Amazon is reported to be reducing the number of copies of books which they hold in their warehouses. The IBPA (Independent Book Publishers Association) post links to the Publishers Weekly report about this. (Thanks to The Digital Reader and BookRiot.) The reason given is lack of space in their warehouses, which is fair enough. Amazon has been building new warehouses all over the place for years, and logically a slow-down has to come at some time.

Now, Amazon works by powerful algorithm, and is extremely sensitive to changes in demand. If a book gets selected for some book group, or gets a good review somewhere, and as a result a few people place orders, Amazon’s system may generate orders to the publisher calling in more copies. They want to be covered against the algorithmic “probability” that tomorrow a dozen people will order the book and so on day after day. A consequence of this is that any sudden jump in demand can result in the majority of a publisher’s inventory ending up in Amazon’s warehouses, even though these dozens of orders don’t actually come to pass. Many a publisher has been forced into a reprint they didn’t really need, when ultimately Amazon’s excess inventory wends its way back as a return.

On the other hand Amazon’s ordering patterns will tend to get baked into publishers’ sales assumptions, and a slow-down in ordering will have an impact on budgets. One publisher is quoted in the PW article as saying that in Amazon’s latest order quantities were down 75% compared with this time last year. That’s not nothing.

Is Amazon moving toward a position of maybe allowing a customer to wait a day or two for a book? Not necessarily. They can and do source books not only from the publisher but from wholesalers, especially from Ingram, so it’s quite possible that they figure they can maintain “instant” delivery using this sort of option. They also have the option, in many instances, of printing a book by print-on-demand, even in some cases where the publisher is still offering copies from inventory printed by offset. This set up will have to have been agreed to by the publisher, and is directed at keeping books continuously and rapidly available. Amazon, on getting an order from a customer, will go through a cascade of options on how best to source the book. In other words, having the book on a shelf in one of their warehouses isn’t their only option.

Now that I have started the hare in my own mind of Amazon’s possibly wanting to exit the book business, I can’t stop reading that speculation into any news about them. But that’s got to be over-interpreting things in this case, even if the IBPA piece does suggest that Amazon’s looking to favor items with a bigger margin this holiday season. Last Christmas season there was a bit of congestion around Amazon’s warehouses, with publishers unable to get delivery appointments to deliver their books. Amazon’s decision to carry a bit less stock is possibly just an attempt to moderate this chaos, with a bit of fingers-crossed hoping that there won’t be much of an impact on their deliveries to customers.