104 Understanding the Numbers
“That’s more like it. For now, let’s ‘roll the bones’—I mean, assume risk is
not an issue. What do you have in mind?”
“ Well, this semester I have a Web-marketing course and I need a project.
Are you familiar with the World Wide Web?”
“I spend a good part of the day corresponding with friends on it.”
“Good. What you just said to me is that you don’t see too many pieces of
the publishing system adding value commensurate with the value they extract.
How about setting up your own Web site and selling your latest project your-
self? We would have to contract with others to provide the necessary parts of
the chain, but selling the book through our Web site is possible. It could fail,
and you would have one very unhappy publisher.”
Abbey thought she was now getting somewhere. “As long as you are get-
ting credit for it, why don’t you develop this idea further. See if it’s possible
and what my risks would be. I might even give you a piece of the action.”
COST STRUCTURE ANALYSIS
A month later Abbey met Stephen for lunch in Boston. He was excited.
“Abbey, this is what I have found so far. Setting up a Web site is very easy,
but maintaining it and keeping it fresh and exciting so that people want to re-
visit it is the challenge. Neither you nor I want to do that, trust me. I have
talked with a number of companies who offer this type of service. Many of
them were excited when I showed them copies of your past books. To set up
and maintain the site, the offers ran any where from a low of $25,000 a year to
four times that. The high-end ones also charge a 5% fee on all revenues gener-
ated. I think we want a high-end site that is creative, custom designed, and ex-
citing so I lean toward the more expensive ones. They are good.”
Abbey liked how he used the word we.And being an artist, she too
thought that her Web site should be exciting, creative, and different. “Go on.”
“I also found a number of printers who specialize in small run sizes, typi-
cally less than 50 books in any one printing. Their technology is called print-
on-demand, and they also work with photographs. I brought some samples of
printed photos.”
Abbey was impressed with the quality. It looked no different than her
previous books. “ What would they charge?”
“They said they could print your books on demand and guarantee the
quality for about $35 each. Now, this is much more than what traditional print-
ers charge, but they always run large volumes, a minimum of 5,000 copies in
one printing, and want to be paid for every one of them even before we could
sell them. Bottom line, we would be at risk if this doesn’t work.”
Abbey was disappointed that she was again making someone else rich, but
moved on. “How would we do all the promotion and sales?”
“Two ways. Once your readers learn of your site, they will visit it. If the
Web-design company delivers what they promise, we should be able to sell