Book Industry Study Group

BISG Announces

Landmark Used Book Study

By Eugene Schwartz (ForeWord Magazine) -- More than 200 industry operations and marketing executives, information technology professionals, service providers and trend watchers gathered at the McGraw-Hill auditorium to receive a variety of progress reports on the remarkable revival and growth of BISG in the last three years; and on such special projects as its up-coming used book study report and its reach into the exotic space of the Global Data Synchronization Network (GDSN) - "a necessary step . . .that would integrate books into the global network of product information."

Lest those of you among our librarian, bookseller and wordsmith readers are ready to roll your eyes and move on to FTW's news notes, or listings of promising new titles posted below, you should know that Joe Gonnella, a Barnes and Noble Vice President and Chair of BISG's Board of Directors, opened the session with an invocation in the form of a reading from a Wallace Stevens poem, titled by its first line. It's first stanza-

"The house was quiet and the world was calm.

The reader became the book; and summer night

Was like the conscious being of the book.

The house was quiet and the world was calm"

-- A reminder of what fuels our efforts to catch up with and adjust to the mundane of the merchandising revolution taking place around us in order to maintain the connections of author to reader which breathe soul into our enterprise.

Industry programs the BISG mission and related alphabet soup:

Jeff Abraham's annual report followed, which reviewed BISG's effective and on-going initiatives in facilitating industry-wide adoption of the new ISBN-13 protocol and its related global merchandising benefits [visit www.bisg.org for the skinny]; the work of a score of committees concerned with supply-chain EDI and management in manufacturing, distribution and information technology; BISAC and ONIX update maintenance; and monitoring developments in emerging uses of RFID chips.

Reports in the Annual Report of 15 major initiatives and of 17 committees included the first stage of BISG's strategic planning process in the form of member responses supporting the three main areas of the organization's mission:

(1) Policy development and best working practices (e.g. warehouse benchmarking and RFID chip privacy policy)

(2) Development and maintenance of standards (e.g. collaboration with UPS in developing shipping and package label standards)

(3) Obtaining and disseminating information (e.g. BISG's reports on industry trends and its annual Making Information Pay conference).

Abraham reported that the last three years has brought the organization to a turning point as "the leading trade organization for policy, standards and research."

Some other highlights (see www.bisg.org):

(1) Released in April 2005, Under the Radar for the first time took the measure of the $14.2 billion of annual revenues of the 63,000 publishers with annual revenues of less than $50 million. How much of this sum will add to the present $28 billion industry sales metric is yet to be seen. Book Industry TRENDS 2006 will incorporate this data annually for the first time.

(2) Jim Lichtenberg of Lightspeed consultants, chair of the New Technology Interest Group NTIG) reported on what is probably the most significant industry embrace of new technology - the RFID chip, which enables the rapid scanning (e.g. E-Z Pass and other automatic toll scanning systems) of objects in which they are embedded. Already in use in carton tracking by major big box retail chains, the ultimate goal is a chip in every book. Lichtenberg reported on the $75 million installation of an RFID application in the Queensboro, NY public library system, with the largest circulation in the U.S.

(3) The Manufacturing Executives Interest Group (MEIG), chaired by Joshua Wright of Random House, brings together for the first time in this writer's memory senior operations and production executives "to review business practices and communications methods among publishers, printers and manufacturers."

(4) The Global Data Synchronization Network (GDSN) is one of those supply chain features that can transform the reach of an industry without most of its stakeholders being aware of it. Major retailers in the consumer market and their suppliers are pushing this development of global standards and supply chain solutions.

An outgrowth of initiatives to use universal product and supplier identifiers, the application of all of this will appear in global data registries holding the correct product numbers and meta data that would reduce such supply chain problems as out of stock conditions, invoice errors, unknown delivery status of orders, etc. In an expression of "multicultural" exchange, an executive of Wegman's Food Market chain addressed the book group on how application of identifiers and coding produced huge savings and efficiencies for the company. Their ability to economically handle books and magazines rests on the publishing industry's adoption of universal product standards.

The Great Used Book Study Preview:

Kelly Gallagher, VP of the Evangelical Christian Booksellers Association (ECBA), and Chair of the BISG research committee introduced a preview of the first ever comprehensive study of the "explosion" in used book sales. Jeff Hayes stuck somewhere in traffic delivered the data, by wireless speakerphone.

Highlights of the study's intriguing findings, still being assembled for publication include what you need to know, but probably more than you every wanted to know:

(1) The $2.2 billion in 2004 sales grew 11.4% over 2003. Of that sum $1.6 billion are college texts, 28% of all college textbook sales. The balance of $589 million was in trade.

(2) Of 111.2 million used books sold, 38.6 million were in the education market, and 72.6 million in trade.

(3) The $609 million in on-line sales grew 33.3% from 2003, while bookstores experienced a 4.6% growth to $1.6 billion in sales.

(4) Bookstore sales are declining in favor of Internet sales. There are 4,200 used book dealers, 95% of who are in a single location and do less than $100,000 in annual sales.

(5) The study also yielded some interesting data on the numbers and kinds of bricks and mortar book retailers, totaling 16,795: 4,200 independent used, 3,340 independent new, 3,875 college, 2,812 religious, 2,281 chain, and 283 "other".

The study also explored the trend toward library stores selling used books at low prices in the 117,000 school, public, academic and government libraries in the U.S. Other used book channels include fairs, thrifts, yard sales, etc. There are around 7,000 thrift stores (including 2,000 Goodwill). The study also estimated about 45,000-yard sales take place each week, selling books at a range of from 50cents to $5 each; and, of course, the "good stuff" that goes to e-Bay.

The impact of this increasing aftermarket on publishers will lead to even more titles, shorter runs, and updates in order to create front list. Online sales will continue to erode the number of used booksellers and booksellers of all kinds. The study will also lay out a number of significant future issues for further study such as international markets, student buying behavior and the metrics for hurts and remainders which were not included in the study.

A partial list of the 11 project partners who provided data and expertise includes Abebooks, Alibris, Amazon, the ABA, Barnes and Noble, Bowker, eBay and Powell's Books. The seven project sponsors who provided financial support are HarperCollins, Wiley, Penguin, PMA and VISTA International.

So, you think you knew all about the book business? The whole project is mind-boggling.

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