of-print books can be printed and shipped to the customer. For the customer, it means that old books can now be obtained. For publishers, it means an evergreen backlist. The number of books that publishers have to manage suddenly gets bigger because none can be ignored. No book can be neglected any more and “it is out of print” is an excuse that publishers cannot use and simply won’t stick

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b. Publishers can now hope for new markets. Webstores being as they are, accessible anywhere, can trigger sales from areas that may not be considered by publishers as a “regular market”. Additionally, with migration within India now being a norm, it might not be unusual, for example, for a publisher of Bengali books to find a buyer in Kerala. Physical bookstores will not address such demand primarily because distributors in all their wisdom might ignore, or be unaware, of this demand altogether. Marketing of books therefore becomes challenging because one can never guess where the next order may come from

c. Prices are under pressure. The larger the online platform, the greater is its ability to both extract large discounts from publishers and offer similar, large, discounts to buyers. We saw this behaviour in the case of Amazon and other retail giants and can be forgiven for believing it might happen here too. Although not documented, the effect of the nascent e-commerce market on books sales is quite apparent – sales to individual buyers have fallen and many bookstores now rely on institutional sales to stay alive. That is because online bookstores can demand, and get, larger discounts from publishers as compared to physical bookstores, especially since they deal directly with publishers by bypassing distributors. They then pass on a large portion of this discount to consumers. With lesser overheads than in physical bookstores, they can probably afford to do so. Large discounts plus free shipping automatically translate into sales. Many buyers will privately confess that they have browsed at bookstores but bought online. Some distributors will also tell you, off the record, that many online bookstores sell at a loss. Since they have themselves given them those titles, they should know. What drives online bookstores to offer such deep discounts is anyone’s guess.

There is another aspect to this, although it is mentioned here purely on hunch and cannot be backed by statistical evidence. Is it possible that what is marketed as a potential bestseller is then sold at a higher discount, which in turn leads to higher sales in a self-prophesying kind of way?

If that is true, then in the absence of visibility (due to the absence of “shelves”), books that are in no way lesser whether in substance or style, get lost only because they were not marketed as bestsellers are or were ignored by book reviewers or because the publisher concerned could not offer a large discount. This leads to a downward spiral. As these books sell in small quantities, the miniscule sales discourage publishers and authors, who decide that such subjects are taboo for which there aren’t any readers, from attempting other, similar books.

All this leads me to believe that discounted prices may not be the way to go. True, it delights readers but in the long term could lead to homogenization of material being produced in books. Perhaps the Indian book industry should seriously consider a Fixed Price Book Agreement like the one in effect in Germany and elsewhere. I have noticed that many physical bookstores hold their ground and insist on selling books at the listed price. It does seem like buyers haven’t objected. For how long it will remain that way is anyone’s guess.

While online bookstores have made book buying convenient and books cheap, they have certainly raised many issues that need urgent consideration.

CinnamonTeal Publishing has launched a new distribution service that will cater to electronic books alone. This service primarily targeted for the distribution of books in Indian languages will allow CinnamonTeal Publishing to leverage its association with several ebook distribution services around the globe and ensure worldwide visibility and availability for its titles. In addition to its revamped website dogearsetc.com, ebooks distributed by CinnamonTeal will also be available through smashwords.com and globalebooks.es, allowing its titles to be purchased on more than 100 websites and a wide range of devices.

CinnamonTeal believes that this service will allow publishers to make their books available worldwide without the extra hassles of printing and physical distribution, in a medium that is increasingly gaining currency among readers. There is a lot of evidence to suggest that ebook sales are increasing worldwide and while CinnamonTeal Publishing already provides ebook development services, this new distribution service will supplement that service and ensure that the produced titles are also now easily available to buyers. For new authors, especially those who wish to self-publish, this service provides them the low cost option of doing everything electronically and altogether rejecting the option of producing copies in print.

This service will be available for all languages and books will be produced in EPUB, MOBI and PDF formats, which, together, can be viewed on most of the e-readers available in the market. For more details, do write in to contactus@ cinnamonteal.in

Many distributors are reluctant to work with self-published authors and this remains the ultimate challenge that such authors face, one that renders their book inadequate no matter how well written and produced. At CinnamonTeal we have tried our best to provide distribution services for the titles we have published but these efforts have largely been confined to India. Many authors want their books to be available globally. Our association with LightningSource International (LSI) provides just that.

Starting this month, we have entered into an agreement with LSI, an international POD distributor as a result of which we will be able to offer POD distribution services and make our titles available for buyers in Europe, North America and Australia. This agreement, allows us access to a large number of distributors and retailers.

We hope that this service will go a long way in making our titles accessible to a larger audience. We have always believed that our authors have told some beautiful stories. We are glad many more can now read them. This service is available only for the books we have published

To know more about this service, email us at publishing@ dogearsetc.com

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