Originally I began this blog as a way to remind myself to take a positive approach to the world. I didn’t want to forget the good parts of life in the midst of an argument or a minor crisis or any number of frustrating moments. I wanted to put the nightly news in perspective and find the joy that populates every day instead of dwelling on aberrations.
I remain committed to the goal of looking for the best in people. In fact, I have planned a new post about a man who seems to embody two amazing traits that I admire: courage and confidence. His name was Garrett Morgan – and he will appear on this page soon.
However, today I need to rage. I need to vent my anger for ills that are aided and abetted by two ugly characteristics that I abhor: greed and arrogance. It is my firm belief that these two oft-entwined negative qualities are the foundation for what is wrong with the human race.
As you may have guessed, I am not of the Gordon Gekko* school of thought: greed is not good. To my way of thinking, greed begets monsters.
Whether it be one sibling who will not share a bit of candy with her brother or a megalomaniac who invades another country in hopes of gaining resources or power, greed destroys. Greed encourages one farmer in California’s Central Valley to dig his well deeper so that his crops have precious water while surrounding farms with shallower wells become parched as they are thereafter drained to fill the deeper one (in true “I drink your milkshake” style). It is because of greed that mega-corporations like, but not limited to, WalMart and Amazon.com squeeze their own labor force and small suppliers, sometimes out of existence, in a perpetual pursuit of gains for a handful of people at the top of the proverbial pyramid. The late great Duchess of Windsor said it best: “You can never be too rich…”
Arrogance is what allows people to adopt such mottoes – to choose greed. If I believe I am entitled to something more or better than my neighbor, what is to stop me from taking what I want, to dig my well deeper, to keep my product margins inflated at the expense of my suppliers?
Since I’ve already uttered the name of one mighty behemoth of greed and arrogance, let me continue with them: Amazon.com. The subject is near and dear to my heart, since I recently published my second novel and released it through several booksellers, including Amazon.
I work with and through a small boutique publisher named OnTrack Publishing. I submit my work to this publisher, and they hire an editor to clean it up, a book designer and a cover artist to make it look professional, inside and out. They work on marketing and publicity for the book – because who’s going to buy a book they’ve never heard of? – and send it out to potential reviewers. They pay the “producers” of the book such as Lightning Source (who is both the on-demand printer and a distributor to the many middle-companies in the publishing food chain) or BookBaby (specializing in the production and distribution of ebooks to those middle-companies). Oh, and did I mention author royalties? There should be a little something in the mix to pay the producer of this find piece of work, right? OTP will (eventually) pay me, the author, some money.
There is probably a secret to setting the right price for a book, just as there is a secret for setting the right price for the new Apple iPhone or a Toyota Camry. I don’t know what that is – all I know is that OTP does set the list price and, in doing so, must take into consideration their production costs (see above paragraph), the actual cost to print and bind the book, and the discounts OTP must offer wholesalers like Amazon, Barnes and Noble, or Baker and Taylor (the latter making the novel available to those few remaining independent bookstores). Once all of this is done, readers can buy my book.
Ah, readers. As it turns out, readers are also a valuable barometer of pricing: “what the market will bear” is equal to the pain level readers will endure when deciding what to pay for a book.
I think what the above really means is that Goldilocks prices books. She decides based on her mood and how many sunspots have been noted on the day the price is set: that price is too high, that price is too low, and that price is just right.
Okay, that Goldilocks remark might be a little snippy, I admit. So let’s look at some hard figures. If the industry expects a 55% discount** for a book that shouldn’t be priced more than “what the market will bear,” in a scenario where list on a paperback is $14.95, the net is $6.73 after the 55% discount is applied. Now, in a print-on-demand scenario, if that book costs $5.79 to print, that leaves $.94 payable to the publisher ($6.73 – $5.79 = $.94). Given that my publisher paid my last editor $2000, the book designer another $1800, the cover artist $1000 and that publicity won’t be any less than $3000, at least 8300 books must be sold before my publisher can break even. Oh, please note that the author has received nothing up to this point.
But Amazon always discounts its books. No one is asked to pay $14.95 for a paperback book, right?
Wrong. In recent correspondence between my publisher and Amazon.com (where my publisher was complaining because their latest offering, A Veil of Fog and Flames, (my book) had been posted for over a month but was displaying NO discounts whatsoever), Amazon responded as follows:
“We have a dedicated team of people working to consistently improve our pricing model. Their decision to discount books is based on a number of very strategic considerations, which can vary over time.
However, we recommend discussing/bringing this request to your publisher/distributor as an option for them to temporarily lower the list-price of your book on Amazon.com. You’ll also want to ask your publisher/distributor how a temporary price change impacts your royalty payments as well.”
So, instead of taking a little bit out of their $8.22 ($14.95 List – $6.73 discounted price to Amazon) so that a modicum of savings might be passed on to the all-important reader, Amazon recommends that my publisher take a little less than the $.94 they will net. Does that sound fair? Especially since, in a print-on-demand scenario, Amazon is out of pocket $0, but my publisher has already spent something close to $8300 to get this baby published.
Now, don’t misunderstand me. I realize that Amazon has a tremendous infrastructure to support the distribution of books and millions of other commodity items. They own tons of computers (and are subject to those inherent costs) and employ thousands of people, offering the products of thousands of suppliers who also employ countless people. But come on, really? Amazon is not willing to take $2 less on a book in order to maintain the illusion that it is offering the best deal to its readers? Readers may pay $14.95 in a bookstore, but they aren’t going to pay $14.95 on Amazon because few people will buy a non-discounted book on-line. This much I know: $14.95 X 0 (for 0 sales) = $0. Nobody wins.
Apparently the above applies only to my latest book. The list price and discounting structure is the same for both A Veil of Fog and Flames and my previous book, Embracing the Elephant. However, for some unknown reason, discounts were applied by Amazon (and Barnes and Noble, by the way – strange) to the latter, but not to the former. Go figure. It seems Goldilocks is an arbitrary bitch.
No, I retract that. Goldilocks is greedy and arrogant. Having first put most independent bookstores out of business, Goldilocks has cornered the lion’s share of the market and can now gouge her way to healthy margins, no matter the cost. Big publishers may (and probably do) have more clout with her, but small independent publishers like OnTrack Publishing be damned. Where else are you going to go, little publisher, to sell your little book. What else can you do?
In the years before divestiture of AT&T, I once saw a bumper sticker that read: “We’re Ma Bell: We Don’t Care – We Don’t Have To”
So enter the new Ma Bell: Amazon. Where Gordon Gekko is king and they are proud of it.
* Gordon Gekko is the ubër greedy stockbroker (played by Michael Douglas) in the 1987 movie Wall Street, noted for the motto: “Greed is good.”
** According to Dan Poynter in his 2007 Self-Publishing Manual, wholesalers EXPECT discounts from 50% to 60%. My publisher takes the middle ground at 55%.