Consignment Continues to Grow at Bookstores
In the months since several bookstores discussed their forays into consignment sales at BookExpo America and the American Booksellers Association’s fifth Winter Institute, other stores have set up consignment partnerships of their own.
Boulder Book Store and Water Street Bookstore have both established consignment programs with publisher Chelsea Green. Boulder’s Chelsea Green display, the store’s second consignment arrangement, has been in place for just a week. Water Street began its consignment sales on July 15.
After reading about the launch of nearby Northshire Bookstore‘s consignment program, “I called my rep and said ‘I want one of those,’“ said Water Street owner Dan Chartrand. By working with Chelsea Green, which focuses on environmental and progressive topics, he said, the store is “selling books that are going to help foster the locally and independently owned community” in Exeter, New Hampshire.
Boulder Book Store buyer Arsen Kashkashian believes that Chelsea Green’s niche is what makes it a viable consignment partner for bookstores. “I think this model has potential with narrower, small to mid-size publishers,” he said. When the publisher’s books fit into a niche, the store is able to create displays that “make sense” to customers.
Chelsea Green is Boulder’s second consignment relationship; in May the store began a similar arrangement with local spiritual wisdom publisher Sounds True. Kashkashian reduced the store’s metaphysics section from four bookcases to two and turned the remaining two bookcases into a Sounds True display. “It’s fully faced-out,” he said, and carries far more inventory than the shelves previously held. Despite slightly lower sales from the smaller metaphysics section, Kashkashian reported that sales from the four cases encompassing both metaphysics and Sounds True are up 70 percent. “We’re getting much better bang for our buck out of those cases than we did before,” he said.
Kashkashian is watching the store’s consignment sections closely and is especially interested in seeing how customers respond when the publisher-specific displays are no longer new. If they perform well, Boulder would be open to expanding its consignment partnerships, he said. “We want to get those two going, and we’ll move on from there.”
Stores that have had consignment programs in place for longer periods have found that the partnership does pay off. “Consignment is the way to go,” said Books & Books owner Mitchell Kaplan. Three of his South Florida-based stores have sold Assouline books on consignment for more than a year now, and Kaplan said sales of those books have increased “80-fold.” Books & Books recently began selling TeNeus books on consignment, and Kaplan said the store has sold as much in the past month as it did in the previous six months.
Part of the reason for higher sales, Kaplan said, is simply giving the books space in the store. “It sounds so obvious, but you can’t sell books unless you have them,” he said. One success story Kaplan points to is Assouline’s In the Spirit of Miami Beach. “It went from remainder to reprint because of consignment,” he said.
In the Spirit of Miami Beach has obvious appeal for customers of Books & Books’ Miami Beach store, which had been selling a few copies a month before the store moved to the consignment model. Soon after consignment began, Assouline sent 100 copies of In the Spirit of Miami Beach to Books & Books. “We sold out of that 100 in about a week and a half,” said Kaplan.
Chris Morrow, owner of Northshire Bookstore, agrees that one of the consignment model’s strengths is the opportunity it gives stores to stock appropriate books in large quantities. “Books should be on shelves where customers can see them, not in warehouses,” he said. Ten weeks after Northshire began selling Chelsea Green books on consignment, “sales have more than doubled, our flexibility has increased, and our cash flow is better,” said Morrow.
Margo Baldwin, Chelsea Green’s publisher, also likes the results so far. “We are very pleased with the experiment and expect to roll it out to other key independents over the next few months,” she said, adding that she expects four or five more bookstores to begin consignment sales soon. “We think that this kind of partnership has huge potential for growing sales and brand awareness, especially for a niche publisher like Chelsea Green.”
At the heart of the Chelsea Green consignment contract is an agreement between the bookseller and the publisher on the program’s goals: “to increase sell-through of titles, allow booksellers to pay for books as they are sold, and further minimize returns.” Booksellers must order enough Chelsea Green titles to fill a dedicated space and agree to keep titles prominently displayed within their regular categories. Based on monthly sales reports from the bookstore, consignment invoices are generated and must be paid by the 15th of the month. Chelsea Green’s minimum consignment order is five books, any combination of titles; the discount is 45 percent plus free freight. Titles that show little or no movement after an agreed-upon time become candidates for shared markdowns. At the end of the initial consignment agreement, which is for a six-month trial, the bookstore and Chelsea Green review and evaluate the program. (For full details and requirements, booksellers should contact their Chelsea Green sales reps.)
Regarding the recent experiments in consignment, ABA CEO Oren Teicher said, “We think it’s extremely encouraging that publishers are taking a fresh look at trade practices and asking themselves whether there are potentially profitable new ideas to be explored. In our discussions with publishers, ABA has encouraged them to examine such new avenues as consignment, which we believe have the strong potential of selling more books, a definite win-win for publishers and booksellers.”
The consignment model “is going to become very common very quickly,” said Chartrand, who is in talks with other publishers about establishing similar partnerships. “It addresses such an important, fundamental issue for independent booksellers, which is cash flow.”
“I am having discussions with two other publishers to implement consignment deals,” said Morrow. “I hope to have half a dozen partnerships worked out by next year. It is time for the industry as a whole to give consignment a fresh look.”