Pricing Your Book For Sale

The Price is Right

You’re holding that book in your hand and here’s the big question – “How much can I get for it?”. After all, that is the point of the exercise. How much is it worth? How much will someone pay?

If there are other listings for your book, then it does have a market and the going price has been set by the old rules of Supply and Demand. If the lowest priced listing is $8, is it wise to price yours lower, say $7.95, just to be the lowest priced and therefore the next sale? One thing that has to be considered to make that pricing decision is condition of the item – is yours better? If so it certainly deserves to be priced higher than that lowest listing. Next to look at is ratings of other sellers, if they’re all brand new or have bad ratings and yours is good, you should be able to price a bit higher and rely on people trusting your product more and being willing to give you a bit more money.

One thing that new sellers are regularly warned against is “lowballing” or pricing below the lowest. It’s not a good practice because you’re leaving money on the table, and also because of auto repricing software that many sellers use. This software is run anywhere from daily to hourly and reprices inventory to always be the lowest. So if you price your book at $7.95, the auto repricer will drop to $7.94 or $7.90 very soon after, and other repricers will follow. Each racing to be lower and lower until that book is selling for a penny. It’s a downward spiral in a race to ruin the market of that book. One way to not become involved in that race is to price yours even with the lowest, or just higher. That will put you in the 2nd or 3rd slot of the page, easily visible when the item is looked at by a buyer, and you won’t be competing with auto repricers. It’s usually easy to see when there are several auto repricers on one listing. You’ll see prices like $15, and $14.95, and $14.20 and then a group of $5.40, $5.41, $5.42 all clustered together. Each time the software runs it’s lowering the price and those 3 are leapfrogging down and down. Best to let them go, ignore those and price yours even with the higher priced listings. Hopefully they will sell off quickly and yours will be waiting to go next at a more sensible price.

How in the world do books end up selling for a penny? That’s the most frequently asked question on the Amazon New Seller’s board. How does anyone make money that way? In a nutshell:
A seller lists a book for $.01
Amazon collects $3.99 from the buyer and gives $2.66 ($.01 + $2.64 shipping allowance) to the seller. (The $1.35 'closing fee' is subtracted from the shipping allowance by Amazon)
The seller is a ProMerchant, so doesn't pay the $.99 fee (but does pay $40 per month to be a ProMerchant).
The 15% fee on 1 cent is zero.
The seller pays $2.31 or $2.65 in postage for a 1 or 2 pound package (or less, if it is very light weight and can go First Class. Much less if the penny seller is high volume and uses Bulk Mail).

The seller cost for the book is zero, because he got it for free somehow (or buys in great volume so the price per item is nominal).

The seller used recycled packing materials, so those cost nothing, too.
The seller ends-up with $.35 (if it's 1 pound media mail) profit in a domestic shipment (a bit more if it's mailed using Bulk Mail).
The seller is happy with his "profit".
Amazon ends up with $1.35 from the shipping.
Amazon is even happier than the seller.
The Penny Selling Business Model is only one of many. Hopefully you have scoped out what kind of seller you wish to be and created some sort of business plan or business model that you’re following. Are you going for the High Brow market – antiquarian, collectible tomes that are scarce and fetch high prices? Maybe you hope to sell just one of those each month or each quarter and that will meet your business needs. Or maybe you’re hoping to turn over thousands of those penny books each month. Do you have plenty of shelf space and lots of patience? You may wish to list in large volume, price higher than most, and wait for each sale. Or are you a flip it, move it kind of person? Get it listed quick, lowest price possible, move it out the door. It’s necessary to make those kinds of decisions well in advance. That way you’re aware of what items to buy and how to price them.

On the opposite side of the pricing spectrum from penny books is the over-inflated pricer. When every other seller offers the title for $5, there’s one who has his listed for $175. What kind of crackhead is going to pay that price, you may ask? Possibly that seller hopes to price incredibly high and wait until all other copies are gone, no matter in what century that may happen. Or maybe the seller made a typo and left out a decimal point when he listed. There are also some who go on vacation or need to take some listings offline for a bit and instead of delisting them, they just increase the price to a crazy number to make sure it won’t sell. If you’re a conspiracy theorist you may want to consider that maybe that seller is money laundering …. Hey anything is possible! Sun spots, contrails, little green men being held at Roswell and money laundering on Amazon.

Usually those crazy high prices are easy to spot because there will be a dozen or more other listings in a certain range – say $5 to $8 and then that one incredibly high listing. But what if there is only 1 copy available and it’s priced at $175? Is it a real value or is it one of our crackhead listings? You need to cast a wider net at that point and look beyond Amazon. Check out your book on www.addall.com or www.fetchbook.info, or www.bookfinder.com. Those sites will check other bookselling venues all over the Internet and come back with the offerings and prices. You can tell quickly if your copy is truly worth the high price or not. If it’s available in abundance on other sites for a much lower price you may want to split the difference, list yours lower to stay competitive. Some will argue that many people look only on Amazon and you should keep the price high but I believe if a person buys at that extremely high price and later finds so many other copies for a great deal less, they will be unhappy and asking for a return. Amazon’s policy requires that sellers take a return within 30 days, and no one enjoys those boomerangs, especially the high dollar ones. I try to avoid those by pricing sensibly and fairly from the start.

Once your inventory is priced and listed, the next decision is if you should use a repricer yourself. There’s a lot to be said for manually repricing – you get to look at the other listings and make the same informed decision that you did when you first listed. Has the market dropped (or gone up)? Should you now change your price? The most important question to ask at this point is, “If I wanted to buy this book, would I choose my copy?” If not, something may be wrong and you need to adjust your price.

If you have many items in your inventory, manually repricing can be very time consuming and possibly impractical. You may need repricing software. The latest versions and services are usually discussed on Amazon’s Third Party board. They all basically do the same thing – once you set your preferences the software runs and adjusts prices according to what you’ve set. Some are intelligent to raise prices also to adjust to the current market value, but many only lower. The software is only as good as the person driving it. That means if you don’t know exactly what you’re doing you could run the program and awaken the next morning to find your inventory all priced at .01 and selling like hot cakes. Hot, cheap cakes. There will be much cursing and gnashing of teeth at that point so save yourself the pain and agony and take the time up front to really understand how to use your software.

One thing to always keep in mind, when Jeff Bezos named this company Amazon it was really a perfect decision. He may have been thinking something big, something enormous, and that word came to mind. But more accurately the Amazon is alive and fluid. That describes the river as well as the website. It fluctuates like the stock market. Up and down, rankings change, prices change, supply and demand. There is a pulse and a current, it is alive and always moving. Learning the art of pricing and repricing is a big part of the game and it’s what makes the whole thing very exciting.