A Small Publisher Doubles Revenue during the Pandemic

The pandemic was good for book sales, whether you were a big publisher or a small publisher. And if you were a small publisher with a strong, direct-to-consumer base? Then you likely did better than ever before. Microcosm in Oregon had to add an additional warehouse due to increased orders. Heyday in California ended 2020 with its best sales since the company was founded. And Lost Art Press in Kentucky? It saw sales increase from roughly $1.4 million prior to the pandemic to $3.2 million by 2022.

Few people even inside the publishing industry know about Lost Art Press, which publishes books of interest primarily to woodworkers. It doesn’t sell or distribute through Amazon or Ingram (by choice), and its books are stocked by just a handful of retailers. Most sales happen through their website, and it’s a print-driven business. And they never discount.

Lost Art Press was co-founded by John Hoffman and Christopher Schwarz in 2007. At the time, Schwarz was editor of Popular Woodworking magazine, which offered him a considerable platform in the woodworking community. Moreover, Popular Woodworking was owned by F+W Media, a multi-faceted mid-size publisher that produced books and magazines, offered book clubs and online education, and had established online subscription models by 2001. Unlike most book publishers at the time, it excelled in direct-to-consumer marketing. (Disclosure: Jane was employed by the same company, and her time there overlapped with Schwarz’s.) Working at F+W gave Schwarz insight into the financial pitfalls of publishing, such as the issue of returns. He departed F+W in 2011 and has focused on Lost Art Press, writing, and woodworking ever since.

For such a successful business, Schwarz says Lost Art Press doesn’t have a budget and doesn’t set quarterly or annual goals. If the business were to shrink going forward, he’d be happy as long as everyone was eating. It was his time at F+W, he said, that made him disgusted with a focus on growth and nothing else. “Everything we do is giving the finger to what we did in corporate media,” he says. Lost Art’s profit margin appears to benefit from that attitude: It’s roughly 35 percent. Most books have an initial print run of 3,000 to 5,000 copies, and the books are printed domestically. And it helps that Lost Art doesn’t deal with distributors or retailers that might demand a sizable discount and saddle it with returns that greatly cut into profits—a lesson Schwarz learned from F+W.

Every Lost Art Press book has turned a profit, which begs the question: How do they always make the right publishing decisions? Who in publishing ever has a 100 percent success rate? Part of the secret: The staff starts writing and posting on a topic—at their blog and elsewhere—a couple years in advance of publishing a book on it. “You can get a good feel for whether it will be a stinker or not,” Schwarz says. They have a lot of reader communication at the blog and ultimately give away a lot of content. But that’s invaluable marketing that gets baked into the process and helps ensure that no book fails. Lost Art also pays $10,000 per month for social media advertising by an outside consultant, someone Schwarz already knew and trusts implicitly to do the right thing.

The most expensive and perhaps most risky project that Lost Art Press undertook was a “deluxe” English translation of an 18th-century French book, With All the Precision Possible: Roubo on Furniture. The book is about 12 inches wide and 17 inches tall, its nearly 500 pages are printed in full color, and it comes with a custom slipcase. They printed 1,000 copies with a unit cost of ~$150; it retailed for $550. They made it into the black. (While the deluxe edition is no longer available, they offer a not-deluxe edition for $63.)

Authors receive royalties that are double or triple the prevailing rates at other publishers. On average, authors receive 26 percent of the retail price. Given that many of Lost Art’s books retail for more than $30, that’s a significant amount going to the author on each copy sold. Lost Art also makes joint decisions with the author on title, design, and production. One thing they’ve found, however, is that their simple cover designs featuring foil stamp on board (no jacket) sell best. (The default for many woodworking books: a photograph of a beautiful piece of furniture on the cover.)

Lost Art Press also sells merchandise, online videos, and in-person classes. But this constitutes about 10 percent of their business; the rest is book sales. They decided to start producing and offering merchandise, mainly woodworking tools, because they’re the kind of thing Lost Art Press editors want that they can’t otherwise get. “It’s not a lot of money, but it’s fun,” Schwarz says. “The margins are terrible compared to books.” And the in-person classes, held at their storefront in Covington, Kentucky? They sell out as soon as they open for registration, attracting people from all over the world.

Lost Art’s next move: buying a warehouse. During its early years, Lost Art Press used Schwarz’s own kids to pick, pack, and ship books. But “shipping 20,000 books a year was not doable for teenagers,” he says, so they moved everything to a fulfillment house around 2012. They’ve outgrown that solution too and have scads of inventory now that demand has moderated post-pandemic. (Many other publishers are in the same boat as far as excess inventory.) Despite paying for a mortgage, insurance, employees, and countless other costs, Lost Art will be making more money from day one by bringing it all in house, while gaining far more control. And best of all, there’s the possibility for a more personal touch—better service to customers—when doing so.

Bottom line: If you read the Lost Art Press blog or Schwarz’s American Peasant newsletter (1,700 paid subscribers), what comes through is passion for woodworking, passion for writing, and a determination to do the right thing for the business, for the suppliers, and for the customers without making a big fuss about it. They clearly work hard at what they do while loving every minute of it. In a recent issue of his newsletter, Schwarz wrote, “Do good things for your customers and the neighborhood and the town in general. Give away your time, your work, your products. Don’t ask for anything in return. Don’t try to build a community; instead try to join one in your neighborhood. What happens next can restore your hope in humanity. And don’t equate customer loyalty with creating a community. You can have loyal customers and zero community. I’ll take the loyal customers for starters, please.”