I can’t quite believe it, but I’ve worked for Waterstones for over ten years. A decade. Yikes, that makes me feel old. But in that time, I’ve seen a lot of changes, a lot of good things, quite a few bad things, ups and downs. I’m sure you don’t want all the nitty gritty, suffice to say that, the era of James Daunt is most definitely part of the good and very much an ‘up’ on the great retail rollercoaster.

As someone who’s been a bookseller for so long, though, it’s easy for me to forget that much of the inner workings of this part of the publishing industry are often hidden from view. So, sometimes, I get a little alarmed by some of the things that are said about how the system works – a lot of what we’re told in class is true, but occasionally – just occasionally – they’re not entirely true of Waterstones. Waterstones is a company that is trying its absolute hardest to do the best for all its customers: the readers, the publishers, and the writers – and to re-address some of the old industry sticking points.

So here are five things about how Waterstones works that I hope will surprise you. And if you have any other questions you’d like to ask, tweet me @bookythought

1. Publishers pay for their books to go in the chart and the windows

False. This used to be true. It isn’t any more. Each shop’s booksellers choose which books go in their windows, and their chart is based purely on that store’s sales.

There are guidelines, of course, but nothing is dictated – for instance, we’d be expected to have a really bright children’s display for half term holidays that emphasises a ‘buy one get one half price’ offer, and almost always to have a display that promotes one of our books of the month. But it’s up to us which of these books we want to shout about. Why? Because each shop is different, and each community it serves is different. And that’s how, in my old stomping ground of Truro, Cornish writers frequently make it into the chart – because we champion and support them and because our community wants books written by its own.

2. Discounting…

True. Yes, discounting is expected. Of course it is. Waterstones would never be able to pay my wage otherwise. And they’d never be able to pass those discounts on to customers through ‘money off’ or ‘multibuy’ offers.

When James Daunt became Managing Director he renegotiated discounting terms with many, many publishers. It caused a bit of a furore at the time, because he essentially asked everyone to provide a flat rate discount. On top of this, he told them they could no longer pay for their books to feature prominently at the front of store or in our windows. So why would the publishers acquiesce? Well, that’s partly between them and him, but as I understand it, it is because (a) Waterstones is the last surviving highstreet bookshop chain and we’re important and necessary to publishers, and (b) because he offered them a compromise. The compromise? Returns (more on this below).

And when the books hit the stores, again it’s up to the booksellers in each shop which books will be put on offer. There is an exception to this: our half price offers. The discounting for these is negotiated on a case-by-case basis with publishers, so it’s important to be consistent across the company. Often, the extra terms are agreed on the basis of promising the publisher that we’ll sell a certain number of copies, a number that might only be fulfilled by selling the title at half price.

3. Books are bought on a sale or return basis

True. But it’s not as bad it’s been made out to be, not in Waterstones today, anyway. We call this process ‘returns’; it’s where bookshops don’t pay for the books they buy from publishers until three or more months down the line. It enables us to send back excess unsold stock.

At one point, my main role in the shop was picking and processing returns, they were such a big part of the business. These were the ‘pile ‘em high’ days of bookselling. Not any more. When those discounting contracts were renegotiated, so were the returns procedures. We still send books back, absolutely we do, but we send back far, far fewer than we did pre-Daunt. This is because stock is managed far more carefully today: (a) less copies of each book are sent to each store (therefore, we’re more likely to sell all the copies we have), and (b) our warehouse (the ‘hub’) enables stock to be recycled around the company (if Shop A isn’t selling Book 1, but Shop B can’t keep it on their shelves, Shop A can send Shop B their unwanted stock. Bingo). Better for Waterstones, better for publishers.

Books do still get returned. We can’t always get it right! But they’re more likely to be old editions, or one or two copies of books we’ve had on the shelf for an age and nobody’s bought, rather than fifty copies of something that was overbought.

4. Signed copies of books are bad

False. This is the most bizarre bookselling myth I’ve ever come across. Any shop that rejects an author request to sign copies of their book would have to be out of their mind. And never, in my ten years, have I heard of a publisher rejecting to the return of signed copies on the basis that they are damaged goods. The publisher will want to support their author, and a book is almost always more likely to sell if it has been signed. It’s just such a nice extra that almost everyone will always appreciate. Who can say no to that?

5. Layout…

So Mal Peachey, Editor-in-chief at Rocket 88, suggested that the typical layout of a bookshop was back-to-front; that the biggest titles should be at the back of the shop to make customers walk past all the other stuff to get there. It’s an interesting idea.

But: people are inherently lazy. Bookish people will go to the other sections naturally – brilliant. But those people are probably going to come in and browse and buy anyway. One key to increasing sales (other than getting bookish people to buy more than they might have been planning to) is to get those non-bookish people through the door. This is most likely to happen if they spy something interesting in the window. And if they spy something interesting in the window, they’re going to want to find it quickly and easily because they’re not used to bookshops. That’s one reason why we have ‘front of store’ – that space right by the doors where the biggest offers go, the new books, the books everyone is talking about, or that we want everyone start talking about. If they can’t find what they want straight away, they’re going to go and buy it online instead. And we definitely don’t want that.

By Isabel Popple – @bookythought