The independent book publishing world just got a whole lot smaller. Advanced Marketing Services, owner of Publishers Group West—the largest indie book distributor—has filed for bankruptcy protection.
This happened over New Year’s weekend and I initially didn’t pay it much attention because I didn’t know that Advanced Marketing Services—known mostly as the exclusive book distributor for wholesale clubs like Costco and Sam’s Club—purchased Publishers Group West in 2002. Advanced Marketing Services has been having financial problems since an accounting scandal in 2003 that resulted in three of its executives being convicted of fraud.
In its bankruptcy filing, the company reported “more than US$200 million in debt to dozens of publishing companies,” according to Julie Bosman’s New York Times report.
For indie publishers working with Publishers Group West—and that means almost all of them—this is a potentially fatal blow. The assets due publishers, but now held by the court, are for sales for the September - December period—the most profitable period of the year. Small independent publishers count on this calendar period for up to a third of their annual sales. Media Bistro reports the court “had approved payments to publishers for books that shipped or will ship on or after December 29” and that Publishers Group West would remit payment “on a weekly basis for the time being.”
Not surprisingly, the best—and most complete—coverage of the issue is by a weblogger. Kathryn Cramer has some skin in this particular game and wonders out loud why publishers—including hers—were dealing with Advanced Marketing Services to begin with. After all, as an outcome of the 2003 accounting scandal, the vice president of advertising was sentenced to three years in prison for her role in falsifying earnings, a salient fact that managed to elude the mainstream news outlets.
0 responses. Comments closed for this article.