The return policy that exists, made between book publishers and distributors back in the day, needs a makeover. Not sure it it will ever get one but that's what it needs. And for what it's worth, it doesn't need a ginormous makeover just one that is more small pub friendly. With small publishers clearly outnumbering larger publishers due to the ease of printing, it would seem that a revision would be in the works.
Who would make the change though?
Publishers or rather the large publishers of today and distributors (provider of books to all bookstores) are responsible for the return policy as it stands with these two entities striking a deal that accommodated both. Sure these publishers no longer need to coddle distributors to encourage them to carry more books to help with with warehousing costs. And by coddle I mean offering them the ability to return all books for a full refund regardless of the condition of the book, the origin . . . so long as the book exists etc. . . But the return policy doesn't hurt them so why change it to make it easier for the competition?
The distributors could add a different return policy for small pubs but that might spark a revolution with all the large publishers telling them where they can ahem, stick it and moving to another distributor.
What's a small pubbed author to do?
Going through a POD is an option (see, I like POD's. Never Ceese is through a POD) Just make the book non-returnable. You don't have to play the game if you don't like the rules or rather if the rules set you up to be the loser. If you're with a POD and put out quite a few books through them then you might survive the slanted-toward-the-big-publisher return policy. One book alone can work . . . eventually . . . maybe . . . but it won't be pretty. LOL
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