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Purple Crayon Bookstores

What Happens Inside a Children's Publishing Company?

(Based on a speech read in slightly different form at SCBW-I conferences in Santa Barbara, CA, on March 1, 1997, and in Washington, DC, on April 19, 1997)

Contents: History and Context | The Machinery | What to do

When I was first asked to talk about the business of children's publishing, I knew that the problem was not what to talk about, but what not to talk about. I could talk about the business as a whole and the very many changes that have happened in the last few years; if I wanted to editorialize I could bemoan the weak market for hardcovers, or I could enthuse about promising developments. I considered talking about individual publishers and what is going on at each of them, which I have done in the past. I could simply point out that children's publishing is a business and leave you to draw your own conclusions, but that wouldn't give you good value for money. I also had to deal with the fact that some of you are published and some of you are not, and that, as a writer friend pointed out, "beginners want to be told good things about publishing and more experienced folks want to know all the rotten stuff."

So to provide some insights for those in both groups, I'm going to prop up the hood and take an insider's look at all the machinery of a children's publisher, particularly a publisher of hardcover books. I've found that many writers and illustrators, both published and beginners, caught up in that machinery, ask the same kinds of questions --

• Why don't they look at our manuscripts?
• Why don't they respond to our letters?
• Why does it take so long to send me a contract when they've already said they want to publish my book?
• Why don't they do more to market my book?
• And, last and most anguished of all, Why did they let my book go out of print without even warning me?

My answers may not make these maddening experiences any easier, but may help you deal with them with a thicker skin and eyes wider open.

But first, to provide some context, a little bit about the BIG PICTURE. Some history, and I hope those of you who know all this will bear with me. In the beginning, back before the 2nd World War, children's books were edited by people with training as librarians, almost all of them women, and sold to librarians. It was a fairly straightforward business, now seen by many as the Golden Age, and although no one was making much money at doing it, children's divisions were pretty much left alone by the companies that owned them. That started to change in the 60's with the appearance of federal funding for book purchases by schools and libraries, and the first of the quality paperback imprints. All of a sudden, there seemed to be money in children's publishing, and men appeared as editors for the first time, perhaps not coincidentally. But cuts in the 70's caused a decline in the business of similar scale to the one we have gone through in the last few years--lists were cut, editors were laid off. Even Margaret McElderry, one of the greatest editors of the past 50 years, and still active today, was laid off by Houghton Mifflin, which felt she was past her prime. Then in the late 80's due to demographics and the growth of children's bookstores, the business boomed again, overexpanded, only to falter and decline over the past four years. Consider a variation on the familiar image of the glass of water that is half full or half empty. If children's publishing was a quarter full in the mid seventies, and almost entirely full in the later eighties and early nineties, and back to only half full now, do we bemoan the decline in the past five years or feel encouraged that even with the drop off the industry is still more diverse and productive than 20 years ago?

There certainly are reasons for worry. Today we see a landscape dominated by large conglomerates, a smaller hardcover market, and a lot of nervous publishers wondering what's coming next. Publishers are no longer independent, as you will see in the chart in The Nation's special issue on the publishing industry (March 17, 1997; highly recommended for this chart and for the articles in it). A few media conglomerates now publish most of the books, at least in numbers if not in titles, sold in this country. This is a fairly recent development and there are exceptions, but children's publishing today is becoming like other industries -- companies are part of large corporations, and are expected to perform as well as all the other divisions. Gone are the days when a children's book publisher could earn a genteel single digit profit. Now, if a cable division of a conglomerate makes a 15% profit, a corporate board expects a children's book division to do the same, and to do so next year, not five years from now. And of course, to make profits like that, a company adopts different strategies (usually but not always pursuit of best-sellers and the mass market).....

Also, publishing companies now have a more corporate culture -- people at them must spend more time doing planning, committees make decisions, and so on. I mention this not because I think it is news to any of you, but because I know that our culture has an image of publishing as being all about Literature, and there is a common view that publishers, especially literary ones and those publishing for children, areas not contaminated by large amounts of money, are almost performing a public service, not running a profit-making enterprise. This was never entirely true, but today, publishers have gone so far as to adopt some of the language of corporate-speak and will talk about "increasing shareholder value" by "developing their brand names." (If you didn't know it, be aware that Stellaluna and the Baby-Sitter's Club can be treated by a corporation in the same way that Cheerios and Coca Cola are.) For more on this area you should refer to my article on Trends in the Business, which looks at children's publishing with something of the same approach as the articles from The Nation do for publishing in general.

Now on to the mechanics.

The submission of manuscripts is where the publishing process begins, and something all writers must go through at some point. And to many it seems completely irrational. Why have so many publishers stopped looking at unsolicited material? Don't they need new books to publish? Why do those who do look at manuscripts take so long with them? Are editors cut off from the real world? (I have an image of an encampment of ragged writers and illustrators in huts at the foot of an ivory tower, while inside the editors languidly sip tea and debate Literature, quite forgetting that they had promised to let down the basket and haul up a few manuscripts to look at on alternate Wednesdays.)

The reality is a bit more prosaic. There have always been many more aspiring authors and illustrators than spaces on publishers' lists, and downsizing has meant that even some published folk are looking for new homes. All these people are jostling for a few vacant slots, since at just about any publisher anywhere from half to 90% of the books on a given spring or fall list are by authors and illustrators that publisher already works with. To put it another way, here is a word problem: If a typical publisher receives 6000 unsolicited manuscripts a year, has five hundred other submissions sent in by agents or authors published at other companies, and only has four slots available two years from now, how much time can an editor at that publisher spend looking at a manuscript? [gesture] In some cases, I think editors may continue to look not because they need to but because they feel they should, or because they enjoy the thrill of the hunt. Unfortunately they must be practical and can't actually devote much time to the process, and so waits of months are all too common.

Once a writer or illustrator does make a contact and start working on a project, even if it is only a manuscript being revised with no contract or a hopeful correspondence with someone who has indicated possible interest in seeing the next manuscript one writes, one would think that they'd hear promptly from the editor involved. But editors seem to disappear on people. This is not rudeness or an allergic reaction. Editors today simply spend less time editing and more time being a part of a corporation. They have planning meetings and production meetings. They have email and phone calls and letters to respond to. They have all the myriad stages of the production of actual books to attend to -- and in leaner meaner corporations, they are responsible for more titles than they once were, some in blues (about to be printed), some being copyedited, some being illustrated or laid out, some still being edited, some needing illustrators, 15-20 books per year, perhaps 60 in all at different stages, and even more at some companies. It's a constant juggling act, as I know from experience, and in the juggling the nurturing of a writer with potential can be the ball that gets dropped, especially since thoughtful response to a manuscript requires focused but relaxed attention, and corporate offices with their many interruptions do not facilitate such a mood.

Get past those two hurdles, and many are then dismayed to find themselves waiting and waiting for a final approval by a mysterious "committee" for a book an editor has said that she or he wants to publish, waiting sometimes for six months and more. Why is this? Why can't the editor just say, "I want to do this book of yours, congratulations! Here's a contract"? That might have happened once, largely because it used to be true that a good manuscript, competently edited and illustrated, would get good reviews and good sales. So editors could decide what to sign up. But now there are so many books being published, and the funds for libraries have been cut so far, that a publisher can not count on good reviews to provide sales. A publisher can't even be sure a book will be reviewed. Publishers must take more risks--the risk of books being returned, of no re-orders, of not being displayed, of not being supported by a bookseller unless the publisher buys display space, and so on.

Corporations don't like to take risks unless they know how much of a risk is involved. So financial analysis of the cost of a book, down to the estimated cost of buying paper for it, and the possible sales, must be worked out before the contract is done. Then the book must be presented to that committee to sign off on it. And of course this committee -- the head of the division, the head of marketing, the head of subsidiary rights, and some others -- is not about to blithely okay everything that is presented to it. The editor has to make the case for publishing the book, covering the finances in a P&L or profit and loss analysis, and pitching it, describing it and giving reasons to publish it, and then there may be a discussion of whether this book really will sell through the first printing of 10,000 copies, given the author's track record, or of the difficulty of marketing yet another book on this particular topic. . . . It's tempting to get up on a podium and condemn this procedure as the triumph of commerce over art, or of marketing savvy over editorial vision, but that committee is agreeing to a 20 to 50,000 dollar investment, one that in maybe 6 or 7 out of 10 cases (if this is a hardcover book) won't be recouped. Of course, in one of those ten cases the company will do very well indeed -- sufficiently well, the company hopes, to make up for all the others, and then some. If not, if the company is wrong too often, they lose money.

Once a book is okayed, you still have to wait for the contract. Yes, part of this delay is ... well, not exactly deliberate, but a company has no incentive other than good relations, which some do care about, to efficiently send out and finalize a contract. Why rush to pay the first advance? But part of the delay is endemic. Contracts are more complicated, lengthy documents that are now drawn up by a contract department, some 20 pages long, instead of one-page forms on which an editor fills out a few blanks, as used to be the case. The goal is to pay as little as possible to get as much as possible out of a manuscript. Good business practice, that's all, and a policy that may be set at high levels and therefore can not be changed. (You can imagine the executive at Mega Media saying, "If we get one afterschool special for our kids channel out of one of those books, it'll be worth it. Keep those film and dramatic rights!") So don't take it personally if they won't change any of those many clauses. But if you've got leverage, use it, and improve your contract! And I strongly advise you to educate yourselves about the standard clauses in a contract.

Once past the contract, we go into production. Production choices and costs do affect the business, but not in ways that you will have much control over, and the details of Smythe-sewn versus perfect-bound don't make for a fascinating discussion. So I am skipping ahead.

When your book is finally published, of course you want to help it along. You'd think the publisher would too. Why then don't publishers support them more? Why don't they help authors and illustrators who want to do local publicity or signings? Why do they throw all their marketing money behind books by big-name authors, who don't need help? I'll start with that last question, since it is the easiest. A powerful force is at work -- the need to protect an investment. If a company spends a lot on an advance, they want to make sure they make it back. Perhaps more importantly, in a money economy like ours, to be taken seriously you must spend money. So if a publisher does not go all out for their Big Author, something all the other publishers do, the booksellers may conclude the book isn't that good, and so they won't order it in sufficiently large numbers. I saw a particularly good example of this is in a recent "Behind the Bestsellers" item from Publishers Weekly (a fascinating column to read, by the way). Hyperion spent $250,000, including the distribution of several thousands readers' copies, and various gimmicky give-aways, just to get a sufficient "sell-in" (books in bookstores). Now they must spend even more money to get a good "sell-through" (books sold to consumers.) This is not as unusual as you might think, and campaigns like this are starting to show up in children's books as well.

But what about basic nitty-gritty stuff like printing up a two-page teacher's guide for an author, or doing a mailing announcing their new book to all the booksellers in their home state, with the author then following up to arrange signings? Many marketing departments don't seem to want to do even this, work which is partly done for them. The problem is, time (from a business point of view) literally is money. Much of a marketing department's time and budget is taken up with things it must do -- get all the books out to the major reviewers and award committees, do two catalogues a year, prepare information handouts on the better-known authors and illustrators, and so on. Marketing an individual book on the ground level does sell books, but ten signings at bookstores and schools in an author's hometown may sell perhaps a few hundred. So marketing departments are reluctant to allocate scarce resources of staff time and money to this pursuit. (And a final contrary comment on this -- it may not be worth it for you to spend a lot of time going to schools, libraries, and bookstores. You could use up a lot of work time over the course of a year. It depends on the book and your own talent for self-promotion. Do not assume that this is something you should do.)

After a little while, you can hope for a paperback edition. Paperbacks! Here at last we come to where the money is, kind of. Just a few months ago, Hyperion paid a $250,000 advance for the rights to a rumored Newbery contender, before the Newbery. Why? That seems like a lot of money, and they'd have to sell several hundred thousands books for it to earn out. But they aren't just buying the one title. With more and more companies with full-scale paperback divisions, each is fighting for a strong list to develop credibility. That one title may also get other titles of Hyperion's into stores and schools.

This is just one example of a noticeable handful of very pricey recent right deals. Unfortunately, you won't find such deals trickling down to midlist titles. Why so little spill-over into books generally? There actually is some -- more authors do get sub. rights income, even if only a small amount, more than used to in the Golden Age of children's publishing, because there are more kinds of sub. rights being sold. I've seen excerpts from novels and whole picture books reprinted in text books, inexpensive paperbacks printed up specifically for classroom use, movies, audiotapes, puzzles made from spreads in picture books, and so on. All of which comes along later, of course, sometimes quite unpredictably. For the most part, publishers are throwing the big money at what they see as the must-haves, and the others don't necessarily see a proportional commitment.

All good things must come to an end, and many books do go out of print, much as we would like them to go on forever. Increasingly, however, publishers are declaring books out of print that had still been selling. Why is that? To an author this seems like an enormous waste of money. Part of the reason lies in the shift of emphasis from libraries to bookstores. Books no longer sell year after year. They may sell heavily in their first year, and then tail off to smaller numbers, perhaps a few hundred a year. Such small numbers are a problem, because it actually costs money to keep a book in a warehouse. Changes in the tax laws, and operating costs for the warehouse itself mean that publishers now track what I recently heard is called R.O.M.-- Rate of Movement. If a book doesn't have a high enough ROM, the number of books sold per year no longer brings in income to cover those other costs, and at that point the fiscally prudent publisher declares the book OP and sells off the rest of the stock, or lets it go out of stock, unable to do a sufficiently small print run, at a low enough unit cost, to end up with two or three years' supply. At the current ROM, that is.

Why didn't they tell you they were going to do this? Publishers often warehouse their books hundreds of miles away from their HQ, and inventory management decisions are made not by an editor, not by the editor's boss, not even necessarily by someone in the same building as the editor, but by someone in charge of running the warehouse. There's usually some consultation, since anew book about to come out may boost sales of the old one, but all too often decisions are made in a rush, and the editor may not hear about them until it is too late. Sometimes, too, the publisher simply runs out of stock and then decides not to reprint, and by the time the author learns of this, there are no books left. Should you ever be notified that a book is going OP, buy as many copies as you can, especially if they are being sold at cost. And use them at events, and remember that book, but don't mourn it. Go on and write another.

The situation is daunting. What should a writer or illustrator do? It is certainly more difficult to get a hardcover children's book published now than it was five years ago. But it's never been easy to get published. Let's say the odds were 20 to 1 against you five years ago. Now they are 30 to 1. If you didn't give up then, why give up now? So what can you do? My advice, as is required in all keynote speeches at writers' conferences, is simply this: keep working at your writing or illustrating. If it's good, make it better, and if it's wonderful, make it amazing. Don't ever stop growing. This is old and extremely cliché advice, but still true. Keep believing in the power of books. If you take one thing away from this, I hope it will to be cynical about publishing, but NEVER about books.

But this traditional advice is no longer enough. I believe you also need to learn about the business, from Publishers Weekly for industry news, from the review magazines, from conferences, and from on-line resources. Visit my site to find out about them -- I've not only got copies of my articles and other information, but links to sites of interest -- as one example, I've found a site that archives and indexes press releases from publishers. Learn how the economy affects what publishers do, remembering that it's easy to see publishers as a sort of force of nature doing things to you -- but even larger forces affect them. Much as we would like it to be different, the selling of books is as subject to market forces as the selling of vegetables. As a result, downsizing, computerization, and consolidation are just as much a feature of publishing as they are of other industries.

Learn how politics affects what publishers do, and act on what you learn. The conservative "revolution" that demanded the tax-cutting that lead to cuts in library funding has had some unintended effects, Goosebumps being one of them. When the traditional market of schools and libraries started to shrink in the mid-80's, publishers could not continue to publish the same kinds of books for the same markets. They looked for new markets, or existing markets with more room. The market for mass-market series was one of them and Goosebumps was the result. The lateral shift toward paperbacks and alternative book products is very striking -- almost all children's publishers now have a paperback line, which was not true even ten years ago. Many have started TV tie-in lines and imprints intended to reach beyond the fairly small percentage of children who are serious readers. So if you want to see more books in our libraries and schools, if you want publishers to publish more quality hardcover books, let the politicians know that schools and libraries need funding. Speak out against attempts to remove or ban books from our schools and libraries. It could be one of yours someday. Work to increase library funding.

Children's book publishing is a business, and it doesn't operate in a vacuum. You do not live in a vacuum. You live in a community. Get together with other writers and illustrators and do your best to exert influence. If the mining companies and the health maintenance organizations can influence politicians, so can we. Help make this business more like the business we want it to be. Thank you.

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