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Self-fulfillment: Or, the Pleasures–and Some Pains–of Handling Orders In-House

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Do-it-yourself is the most popular choice when it comes to fulfillment, judging by hundreds of responses to our “How do you handle fulfillment?” e-mail. And most of the PMA publishers who fulfill orders themselves are happy about it. In fact, on a scale of 1 to 10, with 10 being best, most say their level of satisfaction is way up there at either 9 or “a big 10!!”

Typical comments include, “Sometimes I wish we had help, but in doing it yourself, at least you know it is done right and the way you want it. I’d rate us a 10” ; “I’ll give it a 9. (The boxes of books are very heavy!)”; “10!! It’s part of the job”; “I give myself a 10–I’m happy with the quality of my work”; and “I rate my satisfaction with handling fulfillment myself a 10. One of these years I expect to be too busy to do it all but for now I am truly having the time of my life and loving every minute of it–well, almost every minute.”

Publishers also reported on why they chose the do-it-yourself option. Reasons focus on the physical (“big garage” and “We are part of a larger company which has a complete shipping department”), the procedural (“It’s the cheapest and volumes are low enough for me to handle”; “Anybody who wants a break from staring at a computer screen can pack a book”; “Better control. Can track shipment. Product gets there faster”), and the principled (“Provides work for relatives and neighborhood teenagers”; “We like to keep as many jobs as we can here in the community”).

Many PMA members believe that, one happy day, higher sales levels will make it necessary for them to outsource fulfillment, and a few wish they could offload the task right now (“I wear all the hats and I hate it,” the only seriously disgruntled respondent wrote). But comments like “I am the company” and sigs like “Director (and Fulfiller)” and “Office Factotum” indicate that a clear majority is, at least some of the time, finding fulfillment fun.

The stories that follow show why and how to handle fulfillment yourself. In future issues, we’ll share reports on hiring fulfillment companies, relying on distributors to fulfill orders, and building hybrid fulfillment systems.–Judith Appelbaum

The Self-Storage Smart Pill

My company produces children’s books, including books with audio CDs. For the first year or so I used a local fulfillment service that also provided warehouse space. The warehouse used to charge us $3.50 per order plus 40 cents per book–paperback or hardcover. Before long, I came to the sobering realization that the warehouse was earning more, on small orders, than illustrators and authors typically earn through royalties. What’s more, the warehouse staff made its share of mistakes and helped itself to a generous commission on each book returned.

Once Tortuga Press became more established, I kept the warehouse space but filled orders in my office. Over the years, I’ve paid assistants between $7 and $12 an hour to pick, pack, and ship. (Yes, even teenagers can pick and pack with proper instruction.) When I interview office workers, I ask them about their software background and their ability to heft 40 pounds! (Hint: carry good worker’s comp. insurance just in case.)

Last spring, I took a smart pill and moved my 20 or so pallets into a self-storage unit. I love it! Now I pay a set fee ($250/month) for a 10′´
30′ climate-controlled space where I can store roughly 35 pallets–as opposed to $500 for storing 20. And I have access to my books seven days a week, from 6:00 a.m. to 9:00 p.m. (compared to 7:30 a.m. to 3:30 p.m. Monday through Friday, holidays excluded). While the bulk of our inventory remains in this facility, we keep a manageable quantity of each title on our office shelves.

Tips: Avoid storage spaces where you can see light through the cracks. Where sunlight enters, so does dust. Also, in general, the more insulation, the better. Finally, it’s important that the on-site managers be responsible and mature people.

Long ago I heard the advice, “Spend your money on what customers can see.” So we put the thousands we save in warehousing costs into making our books look–and sound–great!

Matthew Gollub, Tortuga Press

Web site: www.tortugapress.com

To Make a Mailing List

I fulfill orders myself to capture the customers’ e-mail addresses and contact information, thus creating my own internal mailing list for when I release my next book of interest to the same people who bought my first book. Direct sales to my customers are simple and profitable and make up 50 percent of my overall sales.

Erin Pavlina, editor, VegFamily magazine

Web site: www.vegfamily.com

Do Before You Delegate

With one title, The Marketing Toolkit for Growing Businesses, I fulfill all orders myself, handling packing, shipping, billing, and collecting in-house. I chose this option because I wanted to understand this part of the business from the outset. My feeling is that if you don’t roll up your sleeves and immerse yourself in the details of a business, you’ll never be able to delegate that portion of the business effectively when the time comes.

Right now, my volumes aren’t big enough to warrant an outsourced arrangement for fulfillment and collection. But the goal is to grow the business to include additional small-business how-to books, so that outsourcing makes more sense.

Collection has been a learning experience for me. In my marketing consulting business, I get paid within 30 days, plus I personally know the individuals signing my checks. The book trade requires more leaps of faith. Terms are much longer; I may not know the person who cuts the checks, and I spend much more time chasing down unpaid invoices.

Jay B. Lipe, Chammerson Press

Web site: www.chammersonpress.com

Planning That Started with the Trim Size

Call it ego. I have a master’s degree in operations management, and I teach the subject at California State University, so I decided I should be able to manage my own fulfillment without ruining my day (in other words, quickly and efficiently).

I did check out some fulfillment companies that also take orders, but I found them to be very expensive (likely more than 25 percent of book revenues by the time they charge commission and monthly storage fees), especially since my volumes on a new book will be unpredictable. Although my printer could drop-ship an initial quantity, I would end up shipping them a case at a time at additional expense.

Fulfillment planning started very early, with choosing a trim size that would support my marketing plans: sales to individuals via the Internet and a toll-free number, and bulk (special) sales to nonprofit groups for fund raising, and to corporations. I can fit one or two shrink-wrapped copies of Your Chicken Is Cooked into a USPS Priority Mail flat-rate envelope for predictable shipping costs (envelope included) of $3.85. Customers pay the retail price of my book ($16.95) plus $4 S&H for one copy. Shipping is free with purchase of two or more. Dan Poynter recommends not discounting single copies of a new book, and I hope he’s correct!

If I do a radio broadcast and 200 people call, my toll-free messaging system can handle the traffic on a 24/7 basis. The company that answers transcribes the order messages and e-mails them to me for 39 cents each.

Lauren Brimmer, Fallbrook Press

Web site: www.fallbrookpress.com

Shipping It Right in a Rush

You cannot be in the book business if you cannot handle rush shipments. Since rush shipments are hard to handle efficiently, fulfillment houses either do not do them or do them badly. There is also the question of quality control and the way your operation is regarded in the industry. Your customers know you partly by how well you handle the invoicing and shipping functions.

A fulfillment operation should cost 10 to 12 percent of the invoiced amounts. This includes returns processing, which is far less efficient than shipping. But economies of scale kick in when the dollar volume gets above about $10 million, especially in order processing through EDI and with more sophisticated warehouse equipment.

Curt Matthews, Chicago Review Press

Horse Sense

We specialize in publishing equestrian books, and a division of our company sells equestrian products to retail shops around the country, so we felt we were in a good position to market and fulfill orders to the equestrian market. Although we had no relationships with bookstores, once these were established it was no additional work to ship to them as well.

Customer service is a high priority for us, and that was a major factor in deciding to handle our own fulfillment. We wanted to simplify orders for our equestrian customers and enable them to order our books and our other equestrian products from the same source, thus saving time and shipping charges. We also wanted to add a personal touch and offer signed copies to the stores that desire them.

The fulfillment process is quite easy. Once the retailer has established an account with us, they may order by phone, fax, or e-mail. We have daily UPS pickup; orders generally ship within 24 hours. Each order takes less than five minutes to process, and the packing takes approximately 5 to 15 minutes per order, depending on the quantity. An invoice is included with the shipment, and most of our customers pay within 30 days. We send statements to retailers who have an overdue invoice. Collection of past-due accounts has not been an issue.

We are currently just a two-person operation. I handle the paperwork, and my husband handles the shipping. Thus, when we are away on an author’s tour, etc., we need to hire someone else to come in part-time and fill the orders. I am the author, so I usually sign several boxes of books in advance to fulfill the requests for signed copies. But orders for personalized signed copies cannot ship until I return. As our publishing business grows, we will hire staff to handle fulfillment in-house.

On a scale of 1 to 10, I would rate our satisfaction level at 9_.

Jan Neuharth, Paper Chase Farms Publishing Group

Web sites: www.paperchasefarms.com, www.thehunt.us

A PayPal User Reports

My books are available through my Web site. People can send a check to the address posted, but they usually use the PayPal link. I’ve found this to be very convenient.

PayPal notifies me via e-mail when an order has been placed, and the money goes directly into my PayPal account, where it earns interest. I can print out a shipping statement provided by PayPal, pop the book in the mail, and send it off. Then I spend just another minute or two entering the info in my FileMaker Pro spreadsheet for earnings and expenses (shipping, fees to PayPal).

Lori Batcheller, Creative Communications

Web site: www.lbcreative.com

Meeting Many Needs

We store most of our inventory in our small office but have excess storage in the basement of our local printer two miles away, at a modest rental charge. We sell perhaps 45 to 75 units a month, so this is manageable. Even if we sold more, I believe that in-house fulfillment is preferable. We can always add hourly employees and rent or borrow space somewhere. I believe that a fulfillment house cannot possibly package accurately all the variations of book orders that we get, along with the varying promotional materials and invoices we need to insert. Each bookstore that we deal with has slightly different requirements.

Also, we can keep a close eye on inventory and reprint as needed before running out of a title.

Robert Ellis Smith, Privacy Journal

Web site: www.privacyjournal.net

Special Handling

I am a very hands-on author and publisher. I strive to excel in customer service and satisfaction. It is not enough for a book buyer to get a book in a box. It has to be a pleasant experience, with matching tissue paper, a complimentary bookmark, and an autograph. And my customers can track their packages, as they each receive a tracking number via an e-mail that confirms their order. I know they appreciate the special handling, and I believe it will make them more likely to buy my forthcoming titles.

I do all my fulfillment at night and ship the books within 24 hours, which means the next morning. Nobody could do it better. Who would ever care that much? We can hire assistants to help, but doing it ourselves is an absolute pleasure. It feels good to bring those boxes of books to the post office. It’s a really nice way to start the day!

Barbara Rose, The Rose Group

Web site: www.borntoinspire.com

Reasons Not to Pay Somebody Else

One of the main reasons I published my work is for control. By doing my own fulfilling, I am also creating/developing my own mailing list, plus saving the $ that would otherwise go into somebody else’s pocket. I don’t believe in paying someone to do something that I can do–I’d rather pay myself.

Mailing my 6″´
9″´
1″ novel costs $1.84 via USPS Media Rate. It takes only a few minutes to create an address label and put the book in a tight padded envelope. I go to the post office (three miles away) three times a week.

Barbara Davis, Red Barn Press

Web site: www.redbarnpress.com

Collection Challenges

When we first started to publish Black-interest books for children, we handled all aspects of fulfillment. We learned as we went along and eventually became proficient in these areas. Collecting posed the most problems.

Five years later, we decided to use a fulfillment company so we could focus more on our marketing and editorial efforts. This move did not work out for us. We had established a solid reputation for fulfilling orders in a timely manner and being accessible to customers who had questions or concerns. The fulfillment company we selected often sent the wrong books or sent books to the wrong customer. After a year, we started to do our own fulfillment again. We intend to continue it.

We have a staff that is responsible for fulfillment and hire additional staff if a large number of orders must be fulfilled within a short period. Collection continues to be our biggest challenge. We have taken measures over the years to address that area, including using a collection agency to help with troublesome accounts and being very careful about letting customers buy on credit.

Wade Hudson, Just Us Books, Inc.

Web site: www.justusbooks.com

Fulfillment Is Free

We are small potatoes and handle fulfillment ourselves. When we are out of town, we leave complete instructions and pay a friend or family member to handle fulfillment. For orders from wholesalers or bookstores, we use Quickbooks for invoicing, pack the books in Jiffy bags or boxes, and mail them Media Rate.

We used to have a distributor but decided that bookstore sales were a losing proposition, so we promote our Web site and look to that, library sales, foreign rights sales, and special sales for our business. For orders from our site, we use PayPal for on-site payment, then ship the book(s) in Priority Mail envelopes. We do not charge shipping/handling fees because we want a reputation for quick, attentive, free service.

Eileen Haavik, Parent Success

Web site: www.ParentSuccess.com

A Storage Space Solution

Our biggest challenge was warehousing, as the office is a home office. But I have that licked now. I’ve rented space in a warehouse; I own a lift truck and pallet jacks, can accept shipments there without being there, and occasionally send out really large shipments from there. Otherwise, I make one or two trips to the warehouse each week in my Durango to replenish garage stock, use Priority Mail for small packages and UPS for daily shipments under 325 pounds, and get a carrier with a lift-gate truck to pick up LDL-sized shipments of one to three pallets per week from the home office for delivery to distribution centers.

This is not only practical; it also provides great exercise for one who might otherwise be a desk jockey!

Pat Johnston, Perspectives Press

Web site: www.perspectivespress.com

Farewell to Handling Fees

Hannover House recently stopped using a fulfillment warehouse. While the service was convenient, the more we sold, the higher the fulfillment company raised its rates, and payments to us were taking longer and longer. Now our larger orders are shipped directly to wholesalers from our printer; we ship smaller quantities and catalog orders and handle all invoicing.

We recently shipped more than 100,000 hardcover copies of Blood, Money and Power: How LBJ Killed JFK using our own system, which worked quickly and flawlessly and saved us nearly $25,000 in what would have been “handling fees” had we continued to work with the third-party fulfillment warehouse.

Eric Parkinson, Hannover House

Web site: www.hannoverhouse.com

Savings Come from Checking Returns

At Corinthian Books, we chose to handle all our order fulfillment because we want to have complete control of how our customers are treated, to receive sales information in real time, and to build close relationships with our 350 or so wholesalers and retailers. By doing order fulfillment ourselves, we can also customize promotional inserts on a box-by-box basis, and give preference (with author-signed copies, for example) to our best clients. In addition, we can maintain total control over accounts receivable.

Finally, one of the biggest advantages is that when a return shipment comes in, we can immediately check every book for unacceptable returns: torn softcovers, physical damage, nonremovable store stickers, bent edges, dirt, etc. We find that more than 60 percent of returns from wholesalers and distributors are “unacceptable” according to their own definitions. When we charge them back, we get paid for the book, period. If anyone else did the order fulfillment, we’d probably never see the returns, or be able to examine them. This alone saves us $4,000 to $5,000 a year.

Richard N. Côté, Corinthian Books, an imprint of The Côté Literary Group

Web site: www.corinthianbooks.com

What Matters Most

Chivalry Bookshelf does all fulfillment and fulfills for a growing number of other presses and businesses. Having worked with large retailers, we had an idea of what could be done, and we were dismayed at the percentage charged for most outsourcing services. While we did not consider this function a core competence, we did feel we could do the same job for less money and make the fulfillment center into a business.

On a scale of 1 to 10, I feel we’re at an 8 right now; we will be a 10 as the business matures. We have a manager with 30 years’ experience in transportation and military operations, which gives us powerful organizational capabilities and another good mind to work on general operational issues. We can and do ship not only books, but all kinds of related products, within 24 hours.

In dealing with fulfillment, these are the factors I find most important:

·
Accountability/permeability–seeing what’s going on

·
Cost control–hidden costs are things we incur, not “fees”

added by others

·
Cost offset–fulfilling for others subsidizes some of our costs

·
Flexibility–growing the business along different routes, depending on what

succeeded in the marketplace, and having the freedom to add products

·
Available competence–in our case, experience in mail-order retail and staff

experience

Brian R. Price, Chivalry Bookshelf

Web site: www.chivalrybookshelf.com

Control Is Key

Right now I have more time than money; whenever that’s the case, you do the work yourself. It may change, but not in the foreseeable future. Plus, I have problems relinquishing control. When I do it, I know it will be done right and will get there when it needs to, at a rate that my customers won’t complain about.

My printer packaged the books 12 to a box with the first printing. That worked, since I sell direct to nonbookstore retail outlets and price the books so that seven is the minimum most folks order. With my second printing, I had books packaged 24 to a box. Both are easy quantities to handle, and now I have a ready supply of boxes in the sizes I most frequently use. I usually include a copy of the invoice in the box, so I retape and put a label on the outside.

Another reason I do fulfillment myself is that when I was in a different business, I sublet space from a company that ships daily. They agreed to bill me once a month for any UPS packages I dropped off with them. It keeps their rates low and has saved me quite a bit of money. A 25-pound shipment to Pennsylvania cost $6.70 less through them.

Although I understand it’s easier for UPS carriers to pick up at a business than at a residence, I think they’re missing the boat and overcharging customers that could become frequent users.

Not all my customers are so eager to have my books that they want to pay even the UPS rates. So I do send many orders of fewer than 12 books out via USPS, using the Media Rate

Linda Murdock, Bellwether Books

Web site: www.bellwetherbooks.com

What’s Selling, Who’s Buying

During my 22 years in the publishing business, I have both done my own fulfillment and hired companies to do it.

There is no substitute for diving in and getting your feet wet with information on how certain books are selling and what customers are saying about them. When you deal directly with bookstores and wholesalers that order the books, you also learn what kinds of titles sell the best and who the customers are. Paying someone or several someones in the company to do the fulfillment job is much more cost-effective for me and for the publishing firms I’ve worked for over the years.

Susan Campbell Reneau, Colorado Big Game Trophy Records, Inc.

Web site: www.coloradobucksandbulls.com

The Pleasure Is Both Personal and Practical

Something intangible keeps fulfillment in-house every time we visit this issue–that feeling of satisfaction. When an order comes in, nothing makes us feel better than to pull those books off the shelf, verify the quantity, and help load the boxes into the FedEx Ground truck. Additionally, fulfillment helps keep it real by giving everyone in the office a good sense of how the business is doing. We have a better grasp of inventory. We can evaluate a price change or revised cover faster than the spreadsheets. We know when one wholesaler is suffering a slump while another is moving product. And we know when someone is buying full cases of a title or just keeping minimum inventory.

Filling orders takes approximately three hours each day. Since our warehouse is attached to our home, this can be three hours in the middle of the day or after the kids have gone to bed.

Bill Fessler, Primer Publishers 

Web site: www.PrimerPublishers.com

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