Note: The original text of this document is: “Central Propaganda Department and Administration of Press and Publications Some Opinions concerning the Present Book Distribution Structure Reform”.
1 April 1988, Central Propaganda Department, Administration of Press and Publications
On the basis of the spirit of the 13th Party Congress, book distribution work must further liberate thoughts, further open up and become further vitalized, in order to push distribution structure reform towards a new phase.
I, The guiding ideology and objectives of accelerating and deepening distribution structural reform.
Since the 3rd Plenum of the 11th Party Congress, our country’s book distribution structural reform has seen clear successes. The structure with State-run bookstores at the core, with many kinds of economic components, many kinds of sales forms and fewer circulation links has been basically shaped. A number of bookstores have implemented all sorts and forms of contracting responsibility systems. The emergence of all sorts of book fairs and trade fairs, has enlivened book markets. In nine years of time, the nationwide book sales value has grown 3.5 times, State-run bookstores’ fixed assets have tripled, State-run bookstore network points have doubled, collective and individual bookselling points have grown out of nothing to number 28000 locations.
But, the distribution management structures and commercial forms with excessive concentration, rigid control and excessive administrative intervention that have been shaped for a long time since founding the nation has still not basically changed. The autonomy of grass roots bookstores is to little, and they lack vitality. The production, supply and sales relations of books are not smooth, problem of disjoint between the supply and sales of not a few books and especially academic or scientific work still exists. Because of this, we must accelerate and deepen book distribution structural reform.
The guiding ideology of distribution structural reform is, under Party leadership and the Socialist system, fully muster the vigour of the nationwide publishing and distribution workers, to develop the production strength of publishing and distribution departments, and publish and issue more good books. Books are spiritual products, and must put social effect first; books are also commercial products, and attention must be paid to economic effect, its social effect can only be realized through commercial exchange. Because of this, in the process of accelerating and deepening reform, we must persist in the Party’s publishing policies, and persist in handling matters according to the rules of the Socialist commodity economy, give high regard to the unification of social effect and social effect, strive to satisfy the popular masses’ requirements towards books, and even better serve the construction of Socialism with Chinese characteristics.
The basic objective of reform is establishing and developing an open book distribution system with high efficiency, which is full of vitality. At present, we must continue to perfect and develop a new structure with State-run bookstores at the core, many sorts of circulation channels, many sorts of economic components, many sorts of sales forms, and few circulation segments, and move the “three letting-goes and one linkage” forward. That is: we must let go of power and contract it out, to enliven State-operated bookstores; let go of distribution cannels, to enliven book markets, and let sales forms and distribution discounts go, to enliven sales mechanisms; promote the linkage of the horizontal economy, develop all sorts of publishing and distribution enterprise associations and enterprise groups.
II, Let go of power and contract it out, to enliven State-operated bookstores
According to the principle of separating ownership powers, and business powers, truly give business powers to State-run bookstores, make into economic entities that have independent legal qualifications, with autonomous management and sole responsibility for profit and loss. All provincial, autonomous region and municipal administrative press and publications organs should, according to the requirement of separation between government and enterprises, let powers go to State-run bookstores.
Provincial-level Xinhua bookstores shall progressively transfer their business management powers to city and country (district) grass roots Xinhua bookstores. All localities’ administrative culture management departments must also transfer the business management powers that enterprises should happen to the local bookstores. State-run bookstores have the power to autonomously allocate post-tax profit according to State regulations; they have the power to autonomously hire or dismiss employees within the scope permitted by policy on labour and personnel affairs; they have the power to select stocking channels, and autonomously purchase books from wholesalers or publishers.
City (district) first-level bookstores must also transfer powers to their subordinate specialist bookstores and comprehensive salesrooms. We must progressively reduce management levels, and create conditions to divide them into independent accounting work units according to sales departments.
On the basis of letting powers go, State-run bookstores are to implement a management contract responsibility system that puts even better service to readers in the centre, where responsibility and rights are integrated. Where it has been implemented, it must grasp supplementing, deepening, perfecting and developing contracting. State-run bookstore management deals with intellectual products, they are micro-profit enterprises, and contracting base numbers must seek truth from fact. We should, according to State regulations, implement “micro-profit enterprises handing over profit quota responsibility” and “loss-making enterprise deficit (or subsidy) responsibility”. We must give rein to the function of competitive mechanisms in contracting, try out bidding methods, select and designate managers. Small-scale salesrooms, bookstalls and village bookshops may implement collective management, leasing management or try out shareholding management. Regardless of which sort of contracting form is implemented, they all must have book commerce as their main business, and cannot weaken book distribution because of launching many other sorts of business.
Letting go of power and contracting are the only way for distribution structural reform. But in the steps of implementation, we must suit measures to local conditions, not “cut with one knife” and not use only one model. All localities may, on the basis of real local conditions, engage in many sorts of explorations and trials. The general requirement is to ensure that grass roots State-run bookstores are full of vitality, have full business autonomy and stimulate the development of publishing, distribution and production forces.
III, Letting go of wholesale channels, enlivening book markets.
Changing the sole closed-model wholesale organs, and establishing open-model wholesale system with many channels existing side by side, has an important function in enlivening book markets.
To enliven wholesale channels, we must fully give rein to the function of central markets, and establish some open wholesale centres that conduct both wholesale and retail business, and serve all areas in some large cities. There may be different wholesale channels: those of the Xinhua bookstores, those of publishers, and those jointly run by publishes and Xinhua bookstores. Collective bookstores meeting conditions may also develop wholesale business, with approval of the provincial first-level administrative publishing organ.
All distribution venues and provincial-level bookstores must strive to turn themselves into completely open business service-type wholesale enterprises and fully give rein to their pivotal role in book circulation. Wholesale targets are not to be divided into State-run, collective and individual; the scope of wholesale is not do be divided into intra-province and extra-province; wholesale forms may take many varieties and forms. Provincial-level bookstores mainly are to conduct wholesale, storage and transportation work, and must at the same time provide information for grass roots bookstores and foster talents. City (district) and country Xinhua bookstores are both wholesale and retail work units and should strengthen their wholesale business in selling books to supply cooperatives and all other sorts of economic components.
The opening of wholesale business through many channels has increased the responsibilities of publishers in storing books and reprinting books. Publishers should give preference to guaranteeing the ordering needs of all wholesale organs, and continue to perform self-run wholesale and retail work. But wholesale conditions (including wholesale times, wholesale discounts and wholesale varieties) should be consistent with delivery stores, to guarantee the vigour of special wholesale organs in production localities and sales localities. Publishers and State-run bookstores must vigorously support the development of collective bookstores and bookstalls, guide them to sell more good books, and provide guarantees in terms of goods sourcing as much as possible.
IV, Letting go of sales forms and distribution discounts, to enliven sales mechanisms
Subscription solicitation and exclusive selling rights that have been formed over a long time, have fettered the vigour of grass roots bookstores to expand purchases and sales, and have also fettered publishers’ motions, this is where the key of the issue that generally, book ordering numbers cannot go up. In the future, apart from important documents and textbooks of the Party and the State, and books for internal distribution, for which exclusive sale will continue to be implemented, commission selling, consignment selling an many other methods may be implemented for other books. Consignment selling is the direction in which matters are spreading, and should be vigorously tried out. At the same time, we must also practice subscription solicitation with guaranteed refunds, trial selling, period selling, sending out samples for ordering, looking at samples for ordering and other flexible and diverse methods. Regardless of which form is pushed forward, publishers and deliverers must sign economic contracts, and strictly conduct matters according to contract.
Distribution discount must also be let go, in step with letting go selling forms. Fixed and unchangeable discount rates do not benefit the enlivening of buying and selling, and expanding book-ordering numbers. In the future, floating discounts are implemented, and discounts are negotiated by both the publishing and distribution sides themselves. The principle of floating discounts are: publishers must, on the basis of the originally decided exclusive selling, commission selling or consignment selling discount, give a little more discount to distribution department, and the allowed discount is mainly given to grass roots book ordering stores; readers face narrow prices of academic works, this must be suitably let go according to regulations, it is permitted to decide prices with reference to cost, distribution discounts may be smaller than the distribution discounts of other books; publishers may try out quota sales contracting with wholesalers, and wholesalers with book ordering stores, and the part outside of the quota may be granted encouragement discounts. In should, we should utilize the law of value to enliven book sales and mitigate imbalance between supply and demand.
V, Forcefully develop horizontal integration
Horizontal integration is a necessary trend in the development of the Socialist commodity economy, and is an objective requirement for expanding the book market, it has an important significance in changing the separations of departments and regions, and regional barriers, which have been shaped through many years.
Horizontal integration in the book distribution area may be created through many sorts and varieties of forms. Between stores, publishers, and publishers and stores, between communal stores and other enterprise or undertaking departments, it is permitted to jointly setup bookstores, wholesale centres, book trade markets and markets for old books on the principle of voluntary participation and mutual benefit, through investment, share participation and other methods. With permission, it is also permitted to compose distribution enterprise groups, and establish sales systems in all localities. But, work units that have not obtained book or periodical business permits may not sell books or periodicals.
At present, some localities have adopted administrative methods to implement all sorts of limitations, including rigid rules that local provincial stores must have a proportion in selling books of that province, this does not conform to the principles of letting go and enlivening, it is not beneficial to raising the quality of books through competition, and should be corrected.
VI, Large and mid-size cities must pay regard to developing and running specialist bookstores.
Following the progressive rise of the popular masses’ knowledge levels and extent of specialization in production and work, in large and mid-size cities where intellectuals are concentrated, existing comprehensive bookstores can no longer satisfy the demands of readers concerning specialist books. Practice proves that opening specialist bookstores, can concentrate all sorts of specialist books, benefit linking up to specialist readers, benefit targeted subscription solicitation and distribution, benefit stimulating the publishing of academic works that have value, benefit the specialization of distribution personnel and raising the quality of distribution work. Because of this, all large and middle cities must, at the same time as running comprehensive bookstores well, on the basis of the local situation of the composition of readers, scientific, technological and cultural conditions, progressively establish different kinds of specialist bookstores of all varieties, and sufficient stocks. They must also forcefully develop mail-order business, and launch mail-order bookstores mailing fees are to be borne by readers.
VII, Forcefully strengthening distribution work in the countryside and border regions
Following the deepening of reform, the implementation of the “Meteor Plan” and the vigorous eruption of township and village enterprises, the broad countryside’s demands towards science, technology and culture have become ever more urgent, and especially a large batch of rural youths with a relatively high cultural level urgently require developing their knowledge. The work and scientific research bases in border regions concentrates intellectuals, who urgently need all sorts of books. A small number of ethnic regions also urgently require the dissemination of scientific and cultural knowledge. Because of this, forcefully strengthening distribution work in the countryside, border and ethnic minority regions is an extremely important task for publishing and distribution departments.
At the same time as fully giving rein to the function of rural supply collectives as book selling points, all localities’ publishing and distribution departments must strive to ensure that their distribution channels stretch into the countryside, remote and border regions. County Xinhua bookstores must concentrate their main force to do rural distribution work well, establish salesrooms in towns and villages meeting conditions, and vigorously support collective and individual bookshops, bookstalls, booksellers, and agency sales. Town and village enterprises are one of the focus points of rural distribution, and their needs must be fully satisfied, we must also satisfy the book needs of rural libraries, cultural stations, science and technology stations and industrial and scientific research bases in remote and border areas, do targeted distribution well, and make matters convenient for readers in any possible way. Book distribution in rural, border and ethnic minority regions comes with high cost and many difficulties. We suggest all localities’ governments to provide attention and support in economic policies; and to bring distribution network point construction into spiritual civilization construction plans. There are some provinces, autonomous regions and municipalities that exempt rural bookstores from business tax and income tax, which has extremely greatly stimulated books to go to the countryside, this sort of method merits extension.
VIII, Strengthening leadership and macro-level management over distribution work.
Distribution structural reform ahs put forward even higher requirements towards all levels’ Party Committee Propaganda Departments and administrative press and publications organs, leadership must absolutely be strengthened, and macro-level management must be strengthened.
All levels’ Party Committee Propaganda Departments must promote and support administrative press and publications organs in fully exercising management functions, in order to reform and be responsible for the overall picture. We must assist them in doing guidance, planning and trial work concerning distribution structural reform well, timely summarize and disseminate reform experiences, assist the resolution of difficulties and problems that emerge in reform. We must fully utilize radio, television, newspapers, periodicals and other public opinion methods to propagate the significance and methods of distribution structural reform, disseminate book information, recommend excellent works, appraise all sorts of books and periodicals, and commend advanced distribution work units and distribution workers.
All provincial, autonomous region and municipal press and publications bureaus must, on the basis of investigation and research, further formulate and perfect regulations and management measures in the area of publishing and distribution, and, in consultation with public security, industry and commerce culture and other relevant administrative departments, use economic, legal and administrative means, strengthen management over the book market, firmly ban reactionary and obscene publications according to the law, and continue to attack illegal publishing activities. On the basis of the requirements of our economic development strategy, further reform and strengthen book, newspaper and periodical import and export work. In order to adapt to the new situations of provincial-level bookstores progressively transferring management functions, we must establish and complete corresponding functional distribution management organs, and strengthen macro-level management over distribution work.
Whether or not distribution system reform can be successful, and whether or not the appearance of distribution work can be changed, depends on whether or not there is a line of distribution teams with a firm Socialist orientation, who dare to reform and explore, and are proficient in their business. Because of this, we must grasp the training of distribution personnel in a planned and gradual manner, and raise the quality of distribution teams. We must assist in running the specializations of book distribution in higher-level, polytechnic and technical schools, continue to run on-the-job personnel training classes well. We must improve and raise the political and economical remuneration of distribution personnel. Publishers and distribution work units may appoint distribution personnel in specialist technology positions to specialist technological duties; position appointment rules for other professional personnel are provided separately. All localities must not arrange for personnel not meeting conditions to go to bookstores. Staff allocated to bookstores must have an upper middle school cultural level.
In order to strengthen management over the distribution sector, with permission, it is permitted to establish local or national book, newspaper and periodical distribution associations. Making distribution associations into people-run mass organizations with voluntary alliance, which implement democratic management has a positive function in implementing the Party’s publishing principles and policies, safeguarding the sector’s interests, contradictions inside associations and sectors, and other areas. In the management and education work of collective or individual bookstores, bookstalls and booksellers, we should give even more rein to the function of distribution association. We must also adopt all sorts of methods to regularly conduct education on the basic line of the Party in the primary stage of Socialism and the Socialist distribution work principles and asks for the broad distribution workers, to ensure that they fully understand the important function of distribution work in the construction of both civilizations, establish Socialist business thinking and professional ethics, observe discipline and abide by the law, and wholeheartedly serve the broad readership.