I Asked You About Who Pays For Shipping In The Direct Market



Last week I asked CR readers several questions about comics. Here is one of those questions and some of the answers we received.

QUESTION FOUR: Here's a basic question about the Direct Market. Who pays for the shipping on the delivery of comics? Is shipping an explicit or implicit cost?

Ty Buttars: I've seen a couple of my LCS' invoices and the shipping is added to the total.

Jamie Coville: Retailers pay for shipping to their stores. It's a constant quibble between Diamond and retailers as Diamond has a weird way of charging for shipping. Their bill will be for the previous weeks shipping bill or something like that, I don't know any retailer that's fully figured it out. As a result some conspiracy theories pop up now and then. It is believed that Diamond gets bulk discounts and pass on some of it to retailers in regards to cheaper shipping costs. New retailers (or those with bad credit) get their books shipped to them C.O.D. paying for books and the shipping every Wednesday morning prior to being put out on sale. It can take a while to get a line of credit with Diamond. And just for your education if a retailer signs up with Barnes & Noble and their First Look program, they get books shipped to them for free if they order enough books. Diamond gives 45 percent discount, then knocks off a 3 percent reorder fee if it's a reorder (making it approx. 42 percent), then charges for shipping, which can make their discount 40 percent or less. B&N charges 40 percent with free shipping and gives limited returnability. It's one of the reasons some retailers sign up with bookstore distributors, plus they have books in stock that Diamond is often out of. Hibbs used Understanding Comics as one example that's often out of stock as it's no longer published by DC.

Dustin Harbin: We pay shipping, which is one of the biggest strictures in ordering timing. Not just for Diamond -- for instance, I could order a few items I could use extra of from today's invoice, or things people special ordered since yesterday, but I have to hit some kind of critical mass to justify the shipping. Multiply this by several orders of magnitude for direct ordering from non-Diamond distributors, especially on the West Coast. I tried for a couple of years to order from Cold Cut, but the shipping cost and incredible lag time between ordering a book and having it in hand made it a waste. This is why Tony Shenton will never be profitable, as long as he doesn't warehouse books and ship and invoice as a single entity, rather than as a middleman. It's just too much to think about. On the other hand, for individual items, it can be cost effective. I'll get a way better deal by ordering Kramers 7 direct from Alvin, especially as I'll likely order 10 or more, and because of the "special"-ness, no one really cares about if it gets here tomorrow or next week.

Brian Hibbs: To retailers? The retailer. In theory Diamond is passing their volume discounts onto the individual retailer, though "pretty much everyone knows" that shipping costs are a clear profit center for Diamond. It is explicit. To Diamond, the publishers pay, unless they print at one of the printers that Diamond picks up at... in which case I think Diamond is footing that bill.

Matthew Maxwell:Regarding shipping: Retailers pay for shipping from Diamond's warehouses to their stores. I understand some still pick up the books from Diamond themselves, if they're close enough to "enjoy" that luxury. From the publisher side, they're responsible for costs to get the books to Diamond, with a caveat. Quebecor and Lebonfon both have arrangements with Diamond that allow for regular deliveries to the Diamond warehouses for the initial shipment. One would assume that it would count for warehoused copies as well, but in my case, I warehouse the leftover copies at my house in lieu of paying Lebonfon $50 a month to hold onto my stock. I'd also assume that said cost isn't actually "free" but is built into the price that they charge for print jobs.

Robin McConnell: Retailers pay for shipping as far as I know. There have been issues around that, such as when a publisher decides to add a considerably large ad such as a bonus book of ads in a sealed bag, retailers are choked at the increase in shipping costs for something that they have no control over.

Tim O'Neil: Retailers pay all shipping costs for comics. Which is why they get seriously upset when companies put things like CD-ROM inserts or what have you in their comics, because they have to pay for it. Also why returnable books are often more of a hassle then they're worth in the DM.

Dave Rose: Unfortunately, in the Direct Market, the retailers pay for the shipping on the items they order. I say "unfortunately" because this can considerably reduce their profit margin -- depending on their sell-through.

Patrice Roy: I do not have answers to all of your questions, but I did self-publish through Diamond in the 1990s at some point. I live in Canada and I was the one paying for shipping. Since the publisher pays all costs up until it goes through the mail to Diamond here and there around the world, self-publishing in paper format is a very costly endeavor (unless you sell lots), as shipping is the highest cost activity in the publishing cycle after printing. When I go back to self-publishing, I'm going to avoid the paper format and I will do it through the Web.

Jason Thibault: We the publishers pay to ship to Diamond. If we ship to one location, they'll take two percent off the entire order to distribute it to their other three-four warehouses. So instead of 40 percent of cover price, they'll issue a check for thirty-eight percent. I believe the comic shops also pay for shipping for their orders from Diamond. Brian Hibbs has mentioned it enough times in his column so it must be the case.

Chris Rice: Whilst it's not exactly what you asked, I just thought I'd mention that things are a bit different in the UK, when it comes to shipping costs to retailers. Shipping is free from Diamond UK within mainland UK, as long as the order comes to more than £250 (I can't remember if it's cost or retail -- which is a bit bad as I work there!). If it's under £250, or if you want a timed delivery, we charge standard rates for the couriers we use. The same goes for International accounts.
 
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