Like all retail trades, successful bookselling depends on three crucial factors. First, the ‘mix’ between up-market and down-market mass paperbacks of sex, violence and romance that would cater to a wide crosssection of readers. Second, visibility or display: it isn’t just enough for the spine to be seen because books have to be seen before they are bought. Third, easy accessibility to the neighbourhood bookshop because we loathe to travel long distances just to buy a book.

Prices have often been cited as an inhibiting factor but more than prices it is the terms of trade between the publisher and the distributor that becomes inimical to a rapid turnover of stock. What are the usual terms of trade and how do they affect the nature of bookselling in India?

The publisher gives the retailer books at one-third the published price with a credit of 60 days and full guarantee to take back unsold stocks within the stipulated credit period. But there are always exceptions, where both discounts and credits could be extended, depending on the quantity bought and the terms of payment: the higher the quantity the greater the discount, especially if payment is made against delivery. Some publishers would say it is the special arrangements that govern the terms; the usual rules no longer apply in the majority of cases.

Booksellers are interested in making money, so what do the general terms leave them with? The pat answer would be 33 per cent on every book sold, which would be adequate return for the capital invested in stock. But, in actual practice, the sums don’t exactly work out that way. First, the bookseller’s overheads — establishment costs, which include rent, staff salaries, power and other incidentals. Will 33 percent be enough to cover these expenses? Invariably no, but let’s assume it is enough to break even with a little left over.

But there are two other hidden costs which cut into the meagre profit at the end of day. First, not every copy bought is sold; the profit is made only if the entire stock is sold, that is, down to the last copy. Quite often this doesn’t happen because no bookseller can anticipate how many copies will be sold.

This is just one half of the story. Most sales are now made to institutions, not individuals. Institutions demand discounts — a minimum of 10 per cent, going up to 25 per cent — with few other ‘considerations’ at the time of payment. This practice is now so widespread that leading booksellers or distributors have their own blacklist of librarians to whom they simply do not supply, whatever the size of the order. And the blacklist includes a number of central universities and leading institutions deemed to be universities!

What does this leave the bookseller if a proper accounting is done? A profit of just 5 per cent which isn’t enough to keep going. So, what does the bookseller do? There are two choices: either shut his eyes to all the hidden costs or buy at the highest discounts, hold back payments to publishers till the next indent is placed.

Every bookseller knows that hidden costs cannot be hidden for long; cash flow problems will crop up sooner than later, which will affect business. So, he goes for the next best option: buy at huge discounts — often at 60 per cent and over — even if this means remaindered stock from wholesalers. He mixes these with some new books to give the appearance of being there.

Booksellers survive by the skin of the teeth by mixing and cutting their overheads down to the bone.