First, a brief amount of background. The United States is in a recession at the moment. There is talk that there is a global recession (may I point to the example of the entire country of Iceland going bankrupt?). Recessions are, by their very nature, bad for business.
Today, both Publisher's Lunch and Publisher's Weekly ran articles about how HarperCollins' operating income for their fiscal first quarter (ending in September 2008) was down to $3 million from last year's operating income for this quarter of $36 million. The Publisher's Lunch article, said the following (quote in bold):
"due to a higher returns provision in North America combined with lower third-party distribution income" according to the release. (This quarter last year they profited from distributing Harry Potter for Scholastic.) CEO Brian Murray explained to us that the returns provision was related to their accounting (and reserves against sales of new titles) rather than associated with any particular set of titles or accounts.
What's even more telling, however, is that their overall sales are down to $315 million, which is a total drop of 4.5% from last year. The article goes on to explain how HarperCollins has taken preventive measures, by scaling back on print runs and doing other business related things. The most important fact, however, is that they're just not selling enough books to match what they sold last year. This, by the way, is with both Oprah's recent book club selection at the company, and the recent release of THE GRAVEYARD BOOK by Neil Gaiman, who always sells like bananas.
Here's my take on it though: this is just the beginning. It's a recession. People are buying less books. There will be other major publishers who are not selling as much either. Less new books will be bought by publishers in the coming months, because they have less operating capital to buy it with. Agents will make less money because we don't make any money unless we sell something to a publisher for the authors we represent.
We're all in for a bumpy ride.
There are some good things to this recession, and hence, this list. =)
- It will probably take six to nine months for the economy to start to mildly bounce back.
- Six to nine months is a really good amount of time to start writing a novel (NaNo is a great start, people).
- In those six to nine months, you can make your novel so shiny and perfect that when you send it out to agents, they will adore it.
- If you have a novel done already, I recommend you start another! Coming to an agent with multiple novels, which are decent quality, makes you a more marketable quantity once they take you on for the original novel you queried them with.
- To go along with #4, you should KEEP QUERYING AGENTS.
- If you don't query us, what are we going to do for six months? =)
- In all seriousness, your novel can circulate to a lot of agents in those six to nine months, you can get comments back on it, and you may even be able to revise it to make it better, so that you can snag the agent of your particular dreams. (Everyone fits differently with different agents.)
- And finally, just because the publishers are buying less books, that doesn't mean that agents won't still be looking for clients. We want to be prepared for when the book-purchasing money starts flowing again. We'll take you on, we'll suggest our own set of revisions, and we'll help you make your books the best that they can be.