Publishers knew that the system was wasteful. It tied up cash in unsold inventory and cost them money for shipping and storing unsold books. But they had little choice: the books had to be on bookstore shelves for readers to buy them, and bookstores could little afford the risk that they wouldn’t sell, so returns were a necessity. Also, the printing technology of the time was designed on the Detroit model: presses and binders were expensive to set up, but extremely efficient once they were up and running. Printing companies had no interest in printing fewer books to help publishers manage inventory, that’s for sure. Quebecor, a printer we used in the ’90s on behalf of client publishers, wouldn’t even quote on a run of less than 2, 500 copies. Publishers’ production managers were tasked to minimize unit cost, and printers were set up to deliver it–via long runs.
Enter the Xerox Docutech
The introduction of the Xerox Docutech in the early ’90s changed things. The Docutech was the first industrial-strength high-speed digital printer. It could print pages for a book in a couple of minutes, with much quicker setup times than an offset press, and the pages came out more or less ready to bind–no folding required. Aware of this, some publishing people began to ask the question: What if you could print exactly as many books as you needed, when you needed them? But Docutech quality was very low, and the operating cost was high: Xerox would charge as much just for printer maintenance and toner for a run of 1, 000 as a publisher might pay for paper, printing, binding and freight on a run of 3, 000 to an offset printer. Secondly, being able to print a few copies at a time didn’t help if you still had to put thousands of copies on bookstore shelves in order to sell books. The only information a publisher had about true demand for a title was the books they’d already printed: the books shipped, those returning unsold from bookstores, and those sitting in the warehouse unshipped. Aiming for the lowest unit cost was still the only rational strategy.
Enter Amazon
In 1996, Amazon moved the bookstore to consumers’ internet-connected computer screens. The physical location of the books being sold was now irrelevant; there was no need to over-order books just to display them. Amazon could order from publishers based on actual demand and developed sophisticated algorithms to do so. Consequently, Amazon’s returns were much lower than those of physical bookstores. Publishers now had a major sales channel where returns were minimal, which meant that they had much better information about actual demand, which meant that ultimately they would be able to match print quantities to demand much more closely.
Also, Amazon could efficiently stock and sell millions of titles, while the largest physical bookstores carried only around 100, 000 titles. This meant that Amazon had created a market for books that consumers otherwise wouldn’t even know existed. Wired magazine editor Chris Anderson dubbed this The Long Tail. Many of these Long Tail titles sold only dozens or hundreds of copies a year: too few to justify long offset print runs, but a great match for digitally printed short runs.
The Digital Handwriting On The Wall
Individuals who were both aware of new technologies and knew the book industry could see the handwriting on the wall: technology was going to make it possible to match supply and demand in book printing in a way that had never been possible before. Further, those who had witnessed the tidal wave of digital technologies move through the printing industry from desktop publishing, to imposition, to platemaking–replacing analog technologies at every step–knew that it would not stop until pages were read on a screen instead of on paper: eBooks were inevitable. Whatever the ultimate equilibrium was between books sold in print and those sold as eBooks, managing print inventory was going to be a different game, and digital printing technology was going to be key. We started Bookmobile in December 1996; working with IBM, Ingram started Lightning Print in 1997. Other pioneers entered the picture as well: the offset printer Edwards Brothers worked with Xerox to set up a digital print line. All were betting to some degree that 1) the book industry would evolve to a regime with much better information available to set run quantities, and 2) higher quality, lower cost digital printing devices were coming down the road. Driven by the internet and the advance of digital printing technologies, all of this has happened.
Now, rather than having only one option for creating and managing printed inventory, publishers have four. In addition to long run printing on offset printing equipment, there are three print models that utilize digital printing equipment: Print-on-Demand (POD), Short-Run Digital Print (SRDP), and Automatic Replenishment Programs (ARP). Each model offers unique advantages for publishers, depending on the publisher’s sales channel profile, title list, and production requirements. Each also has disadvantages. First, some definitions.
Long-Run (Offset) Printing
Long-run printing that utilizes offset presses is the traditional model of book printing. For a new book, the publisher estimates the number of copies they expect to sell in the first year, based on advanced orders from booksellers and other accounts. This sales estimate is usually little better than a guess. The publisher then sets the first print run quantity according to the guesstimate, all too often increasing it to get a more attractive unit cost regardless of whether or not the extra copies are likely to sell. The books are shipped direct from the printer to the distribution warehouse. If all copies from the first printing ship out of the warehouse, a reprint is ordered, without, of course, knowing whether the books already shipped will ultimately be returned for credit. For offset reprints, setups on presses and binders have to be done all over again, so the print run is once again set high (1, 000 copies or more), regardless of any estimate as to how many books are actually required. Often enough, no reprints are required anyway: the first print run never sells out, leaving unsold books gathering dust in the warehouse.
Use Cases: For all of the deficiencies of this print model, if there is real demand for 2, 000 copies or more, long-run printing using offset presses is hands-down the most economical way to print and is very high quality when produced by a good printing company.
