Editor’s Note: This is the first installment of a three-part series on making life with a distributor successful. We will examine this relationship from its beginnings, through its successful tenure.
Whether or not a book will be successful is determined, to a large extent, at the time the publisher decides to publish it. Hopefully, the publisher has done the right kind of homework in the first place as part of the “whether or not to publish” decision. This kind of homework will ensure that the book will have every reason to succeed. This is also true in a publisher/distributor relationship . . . the future success of the relationship can be determined, to a large extent, during the selection process of the right distributor in the beginning. A mistake at the beginning dooms the intended result, whereas a well-informed choice breeds a fruitful relationship for both parties.
What Is a “Master Distributor”?
I always like to begin a discussion about distributors by defining what a “master distributor” is so that everyone is clear on the terminology. Definition: A master distributor is an “extension” of the publisher, performing certain functions normally done by a publisher such as field sales, warehousing, shipping, billing, accounts receivable, and collections. It also produces seasonal catalogs, pays sales commissions, and participates in various trade shows such as BookExpo America. Theoretically, by delegating these functions to a distributor, the publisher is free to focus its resources on publishing matters. In contrast, a wholesaler is passive, simply filling orders. There are about a dozen bona fide master distributors.
25 Tips for Selecting the Right Distributor
The following points will help you make an informed decision in selecting the right distributor:
1. Stability. How long has the distributor (successfully) been in business as a distributor? Review their audited financial statement, or have your CPA review it.
2. References. Pick several of the publishers which they represent at random and give each a call. Ask how their sales through the distributor have been, and also ask about the distributors payment record.
3. Turnover of Publishers. How many of the publishers who they currently represent are new vs. how many have been with them for 5+ years?
4. Specialty Categories. Do they specialize in certain categories which would compliment or conflict with your titles?
5. Sales Representatives. Are their sales reps commission reps (independent contractors) or house reps (employees)?
6. Key Accounts. Are accounts the likes of Barnes & Noble, Borders, Books-A-Million, Ingram, and Baker & Taylor handled by commission or house reps?
7. Other Trade Channels. What other markets do they cover? Art supply stores (art technique books), health food stores (nutrition books), gourmet shops (cookbooks)?
8. Ability to Target Market. Can they market to a specific area or trade channel?
9. Backlist Sales. Do they actively promote backlist titles, or only passively fill orders?
10. “Working” Key Accounts. Do they work the key accounts by doing stock modeling with buyers and developing promotions? Are they creative?
11. Biggest Publishers. Who are their biggest publishers? Where would you rank in their mixture and, therefore, their attention?
12. Systems Capabilities. Will they be able to provide you with a monthly sales analysis, returns, inventory reports?
13. Key Account Reporting. Are they able (and willing) to keep you informed on the activity of your book(s) at the six major accounts?
14. Specialty Markets. What non-book trade channels (such as auto, gardening, sports, etc.) do they actively cover?
15. Other Services. Can they provide you with publicity, design, telemarketing, and other similar services when you need them?
16. Facilities. Try to visit their offices and warehouse. Are they clean, orderly, systematic?
17. Vendor of Record. Discuss how they handle the various VOR programs at major accounts. Do they have a handle on this?
18. Innovation. Are they innovative or stuck in tradition?
19. Publisher Liaison. Who would be your contact at the distributor? Is he/she responsive with a “can-do” attitude?
20. Staff Turnover. What is the tenure and experience of the staff?
21. Growth. Where has their growth come from? Frontlist sales, backlist sales, or simply by adding new publishers?
22. Returns. Industry average is 20-25%. What is theirs? If it’s significantly higher, why?
23. Sales Mix. What is their ratio between frontlist and backlist sales?
24. Recommendations. Get recommendations from qualified experts.
25. Comfort. What is your comfort level throughout your discussions with a prospective distributor?
The next installment of the series will be “Realistic Expectations of the Publisher and Distributor.”
Bob Erdmann is a publishing consultant and past president of PMA. A veteran of nearly 40 years in the book business, he can be reached at PO Box 270024, San Diego, CA 92198-2124, Phone 619/675-0303, Fax 619/675-0088, e-mail RErd@aol.com.