Mid-sized Firms Prosper
"Publishing is a passion, but it is
also a business," John Huenefeld told me the night
before a session in his honor at the Publishers Association
of the West Convention. I interviewed him in the lobby
of the beautiful Snowbird Resort near Salt Lake City, Utah.
It was the perfect environment for a conversation about
books: fat leather chairs, incandescent light, and a chill
in the air outside inviting people to curl up with a favorite
book. How many of those books would not be here without
John Huenefeld looking over some publisher’s shoulder,
gently scolding with his easy laugh and infectious good
Once publishers survive the birth pains of
building a catalog and arranging for a distribution channel–when
they’re ready to grow up–that’s when
they call John Huenefeld. "There are 2,950 mid-sized
book publishers in the U.S. and Canada," Huenefeld
reported with characteristic precision. "That’s
my market." He has counseled nearly 400 of these firms,
stressing that it’s necessary to make a profit if
you hope to survive (Amazon.com not withstanding). And
it’s clear from talking with him that the goal of
many mid-sized publishers is not to make a profit but to
generate enough cash flow to publish one more season.
Toward Better Bottom Lines
In the recently completed "Huenefeld
Survey of Book Publishers" (conducted this year by
the Publishers Association of the West after Huenefeld
bequeathed it to them), mid-sized publishers collectively
projected a 3.6% profit for the year 2001. That’s
how much they hoped to make! If nothing else convinces
you that publishing doesn’t observe standard business
practices, the fact that publisher pro-formas are pessimistic
should do the trick.
Actually this segment of the industry made
a respectable 8.9% profit in 2000. In the dot.com era of
superheated speculation, a profit margin like that would
have been cause to project world domination by 2005. For
mid-sized publishers, it simply meant another dozen manuscripts
would make it to press.
At our interview, Huenefeld slipped me the
sixth and "final" edition of his book, The Huenefeld
Guide to Book Publishing, his paean to publishing management.
He is beginning retirement, having penned his last dispatch
for The Huenefeld Report, his fortnightly newsletter begun
in 1973. "I wrote 734 out of 736 issues myself," he
confided. Gone, too, are the professional development seminars
Huenefeld used to spread a sermon of sound business practices
to publishers who typically focused their attentions well
north of the bottom line.
If you’re just starting a publishing
company, you can’t read The Huenefeld Guide; it’s
too depressing. It would be the equivalent of having a
crush on someone and reading Dr. Phil’s Relationship
Rescue for courting advice. I told Huenefeld that I first
picked up The Guide in 1984 when I was the third spoke
of a three-person publishing house.
"What color was the cover?" Huenefeld
"Teal, I believe."
"Fourth Edition," he said.
As I recall, I got to the part where it says
you need a minimum of $75,000 capital to start a book publishing
company and I put the Guide down. Maybe you need that much
to survive, or to start a successful publishing company,
but all that’s really required to set up shop is
a printer who would give you terms. The Huenefeld Guide
is most useful once you have a publishing company and have
run out of home equity. That’s when you call in The
Prescriptions for an Influential Industry
Huenefeld’s first job, after he got
out of the service, was as a newspaper reporter for a few
years. "For the next ten years," he recalls, "I
worked as an editor at a company that produced financial
newsletters. I left them to take my first job with a book
publisher–Beacon Press. I stayed with them for three
years. That was during the Vietnam War. They published
the original, unedited version of The Pentagon Papers."
In 1968, he started The Huenefeld Company,
a management consulting firm for book publishers. I asked
him if he had any special training for this work–a
degree in accounting or maybe an MBA? "My master’s
degree is in history," he laughed. "I never took
a course in business or math. I guess I just picked it
up along the way. Ten years editing financial newsletters
must have taught me a thing or two."
When pressed for "war stories" about
publishers he’s worked for, Huenefeld talked about
the forest and not the trees. "Across the interstate
from my office in Bedford, Massachusetts, is the world
headquarters of the Raytheon Corporation. They make missiles
and such things. Sometimes I look out the window and realize
that the gross revenue of this one company exceeds the
entire annual revenues of all the U.S. book publishers
"Book publishing is a relatively small
industry, and a lot less concentrated than most people
think. There are 50 major book publishers with annual revenues
over $50 million, each. There are another 5,000 mid-size
and small publishers with annual revenues between $10,000
and $50 million. Finally, there are anywhere from 25,000
to 55,000 self-publishers, depending on whose numbers you
use. All these companies together don’t add up to
"But look at the impact these publishers
have had! They’ve changed the way we think, the way
we dress, the way we act. They’ve led the peace movement,
civil rights, equal rights for women, religious freedom,
the environmental movement. They’ve toppled world
leaders, stopped wars, and shared the knowledge that fueled
the new economy. They have changed the world. That’s
You could see the pride in Huenefeld’s
eyes… the awe he has for the profession he is associated
with and its efficiency in generating more social changes
per dollar invested than any other form of entertainment.
That’s the way his mind works.
Content Rules the Roost
Given his level of concern with financial
performance, you’d think Huenefeld would be a big
fan of the trend toward marketing-driven publishing. But
asked who occupies the most important slot in the organizational
chart, he was unambiguous. "Acquisitions editors.
They are the stars of our profession. They control the
relationship with the creators of content."
What’s the project he felt proudest
of? "I’m a confidential consultant," Huenefeld
replied–a promise he takes seriously. When pressed,
he shared one anecdote from his roster of hundreds of clients. "It
was such a long time ago," he said, "I don’t
think they’ll mind. There was this printer by the
name of John Ballantine, and he was asked by an author
to publish a book about bottle collecting. John published
it, and he enjoyed the experience so much he decided to
publish a book of his own, called something like 50 Great
Hikes in New Hampshire. It sold very well locally and spread
throughout New England.
"That led to 50 Great Hikes in Vermont,
50 Great Hikes in Connecticut, and so on. All these fresh-air
types started sending in suggestions, which became manuscripts.
The New Hampshire Publishing Company kept growing, and
John would send his staff over to me, one by one, to be
"When he ran out of places in New England,
he consulted with me about expanding the hiking line nationally.
I advised him to stick to the regional market. He had account
relationships with vendors throughout the region. It would
be easier and more profitable for him to come up with new
books to sell into this market than to endure the risks
of building bookseller relationships farther afield.
"So out he comes with 50 Great Canoe
Trips, 50 Great Fishing Holes, 50 Great Ski Trails, and
so on. He was very successful and eventually sold his publishing
operation to a big company for a lot of money."
The Persistent Passion for Publishing
End of story? Not so fast. "Once he
sold the company, he retired to publish books about the
history of little towns in New England. That’s what
he wanted to do all along. He finally had enough money
and free time where he felt he could do it." Oh, the
lure of publishing!
As John Huenefeld winds down his own career,
I can’t help but wonder how permanent his retirement
will be. The final chapter of the final edition of The
Huenefeld Guide to Book Publishing holds some key clues,
and perhaps so does his answer to the last question he
was asked at the PubWest Conference: "If you were
thirty years old today, knowing all you do about the business,
would you start a publishing company?"
"Absolutely," Huenefeld replied. "I’m
very keen on this POD technology. Even though the profit
margin is smaller, it moderates the risk of overstock returns.
Two-thirds of the cost of inventory is manufacturing. With
that capital freed up, I could publish a lot more books."
Steve O’Keefe is the Executive Director
of Patron Saint Productions–a publishing consultancy
specializing in online marketing strategies, campaigns,
and training–and author of the "Complete Guide
to Internet Publicity" (John Wiley & Sons, Inc.).
If you have suggestions for future Publishing Portraits,
please e-mail them to info@PatronSaintPR.com.
"The Huenefeld Guide to Book Publishing," Revised
6th Edition, is available from the publisher, Mills & Sanderson,
P.O. Box 665, Bedford, MA, 01730-0665 (ISBN 0-938179-40-3,
405 pages, paperback, $45 postpaid).