Selling Books for a Penny
Earlier this month we pondered the strange Internet phenomenon of penny-book sales via Amazon.com, and reached the conclusion that penny books might be less a business model than an unintended consequence of a business model.
One reader begged to differ, contending that our argument really applied only to small businesses. And he knew what he was talking about, seeing how he was the president of a Seattle bookseller that sells more than 1,500 books a day on average, with perhaps 30% to 40% of those going for a penny.
“We’ve been trying to find the most-efficient way to list the most books in the least amount of time with the least labor,” says Hector Rivas, president of Thriftbooks.
Thriftbooks’ weapons in that battle are technology, a willingness to experiment — “we’re young guys learning from our mistakes,” Mr. Rivas says — and those very economies of scale that we didn’t think were such an asset in the penny-books world. But that said, a quick tour of Thriftbooks’ business model only reinforces many of our initial conclusions: Penny books are a savagely low-margin business with little room for error, and not a good business for the little guy.
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