Money

Firstly, I should say that I have never been overly impressed with “money.” I have never coveted an expensive car or a mansion. I live in a nice house and I have a decent car – it’s just neither are particularly expensive. When I travel I stay in good hotels but I never stay in fancy hotels. I have always flown coach and have never even been offered an upgrade. I have made a good income and have managed to save and invest reasonably well because I’m not particularly materialistic. 

In 1986 I started writing professionally. I landed a weekly gig on CBC Radio as a writer/broadcaster and wrote feature articles for various small magazines. Because I earned very little money I had to work part-time at another job. I had a $2,0000 limit on my only credit card and lived a simple yet rewarding life. Every year I traveled for at least a few months and maintained this lifestyle for many years.

Eventually I established a small, regional publishing business and built a nice house on a lake outside town. I published regional books for more than twenty years and saw the industry experience massive change. When I started I could justify 10,000 copy print runs that would evaporate from my warehouse in a single season. We worked with distributors and retailers that were healthy and robust and paid their invoices early and always without reminders.

Click forward to 2011. More than half the stores we once had accounts with no longer sell books or are out of business. Our US distributor is bankrupt owing our company tens of thousands of dollars and Borders went bankrupt yesterday also leaving substantial unpaid invoices. At least a third of our present retail accounts no longer pay their bills on time and we fear they will be out of business in the next couple of years.

To adapt to these realities we “refined our supply chain” and found spectacular ways to reduce overhead. We incorporated a digital invoicing and inventory system and emptied our warehouse of overstocked books. Today we produce few new titles and only print small quantities. We also release eBooks and are planning on using Print on Demand for our backlist. Overall we are profitable and have relatively little debt. But don’t get me wrong our company is contracted and we have retreated into a fiscally responsible bunker. 

Recently I attended Digital Book World in NYC. It was a bipolar conference with all publishers feeling squeezed by the present realities of the industry while trying to seem optimistic about eBooks and all the uncertainty of the new publishing platforms and economic models. Repeatedly I heard publishers respond to free eBooks by saying “free is not a business model.” Writers like Seth Godin and Amanda Hocking cause publishers a cold sweat. But in this climate can you blame writers for bypassing publishers? 

Whatever the new economy brings I am happy that I don’t have Champagne tastes. It would likely only lead to disappointment. I am pleased that we scaled back our operations years ago because I also wouldn’t want to have a big warehouse in this economy. I look at the Big 6 publishing houses and I wonder how they will scale back their companies and adapt to the new realities. The big dinosaurs seem to die first.