Guest Post: Saku’s Random Book Club

Books and entrepreneurship? Pushing all my buttons.

Another guest post for you today -what is this? Christmas already?

I love books and reading, am interested in random business ideas and making money, and have been a fan of Patrick’s newsletter for a while. When I saw his new subscription service idea I thought it would be a good fit for the blog: either because people would be into the idea or because of it’s a case study of a micro-business startup. Either way, enjoy 🙂

Ben Tanaka was tickled by my start-up business Saku’s Random Book Club, and asked me to write about it for RetireJapan readers. Glad to oblige, but where to start?

How about an origin story… let’s see… my parents were crushed to death under a pile of leather-bound first edition books while trying to fact-check a Trump tweet and I was brought up by Saku, their stray cat, but it was only when he was bitten by a radioactive bookworm that Saku’s Random Book Club became real…

Or how about the truth? I read Diary of a Bookseller by Shawn Bythell and thought the random book club he was running to rid his Scottish bookshop of unsold, good books was a brilliant idea, only when I tried to join three months ago, he wasn’t taking any new members. So I figured if you can’t join ‘em, beat ‘em…

Perhaps I should just give you my pitch? Sign up for a year and at the beginning of every month I’ll send you a random, hand-picked good book from my collection with a key element of surprise: you won’t have any idea what the book is until it arrives in the mail. It’s not actually picked by my adopted stray cat, Saku, but it might as well be.

So, whaddaya think?

I’m a bit of a sucker for watching repeats of the Dragon’s Den on YouTube while I’m tucking into my bento of an evening between teaching English lessons at my Abiko, Chiba Prefecture, eikaiwa, and I can easily imagine how the dragons would rip the idea apart as an investment.

Second hand books? Made of paper? That the customer can’t pick? Everything is going digital now. It’s all about more choice, not less. I’ll tell you where I am, I’m out.

And I’ll tell you where I am: over the moon.

Here’s the thing. I’m not trying to create a Netflix for secondhand books to rival Amazon, I’m not interested in attracting investors at all. I’m interested in turning a personal love of hunting for good secondhand English books into a profitable sideline that funds me to find yet more books. A modest aim, although, if I admit to you my true goal, you might think me a few lines shy of a chapter. Don’t tell anyone but I want to create the best stocked collection of English language books in Japan. And the first step up this mountain is to monetize my cat?

In a word, yes.

Allow me to present the business case for Saku’s Random Book Club. My extended pitch and attempt to answer any customer objections before they arise (thanks to a advice from Dan Kennedy’s The Ultimate Sales Letter, which I liberated from a secondhand bookshop in Matsudo, by the way) forms the homepage of the Saku website, so I won’t rehash that all here, other than to state that I’ve positioned the business as a way for keen readers to discover “new” good books in a world swamped with reading options.

This wasn’t my initial plan. At first, I highlighted the quirkiness of my cat picking books, but that didn’t particularly resonate with the 200 subscribers to my monthly literary Our Man in Abiko newsletter. While a handful of subscribers expressed an Interest (and love for Saku, he is adorable, after all), many were horrified at the thought of yet more books to read and, urghh, books made of paper? Gross. The randomness of the club was just an added distraction.

So I modified my positioning to address these concerns – the randomness is the feature, not a bug, peeps. You say lack of choice, I say increased opportunity. Randomness allows you to discover unknown (to you) books and authors, and thus the club is actually saving you time because you don’t have to hunt for good, unknown books or agonize over what to read every month or “feel guilty,” as one newsletter subscriber told me, that they couldn’t finish all the books they had.

Saku has your back, yo.

That was the promise at least. But how much was that worth to potential customers? I asked a few newsletter subscribers. Some said they would be happy to pay ¥600 to ¥900 for a random book a month. A pal in the UK said   10 pounds a month would be OK, if he had the right to quit or change the books if he didn’t like the selections. Another said she would be into the idea except that she had renounced paper-bound books for digital to save space (and the Earth). One subscriber said she’d be happy to join only if she could pass on the books to others in the club to read, she’d even be happy to pay postage if that was the case.

OK, duly noted. I tried to come up with work-arounds. If people didn’t want to keep pesky paper books, they could return them with an extension to their membership as payment. If anyone didn’t like how the club was working out after trying it for three months (THREE MONTHS!), I’d refund all their money, no quibbling. But how much should I charge?

I popped along to my nearest post office with a medium-sized trade paperback book and found that the cost to send it anywhere in Japan would be ¥300, to Asia would be ¥500 and the US ¥900. I already knew that you could buy two book-sized padded envelopes from the ¥100 shop. What other costs did I have?

Oh yeah, books.

Before coming to Japan in 2007 I had accumulated 5,000 books in the UK comprised of the overflow of review copies sent to my newspaper employers (The Nottingham Evening Post and the Derby Evening Telegraph) that I liberated to my garage, supplemented by trips to charity shops on my lunch breaks to search for underpriced good books, the best find being a first edition of Roald Dahl’s first published book from 1946, “Over to You” complete with its ration-quality paper dust jacket. It’s sitting on a shelf in my bunker as I type this. Since coming to Japan, the opportunities to find such good second hand books in English were close to nil, I thought, so I contented myself with buying the odd book through Amazon or Abebooks and scouring the secondhand bookshops of Jimbocho, Tokyo, for bargains a couple of times a year. Those sources are too expensive to base a reselling business on, but I noticed that most Book Off Japanese secondhand book stores usually had a couple of shelves devoted to cheap English language books. Their pricing policies vary store to store, but seem to be based on how large, familiar to Japanese or new-looking a book is, rather than its rarity or read quality. So, a hardback copy of a later Harry Potter will be on the shelves for anything from ¥300 to ¥1,500, whereas that older PD James paperback goes for ¥100. Was it possible I could get enough good, cheap copies of quality secondhand books to supply a fledgling book business?

There are seven Book Off stores within sortie range of my bunker, five of which I discovered carry English books. As an experiment I raided each outlet once a week over two months to trawl for cheap, good books. Anything in good condition, worth reading (even if not my cup of tea) and priced at ¥100 to ¥200 went home with me to meet Saku. After two months, I had increased my stock of sellable books by 100 at an average price of ¥200 per book when transport costs were factored in. 

So, my back of the envelope cost calculation per book looked like:

Book cost: ¥200
Postage:    ¥300 (¥900 to the US)
Packaging: ¥50

Given that a key purpose of this venture is to increase my stock of books, I need to make a minimum profit of the price of one book (so that for every book that goes out the door, two come in), giving me a minimum price to charge of ¥750 per book, which is about half the price most new books in English can typically be bought for in Japan.

But that still felt a little high to me for a book you have every chance of not liking very much, especially if a customer needed to pay so much more for the book to be mailed abroad. If I packed the books myself using cardboard boxes from the nearest Big A supermarket, packaging would be negligible (the price of a strip of duct tape) and if I cycled to the Book Offs, that would make the transport costs negligible too. For customers abroad I’d just have to encourage Saku to “randomly” pick books that were smaller and lighter than the average to keep airmail costs down. All of these cost-cutting measures were eco-friendly too, so there is that, even if I was sacrificing a bit more of my time to save a couple of yen.

So now I was looking at just needing to charge ¥600 or so per copy or around ¥900 for readers based outside of Japan.

OK, that sounded like a more reasonable amount to charge folk, but of course there were going to be other running costs, like a website, a way to take payments, and where was I going to keep all these books? The latter question was solved by storing the books at no cost in the library of the eikaiwa I run with my wife. When the shelf space runs out (at this rate, around March, 2020), I’ll, er, cross that bridge when I come to it.

I decided to go with PayPal to handle payments as it is a known name and takes a very reasonable cut in the order of 3% per transaction plus loose change, with no startup costs. I was happy to use a free website domain and gmail until the business gets big enough to warrant paying for a .com address and fancy-pants email address. I figured I just needed a button on a freebie website by WordPress or Squarespace or the like, but I quickly discovered that they wanted to charge me ¥3,000 a month for the privilege of attaching a PayPal button.

I ended up going with a Wix.com site straight out the box largely because it looked pretty and had a formatted PayPal donate button, which I subsequently found doesn’t work in Japan, so although I now have a (free) website, I have to get people to email me before I can send them a PayPal invoice. It works, if a little clunkily, but it will do for now.

How do I know it works? Because I have three paying customers through this method, none of whom is related to me (to my knowledge) or that I’ve even ever met offline.

The future? It’s digital, as everyone knows. But that presents an analogue opportunity too. If everyone and their cat is moving to digital, there should be a glut of underpriced, unloved paper books entering the secondhand market for a while yet, and me and my moggy are happy to fish for bargains while that remains true, provided enough people are still happy to read ye olde paper books.

As it stands, 2020 will be the year that either makes or breaks Saku’s Random Book Club. I want to get a few new subscribers every month and work on improvements and test what works (and what doesn’t). I have a few marketing ideas, though don’t want to spend much until I have a better idea of who Saku’s customers are and what they want.

It is possible that customers might prefer to specify random books within a genre (for a modest increase in fees), or English books for Japanese learners of English, and I’ve thought about offering a premium club selling only random collectables (hardbacks and first editions and such) and charging a premium price. If the customer base shows it is rising steadily, and I can retain most subscribers year on year then I’ll have to find new sources of cheap secondhand English books in Japan. Ex-pats leaving Japan or schools offloading their paper-based libraries spring to mind as likely good sources, I’ll have to see.

Of course, it is entirely possible the club fails to resonate with customers, in which case, my library (and wife) will groan under the quantity of books. But I’m betting there are still enough people who love surprises and reading books on paper. As long as that remains the case, I’m confident that real books will always maintain some real value, if so there should always be a place for Saku’s Random Book Club on the welcome mat.

Patrick Sherriff, an Englishman who survived 13 years working for newspapers in the US, UK and Japan. Between teaching English lessons at his conversation school in Abiko, Japan, with his wife, he writes and illustrates textbooks for non-native speakers of English, releases Hana Walker mystery novels, short stories, essays and a monthly newsletter  highlighting good fiction published in English about Japan. Saku’s Random Book Club is his latest project to spend more time with books.