Lulu.com Cuts Staff Due to Economic Slowdown

This news is from last October, but it’s important for anyone considering using the Lulu service.  Lulu has showed some ill effects due to the faltering economy – as a result it is cutting its workforce in order to make up for lost revenue.

On the one hand, this is surprising.  Lulu has a fairly good business model.  Given that books are only printed when they’re bought, Lulu does not lose money on books that are printed but not sold, as is the case with a traditional publisher.  Every Lulu author will likely print up at least one book – which accounts for a fair degree of Lulu’s sales, as non-marketed self-published books will not have any buyers except the author.  What this means is that not only are sales down of print on demand titles – which are normally five dollars more expensive or more than traditionally published books – but fewer authors are using the service and printing their own books.

Problems with Lulu Management

One wonders though it this is part due to Lulu Enterprises’ poor management.  Recently, Lulu raised the prices on books in their American network.  This was done without warning, meaning that thousands of authors who had printed up covers with a printed price and marketing materials, such as postcards, with a different price would have paid for outdated materials.

There was an instant outcry against this elevation in prices.  This was done on the heels of Lulu doing the exact same thing to the foreign market and then apologizing in their correspondence with writers that they were caught by surprise and needed to raise prices in order to sustain their business model.  This turned out to be an untruth because Lulu then did the same thing months later to the American market, which was met with the same outraged reaction – justifiably so.

Put together, Lulu has management issues that are contributing to its increasingly-poor reputation.  It is not surprising, then, that a few months later that Lulu revealed its plans for layoffs.  Bryce Boothby, hired as Lulu’s President in 2007, was one of the 24 let go out of the roughly 125 employees.  He claims “The company is actually doing quite well. It’s more a reaction to what’s happening in the marketplace.”  What’s happening in the marketplace isn’t necessarily only that people are not buying expensive print on demand books, but writers are looking for other outlets due to Lulu’s recent problems dealing with authors.