Six Fatal Marketing Mistakes, Part II

January 2001
by Brian Jud

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Mistake #4:
Not Considering Volume & Velocity


Should you print a large or small number of books initially? The answer is, it depends. There are two factors that should be considered when deciding upon the optimum inventory level: volume and velocity.
Volume is related to the quantity of books you have in the distribution network and also on hand, ready to ship in response to significant promotional success. Having too many or too few books in stock can negatively impact your profitability.
A strategy of printing a small quantity of books initially will lower your printing expenditure as well as your carrying costs. There is also less likelihood of having to remainder excess inventory. On the other hand, a short print run will increase your unit costs and reduce your profitability. There is also the opportunity cost of not having enough books on hand to meet demand.
For example, suppose your author appears on a major national television show, stimulating considerable awareness of his or her title. If you do not have books on the retail shelves at that time, it is unlikely that people will return later to buy them. Many of the books you print and ship after their interest wanes will be returned.
Conversely, you could arrange a large first print run, ensuring sufficient stock and lowering the unit cost. However, this requires a more substantial initial investment and increases your carrying costs with no guarantee of a major media event that will stimulat…IBPA Members – Click here to view the full article (login required).

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