We released our very first book six months ago, at the end of April 2019. We now have eight books in market, our allotment for the year. It seems an appropriate time for an update.
We have headlined this “How to become a publisher” not to suggest that we know the right way to do that but simply to describe our way of doing it. For all we know, it’s the worst way, but we exist, so it is legitimately “a way” to become a publisher. Emulate it at your peril.
We had no experience in book publishing (except writing books) when we launched Sutherland House so we had no idea what to expect in our first year. We assigned ourselves certain objectives. We wanted to sell books, mostly by Canadian authors, on both sides of the border. We wanted to earn more through book sales than we spent making books in the course of our first year. We wanted our activities to appear sustainable enough that a second year was not foolhardy.
We had no idea if those objectives were achievable, although we did get some excellent guidance from our friends Jack David at ECW, Anna Porter (formerly of Key Porter Books), and Tim Inkster of The Porcupine’s Quill. That’s Jack looking impish, as per usual, above.
Thanks to a small amount of notoriety from our previous career in magazines and newspapers, we were able to attract a smattering of media attention around the launch of Sutherland House. Journalists and editors seemed amused that anyone would launch a book publishing concern in this age. “Are you going to build a darkroom, too?” laughed one.
But we had done some research. Book sales have been stable across North America over the last decade. To the extent hardcopy sales are down, ebooks and audiobooks are up (and there is money to be had in all formats). The young buy and read books. Book prices are stable. We felt that a stable market (a growing market, of course, would be better) was fine for our purposes. We were accustomed to the rapidly declining markets of print journalism.
We limited ourselves to non-fiction books (above) for a variety of reasons. It is our area of expertise. Non-fiction is a healthier market than fiction. Prices tend to be higher. Most publishers are keener on fiction than non-fiction, especially in Canada so there seems to be more room for us in the market.
We also concentrated on non-fiction in response to recent challenges in book marketing. Through most of the twentieth century, there existed a great infrastructure for the marketing of books: each city had several good independent bookstores, one or two newspapers with book editors and book reviewers, and local TV and radio shows that would cover books. A large publisher, say, Random House, could push a diverse array of books into this system and then send its authors from town to town on a book tour, signing books and meeting the public in bookstores, and answering questions for local media. And the books would sell. (It was actually more complicated than that but you get the idea).
That infrastructure is now blown to shit. Most of the bookstores are gone, most of the newspaper book sections are gone, as are most of the intelligent local TV and radio shows. The book-reading public, no longer accessible through the old intermediaries, is fragmented and scattered. Today, a publisher needs to search for the right readers for each book through discreet communities of interest—romance fans, history buffs, yoga fiends. This is accomplished primarily through the internet. The more specialized a publisher, the better he or she can expect to know the audience for his or her books, and how to speak to it.
So that is another reason we only publish narrative non-fiction: so we can better target our audiences. And by narrative non-fiction, we mean true stories of history, biography, current affairs, business, etc., written for general audiences (like the great stuff above). We don’t do cookbooks or guide books or conventional self-help. Some experienced publishers tell us we should open ourselves up to greater variety. They may be right, but we’re not convinced so, for now, it’s narrative non-fiction.
The first thing we needed to get Sutherland House moving was manuscripts to publish. A publisher is nothing without product. The initial media attention we received brought us a small flood of manuscripts from authors, some of whom we knew, others we did not. We chose six we thought had a good shot of finding an audience both in Canada and the U.S. A seventh was for Canadian audiences only, Conrad Black’s Canadian Manifesto, but we felt it would do well enough in Canada that we need not worry about a U.S. sale for it. The eighth was a reprint of Bernard Crick’s biography of George Orwell, which we’ll explain later.
We made the selections ourselves, meaning Ken Whyte in conversation with employee no. 1 (above, demonstrating our handy new book truck in our worldwide headquarters) and Matt Bucemi, employee no. 2. We have no investors or partners to answer to, thank christ. (We agonized over that one for a while. We could have raised more capital and started with a bigger bang, and we did speak to one individual about a partnership but our offer, fortunately, was declined. We are happy and relieved to be making our own decisions and our own mistakes, even if the risk is all ours.)
Once we had an initial list of eight books, we needed to find distribution and sales help. As publishers, we find manuscripts, work with writers and art directors to turn them into books, and then get them printed. Once they’re printed, they need to be available to booksellers, which is where distribution is required. Because making books available to booksellers is not enough—the booksellers must be convinced to stock them—we needed sales agents.
Finding Canadian distribution was not difficult. We signed with University of Toronto Press distribution services. There were other options but after hearing nightmarish stories from Anna Porter (above) about the financial implosion of her distributor—it sank her company—we decided to go with the biggest and most economically-secure outfit we could find.
For Canadian sales, we got lucky. Most small independent presses are sold in catalogs featuring a lot of other small independent publishers. Canadian Manda, one of the largest and best of our domestic sales agents, took on Sutherland House on a standalone basis. And so we had distribution and sales in Canada.
We were fortunate in the U.S., as well. One Canadian publisher had told us we had no hope of getting U.S. distribution until we had a track record of five years of sales. Thanks to certain helpful connections and on the strength of our initial list, we signed sales and distribution agreements with Baker & Taylor Publishing services, which is part of one of two dominant U.S. firms in the business. The other is Ingram, which also offered to represent us. We went with B&T because they seemed more flexible and communicative, although slightly more expensive than Ingram. We knew we had a lot to learn so being able to get people on the phone whenever we needed was important.
With B&T and our Canadian partners, we had the means to get our books into virtually Amazon, Barnes & Noble, Chapters/Indigo, and virtually any bookstore on the continent, including Ben McNally’s lovely store where we’ve held a couple of events (below). Sutherland House was ready to roll.
This might be a good point to pause and note that launching Sutherland House from scratch was our second choice. Our first choice was to buy an existing publishing house. We looked closely at five, and informally at three or four more.
The principal attraction of buying an existing house was that it would save time. An existing operation would have distribution and sales in place, as well as accounting systems, a pipeline of projects, and a reputation. It would have a stream of revenue from books it had published in the past, and it would receive grants from several federal and provincial funding sources.
When you are launching a new venture in your mid-fifties as opposed to your mid-twenties, you are likely to feel that you have more capital than time. That was our case, so it made sense to buy an existing company and get a head start.
Buying was much trickier than we expected, mostly because the Canada Council, one of the largest granting agencies in Canada, reserves the right to cancel a publisher’s grants if the company is sold. All of the publishers we considered would lose money without their Canada Council grants. Companies that lose money and are otherwise without assets beyond shelves of unsold books (“landfill,” one called his stock) are worthless.
We had a deal to purchase Tim Inkster’s company, The Porcupine’s Quill, that would have enabled Tim to achieve his goal of retirement and us to get a head start in the publishing business but the Canada Council would not waive its right to cancel his grant in the event of sale, and would not tell us whether the grant was likely to be canceled or reduced or maintained in the event of a sale. There was too much risk. We called it off. The Canada Council supported Tim for about forty years, badgered him to come up with a succession plan, and then cast him adrift when he was finally prepared to make his exit. Brilliant. (That’s Tim above showing off the press in his basement. He prints his own books. We value our fingers and outsource printing.)
We’ll discuss at length on some other date the complications of buying and selling Canadian publishing businesses. Suffice it to say that because of the Canada Council’s obstructionism, it made more sense for us to start from scratch. It has taken a little more time. It will be another year or so before we are eligible for all the grants. On the positive side, we’ve learned a lot more, we’ve set things up exactly as we want them, and we don’t have a legacy business and legacy systems to worry about.
The challenging part about starting from scratch is that you have no revenue from a backlist (previous years’ books) or from grants. You are dependent on whatever sales revenues your first books bring in, and those revenues are slow to roll in. They don’t start arriving until several months after a book launches. Meanwhile, you’ve had to pay an author an advance to acquire a book, pay to edit it, pay to have it designed, pay to have it printed, and pay to have it promoted and marketed. That’s a lot of upfront costs. It seemed like we did nothing for the year before our first book was released besides write cheques, and for several months afterward, besides.
We made a bunch of mistakes in those months. We rented office space (inexpensive and very convenient, two blocks from home, and next door to Employee No. 1’s favorite dog park) six months too early. We hired an Austin-based PR agency called PR By The Book for our spring books. It was expensive and useless and we had to backfill with other publicists. We paid a lot in design fees, looking for the right person, before we found the fantastic Lena Yang (below right).
We also made some good moves. Matt Bucemi (above left), our industrious and vastly over-qualified Employee No. 2, has been an enormous help with every aspect of the business. A couple of agents, Michael Levine and Beverley Slopen, have been extraordinarily generous with their time and clients. We’ve spread our work across a couple of printers, one in the U.S. and one in Canada, and they’ve both been great. Sarah Miniaci and Smith Publicity have significantly upgraded our marketing and PR efforts. And the books we elected to publish have panned out.
We chose books that we thought could sell a minimum of 2,000 copies each. Being inexperienced, we were guessing at which were the best prospects, although we did get feedback from a range of booksellers, publishers, and sales agents before we made our choices. We chose the 2,000 number because we estimated that selling 2,000 of each of eight books would cover our expenses for the first year.
We underestimated our expenses, of course. Fortunately, the spring books have sold about 2,500 copies on average (roughly half in the U.S. and half in Canada) and they still have almost a half year to sell before the year is up. The fall books have only been out for a month but they have started well. A couple have been legitimate top three or four Amazon bestsellers. Several have been category bestsellers on Amazon but, dirty secret, you can sell fifteen books in a day and be a category bestseller on Amazon in Canada (“#1 in Icelandic medical history!”).
There is a lot of guesswork in choosing which books to publish. It is notoriously difficult to identify bestsellers before they’re in market so we concentrate on avoiding books that won’t sell rather than dreaming of hitting home runs. We learned in the magazine newsstand business that avoiding dogs (underperforming covers) did more than the occasional hit to keep our average sale at a good level.
We will only publish books we think will sell to our targets. We don’t publish books that we love but know won’t sell, or books that are more likely to win awards than sell. Sutherland House is a labor of love but if we don’t run it like a business, we won’t love it for long. KW edits all of the books personally which is not sustainable in the long-term but makes sense for now.
Six months in, we feel comfortable that barring unforeseen circumstances or bad math (the latter is more likely) we will hit our target and break even in year one. That sets us up for a second year in which we will have both a back-list (last year’s books) and front-list (new books), and be eligible for certain grants. We will be able to get a little more help—we are running leaner than lean—and to aim for a profit margin of 18%.
We chose 18% for two reasons. We want to grow to twelve or sixteen books annually by year three and we need to be solidly profitable to do that. And also because 18% is the target that Random House gives Knopf, it’s finest imprint. Of course, we don’t have Knopf’s backlist of some of the world’s greatest literature but neither do we have their New York rent and overhead. We’re told 18% is crazy for a Canadian publisher, and it might be, but we needed a target so why not be ambitious?
The spring books were Michael Ungar’s Change Your World (now on second printing), Joe Berridge’s Perfect City, Conrad Black’s Canadian Manifesto, and Bernard Crick’s George Orwell: A Life.
For fall we have Jon Kay and Joan Moriarity’s board-game book Your Move, Dr. Jeff Sutherland’s Still Life, Dr. Angela Mailis’s Smart, Successful & Abused, and John Stefanini’s More than We Bargained For.
The outlier among the eight, the only unoriginal work, is Crick’s Orwell. First published by Random House in 1992, it has long been out of print. We esteem it as one of the great twentieth-century biographies and wanted to reprint it as the first of what we’re calling Sutherland Classics. We’ll continue to bring back to print one or two classic biographies every year because we love them and, eventually, we’d like to publish a lot of great biographies of our own. Next up is Julian Symon’s life of Edgar Allan Poe, The Tell-Tale Heart.
All of the books are available, signed and wrapped in beautiful SH tissue paper, on our website https://sutherlandhousebooks.