Royalties can be confusing to the new author. I know an author that once received a check from his publisher for a mere 39 cents. Frustration can ensue when you used a royalty calculator, and your royalty payment is much less than what you calculated. The question is, where is all the money going?
To understand royalties, one must consider the type of contract the publisher offers. Contracts vary widely, and royalties’ percentages will reflect the method used to create the book, market it and sell it.
Professional crafted books are not cheap. Even if you go the self-publishing route, the time and effort will cost something. Remember, everyone will get a piece of the pie no matter which method you use. Let’s get back to contracts.
Some publishers front the money to bring the book into existence. They recoup the cost incurred by producing the book by retaining 100% of royalties, until they recover their production costs,and then start paying the author. Another method is where an advance is paid to the author and then is paid back with royalties gained from the book’s sale. Only after the advance is paid back will the author receive any money. Many self-publishing companies get paid upfront for services and then give the author a file that can be loaded into a Print On Demand (POD) platform like Amazon, where the author then receives royalties from each sale. There are other variations, but these are common.
You might be thinking that the fastest way to riches is to go the self-publishing route and throw the book on Amazon. You might be right, but you need to understand that you will still pay Amazon for the privilege of using their platform.
If you decide to self-publish throwing your work onto Amazon, they will still take some of the total sales. Amazon has its advantages, but you need someone that knows how to leverage these “advantages.” The standard royalty for Amazon is 60/40. That is, you get to keep 60% of every sale even after you did all the work or paid someone to get your book ready to upload. Why is it that they keep 40%? The simple answer is they are the store that is carrying your product, and they have to maintain that store.
There are industry expectations in the background of any effort to publish, market, and sell a book. For instance, to entice many of the more prominent retailers, it’s normal to offer a 54% discount from the retail price. 54% is a good deal for the local bookstore and incentives them to carry your book but is a killer on the profit to the author and publisher. There are also buy-back options that state if the retailer can’t sell the book that the publisher will purchase the book back. This expectation is the ruin of many authors. They agree for a big box store to carry several hundred copies of the book and then purchase them back if they didn’t sell.
To put a title into a catalog that reaches thousands of retailers that incurs a cost. There are various miscellaneous costs associated with maintaining a title with a printer for loading a file. The printer to check the cover size is but a few.
If you own a website to sell your book, there are costs, and any POD platform will take a piece of the pie. All the charges are the reason for the disappearance of the royalty that the calculator said you would get paid.
There is a way to hedge against all these costs and make more money from each sale. And that is volume. The more books printed in a run will reduce the cost to print the book, thus increasing the royalty paid to the author.
Tactical 16 Publishing can help navigate all the costs associated with creating marketing and selling a book and help to get you the best royalty possible. We will work with you to create a contract that makes sense for you and your budget and will do more to support you with author pages marketing and release parties.
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