Due to the economic development and the individual purchasing power, publishers and booksellers (retail and wholesale) have a strong interest in exploiting all market opportunities, even those in remote areas. Furthermore they are in need of a functioning ordering and distribution chain.

The book industry needs to build up close customer relations based on a trustworthy cost effective relationship. However, this becomes rather difficult, if books are priced differently depending on the conditions the bookseller gets from the publisher and on the costs of delivery to bridge the distance. Though short term losses and decreasing turnovers may be possible, in the long, run fixed retail prices will lead to more revenue for each part of the book chain because of price security for the customer.

As one of the major conditions, the partners of the book chain should respect and follow respective regulations. Publishers fixing the prices should consider the economic needs of wholesalers and retailers accordingly and allow sufficient discounts.

For the retail trade a reliable system of terms considering margins to cover their income, including overheads and investments into stock is an indispensable demand. Besides discounts drawn up according to quantities, realistic terms for payment are necessary; quantity based pricing used already by publishers could be re-oriented to the discount system.

The purchasing power of the end user is of prime importance regarding the sales of books for all sectors of the book chain; it is also of importance for the existence of wholesalers and retailers distributing books outside urban areas in remote regions. Even when considering limited interest regarding subjects and titles there, the decrease of print runs (and turnover) for individual titles proof clearly that market penetration is insufficient. Fixed prices can contribute to more democracy in the distribution of books by providing the same opportunities of sales for each bookseller and by enabling each potential reader to get the book wanted at reliable conditions. 

The success indices for the book industry in Lithuania are defined by the free market-oriented development and a growth providing substantial revenue for all actors involved. Professional competencies and skills of the staff employed in companies of these sectors are a condition to act accordingly to economic needs and demands and to understand the interrelation of actions and their consequences. 

The answer is not that some of the advanced book economies of western Europe link professionals to their system by providing opportunities of vocational training and gaining influence in this way, but to develop a system of education and further training for all book professionals in Lithuania based on and aimed at the needs of the book sector there. During the past years the book industry has already achieved high standards but still lacking advanced know-how and training of their staff. While librarians are already trained professionally and have the National Library as centre of methodology and excellency, the commercial professions have built up no equivalent. 

The present state of the art regarding professional know-how means a challenge regarding the development of curricula for the education and training of book professionals at the edge of the information society.

The transition of the book industry with the shift to a new economic approach has enabled rapid changes in all sectors and increased competition from national and global resources. New opportunities have shaped a situation where professional education becomes of prime importance. Trained book professionals combining traditional professional know-how of the book sector and new competencies from the field of information and communication technologies will contribute to support a modern book market infrastructure and a healthy book industry.

The book community will in the future move towards the information society and the staff of the book industry will develop into information professionals. This requires additional knowledge of the paradigm shift from the printed book to digital information and communication which is already in the process of becoming reality in Lithuania.

The development of a vocational curriculum for the book industry must be targeted towards publishing as well as the book trade and involve both professionals and officials. It should include basic and standard theories regarding the life-span of a book and training on the job enabling participants to fulfil their day-to-day duties. In addition, the latest developments should be trained in courses offered to update professional know-how. Core competencies and standard issues which are common to the both sectors should be focused on within basic educational programmes, while skills for specialised activities should be improved during further training.

While training is one of the core issues of the book sector, the awareness of senior and cultural administrators regarding market opportunities and the paradigm shift of content taking place because of the introduction of new information technologies remains yet another topic of concern. 

The success of distribution depends heavily on the infrastructure of transport and delivery mechanisms. Publishing and wholesaling companies with their own delivery vans serving only their own titles and their clients provide a costly response to a nearly non-existing distribution network. It happens, that two vans of different companies from Vilnius visit a far away bookseller at the same time. In addition booksellers travel to visit publishers’ and wholesalers’ warehouses to collect the titles they want. 

Efficient postal services could easily bundle efforts to the best of the whole economy including the book industry. Books – up to a limited weight (limited number of copies) – send by special book mail could be delivered to each region of the country within a few days, less than a week. For this book mail special rates could apply being remarkably lower than for ordinary parcel mail. 

The distribution chain could become more effective as limited quantities would not necessarily be send by van but by book mail. Financial effort put into distribution by all actors at present could be reduced contributing thus to a more cost efficient system and to additional revenue. Within a system of fixed retail prices and discounts from publishers for wholesalers and retailers charges for transportation should be shared between the parties. In addition, special postal rates could lead to more competition through book shops and book clubs providing mail ordering services for individuals who cannot find titles they want at their local bookshops.

This change in distribution carriers could reduce competition in an area where it is superfluous and contribute at least indirectly to developing the market infrastructure and support the use of Books-in-Print catalogues as an information tool for booksellers. 

It is not the quality preventing customers from buying, it is the high retail prices – and the costs - being the result of a permanent circulus vitiosus, which first of all publishers have to overcome by cutting costs and securing finance. A negative cost-benefit-analysis always will result in higher prices for the end user. 

Additional finance needed to develop a successful list could be gained in different ways: Most common, though resources are limited, are subsidies and grants from the state budget or from foundations with defined lines of interest. Another possibility is the firm sale of a major part of a print run to one customer with short term payment. And the third one, not yet very common in publishing is to invite sponsorship for the support of an edition, of series of titles, of a programme line, of a translation project, etc. 

Sponsors very often are difficult to acquire, as they are expected to invest into a project, which mostly does not correspond to their direct line of business. Various factors have convincing effects, tax incentives such as reductions on income taxes certainly are among the more favoured ones for the commercial and private sector.

Publishers have a strong interest in content selling well and meeting the average readers interest. This does not always apply for the so called good book or good literature. Even more, titles of high cultural value seldom sell well enough to gain revenue making any kind of support desirable. Sponsorships which could have tax saving effects could add to the reputation regarding cultural responsibility of both the donor, the government and the publisher. 

The economics of publishing involve high first copy costs (for first print runs) and lower costs for further print runs. These include all stages of development and pre-production, which must be financed before any turnover is achieved. If publishers can sell (international) subsidiary rights for the content before publication this can contribute to finance a publication as additional income. 

Bookstores working with short term conditions from publishers face similar issues as they have to finance at least part of their stocks well in advance of any returns from sales. 

Banks are reluctant regarding loans and flexible credit lines for the book industry as in most cases securities demanded are not available. Printed books and publication rights are not assessed with the same value as real estate or technical equipment. Neither publishers nor booksellers own equipment, that can be mortgaged, the product of the industry – the published books – are the only goods, but they are not accepted by banks as collateral. New models of loans through private sources are one way, the government acting as guarantor or introducing credit insurance could be an effective way of acknowledging the industrial and cultural character of publishing providing facilities to enable further market development and reputation. 

It’s a question of book policy to acknowledge the industrial character of the book and consider their cultural content as essential for the consensus between the private and the public sector. The good reputation of companies as borrowers must be supported to enable further cultural diversity. However, it is technical solutions to overcome impediments, it is entrepreneurship combined with capital to exploit successfully the potentials and make the book sector with its unique products contributing to the cultural diversity of Lithuania. 

Looking at the Lithuanian book sector the market approach can be described as a combination of separate and distinctive forms of selling cultural products. Books require point to point communication from the publisher to first and second level target groups, greater audience and wide scaled reception. Marketing activities must offer new dimensions of communicating the content message. Successful campaigns involving the retail trade are aiming twofold at the reader and the customer, not always being identical.

A study of market potentials, of readership and of the distribution process with its mechanics could start with the organisational structure moving on to all issues concerning marketing communication and customer care – trade and end user. Any comprehensive survey will look at the implementation of Books in Print catalogues, the functionality of order fulfilment, cost effective stock holding, and distribution methods and channels involved. Regardless of standard and market penetration of the individual publisher’s activities, this survey could result in a best practice manual providing recommendation and advice for approaching a book market without transition constraints and flourishing.

The shift in readers behaviour not being considered by many publishers till now leads to new customer relations. This however involves refocusing of the business operation starting with re-orientation of the publishes’ list and moving to the development and deployment of services based on the implementation and professional use of Books in Print catalogues, which is not yet considered a useful information source. Based on reliable background information a concerted action is needed joining publishers, the retail trade and the public sector together to introduce efficient services and supply for customers in all regions of the country. 

In Lithuania, relatively little promotion and advertising for books coincides with increasing retail prices, and booksellers only having a limited amount of titles stored. This indicates that the distribution of books to all regions and the support for reading cannot only be left to the market – it is a matter of concern for public powers as well. 

Booksellers and librarians need reliable and up to date information on titles being available in order to meet the demand of readers/ customers and their defined needs. Besides publishers’ advertising material and various bibliographies, Books in Print catalogues (BIPc) have proven to be essential and effective tools for book professionals. Though a first edition is in the Lithuanian market it still needs awareness to find its definite role.

The increasing output of books has intensified publishers’ need and search for new retail opportunities. The core issues are: 

• Communication on books available must be improved and promotion aiming at increasing sales through informing and persuading the target audience has to be developed;
• The benefits of BIPc have to be experienced, implying their defined function and working mechanisms for stock keeping and ordering;
• Improved distribution mechanisms through re-shaped and efficient wholesale segment and additional sales points for books, housed for example, at public libraries;
• Professional competence and approach in the book trade regarding service and stock policy in order to distinguish core titles and seasonal ones managed by a precise stock control system based on EAN codes

To meet continuously changing demands of readers (customers!), publishers and booksellers need to employ communication seriously and understand that this is a product-driven and not a demand-driven industry. Furthermore, theoretical advice and practical help can only be a beginning of indispensable professional education for actors in both segments. 

The privatisation process of the formerly state-owned retail bookshops was interrupted due to the fear that owners of privatised shops would turn them into more profitable businesses. As a result the remaining shops were moved into ownership of municipalities not considering that this meant to maintain the old inefficient system to a large extent. However, this can only be a transitory compromise for a limited time. 

For publishers it is of vital importance to have trade partners understanding and following their commercial needs. As publishers need fast incoming returns they complain about booksellers’ lack of financial responsibility for selling books. Shop managers definitely have professional competencies, but as long as they do not feel responsible themselves they will leave the economic constraints publishers experience through delayed payments to a disinterested administration. 

That privatised book shops were converted into outlets for more profitable goods has often been a short term decision as the market for these goods is not unlimited. This practise mainly resulted from a lack of professional education and knowledge how to manage a book trade company in the free market system. Moreover, the attitude was, and sometimes still is, deeply rooted in the former system of demand according to supply without any service for customers.

Though the Lithuanian book market is limited in size there are sufficient potentials to operate profitable book stores considered they have professional expertise and invest into rationalisation. If booksellers understand common goals they even can start a co-operative and thus demand better terms from publishers. 

To meet this challenge the support required involves professional training, assistance and encouragement regarding the elaboration of individual shop concepts reflecting local environments and the feasibility of long term investments. 

Publishing in Lithuania still follows traditional production lines of printing large sheets of 16 pages demanding print runs relatively high to be cost effective. With Print-on-Demand books are printed page by page and copy by copy instead of printing sheet by sheet. With digital printing a book (with pre-mastered content) can be produced in any number of copies, at any time at reasonable unit costs enabling the publisher to produce the amount of copies needed just in time. Once a text is electronically stored and printed with digital techniques the production requires – in principle – no more than the paper costs.

Using a common term Print-on-Demand must be seen as a new innovative system term based on digital printing which is no alternative to traditional offset printing. It must be regarded as an adjunct opportunity improving the possibilities of printing works which otherwise would not be available in book form. This applies for titles with limited print runs, especially non-commercial and specialised titles, and for books out of print.

Print-on-Demand could also be a solution for the production of content material for minority groups such as the Russian minority for which few books are produced in Lithuania as well. Through making use of the opportunities the digital printing technology provides, the integration and assimilation of minorities could be facilitated by furnishing related contents in their language or publishing them bilingual. For Russians in Lithuania it would mean an easier approach to the Lithuanian heritage and increase the variety of books published in their language there. 

As a consequent decrease of production costs is the main factor to encourage the introduction of digital printing services not only the prices for offset and digital print must be considered, but initial costs and overheads should be studied as well. Suppliers of digital print quote an upper limit of approx. 500 copies regarding the profitability of a print run, the lower limit ranges at 20. Finishing costs take a remarkable share.

Looking at the profitability of printing costs in Lithuania at present, the cut-off point for digital print cannot be clearly defined as this new technology is not yet sufficiently introduced; printers approach mainly is based on traditional technology. However, estimates are heavily burdened with amortisation of hardware making it even at low print runs impossible to be competitive with offset printing.

The variety of intellectual content created in Lithuania that presently cannot be made available at the market due to financial constraints could become more obvious if the public sector would support a best practise model using digital printing for the production of low-print run books. The support needed involves the role as guarantor for the purchase of hardware and should cover the depreciation value for a defined period. 

While a best practise study and model with the public sector as guarantor and the industry as beneficiary is carried out publishing companies can adjust the multitude of their titles and define the critical number of copies to have sufficient presence without producing optimistic print runs. 

Efficient and cost-attractive services limit publishers’ uncertainties and make the advantages of Print-on-Demand obvious.

In addition the public sector has the opportunity to redefine their grant policies, thus subsidising a greater number of non-commercial titles as before with the same amount of funding.