Biblio Announces New Pricing Schedule
By Michael Stillman
The third largest old book site on the internet recently announced a new pricing schedule for its dealers. No, it is not a simple price increase. It is an option. Biblio now allows its dealers to choose from two pricing schedules, and for some of them at least, it could mean a price decrease. It all depends on how the dealer sells.
Biblio, in the past, has worked on a straight commission schedule. You pay 15% of sales up to a certain point, 7.5% on sales over that level (the threshold depending on how many books you list). Nice and simple, and no cost if you make no sales.
Biblio has retained a commissions only structure, but has now added a combination commissions and flat fee option. That is option, not requirement, as sellers may remain on a risk-free commissions only structure if they wish. The use of a combination structure is one that has gained popularity among the selling sites. Abebooks previously moved from a flat fee only to a combination structure, and now Biblio goes to a (optional) combination structure from a commissions only structure. The popularity of a combined fee schedule by the sites makes sense. Commissions allow them to participate in the success their dealers enjoy on their sites, while flat fees provide a predictable, guaranteed flow of monthly income. Both are important to any business.
Biblio's two structures work this way. Plan A is a flat 15% of sales. This is not quite so favorable as the old commission structure, at least for those with higher sales. The old formula was 15% up to a certain level of sales (based on number of books listed). After that the rate dropped to 7.5%. Now, it no longer drops.
However, larger dealers can opt for Plan B instead. This adds a flat monthly fee, ranging from $10 for up to 10,000 books listed, to $25 for 40,000 books listed, plus $5 per additional 10,000 books. Under Plan B, all commissions are at the 7.5% rate. None are charged at 15% any longer.
For the smaller dealer, there is effectively no change. Those who did not sell enough to reach the cut off rate where commissions drop from 15% to 7.5% can choose Plan A and they experience no change at all. They pay the same 15%, including zero if no sales are made in any given month.
For larger dealers, the structure actually offers a price reduction! When was the last time you saw that? For example, under the old schedule, a seller who listed 25,000 books, and made $300 in sales ($300 being the cut off between the 15% and 7.5% rate) would have paid $45. Under the new formula, that dealer pays a $20 flat fee, plus 7.5% of his $300 in sales, or $22.50 in commissions. His total is now $42.50, versus $45 under the old formula, a savings of $2.50. Since both structures charged 7.5% on sales above $300, that $2.50 savings will remain no matter how much larger his sales might be.