Indie Sales Numbers
Valamir:
Ron, the fact that I understand the distinction your'e trying to make is clear when I say "The difference between a sale to an end consumer and to a distributor is the price received per unit"
But that distinction is utterly irrelevant to the issue of sales totals and units sold. Sales are sales is not only not sub par logic...its basic business 101. When a unit leaves your inventory, and you receive payment for it (or a receivable for future payment) that is a sale. Period. Whether you receive full MSRP or 1 penny is relevant to how much revenue you book from the sale. But it is NOT relevant to how many sales you book. Sorry. Not horse shit. Basic accounting.
Also your aside as to end user status is likewise irrelevant to the question of sales. Its very important to OTHER issues (like how much actual play is occuring) but when a business books a sale, they book a sale. Whether that sale is to a wholesaler, retailer, or end customer again...impacts the revenue...does not impact the sales number. Isn't relevant at all. And here at all includes when half the total sales get mulched by a wholesaler who couldn't sell them. From the perspective of the business...sold is sold. The exception here is when the buyer has recourse and can force you to take unsold copies back. In proper accounting this is treated with a special reserve account that reduces your earned revenue by the amount of the reserve. In that case, a sale isn't necessarily a sale because it can be "unsold" so to speak. But in that case there is a proper accounting treatment to handle that.
You also in your points neglect to account for the increase in revenue that increased volume provides. If you sell 200 units direct you get to pocket 100% of your Revenue less your cost of goods sold. If you sell 7000 units into distribution your per unit revenue is much less. But I guarentee your per unit cost of goods sold is much less also. So the deep discount isn't quite as deep as it looks when you do the math. From my own experience simply going from 100 copies to 1000 reduced my cost by nearly 5$ per unit. On a $20 book that's 25% towards reducing that discount.
I had thought perhaps you had a different point to make which is why I wasn't following your logic. But after your clarification I just have to conclude your logic is just wrong.
Recording units sold based on when revenue is earned is standard operating procedure for pretty much every business in the world that deals in inventory. Some sales generate more revenue than others, true. That's what Profit Margin is designed to track. But units sold are units sold.
Mathew E. Reuther:
That's in line with what I was saying earlier, that the units that are sold can be sent back if there's a deal in place which allows it. In that case, those units are not actually sold until they reach the customer's hands and pass the return policy of the reseller.
In particular there are major resellers that if they stock your book, will generally only do so because you as a publisher have set a book's buyback option.
You may think, well, simple, just eliminate the problem by not offering it . . .
But if you could get a title into a major brick and mortar store, you might sell far more units than you otherwise could count on, making buyback an attractive option.
So in that case, books are sold when they are sold to customers, not when they hit the distributor, or the reseller.
In the case of the Dresden files, we cannot tell you what their policy is. I have not seen the RPG available from one of those major stores, but that's not proof of anything . . .
Sales numbers are important, but only tell a part of the story. Being a bestselling author generally means your book is sold places like Walmart . . . any idea what kind of a deep discount THAT store looks for? :)
drkrash:
Golly. I was just looking for projections of what sales numbers people were individually happy with for their own work. :)
Ron Edwards:
Ralph, this is the same double-speak I got from the RPG publishers back in the mid 1990s, all of whose companies have failed in the interim. You can quote all the B-school text you want, but none of it is actually saying what you claim it is. You can say "you are wrong" loud and clear, but that doesn't make it so when your backup is nothing but circular reasoning.
To say that accounting terms 10 books leaving my stock is 10 books, always, is trivial. Of course it is, just as $10 in my pocket is $10 no matter how it got there. But none of that - or repeating it or waving "101" at me - actually challenges my points. In business terms, which is to say, to me as creator, publisher, investor, financier, and chief executive, the crucial question is how the variables interrelate. And the 10 books leaving my stock in the context of direct sales doesn't relate to any aspect of marketing, profits, effort in the same way as 10 books leaving it in the context of distributor sales.
I cannot believe you of all people are perpetuating the old Brooklyn Bridge line about lowered print cost to offset high print run costs. True: there is clearly a sweet spot where per-unit print cost meets print run size cost, specific to any particular project at a particular time for a particular printer. A big part of choosing a printer is finding the one who can provide it. But: too many times, RPG publishers get enchanted by "more more more" when they find out that unit cost drops sharply, and go past that sweet spot. Loading yourself with huge stock and congratulating yourself on the deal you've cut per book, is exactly what tanked so many RPG companies in the 1990s. The per-unit deal is only a deal if those copies actually move out of your stockpile - otherwise it's a deadly trap, especially when tax time rolls around. You yourself exemplify the smart strategy: shorter print runs sized and timed to pay for the next, within the sweet spot to be sure but never loading yourself with oh-so-cheap but mountainous inventory that won't sell fast enough and becomes a drag on the financial cycle.
To anyone reading this, I am not posting in advocacy of only doing direct sales. I am calling attention to understanding what is happening in your own business and making decisions about what to do next that make real sense to you. And not to gaze at some company with stars in your eyes because they look so successful to the naive consumer. D&D's financial history is a series of train wrecks. White Wolf's design and business model tanked when it encountered an actual marketplace and had to be severely revised.
Regarding buyback, that's a detail which cannot be automatically associated with direct vs. distributor sale dichotomy. Either way, you offer it or you don't. For example, for me, it's actually a benefit of distributor-free publisher-to-store sales, that the publisher has absolute personal control over it. I offer full buyback to the stores right up-front, which enhances my cred with them and also enhances the chances that every book actually gets into a user's hands. I don't think it loses me money at all; I know that the direct sales would in the fullness of time move all my books if they had to, and the retailer side of it is augmentation.
Best, Ron
Gregor Hutton:
For numbers there is a great article, based on real numbers, at the Collective Endeavour website: Small Press Publishing: Expected First Year Sales.
Oh, and I know of at least one "real" RPG publisher who tried to piss on those numbers online and imply they weren't very illustrative of gaming in general. I don't buy that.
To counter that opinion I will say this: I strongly believe the data in that article to be very accurate and realistic. I also note that when you look at 3:16's numbers and cross-reference it with The RPG Countdown Top 100 for 2008 (3:16 at #24) you can see where those numbers lie in regard to other products in the market.
In my opinion Dresden has been a huge hit, built solidly on a strong IP, a popular system and a lot of effort put in by people who know their market very well. Dresden numbers should not be expected by anyone under normal circumstances (but they are achievable as the Evil Hat guys have shown). And I tip my hat to them.
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