Answer to the Foregoing Statement

Answer to the library Committee on Relation with Booksellers, as proposed by Charles E. Butler, Brentano's, New York.

1. We agree that the relations between librarians and booksellers should be on a business basis, and that there is no question as to the desirability of improving the condition of the book trade.

2. We are in hearty sympathy with the desire of the libraries, that a careful and just consideration should be given to their claims for better discount as large buyers collectively of a special character.

3. It is the most earnest desire of the book trade to be absolutely fair and just toward the libraries. We fully and most sincerely believe that the libraries would not for a moment desire or expect that their purchases should be made at the sacrifice of a trade, whose very existence depends on what reasonable profit can be made by them in their business transactions.

4. The libraries believe that the booksellers can make better discounts than they do now, if they carry on their business along the lines indicated by them, while the booksellers claim that the present condition of buying and selling prohibits them from making a profit, but is actually productive of loss, and that the method proposed by the libraries is not possible.

5. The booksellers are of necessity the agent of the publisher. If his business is not self-sustaining, he must fail. The reduction of real booksellers, by a most liberal construction of what constitutes a bookseller, from about 3,000 when our population was 40 millions to about 2,000 with our population at 90 millions, is evidence of the truth of this assertion. The booksellers are entitled to sell to everyone who buys books, libraries or others.

6. The libraries are not booksellers, therefore they are not entitled to booksellers' discounts, which they are now getting from certain sources. Thus, booksellers are deprived of the library business.

7. The bookseller is an important factor in any community in which he is placed. He is taxed by city and state. His educational influence cannot be estimated. His capital, his brains and physical effort are all invested in making his business a success. To do so, he needs reasonable profits, and it is business folly to do any part of his business that results in a loss.

8. A great majority of the libraries are created and supported by direct taxation, by charitable contribution, endowment, legacies and the like. It is true, the libraries have to be conducted in a careful, businesslike way simply keeping within their means. Doing this, they are free from the booksellers' anxieties and difficulties as a merchant.

9. The unique position enjoyed by libraries in the community as to their capital and freedom from commercial risk, and exemption from taxation and rent, has raised the question: "Why should they receive discounts on books?" Do they, as libraries, get special discounts on their building, their shelving, light, heat, electricity and supplies, etc., etc.?

10. The libraries state that in booksellers dealing with libraries many of the largest items of the expense involved in the conduct of the retail business are wholly unnecessary.

"It can be conducted as well by dealers on back streets or in lofts as it can be done by those who have the most luxurious stores to attract the retail trade; it does not call for the advertising of their wares by the dealer; all skill of salesmanship is eliminated and no accounts have to be charged off because of failure."

11. The bookseller establishes himself in every community, in such locations as will attract trade—generally the best—limited only by his capacity to pay rent and expenses. This is vital to his success. A bookseller locating himself on a back street for the purpose of doing business to enable him to give the library a large portion of his small earnings would speedily end his career. He could not get enough library business to exist on and his chances of doing a general retail business, on a back street, would be very small indeed. He would become solely a 25 per cent or 30 per cent buyer, 10 per cent which he gives to the libraries, with a possible 28, 25 or 20 per cent expense account. We do not believe that the libraries would knowingly ask anyone to do business under such circumstances for their benefit. Will the libraries figure this out?

12. Presuming, for the sake of argument, a bookseller does locate himself on a back street for the purpose of doing library business: He must be a bookseller to get a wholesale rate. A mere agent not carrying stock, but simply buying on orders, would not be supported or supplied by the publishers, as he does not carry stock or assume the risk of the business.

13. He would therefore have to carry a reasonable amount of stock to be considered a bookseller. The libraries may not know that the discount given the bookseller is qualified by the quantity purchased of each item. Thus, the average trade discount now prevailing on net books and net fiction is 30 per cent in small quantities. If he purchases 10 to 25 copies of a title, he gets an extra 5 per cent. If he purchases 50 to 250 of a title (according to the publisher and the book offered) he gets an extra 10 per cent. The libraries familiar with this discount, and being misguided as to the results, argue that a better discount than they now get should be given them by the bookseller. We have not included here the great number of books published at such discounts as 25 per cent, 20 per cent, 15 per cent, and even 10 per cent, to which must be added transportation and other charges. More of such books are bought by libraries than by the retail buyer, such as educational books, scientific books, medical books, law books, subscription books, etc.

14. Now this is what really happens to the man on the back street, as well as to the bookseller on the principal thoroughfare. It is safe to say that out of the purchase of 100 new books of any one house, say for a period of a year, about 90 per cent would have to be bought in small quantities at a discount of 30 per cent, about 5 per cent at the extra 5 per cent discounts, and 5 per cent at the extra 10 per cent discounts. Thus, buying 90 per cent of his stock at 30 per cent and selling to libraries at a discount of 10 per cent leaves 20 per cent to do business, with an average expense cost to the bookseller of 28 per cent on every dollar of sale. The 10 per cent at better rate would improve matters very little, as can readily be seen. It does not seem as if the bookseller could make better discount than he does to the libraries and it really is a question whether he is justified in giving as much as he does now, if able to give any at all, except at a loss to him.

15. The theory has been advanced by the libraries that all their business should be considered by booksellers as an independent element in the business and not chargeable with the 28 per cent cost per dollar of sale, but that the library business should be charged with a much less ratio of expense, thus enabling the bookseller to gratify the desire of the libraries for a further discount. They base this proposition on the following claims:

The facts are that the smaller libraries, and to some extent the larger libraries, are constantly supplied by publisher and bookseller with circular matter regarding new and forthcoming publications, letters and personal visits as to special publications, as well as sending the new books, as issued, on approval, at considerable cost and trouble, and some loss of sale, because books are not available for display to possible buyers who visit the dealer's place of business. The proper handling of library orders to any reasonable extent requires skilled clerks with good knowledge of books, the use of catalogs and the ability to work out titles correctly that are incorrectly given, and which is so often done. It is true that no accounts have to be charged off, but library accounts require much care and trouble in making duplicate and triplicate vouchers, many have to be sworn to before notaries, in some cases depositing money as security that goods will be supplied at prices quoted, and generally a long wait before the bills are paid, and many minor troubles annoying to both libraries and dealers.

16. As a business proposition, the making of a library department a separate one from the business, and determining its exact cost of maintenance, and basing the library discount thereon is not feasible, for the reason that the bulk of its operations are so interwoven with the business, requiring the assistance of the entire force at many stages that it would be impossible to pick out and determine what each operation costs. Again, the profits and loss of a business can only be finally determined at the end of the fiscal year, when the stock is taken, and the books closed—a very anxious moment indeed for the bookseller. He then knows, to his joy or sorrow, how much it has cost him to make one dollar of sale, and what profit or loss he has made on each dollar of sale, on every class of merchandise he has sold, the library trade included. This percentage of sale is his guide for the following year, and as a good business man, he must eliminate every class of merchandise he sells that does not produce some profit. No business can work successfully otherwise.

17. The following table will show the various ramifications of a special library department in the business, if carried out as proposed. What suggestions would the libraries make in a case like this?