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Author Topic: The New Thing  (Read 7718 times)
Ron Edwards
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« on: October 17, 2008, 07:25:27 AM »

This is a companion thread to Independence, Adept Press, and Indie Press Revolution and The Forge Booth 2009.

At GenCon this year, Vincent Baker, Julie Stauffer, Matt Snyder, Paul Czege, Danielle Lewon, and I had a big pow-wow about all of this. It was one of those lightning-fast, multiple-speaker conversations in which parts provided by different people fitted together into single points. Our conclusions included:

1. Fulfillment serves us best when it is not profit-driven. The solution: non-profit organization style payment, in which the person doing the annoying thing is paid for his or her time, and that's it. It's not a living for them nor a way for them to make more and more over time. The rest of the money, all of it and always, goes to the publisher.

2. It's dangerous to lose contact with our customers and the logistics of orders. Not knowing how many books you've sold, to whom, and how that order might be going, makes it impossible to be sure you're getting the real deal on payment, and more importantly, makes it impossible to make reasonable and timely decisions about new printing. Also importantly, customers who run into problems always appreciate direct contact with and help from the publisher; their customer satisfaction and loyalty are established to me as a publisher, not to the middleman.

3. Presenting our games to the customer or potential customer is best served by individual website sales-points and simple, small combined-publisher sales points. Either way or both, the visitor to the site should be able to tell what these games are and why they're present together.

The discussion turned very quickly into a practical project, when Vincent revealed that Meg Baker had already been talking about starting an alternative fulfillment service. The project fell into place as follows:

1. The publisher has a simple webpage to go to; when he or she signs in, there's an entry that says how much money is left in his or her account, a list of how many books are available, and the ordering/shipping status of past and current orders. He or she can choose whether to take orders independently (and forward them), or whether the orders go straight to the fulfiller.

2. Fulfillment is handled by a single person who stores a fairly small stock for each title.

3. The fulfiller is paid according to any arrangement settled upon by everyone involved. (As currently conceived by me and the others starting this, that's an hourly rate based on current standards for non-profit organizations. Each publisher pays some money up-front from which the fulfiller draws pay, and so your books keep being fulfilled as long as you keep the account positive. Everything in these parentheses is our specific arrangement, and not "the way" any other group of publishers and fulfillers might do it.)

4. What it looks like to the customer: at the most basic level, like nothing. You visit the publisher website, hit a Buy button, and pay through Paypal or whatever just as you would before. Vincent is working on a shared website buy-point for all the titles in this particular group (i.e., who use Meg), but this is an addition to the individual website pages, and more important, it's an option rather than a fixed piece of the software.

5. It's not exclusive. For instance, although I'm not renewing my contract with IPR, separating oneself from other services isn't actually required to participate in this new thing. I or anyone else can sell our games any other way that's available in addition to this. In my case, that means that retail and distribution sales are still handled by Key 20, as always. Hell, even membership isn't obligatory - if one day I decide to opt out, all I do is get my books back, collect any funds in the account, and that's it.

6. The fulfiller has full and total authority over which publishers he or she will serve, and how many. Period.

7. And important: full and utter transparency regarding how it's done. The point is that anyone can do it! The software is set up as an installed web forum - like the Forge - and anyone can get an account on it and use it, for the asking.

All of this works really well for me because Key 20 already holds the bulk of my inventory and handles retail and distribution orders. And frankly, it's a good thing that I'll have to modernize, update, and generally overhaul all of my publisher websites to make them enticing places to buy games from, which is long overdue anyway.

"Independently Fulfilling" has begun with Lumpley Games, Night Sky Games, and Adept Press, possibly a couple of other companies. This is not a recruitment post. Do not email or ask to sign on. The whole point is not for anyone or everyone to flock to some specific banner, but rather to make the process available for separate and non-connected use for anyone who wants to do it too. I'll go so far as to suggest that an existing successful community-alliance such as Collective Endeavour, or a possible sub-section of Arkenstone Publishing, might be especially well served by it, but again, that's up to the people involved in those or similar groups and no real business of mine.

So hypothetically, let's say you're a publisher and you want to outsource fulfillment in the simplest possible way. And a few other people feel the same way. And one of you, or someone you know, is willing to devote a certain number of hours, probably at least twice a week, to stuffing books into envelopes and shlepping them to the post office. You all arrive at a financial arrangement which will either work or suck depending on your own professionalism. Then you use Vincent's installation to establish a website which each participant only signs into his or her personal account. The fulfiller reports order status and financial "draws" as he or she goes. If you want, you can set up a group website as a mini-storefront, or you might not.

To be absolutely clear as mud, internet display of who is using a particular fulfiller is still a question. It may be that anyone using any such installation can be displayed with everyone else doing so (and who wants to be displayed) on a given storefront page, regardless of fulfillment person. That's all as might be worked out in the future. Vincent can explain that better.

And that's all. Email Vincent at lumpley@gmail.com to get the practical info.

Best, Ron
edited to set up the links - RE
« Last Edit: October 17, 2008, 07:30:34 AM by Ron Edwards » Logged
Eero Tuovinen
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« Reply #1 on: October 17, 2008, 09:18:39 AM »

This is certainly exciting, do keep us posted on how this starts working.

On the practical side, as a matter of interest, would you mind discussing explicitly the expense structure of your Meg-centred fulfillment solution? In other words, how much are you planning on paying for her services? What sort accounting will you use to keep track of other expenses which the publisher will have to cover? Will the publishers pay the expenses of travelling to the post office alongside postages and such, or will Meg's pay-for-time paycheck include such implicit expenses, too? Also, I'm interested in any insight on the practical issues of scale logistics - how large stocks is Meg going to be handling, how much outflow are you projecting for, that sort of things. We do our own fulfillment here in Europe, so I'm interested in the practical details, too.
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Ron Edwards
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« Reply #2 on: October 17, 2008, 09:31:34 AM »

I'm pretty sure that this is open information.

In our case, each publisher pays Meg $50, which we're using only because no one knows what a good starting value will be. We'll find out once the hourly work kicks in; maybe it'll dry up fast or maybe it'll last satisfactorily. There're two dials - the number of publishers used by her (decreasing per-publisher cost) and the number of titles added with more publishers (increasing the time worked) - so it's practically impossible to tell beforehand.

A lot of what you're asking can only be answered by the particular fulfiller, so I'll let Meg take over those. As I understand it, shipping costs are part of the picture too, i.e., that comes out of the fulfiller account because that's the person who pays the post office or whoever. As you can see, this makes his or her job annoying, because even if (if) time is treated equally among publishers, shipping has to be accounted for for each one. (Aargh! Just thinking about this makes me irritable, I hate hate hate fulfillment.)

As for travel expenses, that's something that again, a given fulfiller would or would not charge for, but should be explicit. One publisher I know uses a post office right on her way to work, so doesn't find it inconvenient to fulfill games - if that person were to be a fulfiller for a project like this, I imagine that travel expenses wouldn't come into it at all. Perhaps that's one of the informal criteria people might use when deciding to play such a role in the first place; otherwise, they should be up-front that such costs are involved and expected as recompense from the publishers.

Best, Ron
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Ron Edwards
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« Reply #3 on: October 17, 2008, 07:41:33 PM »

I just got my first order, which happened to be for Sorcerer.

I got chills. It was like that first time, back in late 1996, when I got an email saying "send me Sorcerer" from my little automatic macro on that one-page site.

I feel like a real publisher again. I hadn't realized how disconnected I'd become from the customers, and how much I'd missed it.

Best, Ron
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Ben Lehman
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« Reply #4 on: October 17, 2008, 08:56:42 PM »

Hey, Ron:

So I have a friend who would really be absolutely perfect for this sort of thing. At what point is the platform (I'm talking about the web-interface that Vincent is working on) going to be available to me?

Also, if you don't mind disclosing, what is the rate that you're paying Meg, and why?

yrs--
--Ben
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Ron Edwards
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« Reply #5 on: October 18, 2008, 04:34:41 AM »

Hi Ben,

I waited until it was all ready before posting here. Which is to say, contact Vincent and you'll get what you need. Unless I'm misunderstanding what you mean; I'm talking about the interface publishers and fulfillers use to keep track of everything.

You're going to laugh, but I actually don't know Meg's hourly rate. I'm sure I'll find out in the course of things. This is clearly not the degree of professionalism (or lack thereof) I'm recommending for others in this thread, but the fact is, I can be sort of a doofus about money,* and anyway, all of us involved are still feeling our way a little.

I was thinking last night, and it suddenly occurred to me that a publisher doesn't need "a group" at all! It could be just you and a fulfilling person, period. Or to get really wacky, it could be just you and your own books, and you use the installation as a means of keeping track.

Best, Ron

* I refer anyone to the first season of the British TV show, Chef, to see a pretty good representation of me as business owner.
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lumpley
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« Reply #6 on: October 18, 2008, 07:05:10 AM »

Ben, I'll give you a tour of the platform (by email). It's an open house! Tours for everyone, just let me know you want one.

We're paying Meg a dollar a book, flat, not hourly, which we'll revisit after two months. I'm pretty sure we chose that number because it both seems fine and is round.

I was thinking last night, and it suddenly occurred to me that a publisher doesn't need "a group" at all! It could be just you and a fulfilling person, period. Or to get really wacky, it could be just you and your own books, and you use the installation as a means of keeping track.

Absolutely. If I were building just an inventory management system for my own stock, it'd look a lot like this.

-Vincent
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Ben Lehman
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« Reply #7 on: October 18, 2008, 07:08:04 AM »

You're totally correct in that it doesn't need to be "a fulfilling person who handles multiple publishers." I imagine that I would be using stuff with a very different model.

In fact, I see no reason why there needs to be any sort of direct correspondence between publisher and "fulfillment person" at all. For instance, I will want to keep some copies of Journeying West wherever Joshua is keeping Under the Bed, so as to facilitate selling them in package deals (and likewise Anna with Polaris). That would (most likely) be separate from where I kept my main stock.

Likewise, I'd want to have at least one US person, a Eurozone distributor, and maybe other areas as needed (For example: oh, look I have a big increase of sales to South America. Maybe I should find someone in Brazil.)

What sort of organizational structure are you using, in terms of taxes and such? You were talking about a non-profit, is that a formal non-profit? What kind? Who is founding it?

yrs--
--Ben
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lumpley
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« Reply #8 on: October 18, 2008, 07:22:17 AM »

Re: no direct correspondence: Good! You're right. I didn't think about it that way and that's pretty exciting.

What sort of organizational structure are you using, in terms of taxes and such? You were talking about a non-profit, is that a formal non-profit? What kind? Who is founding it?

Not a formal non-profit. Not even any kind of structured organization. Each fulfiller is financially independent, responsible for her own taxes. I believe that Meg's tax-time plan is to use the good old lemonade stand model. Her gross, costs, and net income from this thing as a (very!) small business  will all come straight out of the database at the end of the year.

-Vincent
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Ron Edwards
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« Reply #9 on: October 18, 2008, 07:36:44 AM »

I can't over-stress that all of these details about this particular deal with this particular fulfiller are, effectively, irrelevant for purposes of doing something like this on your own. I'm not saying it's rude or dumb to ask, but I am afraid that people will think we are presenting some kind of highly-polished business model to emulate in all details. That's not the case. All such things are settled among whoever you are and however you want to do it. All that's being made available is the (hope I'm using the right word) platform so the publisher knows what's going on with the books and money at all times.

Best, Ron
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Ben Lehman
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« Reply #10 on: October 18, 2008, 07:47:36 AM »

Oh, yes.

I look at a dollar a book and go "well, uh, that's grossly unsuitable for me, since with a single publisher that won't amount to minimum wage, and I have some books that are cheaper and smaller than others."

Vincent, cool. I await the e-mail tour. Can I set up a fake account and fool around for a bit?

yrs--
--Ben
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iago
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« Reply #11 on: October 18, 2008, 02:13:28 PM »

Does this business model (unpolished, highly polished, or otherwise) include some specific thoughts about how to sell to retail stores? Or is this specifically sourced from the idea that it's all about direct to customer sales?
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lumpley
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« Reply #12 on: October 18, 2008, 03:16:03 PM »

This approach to fulfillment - it's not a business model! - doesn't include any specific thoughts about sales whatsoever, to retailers OR to customers. Sales is the publisher's job, not the fulfiller's.

I think that it's going to offer very good opportunities for sales down the road, though, including sales to retailers. Having a shared storefront or sales portal will be an essential first step; once I create that, it'll be trivial to create a matching portal for retailers (which the publishers will opt into or out of, of course, and very strictly on their own terms). Having big-name games unavailable elsewhere will surely help. That's why I'm pulling my games from IPR, to give this thing a shot at reaching into retail. Personally, I don't expect to lose my best retail customers - I'll drop a note to Endgame, for instance, letting them know how to get Dogs in the Vineyard now, and I expect they'll figure it out pretty quickly - and I hope that that'll create the same opportunity for other publishers.

-Vincent
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HighmoonMedia
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« Reply #13 on: October 19, 2008, 06:39:17 AM »

Out of curiosity, aside from the fulfillment issue, what is the difference between this approach and IPR? Is it the ability to be more in-the-know about who is buying your games? Having more up-to-the-minute info on your stock levels?
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lumpley
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« Reply #14 on: October 19, 2008, 01:01:04 PM »

Strange question, Daniel. It's a way to fulfill your books. "Aside from the fulfillment issue" leaves me scratching my head.

Those that you mention, they are a couple of ways that my web app is different from IPR's, sure. There are others too. But they're just trivialities of execution. IPR could offer them too, any time they felt like implementing them.

The important difference IS the fulfillment issue.

-Vincent
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