Hi everyone! Welcome back to our Peek into Publishing blog. We’ve created some different content for you this week with our Top Ten Sales Terms!
So far you’ve met Rachel, Craig and Kieryn, who have given us insights into various publishing departments, and these profiles will continue every other week. However, this week, we’ve asked Lauren and Craig in the sales department to offer you their top ten sales terms they wish they’d known when they first started out working in their publishing roles.
These terms are useful for anyone looking to work in publishing, not just in sales. They get thrown around during sales review meetings with all departments, so we hope you’ll benefit from learning them! We’ve asked other departments to also curate their top ten terms they want you to know, so keep your eyes on our Peek into Publishing page for more similar insights.
1. Firm sale
We use this term to signify when books have been sold to a consumer with no possibility of any of these books returning to us (the publisher) in the event of poor sales or excess stock.
2. Sale & return
In comparison, this term refers to when books are sold to a consumer with the possibility of returning excess stock. For example, if a consumer overestimates how many sales they can make, so only sell half the number of copies they ordered, they can return them to us if they have a sell & return clause in the contract.
This is the amount of profit we make after a sale, taking into consideration all editorial, marketing, printing and shipping costs, usually displayed in a percentage format.
Lets give an example:
Say, for example, a store wants to order 1,000 copies of a £9.95 book at a 60% discount.
The total amount he would need to pay would be £3,980, but our profit would not be £3,980 because we incurred costs making the book.
If these costs were £0.92 per copy, 1000 copies would have costed us £920.
Our profit would be £3980-£920=£3060.
Our margin would therefore be 31% (306/995=0.307).
4. ROS & ROM
Rate of Sale (ROS) and Rate of Movement (ROM) are both ways of referring to the average number of units sold over a specific time period. For example, if a title sells 15 copies in Month 1, 20 copies in Month 2 and 13 copies in Month 3, the three-month ROM would be 16 copies. This shows us how quickly books are moving. If they have a sudden boost in sales, this will be reflected in the ROM, so we can then calculate the best time to organise the next reprint (see MOH next).
MOH is shorthand for Month on Hand. This uses the ROM figure to calculate how many months’ worth of stock is in the warehouse if the same buying patterns continue. For example, if there were 100 copies in the warehouse and the ROM was 16, the MOH would be 6. This means our current stock levels would last for 6 months if buying patterns remain regular, so we don’t yet need to organise a reprint.
Retailers often take a quantity of stock to hold in their own warehouses but only pay for the titles as and when they are sold. This is called consignment.
7. Gross Sales
This refers to the total amount of sales including returns. So, if we sold 1,560 copies of a recent publication such as Why We Get Mad then we had 60 returns, the net sales for this book so far would still be 1,560.
8. Net Sales
We calculate the gross sales by removing the returns, instead calculating the total amount of sales excluding returns. In our example above, the gross sales would be 1,500 for Why We Get Mad by Dr Ryan Martin.
Pulping is the process of shredding of excess stock. We make the decision to pulp for two reasons:
- It’s a very old title and we have far too much stock compared to its ROM. If we have too much stock that we know we won’t use, it can incur warehouse charges that amount to more than the book is bringing in.
- It is an old edition and we’re printing a new one with substantial changes. We first try and sell via remainder (see next term), and then we pulp.
If stock isn’t moving as quickly as we’d like, an alternative to pulping is remainder, where we sell excess stock in bulk for a high discount to discount stores. This allows us to move the stock out of our warehouse without pulping them.
That’s all for this week! We hope you gained a little more knowledge of the sales terms that get used a lot in publishing. We wish those of you seeking a job in sales (and in publishing in general) the best of luck! If you want to learn more about upcoming Peek Into Publishing projects, follow Watkins on Twitter. Next week, we have one of our amazing commissioning editors giving insight into the editorial department, so come back on Wednesday. To catch up on previous posts, see below for insights into sales, marketing and design:
- A Peek into Publishing: Application Tips from Hiring ManagersOur senior hiring team have answered your questions about applying to entry-level publishing jobs – what stood out, what not to do and what they were specifically looking for.
- Forest School Wild Play: How Foraging for Food Can Bring Kids Closer to NatureForaging for food is so exciting – a fantastic opportunity to tap back into…
- Top Ten Terms: Rights in PublishingWe’ve asked our rights department about ten terms they wish they’d known when they started in publishing.