When you first become a published author there is much to learn about the ins and outs of this sometimes difficult to understand industry. There are some aspects that seem just plain backwards, particularly for those entering the industry from a business background. One of the hardest elements to come to grips with is the concept that a sale is not really a sale until it goes through two or three transactions. This makes calculating expected revenue difficult, to say the least. Add to that the returns factor (discussed here) and you are left with some confusing data to sort through.
If you’re working with a distributor, your distributor is going to sell your book to wholesalers and to retailers. Wholesalers play a very big role in all of this and it’s not uncommon for the majority of your books to first be sold to the myriad of wholesalers out there, big and small. (Learn about the difference between a wholesaler and a distributor here).Your distributor will report this is a sale to you and you will be paid for that sale (minus returns and reserves against future returns) but in the more explicit sense of the word, it’s not quite a sale yet. At this point, your book has been stocked in a wholesaler’s warehouse with the hopes that their customers (retailers and libraries) will purchase it from them.
Now the retailers and library customers of the wholesaler begin placing their orders for your book through the wholesalers. The wholesaler considers each order of your book a sale and will be paid for the books by their retail or library customer for those purchases. If the purchaser is a library, the cycle is done and you can safely call that sale an actual sale since the book is unlikely to be returned. If the purchaser is a retailer, however, it’s not quite a sale yet. Your book is one step closer to really being sold, but at this point, your book has now been given shelf space in a retailer’s warehouse and stores with the hopes that their customers, actual book-purchasing and reading consumers, will purchase it from them.
When an actual consumer picks up your book from a shelf and buys it, it is finally sold. Your distributor will differentiate between the sales to the wholesalers and retailers and the actual consumer sales as “sold in” versus “sold through”. The sold-through number is what you are both going to want to monitor, especially as it relates to the sold-in number. A large discrepancy can spell trouble around the bend in regard to returns. Consumer sell through is reported weekly by Nielsen BookScan and can be obtained through your distributor’s account or through your Amazon Author Central Account.
Until a consumer actually buys your book, it is subject to being returned by the retailer or the wholesaler, so keep in mind that the act of being placed on shelves is certainly not a guarantee of sales. You have two or three more “sales” to make before your book is actually sold through. Focus on creating demand so those books stay sold.