Monday, August 13, 2007

Short Discount and Trade Discount

Until today, I didn't even know there was a difference between the two. You can read more about it from Self Publishing:
When publishers talk about the "trade discount", they mean the standard discount off the cover price at which the publisher sells books to resellers. It would be better to call this the wholesale discount, because bookstores call the "trade discount" the percentage off the cover price they buy books at. When the buyer is a bookstore or chain purchasing direct from the publisher, the wholesale discount and the trade discount may meet at the same percentage:-) Normally the wholesale discount is between 50% and 57%, 55% is probably the most quoted number by small publishers since it was the standard Ingram figure for years. Specialty distributors may demand a discount between 60% and 70%, in return for pushing the book (maybe) and financially failing (frequently). The wholesale discount does not lock-in how much the bookstores buying through distribution will pay for the book, you can generally assume that somewhere between 10% to 30% of the cover price will remain with the distributor or wholesaler. If a middleman anywhere between the publisher and the individual book buyer doesn't feel they are earning enough profit by handling the book, they may resticker the book to a higher price than the original cover price, or charge a sourcing fee.

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