The book business is baroque in its complexity. Traditional publishers sell their titles to indie bookstores, bookstore chains, and online bookstores, but they also sell to wholesalers, who in turn sell to—guess who—indie bookstores, bookstore chains, and online bookstores. And what about book distributors? They also get books from the publisher and sell to indie bookstores, bookstore chains, online bookstores–and wholesalers! This is complicated enough, but consider that most books moving through these various paths to consumers are sold on a returnable basis. A large percentage of books in a bookstore–30% for some categories–wind up not being sold and are returned for credit from bookseller to wholesaler to publisher, or bookseller to distributor to publisher, or….you get the idea. A distributor acts as a publisher’s exclusive agent and sole source of books to the book trade (the book trade includes bookstores, book chains, online booksellers, and book wholesalers). This is critical for a couple of reasons, one being the fact of returns mentioned above: everybody in the value chain wants to know where they can return books for credit on their account. They don’t want to get stuck with unsaleable books. Distributors want exclusivity not only to minimize the returns confusion but also so that if a book sells anywhere in the book trade, they can make money from the sale. Because so many books don’t sell, this is critical to the distributor’s business model. They can’t sell books to the minor resellers while the publisher sells books themselves to Amazon, for example, diverting the lion’s share of sales dollars while the distributor’s sales and marketing staff do a lot of work for minimal sales. So a publisher can have only one distributor.

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