Small presses are taking a big hit

It's increasingly difficult for book publishers to make a profit. In order to get a book carried in a bookstore, a publisher must have a distributor, who takes as much as 45 percent of the cover price as a fee. The bookstore can take 35 percent.

That doesn't leave much to cover the costs of layout, design, printing and mailing the book -- the publisher pays the postage to send it to the distributor, and when unsold copies are returned. And let's not forget the author, who usually earns 10 percent to 15 percent of a hardback's cover price.

Short-run printings, around 300 to 500 copies, cost around $5 per book.

A decade ago a small press could guarantee sales of 2,000 books to libraries. Now it's unusual for a small publisher to crack 100. Walk into any library these days and what do you see? Computers. Each computer purchased probably replaces at least 100 books.

Combine this with the 2007 study by R.R. Bowker that showed that the number of readers buying books is decreasing, and the situation for small publishers looks bleak.

The situation isn't much better for large publishers. Publishers once considered a 5 percent profit margin acceptable, because they believed they were preserving literature. Now publishing houses are elements in entertainment conglomerates run by CEOs who view books as products and profits as the chief goal.

Many major U.S. publishers are owned by foreign companies. They function as divisions of larger entities. Most writers whose work can't guarantee a minimum of $50,000 in sales are left to seek out small presses, literary presses, university presses.

For these boutique houses, a work that sells 500 copies is a success. But even that is a difficult level to achieve.

One local press, Carolina Wren Press, has survived by structuring itself as a nonprofit. Instead of book sales, the Durham-based house depends chiefly on grants and donations. This allows it to choose books based on their literary merit, not sales potential.

Carolina Wren Press began as a one-woman operation in 1976. Founded by Judy Hogan, it used grant funding, primarily from the N.C. Arts Council, the Durham Arts Council and the National Endowment for the Arts to cover the cost of its publications.

Its authors published in the finest literary magazines. One of the authors discovered by Judy Hogan, poet Jaki Shelton Green, was recently chosen to be the first Piedmont Poet Laureate.

But Hogan moved on and the press foundered. By 2002, it was on the verge of collapse. When Andrea Selch took over that year, "Carolina Wren had literally $79 in the bank," Selch says, "and so we weren't able to publish anything."

Armed with a Ph.D. in English literature from Duke University, where she studied under the famous, or infamous, Stanley Fish, she brought an outsider's eye and an intellectual rigor. Selch devised a strategy of grant writing, capital campaigns and online books sales to turn the company around.

"In a good year, we could count on $6,000 in programming money from the [N.C. Arts Council], about $5,000 from the Durham Arts Council for general operating support and $6,000 to $7,000 in contributions, including contest fees. Sales, mainly from Amazon and our Web site, brought in $7,000 to $14,000 a year."

This was enough to fund the publication of four books a year and pay each author an advance of $1,000 -- well above the standard for small presses. But recently Carolina Wren's funding was cut. With the downturn in the economy, donations declined. So Selch had to rethink her strategy.

"We're going to cut back to two, possibly three books. We will no longer publish children's books, which I don't know how to sell, and will refocus on what we do best. For the foreseeable future, we will not be able to read submissions. All our publications will come from our two yearly contests, one for a poetry book and the other the annual Doris Beckham Competition for Writing by Women."

Carolina Wren's book sales exceed those of many small presses. Its chapbooks -- short paperback collections of poems -- routinely sell 500 copies. Its full-length books of fiction and poetry sell 1,000 copies.

This audience, built by direct appeals from writers and readers, is loyal and supportive. But the loss of grant money has a snowball effect: Also gone is the income from the books Carolina Wren cannot afford to publish; also threatened are donations from contributors who would be willing to support an outfit that brings out four books a year but not one that publishes only two.

Selch is redesigning Carolina Wren again to address these changes in circumstance.

"I still plan to choose work that challenges, that rips my head off," she says. But she will look into other venues besides hard copy publishing.

"Increasingly, we're going to look into electronic rights. E-books, print on demand, Kindle. That's the future of publishing."