Finding Their Way

The 15 companies in PW's ninth annual survey of fast-growing small publishers have little in common besides success. This year's list includes publishers that specialize in sports, photography, and New Age. Some have just completed their third full year of business, while others have been in business for as long as 30 years.

In addition, the companies approach the critical function of distribution in a variety of ways. A surprising number handle their own sales and marketing, usually aided by commissioned rep groups, and several companies are even building their own distribution businesses. Red Wheel/Weiser is looking to add more distribution clients to its existing roster of five, while powerHouse Books does its own distribution as well as handling distribution for Umbrage Editions and Juno Books. Some of the 15 are distributed by major publishers, including Shambhala Publications, which is Random House's sole remaining distribution client. But no matter the distribution vehicle, all the publishers say that finding the right distribution arrangement was key to their growth.

The standout publishers of 2002 were very successful over a three-year period of overall sluggish growth. 2002 "was the most challenging year in my 21 years in the business, especially at the national level," says Red Wheel/Weiser president Michael Kerber. Small publishers, like their larger brethren, were confronted with conservative ordering by the major bookstore chains for much of 2002 and by weak holiday sales. But many overcame the bookstore shortfall by increasing sales through alternative channels. Rob Meadows, v-p of sales for Inner Traditions, Bear & Co., devoted more resources to the company's direct mail program last year, not so much to boost direct mail sales, but to build a readership that would seek out its books at bookstores and e-tailers. Hatherleigh Press scored a big special sales order when it sold 50,000 copies of a title to a pharmaceutical company. PowerHouse Books has tapped into the corporate market, partnering in one instance with Nike for a book that the company sold out in one week.

Whatever the methods, they worked for PW's small publisher standouts. Between 2000 and 2002, total sales for the group increased approximately 60%, to roughly $82 million.

The publishers' strategy for managing growth in 2003 varies from house to house. About half the companies are adopting a go-slow approach to adding titles, opting for more sales per title, while others feel now is the time to increase their presence in a niche or even enter a new segment.

The Players

The fastest growing publisher on this year's list is ibooks, the newest publishing venture launched by Byron Preiss in 1999. The company publishes in a mix of segments and formats, including e-books. Approximately 70% of ibooks' print titles are now done as e-books, and the line "became a real business in 2002. It doesn't lose money," Preiss says. Titles done in the Palm format "now deliver five-figure revenues," Preiss says, particularly in science fiction, the most popular category. But e-books only account for a small portion of ibooks' total revenues, with hardcovers, trade paperbacks and mass market paperbacks generating the majority of sales. The prodigious leap in ibooks' title output over the last three years is due in part to its aggressive approach, led by consultant Roger Cooper, to the series-driven mass market paperback niche. Military history, mystery and science fiction all do very well in mass market. In addition to adding new titles to its list, Preiss credits its distributor, Simon & Schuster, as well as sales to book clubs for boosting revenue. For 2003, ibooks will publish 185 titles. To make sure the big jump in title count doesn't come back to haunt the company, Preiss says ibooks "paid the right price for the books" and "will be conservative with our print runs." Among the line extension set for 2003 are more titles in its pet line and the introduction of one or two graphic novels per month.

PowerHouse Books' 250% revenue increase over the last three years has been driven by the phenomenal success of New York September 11, a collection of photographs by Magnum photographers. The title has sold 200,000 copies in the U.S. and another 100,000 worldwide. Publicity director Sara Rosen says the success of September 11 "opened the flood gates in getting better projects." The book caught the eye of Nike executives who contracted with powerHouse to do Sole Provider, a history of the sneaker company that powerHouse sold out of in one week. Rosen said the company is in discussions with Nike, which holds the copyright, to do a second printing. While Sole Provider was a co-venture with Nike, the corporate link to the Gap came after the book The Blue Jean had been nearly completed. The Gap put an ad on the back cover and held a launch party that "helped reach people who don't usually go to bookstores," Rosen says. PowerHouse will continue to pursue selective projects with corporations, but its focus will remain on expanding its photography and illustrated book line. The company will increase its title output to about 35 in 2003, including a new book from the Magnum photographers. With its growth, powerHouse will move to a new 5,000-square-foot facility this spring that will include offices, a gallery and bookstore featuring hard-to-find photography titles.

Sports Publishing, which had a big leap in sales in 2001, had another solid gain in 2002, leading to a 187% increase between 2000 and 2002. The company's move into instant sports titles continued to pay dividends in 2002 (News, Feb. 17) and has played a major role in Sports Publishing's growth. Its successes in 2002 included books on the New England Patriots, the University of Maryland basketball team and the Anaheim Angels. The company also generated a total of more than $1 million in sales from two non-sports books: Elvis: The King Remembered and Standing Tall. Another factor in the company's growth last year was a non-event—no baseball strike.

The smallest publisher on this year's list is Harbor House, founded by E. Randall Floyd in 1998 to publish his Civil War novel, Deep in the Heart, which has sold nearly 100,000 copies and remains the company's biggest seller. Harbor House's In the Realm of Ghosts and Hauntings produced steady sales last year, and the publisher has sold 10,000 copies of the novel Two Rivers. The company's business breakthrough in 2002 was largely due to the move to National Book Network for distribution in late 2001. "They've done a fantastic job for us," Floyd says. Floyd intends to keep Harbor House's list small; it will likely publish only six books this year, and Floyd says he wants to keep the list to no more than 10 books per year. But he is expecting more sales from each title and thinks he'll have his biggest book ever this year with The Dark Side of Liberalism by Phil Kent, the president of the Southeastern Legal Foundation. Pre-orders have topped 40,000 copies, and a deal is close with the Conservative Book Club. Floyd has also signed a deal with "Friends of Bill" Harry Thomason and Linda Bloodworth-Thomason for their edition of The 12 Days of Christmas, due out in 2004.

For the second consecutive year, Charles River Media has countered the slump in computer book sales with solid sales gains and managed to boost revenue 145% over the last three years. President and founder Dave Pallai attributed the growth to expansion in Charles River's core areas of game development and computer graphics as well as entry into the new markets of programming and computer engineering. Pallai thinks that Charles River is still small enough that it can expand by targeting specific areas within niches and in that vein will continue to add titles in programming and engineering this year. Charles River's titles are aimed at serious computer users and professionals and have done well both in bookstores and in college adoptions. As part of its expansion plans, Charles River launched its first journal in December, The Journal of Game Development, available in print and electronic editions. "We want to make sure we're seen as a major player in game development literature," explains Pallai, adding that 50 books are set for release this year. To accommodate its growth, Charles River moved to larger offices in January and has budgeted to hire three more employees in the year, including an acquisitions editor. The company does its own distribution and is considering adding a client or two.

Increased interest in health and fitness by baby boomers has sparked the 127% sales increase at Hatherleigh Press in the 2000-to-2002 span. In 2002, Hatherleigh's sales were led by its Body Sculpting Bibles series which had hits with The Bible Sculpting Bible for Men and The Body Sculpting Bible for Women, which sold 40,000 copies each. Marketing director Kevin Moran said the company's backlist also did well in the year, especially its series on chronic diseases, topped by Living with Hepatitis C. Another factor in Hatherleigh's success was the ability of its distributor, W.W. Norton, to expand the company's reach into new markets. The company also upped its promotions at the major chains. Moran said that given the uncertain economic and geopolitical situation, it will keep its list at around 24 books this year. "Now's not the time to go ballistic," Moran says. Despite the cautious approach, the publisher will enter a new segment, cookbooks, with the publication of The Complete Book of Raw Food. The addition of a new employee or two is also possible.

America's Test Kitchen, the new name of Boston Common Press/Cook's Illustrated, brought its book publishing operation in-house in 1999, but the book group really took off after the launch of the America's Test Kitchen television show in 2001. The TV show, conceived by ATK founder Chris Kimball and carried by PBS, shows how the editors at Cook's Illustrated magazine develop their recipes. The companion book to the 2002 series, The America's Test Kitchen Cookbook, sold 80,000 copies, and the first printing for the companion to this year's show, Here in America's Test Kitchen, has a 90,000-copy first printing. While the TV program has given tremendous exposure to the ATK brand, marketing v-p David Mack notes that the company had already started developing a solid book business around Cook's Illustrated magazine, which has 560,000 subscribers. Its first title, The Best Recipe, was released in 1999 and has sold 270,000 copies to date. The success of the title convinced ATK to develop a Best Recipe line that in 2002 included the American Classics and Italian Classics titles. In 2003, ATK will publish three new titles under the Best Recipes umbrella, plus its annual compilation of recipes from the magazine as well as two non-series titles, The Best Kitchen Quick Tips and Kimball's The Kitchen Detective. ATK has its own in-house sales force that calls on chain and independent bookstores as well as a large direct mail operation that leverages the subscriber list of Cook's Illustrated.

Although best known for its alternative health and martial arts titles, North Atlantic Books and Frog Ltd.'s sales leap in 2002 was led by its first children's book, Walter the Farting Dog, which has sold more than 100,000 copies. Marketing director Oliver Chin explains that North Atlantic decided to test the children's book waters with Walter after major publishers rejected the book. Other factors contributing to gains in 2002 included the release of the third edition of Healing with Whole Foods, North Atlantic's bestselling title with 400,000 copies in print, plus the release late in the year of the graphic novel Diary of a Teenage Girl, which had a first printing of 7,000 and has gone back to press. During the year, North Atlantic tried to raise its profile among booksellers by participating more in Book Sense which Chin says helped raised sales of its core titles including The Vaccine Guide. More emphasis was also placed on special sales. With Walter as its foundation, Chin thinks North Atlantic should have good gains again in 2003. In addition to Walter, the publisher will release Francine Francine the Beach Party Queen by Audrey Coleman, the illustrator for Walter. Chin also has high hopes for another graphic novel, Nine of One.

Howard Publishing's recent prosperity is tied largely to the success of some of its series. The best known, the Hugs series, was introduced in 1997, and the 27 titles in the line have sold 3.5 million copies. A new Humor for the Heart series and The Power of a Positive Woman also sold well in 2002. According to president John Howard, the publisher's titles have sold steadily in the CBA and gift markets and are beginning to gain more acceptance in the general marketplace; the mainstream market is where Howard expects to see most of its growth in 2003. The company will publish about 35 titles this year, including its first three Christian fiction titles. Howard is counting on another new series, Thank You, to get a good reception in 2003. Among its single titles, Answering the 8 Cries of the Spirited Child and Honey They Shrunk My Hormones are expected to do well.

It was another year of solid growth at Gibbs Smith, Publisher in 2002 with total sales increasing 25%. The gain was driven by Gibbs's text division, the smaller of the publisher's two units, which posted a 57% gain in 2002. The company's main text product, state social studies programs for the fourth and seventh grades, did extremely well in 2002, according to general manager Christopher Robbins. Trade division sales increased 11% as Gibbs's focus on "home and hearth paid off well," Robbins says. Villa Décor, at $40, was the publisher's top money earner in the year, but Gibbs had a surprise best seller in 101 Things to Do with a Cake Mix, a title that had been self-published but which sold 80,000 copies for Gibbs. The title has done very well in non-bookstore outlets, particularly Costco, which recently ordered another 20,000 copies, Robbins says. Gibbs plans to turn the 101 Things into a series and will publish 101 Things to Do with a Slow Cooker in June. Robbins says no major changes are planned for Gibbs's publishing direction in 2003, although the company will look to expand the mix in its new gift line of note cards and journals.

Four books that were released in late 2001 drove the growth at Inner Traditions, Bear & Company in 2002, according to Rob Meadows, v-p for sales and marketing. The exercise book Pilates on the Ball has sold a total of 77,000 copies, including 58,000 last year, Meadows says. Pilates was joined on Inner's bestsellers' list by Transfigurations, a $50 title that has sold 15,000 copies; The Tutankhanum Prophecies' which has sold 20,000 copies; and The Lost Book of Enki by Zecharia Sitchin, 22,000 copies sold. A number of Sitchin's previous titles had been published by different major New York houses, and he is one of a growing number of authors that have moved from New York publishers to Inner. "I think they feel we relate to them better," says Meadows. In addition to its four major frontlist titles, Meadows says the company's backlist sold better in 2002 than in previous years, something he attributes in part to an improved direct mail effort. Inner also "did better on the fundamentals," Meadows says, particularly in getting books shipped on time, something that Meadows admits had not always been the case in the past. Meadows is excited about prospects for 2003. The follow-up to Pilates, Abs on the Ball will be released in the spring with a 30,000 copy first printing, the highest in Inner's history. Yoga on the Ball will be published in the summer with a 20,000 copy first printing. Good things are also expected from Sexual Reflexology, which has a 15,000-copy first printing. Inner will hold to its traditional print schedule of 62 titles, a figure that excludes Spanish-language editions of some of its top sellers; eight Spanish-language titles are planned for 2003.

A move into more mainstream publishing and the hiring of a sales director with a trade publishing background are the two main factors behind the 25% sales growth at Princeton Architectural Press over the last three years. Nettie Aljian joined PAP in July 2000 just as the publisher was broadening its publishing program into new areas such as popular culture. Two books in the pop culture segment were among the top sellers for PAP last year, with Lost And Found Pet Posters selling 20,000 copies and Photobooth selling 20,000 copies in hardcover and another 6,000 in trade paperback. The move to broaden PAP's list "has expanded our appeal and introduced us to new customers," says publicity director Katharine Myers. Two hits in PAP's core architectural line were Chrysler Building and Rural Studio. Another source of growth has been PAP's distribution and marketing for European publishers, done in conjunction with Chronicle Books, which has been PAP's distributor since 1996. PAP will publish 50 new titles this year and distribute another 50 and will enter the fashion book segment.

The transformation of Red Wheel/ Weiser, begun in May 2001 under new owners Michael Kerber and Jan Johnson, continued in 2002. The company acquired Conari Press in May 2002 and integrated the West Coast publisher's operations into its own Boston offices, and in the process added Brenda Knight, formerly director of sales at Conari, as Red Wheel's director of special markets. With retail sales soft, the gift market played an important role in increasing Red Wheel's revenues by 10% last year. The gain excludes revenue from Conari and includes the absence of $800,000 in revenue due to the sale of Weiser Wholesale at the end of 2001. Red Wheel took over distribution of Conari, which has been sold by Publishers Group West, on March 1, 2003 and Kerber expects the gift market to play an even larger role in the company's sales this year. In 2002, the company did well with new Red Wheel titles The Old Girls' Book of Spells and A String and a Prayer, as well as with a number of Weiser backlist titles, including the $75 General Principles of Astrology and The Celtic Cross—a book-gift package that sold more than 10,000 copies. Red Wheel will up its title output from 56 to 62 in 2003. Key titles include Stillness: Daily Gifts of Solitude, which has a 15,000-copy first printing, and Celestial Wisdom for Every Year of Your Life, with a 12,000-copy first printing. Kerber said another acquisition is possible in the year, and the company is also looking to add more distribution clients to its current roster of five.

Founded in 1993 in the U.K. by Tessa Strickland and Nancy Traversy, Barefoot Books opened an American office in 1998. In 2002, the American market accounted for approximately 54% of the children's book publisher's total revenue. The 22% gain recorded in its American sales over the last year occurred despite a dip in 2001 caused by relocating both Barefoot's U.K. and U.S. offices. The move, says publicity manager Katie Fields, is part of the company's effort to build a global brand. At the end of 2002, Barefoot had a worldwide staff of 30 and published 76 titles. The Barefoot product focuses on cross-cultural board books, picture books, gift anthologies and audiobooks.

Success in 2002 for Shambhala Publications was not due to any single book, but to solid gains of both backlist and frontlist titles, explains president Peter Turner. He attributes improved frontlist sales to a broadening of Shambhala's publishing program beyond its core in Eastern philosophy. "We've made some forays into fiction and more general nonfiction," Turner says, a trend he plans to continue. To that end Turner says it is likely that Shambhala will create a new imprint in 2003 to show agents and authors about the publisher's commitment to broadening its line. A surprise hit last year was Confessions of a Pagan Nun, a novel that is selling "purely by word of mouth," Turner says; there are a total of 35,000 copies in print in hardcover and trade paperback. A new title by Pema Chodron, Comfortable with Uncertainty, sold well last year as did the reissue of her The Places that Scare You. A December release, The Woman's Book of Yoga & Health shipped 20,000 copies before the end of 2002, and another 10,000 copies have shipped this year. Among the titles Turner thinks will do well in 2003 are Healing Through The Dark Emotions; In Buddha's Kitchen; and Already Home. Turner is budgeting for little growth in 2003, and Shambhala will publish 60 titles this year. Turner considers the slight decrease in the list prudent given the uncertain times. "If I'm going to be surprised, I'd rather be it a good surprise," he says.

PW's Small Publisher Standouts