Optimizing the Book Supply Chain

By Ralf Schlozer / Published:

Books are one of the most prominent print applications and did well even during the pandemic. Still, there is considerable potential to optimise the supply chain, and who would be in a better position to know than a book distribution company?

I took a look at Libri, one of the largest book distributor and wholesaler in Germany. Founded in 1928, the company delivers to book shops as well as large online retailers as Amazon and Thalia. In addition, the company provides logistics services, stocks books and has an inventory control system. As a book distributor, Libri saw the opportunities in printing books on demand in the run of one and feeding those directly into the supply chain. Libri developed the concept for Books on Demand (BoD) in 1997. This led to the founding of BoD as a printing subsidy in Norderstedt, near Hamburg, in 2001.

In its more than 20 years history BoD grew to a sizeable enterprise. With 200 employees the company is active in 9 countries in Europe, although the main focus remains in Germany. The company produced about 5 million titles in 2020, most in the run length of one. Occasionally, short runs are produced as well, e.g. if self-publishers are ordering a small run or if sets of books need to be taken to a reading where they should be available immediately for sale. BoD achieved double digit growth rates in the number of books printed in recent years.

Coincidentally, BoD has about 5 million titles stored electronically and ready for print. Customers are in equal shares authors (including self-publishing) and publishers. About 55,000 authors are listed and 3,500 publishers.

In its print operations BoD relies on Trivor roll-fed inkjet printers from Xerox for the bulk of the titles. Finishing is automated with Hunkeler book production lines. BoD owns a fleet of cut-sheet monochrome and colour toner printers as well.

Most of the books are printed in black & white. BoD offers colour printing in addition, with most colour books printed on toner printers today. Colour print with inkjet is offered as well, but the quality demonstrated is noticeably lower and only lends itself to textbooks. BoD expects that with the improved quality of the latest generation of inkjet printers it will invest in colour inkjet printing.

The expansion of BoD is moving into a new phase now. With Plureos, Libri and BoD are launching a new brand to bundle their on demand printing activities. This is now the common platform from Libri and BoD for on demand book production.

At the same time the BoD print production is moved from Norderstedt, in the North of Germany, to Bad Hersfeld, strategically located right in the middle of Germany. Bad Hersfeld is also Libri’s main site for book distribution in Germany. This allows feeding books printed on demand directly into the book distribution logistics of Libri. The companies expect to slash transport costs and times while improving the environmental footprint at the same time. At the moment BoD is gradually moving its equipment to Bad Hersfeld without interrupting daily operations. It is expected that the move is completed in 2022.

Moving the plant has considerable order time advantages. Currently it takes three to five days from ordering a book to having it delivered to the reader. With moving the printing operations the plan is to have softcover books ordered until noon being delivered on the following day. Hardcover books, which are offered as well, will still take three to four days due to the more complicated binding. It is planned to automate hardcover binding as well, to bring down the time needed for this type of books.

Customers ordering a book, whether from online retailers (like Amazon), in a book shop, or any other channel will not notice whether a book is from stock or has been printed on demand. Print quality and binding is almost identical. There are some limitations by BoD however on available book formats, papers, cover effects and special finishing. 10 formats and 4 types of papers are offered currently. Special effects on covers are out of reach. The maximum number of pages is limited to 700 pages as well.

Apart from printing services BoD also provides a raft of services for authors and publishers.

  • Services for proofreading, editing and advice on writing
  • Preparation of e-books
  • Allocating ISBN numbers, listings for available titles
  • Design services, e.g. cover, type layout, illustrations
  • Various marketing activities

Libri and BoD also operate their own online shop for books. All helps to get aspiring book writers started and offers them an easy entry into book publishing and selling.

Having a look at the BoD online calculator can be an interesting exercise (although only in German). Depending on the product specifics (page count, format, finishing, paper type) a recommended sales price is calculated, including the margin for the author. After cost of print and distribution as well as retail margins and VAT are deducted, typically a margin of 10 to 15% is recommended, although the author can modify the sales price. Selling via BoD’s own online shop results in a margin that is about 6% higher, an incentive for authors to use BoD as online retailer. For example, a 300 page book in A5 format is suggested to retail at €9.99 (US$ 11.60) resulting in a €0.94 margin for the author in bookstores. The prices and margins are calculated for authors – publishers, especially larger ones, are able to negotiate their own rates.

The book production BoD and Libri set up is a very efficient way to produce and distribute books in the run of one. Taking care of all logistics makes it hassle free for publishers and authors alike. While the print costs are higher than for conventional print runs of thousands, taking out stock, administration, returns and avoiding tied-up capital makes it worthwhile for many titles, especially the long tail or slow selling titles. There is some room to improve for example by removing some limitations in cover design and page count. High quality colour at lower prices would be advantageous as well. Still the opportunities for further growth are excellent.

Share
About the Author

Ralf Schlozer

Ralf Schlozer is Independent Print Analyst. Ralf provides analysis, sizing and forecasting the market for digital printing technologies and associated applications and business processes. Connect with Ralf on LinkedIn

Leave a Comment