The Contract Traps (And Why AI Just Kicked The Door Open)

In Part 1, I told you what happened to Baker & Taylor. Now I\'m going to tell you what\'s been happening to you.

For decades, library vendors have operated behind a curtain. You send them money, they send you books with labels and MARC records attached. The process felt like magic because it was designed to feel that way. The complexity was the product.

That complexity is about to collapse. And AI is holding the sledgehammer.

The Dirty Secret of Library Vendor Pricing

Let's talk real numbers. I pulled these from actual RFP responses and consortium pricing agreements.

A typical vendor charges you:

• $0.59-0.62 for a MARC record
• $0.34-0.38 per label (spine label, barcode label, ownership label - each charged separately)
• $1.05-1.25 for a mylar jacket
• $0.75-0.79 for theft detection strips
• $2.15-2.50 for paperback lamination

Add it up. A single book with full processing runs $4.50-5.50 before you even pay for the book itself.

Now multiply that by your annual acquisitions. If your library buys 5,000 items per year, you're spending $22,500-27,500 just on processing. A larger system buying 20,000 items? That\'s $90,000-110,000 annually.

For what, exactly?

A MARC record is a standardized data format. The Library of Congress gives these away for free - they literally have a public API that anyone can query. The cataloging data you're paying $0.62 per item for is often just a lookup against a database that already exists.

Labels are printed paper. Spine labels, barcode labels, ownership stamps - these are PDFs printed on die-cut stock. The materials cost is pennies. The "processing" is data entry and a printer.

You\'re not paying for complexity. You\'re paying for the appearance of complexity.

The Five Contract Traps

After years of reviewing vendor contracts in legal tech, I can tell you: library vendor agreements are some of the most one-sided contracts I\'ve ever seen. Here\'s what to watch for.

Need contract red flags right now?

Your library has specific requirements for how books get processed. Your spine label format. Your call number preferences. Your barcode placement. Your MARC record fields.

All of that lives in your vendor's system.

Ask yourself: if you terminated your contract tomorrow, could you take that data with you?

The answer is almost always no. Your processing specifications - the institutional knowledge of how YOUR library does things - belongs to them. When you leave, you rebuild from scratch.

This is intentional. It's a switching cost designed to keep you locked in.

Trap #2: Rush Handling That Spikes When You're Desperate

Standard processing takes 2-4 weeks. But sometimes you need books faster - a new branch opening, a summer reading program, a curriculum change.

That's when you discover rush processing fees.

I\'ve seen contracts where rush handling adds 50-100% to processing costs. And here\'s the thing: desperate libraries don't negotiate. When your summer reading program starts in three weeks and you need 500 books on the shelves, you pay whatever they ask.

Vendors know this. The pricing structure is designed to extract maximum value when you have minimum leverage.

Trap #3: Fill Rates That Hide The Truth

Fill rate sounds straightforward: what percentage of items you order actually get delivered?

But vendors calculate fill rate differently. Some exclude items that were out of stock when you ordered. Some exclude special orders. Some measure fill rate at order time, others at ship time. This inconsistency makes comparing vendors nearly impossible.

A vendor could advertise a 95% fill rate while you're actually receiving 80% of what you ordered - because the other 15% got excluded from their methodology.

Trap #4: Minimum Orders and Volume Commitments

Some contracts include minimum order requirements or volume commitments. You agree to spend $X per year, or order Y items per month.

Miss those minimums and you might face reduced discounts, additional fees, or contract termination (and loss of your processing specs).

These commitments made sense when libraries had predictable budgets. They're devastating when your funding gets cut mid-year, or when your vendor suddenly collapses.

Trap #5: Auto-Renewal That Traps You

Many vendor contracts auto-renew unless you provide written notice 60-90 days before expiration.

Miss that window and you're locked in for another year. At whatever rates they\'ve decided to charge. With whatever terms they've decided to change.

Calendar the cancellation deadline. Not the contract end date - the cancellation deadline. Set reminders 90 days, 60 days, and 30 days out.

Why This System Existed (And Why It's Ending)

Here\'s the thing: vendor processing services weren\'t always a scam. They emerged because cataloging was genuinely difficult.

Creating MARC records required specialized knowledge. Physical processing required equipment and expertise. Economies of scale made it cheaper for vendors to process thousands of books than for each library to set up their own operation.

So libraries outsourced. And vendors built profitable businesses around that outsourcing.

Over time, the complexity became the product. The harder it seemed, the more you needed them.

But here\'s what they don\'t want you to know: it was never that complicated.

BTCat - Baker & Taylor\'s vaunted cataloging database? It\'s a glorified spreadsheet with macros and a pretty interface. They built a walled garden around public data, added some search functionality and a nice GUI, and charged you $0.59 per record to access it.

And because the interface was polished and the process felt seamless, you never questioned whether you could do it yourself.

You could. You always could.

I know what you're thinking: "I don\'t have the staff. I don\'t have the time. I don\'t have the technical skills." Stay with me. Part 3 is going to show you it's simpler than you think.

The AI Liberation

Here's what kept libraries dependent on vendors: the integration work.

Sure, you could theoretically look up a MARC record from the Library of Congress. But then you had to format it for your ILS, add your local fields, and generate labels that match your specifications. You had to create barcodes that your scanners could read.

That integration work required technical knowledge. Most libraries don't have that person on staff.

So you paid vendors to handle it.

AI just eliminated that barrier.

I'm talking about AI tools that can take an ISBN and automatically query the Library of Congress, pull the MARC record, format it for your specific ILS, apply your local customization rules, and generate print-ready label sheets - all without you writing a single line of code.

You describe what you want in plain English. AI builds it.

The vendor model depended on complexity gatekeeping. They made it seem hard so you would pay them to do it. They kept the knowledge proprietary so you would stay dependent.

AI is the lockpick.

What The Vendors Are Doing Right Now

The smart vendors see this coming. They're already repositioning.

Watch for these moves:

"AI-powered cataloging" - They\'ll sell you back AI tools built on the same free data sources you could access yourself. They\'ll add a markup and call it innovation.

"Enhanced processing analytics" - They'll use your order data to train models, then sell you insights derived from your own institutional knowledge.

"Seamless integration" - They\'ll emphasize how their systems "just work" with your ILS, hoping you don\'t realize that the integration is simpler than they've led you to believe.

This isn't conspiracy theory. This is standard vendor playbook. When disruption threatens your business model, you co-opt the disruption and sell it back to your customers.

Don't let them.

Your Homework Before Part 3

Before we get into the technical liberation, I want you to do something.

Pull your current vendor contract. Actually read it. (If you need help, Library Futures has a great guide.) Look for:

• Auto-renewal clauses and cancellation windows
• Data portability language (or lack thereof)
• Minimum order requirements
• Processing fee schedules
• Fill rate definitions

Calculate your annual processing spend. Number of items times processing cost per item. Include MARC records, labels, jackets, everything.

Ask yourself: what would I do if this vendor disappeared tomorrow?

Because Baker & Taylor\'s customers had to answer that question in real-time. Don\'t wait until you're in crisis to figure out your backup plan.