Hi everyone,
Jennifer just posted this message to the Limitless facebook group.
"*INGRAM UPDATE* At this point because of the high rate of return on ingram, we are no longer offering a return option for book stores. (1) Paperback sale = $0.87 (1) Paperback return = -$7.86 this will reflect on your royalty statement if you've have a negative balance due to returns. That means it will cost you $7.00 per book for every return made back to Ingram from the book store."
I'm not familiar with this Ingram policy. Does this make sense? Seems very sketchy.
From a bookstore's perspective, regular terms from Ingram include their discount (based on overall store volume, usually 40%-42% off the book's list price) and returnability. So when a store orders a book from Ingram, they have the option of returning it if it doesn't sell. The store gets credit for the return, although not the full amount they paid for the book. Many of these returns, for example, could be hardcovers that are leftover when the paperback comes out. Other times a store might purge some of its stale stock to get the credit and make room on the shelves for new stuff. This is standard. When ordering directly from legitimate publishers, they will also offer returnability and usually they provide full credit too. So the store is only on the hook for shipping the returns to the publisher.
I am not an expert on how publishers handle those returns in terms of royalties to the author, but there is no doubt in my mind that it is extremely sketchy to basically charge an author $7 if a bookstore returns a copy of their book. That's absurd. I would assume that this issue should be spelled out in the contract between the author and the publisher.
Ultimately, returnability is determined by the publisher when they contract with Ingram for distribution. All major publishers do it. Most legitimate small presses and even micro-presses do it. From the perspective of a bookstore, if I were to look at a listing on Ingram for a book I am considering carrying, if I see that it is non-returnable it is a deal-breaker. The only exception would be for a special order for a customer, and if they aren't a customer we know well, we would require pre-payment from them.
It is also a red flag about the publisher - if they can't/won't provide returnability via Ingram, they either don't know what they are doing or simply aren't doing things well. Returnability is the industry standard.
So if this publisher removes the returnability option for their books through Ingram, they will probably not end up in very many bricks-and-mortar shops aside from special orders. Perhaps if the book is the right niche for the store, and by a known author with a good sales record, there would be a higher likelihood of the book reaching the shelves. But that would be the exception.