Read Before Signing
With authorship comes the need to put your pages in front of as many eyes as possible. What's the point of publishing if you're the only one to read the book? So you advertise it on facebook, twitter, minds, gab, instagram, EVERYWHERE, but that's not quite enough unless you already have a following. Things aren't moving as fast as you would like. So you turn to traditional bookstores to try to sell a few copies. That's when they hit you with the consignment contract, BAM, in your face, and you have no idea what the hell any of this is.
Here's my biggest advice to you:
1. Measure your expectations. Be realistic.
2. Read the whole contract all the way through and ask for clarification (in writing) if any part of it is unclear.
A consignment contract is basically just a piece of paper that says the store will sell your book for X months, at Y royalty, for Z fee. This is a legally binding contract and you must follow it or risk legal action. It essentially rents their shelf to you so you can sell your book in their store. As with any contract, comes the possibility of bamboozling, advantage taking, and dare I say, scamming. So, here are a few red flags to watch our for initially and some other things to take into consideration when looking over a consignment contract.
Insurance/Possible Damage/Theft
A lot of the contracts I've looked at have maintained that the store bears no responsibility for the damaging or theft of your book while it's on their shelf. This means that if they dub the book sufficiently damaged, they can just throw it away without informing you and whatever investment you had in the book is now in a landfill up the road. This might be a risk you have to take, that the book may be damaged and removed, as most stores don't want to hold the bill if one of their customers rips a few pages out. You should not accept any contract that refuses to accept responsibility in the case of theft, however. This will be particularly relevant with smaller stores. I've read a bunch of cases where a book was sold legally, but when the author went to pick up their share of the sale, the store manager informed them it had been stolen, not sold. You should also contractually request that any damaged copies of your work be set aside to be returned to you rather than disposed of. This may take some negotiation and I recommend walking into the store to do said negotiating. Managers are far more likely to discuss alternate contracts if you're face to face rather than over email.
tldr; Require theft protection as a key point of the contract. Don't let them throw away copies of you book at their discretion.
Short Contracts
I've run into several contracts that were written for only a month at a time. If you intend on placing your book in multiple stores, I highly recommend avoiding contracts that last for less than three months. With only a handful of stores, it can become a huge challenge to upkeep consignments when you have to physically go to each individual store to check up on your work, deliver books, and pick up unsold products. Try to get four to six month contracts and negotiate for longer ones in stores that you would like to get into but who's base contract only offer a month or two at a time. This way you won't be running around like a mad-person every day after work trying to keep up with the workload.
tldr; Request consignments over four months or over. OR manage your time efficiently so you don't get overwhelmed by short contracts.
Unfair Royalties
Remember going into this that the book store needs to turn a profit or it's totally pointless for them to host you. Charity is a great thing, but it's rare in this world. You have to play off of their desire to make money. The majority of the contracts I've seen split the royalties on a book 30:70 or 40:60 in favor of the author. There have been a few that want 50:50 or even 60+:40- in favor of the store. Negotiate for the best split possible in all cases. Even if they already offer a good split, push for a better split. Sometimes they will allow it without further discussion. Don't request free shelf-space, be fair and courteous to them, and remember that they need to make money too. The best I've managed to get is a 20:80 split in my favor at two stores. Do NOT take a split under 60% of the profit. It will be near impossible to turn a profit that way. If a company refuses to negotiate a bad split, you need to do the following:
Get up.
Walk out.
You're nobody's bitch. You put in the effort to write your book, you deserve profit. If a store will not negotiate a fair split with you, it's their own fault for losing out on getting a foot in the door on the next big bestseller.
tldr; Don't take a royalty split under 60%, negotiate for better splits in almost all cases.
Insane Consignment Fees
As I said above, the business wants to make money, as they all do. So, naturally, most places will require a fee to shelve your book at the beginning of the arrangement. This is totally normal and fair. The guy putting the book on the shelf and running the register needs to be paid, after all, and they can't be sure the book will actually sell to refund that cost of business. The best consignment fee I've seen (besides a few places that would shelve me for free if I proved I was a local author by ID) is $25/6mo. That's $50 per year to have your books in their store, which is pretty good if you're selling well. The most insane fee I've seen was a whopping $120/5mo. You would have to sell a LOT of books to make that back. Incidentally, the same place that required the huge consignment fee also had a terribly unfair royalty split as well.
If you're not sure what the fee covers, here's the usual list:
1. Shelving. The physical act of putting the book on the shelf.
2. Sales. Selling the book to customers.
3. Shelf Space Rent. The space your book takes up could be used for other books.
There are a few other things that this fee covers, but it depends on the contract. Some companies use it as insurance on the book(s). If one is stolen or damaged, some places will give you a share back out of the consignment fee. If no books are damaged, they keep the fee for their effort. This is a fantastic bridge between having no insurance at all and being fully covered for losses. It could also cover promotions, as some places will advertise you after you sell a handful of copies on an aisle head or something of that nature. This is less likely for a starting contract, but it has been in a few I've seen.
tldr; Get a fair consignment fee that will easily be covered by sales in the time frame discussed in the contract. The acceptable fee will change depending on how many sales you can get.
Ridiculous Advertisement Provisions
Many of the contracts I've read have required, not requested, representation for their business in ALL of your social media and promotional material relating to the book you are placing in their store. This can mean a variety of things including the following: Link to their site in all biographies on all sites, link to their site on all posts pertaining to the book, their web address or phone number on your business cards, their web address on all promotional fliers/posters/popups, and representation on your personal website.
You want to clarify, in writing, exactly where you are obligated to advertise them before you sign the contract. Some placed might just ask for a shout out when you post telling people to go buy the book. Others may request all of what was listed above, and more, bordering on total invasion of your social media. This can be a huge sticking point and you should only do what you are comfortable with. If you really like the store or it is your main marketplace for your book it might be alright to agree to more invasive advertising, while if it's a side store you're putting your book in for the hell of it, you probably won't want to have to advertise them on everything all the time.
You might brush over this aspect thinking it's a minor agreement, but you MUST remember that this is a legally binding contract. If you agree to some tyrannical advertising and don't hold to it they can void the contract, keep your books, and even take you to court if they think they aided you more than you aided them. Pay close attention to this and don't agree to anything stupid.
tldr; Carefully consider how much you want to be advertising every store in which your book is shelved before agreeing to posting links to store sites.
The Back Shelf
I want you to physically visit the store before agreeing to anything and check out their layout. Ask them before signing where your book will be placed in the store. A lot of stores have a special shelf for their consignments, a special shelf in the back, behind the air handler, with a ladder sitting in front of it and a water leak from the ceiling dripping into a bucket. Don't accept this terrible arrangement and negotiate for better placement. Just disagreeing and requesting a different location can be enough to get them to place your book alongside established authors and their usual stock. Never forget the worth of your work and don't accept unfair treatment.
tldr; It's one paragraph, just read it.
The Dollar Paperback Bin
Finally, establish up front, before signing anything, what the set price will be for the book. Come in prepared, know exactly what it will cost you to order each and every book you plan on placing in their store so you can price for profit. You'll need to take into consideration the split and whether that will cover the cost of the book, and then how many books you will have to sell at that rate to cover the consignment fee. NEVER let them claim independent pricing rights for your book. Chances are it'll end up at half the price you paid to have it printed and shipped. To determine a profit margin based on split, use this formula:
([Your split in %] x [Sale Price]) - [Order price]
This in use would look like this: Assuming a 70:30 split in your favor, you'll make 70% of a sale, or .7. At a sale price of $10.00, this is $7.00 profit. Then you subtract your order costs from that to get your actual profit. So we'll say it costs $5.50 to print and transport your book. This leaves you with $1.50 profit.
(.7 x 10.00) - 5.50 = $1.50
To then determine the number of books you would need to sell to cover your consignment fee, just divide your consignment fee by your profit. So assuming a $35.00 consignment fee, it would be 35.00/1.50 = 24 (rounded up). So you'd need to sell 24 books from that store over the course of a consignment period to break even, any book sold over that number will give you a profit of $1.50 each.
I know math sucks and as a writer you hoped never to do it again, but it's important to know EXACTLY where all of your money is going and what money is coming in to know if you're being ripped off or not. Practice the math a few times, learn how to punch it into your phone calculator quickly on the spot, and know how to ask for better numbers.
tldr; Learn to do the math to calculate profit while considering all costs and don't let a store set the sale price independently on your work.
Thank you for reading! I hope this helped at least one person to understand the annoyance that is the world of consignment contracts.