Better World Books: What other dealers can learn from the new model
BWB also makes a well organized effort to contact library systems with a very appealing offer - to take all, repeat ALL, their unwanted books, track the sales and compensate the libraries for any books that eventually sell. Payment is made on a sliding scale that ranges from about 15% for low value books to 50% for books worth $500 or more. All books become the property of BWB and payments are made to the libraries after the transactions have been completed.
BWB also buys books from thrift shops typically at a cost of about four to eight cents a pound.
This integrated model has multiple virtues: It creates tangible benefits for their literacy partners, a cash flow for their library client base, a feel good aura for the donor, and a decent amount of revenue for the corporation. Call it Win-Win-Win-Win. What it hasn't done so far is give them much understanding of their product also known as "books" or make them a lot of friends among the older generation of booksellers.
Better World Books sells recent and older books on their own site www.betterworldbooks.com. It also lists on 22 different on-line locations. The company has two small retail outlets for popular titles, both in Indiana, and they are presently establishing a growing niche in the antiquarian, rare and collectible (ARC) market.
The key to their rapid rise owes much to algorithms, SKU codes, statistical and pricing theory and a systems approach to volume. It's a model that has more in common with processing aluminum cans than the traditional life-of the mind. BWB sees books as a cheap and plentiful commodity. The goal of the bookseller as a corporation is to acquire, process and turn around the inventory in the shortest amount of time. Each sale "monetizes" a small amount of profit multiplied by a very large number of sales.
BWB has 350,000 square feet of warehouse in Mishawaka and about another 80,000 square feet of warehouse space in the UK. In Mishawaka they process the incoming flow of books at the rate of about 100,000 volumes a day. The sorting is largely automated and divides books into pre and post ISBN categories. It also distinguishes between books that come from libraries and books that come from other sources like donation bins and thrift stores.
The determination of what has value happens very rapidly and is done for the most part by computers. Books that do not meet the BWB value thresholds are either shipped to literacy partners or sent by the container load to be recycled for such uses such as paper napkins.
The books come in two streams: boxed books shipped to BWB from libraries are treated differently and somewhat more gently than books from thrift stores and donor boxes. These come in huge cardboard containers known as Gaylords. Books in Gaylords are treated roughly; if they weren't wrecked by the time they got to Mishawaka, what's left after BWB has taken a fast look is, in many cases, waste paper.
Their success with libraries is not surprising given that BWB is one of the few dealers that will take it all. Not only will they take it all, but they will do all the related work too - from supplying the shipping boxes, to listing, tracking the sales, shipping orders, then cutting the checks. The libraries supply the books, BWB does the rest. They do have some competitors, but not too many, as few other companies can make the same offer or do it with comparable efficiency and cash flow to the libraries.