The Economics
of
Publishing Your Book
Bud Banis, PhD, CMA
Some might say—
"Don't even think about publishing!"
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Most books lose money.
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Many publishers receive 100 unsolicited manuscripts per day.
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There are 120,000 new books published every year, about 10,000
per month.
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Six mega-publishers account for 60% of all adult book revenues.
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It takes about 18 months to get a book to market after
negotiations are completed.
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A typical first print run is 5000 books.
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Books typically remain on the shelves for less than a year,
then "remainders" are sold off cheap to get them out of the way.
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Most publishers actively promote only the top 20% of their
books.
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Authors usually get 6-10% of NET. With discounted sales,
this is about $3000 on a print run of 5000, if they all sell. Most
don't. Most books lose money.
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Big publishers take control away from the author.
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60% don't allow the author final copy approval.
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23% don't let the author choose the title.
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20% don't consult the author on jacket design.
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36% rarely involve the author in promotion.
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If a big publisher considers your work, it is unlikely you
will have control over it or make enough money to pay for your time.
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Top authors do very well in this process, but what do you
do if Oprah doesn't call?
Vanity Publishers—
An Expensive Way to Feed Your Ego
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Vanity publishers produce about 6000 titles per year.
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20 firms produce 70% of all the subsidized books.
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Full publishing costs (much more than just layout and printing
costs) are paid by the author.
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The publisher doesn't care what kind of book it is.
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The publisher cares about being paid by the author.
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The publisher has no investment and little incentive to make
the book a success.
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Cost to the author may be $10,000-$30,000.
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The books generally look pretty good and there may be some
publicity in the package.
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Only 5% of books break even or make money.
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This is an expensive way to satisfy your creative needs and
may dead-end in a closet full of books.
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Be wary of "publishers" who ask for money up front and give
you all the inventory.
Self-Publishing is a Reasonable
Option
Self-publishing is less of a stigma and more practical than
ever before.
Some self-publishers are very successful:
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Mark Twain
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Zane Grey
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Walt Whitman
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Edgar Allen Poe
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Virginia Woolf
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Gertrude Stein
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James Joyce
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D. H. Lawrence- Lady Chatterly's Lover
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Edgar Rice Burroughs
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Richard Nelson Bolles -What Color is Your Parachute?
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William Strunk, jr. -Elements of Style
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Blanchard & Johnson- The One-Minute Manager
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John Javna-50 Simple Things You Can Do To Save the Earth
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Wess Roberts-Leadership Secrets of Attila the Hun
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James Redfield-The Celestine Prophecy
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Peter McWilliams-poetry books include How to Survive the
Loss of a Love and Life 101
Costs of Self-Publishing
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You have to learn about it all yourself. This can be fun.
It's also a lot of work, and can cost quite a bit.
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Publishing company startup costs include:
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ISBN prefix, equipment and software for layout & printing—approximately
$1000
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Learning curve means expensive mistakes.
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~$500-1000 minimum startup promotion per book.
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Minimum economical print run is 2000 copies at $3-10 per
book: $6000-$20,000 commitment
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If the book sells for $10 (average with discounts), break-even
on production costs alone is around 1000 copies sold.
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The author takes the risk, but reaps the benefit, but it
doesn't run without your constant attention.
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Most self-publishers run out of gas and end up with a closet
full of books.
Print on Demand May be Useful at
the Vendor Level.
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Substantial investment in equipment and expertise are needed
to do this yourself.
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Production cost, $5-$14 per book.
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Books are produced one at a time only to demand.
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There is a stigma of sorts attached to this approach due
to equipment startups, possible quality issues and perceived value of the
work.
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One could envision this approach perfected someday to allow
a one-off production at the bookseller's shop.
Production Order Quantity Approach
Reduces Risk
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Inventories of books are maintained depending on level of
demand for each title.
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Break-even is at sales of 500-1000 books.
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Design & promotional startup expenses, $500-$1000.
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Book will probably make money in the long run, is unlikely
to lose money.
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low inventories avoid having to close out and remainder the
book as space and working capital are minimized.
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Typographical errors are detected and fixed in the production
stream rather than endured in large inventories.
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Continuous short run Production (50-300) means books can
be kept in print without a major commitment for new printings.
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Sales continue beyond break-even to give a steady stream
of income.
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The key is to publish books with enduring value and continuing
sales.
Save Time and Work—
Work with an
Established
POQ Publisher
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Have your book adopted by an established publisher who has
the equipment and mechanics in place.
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The publisher is selective, but can afford to produce books
of value which may not fit mass-distribution channels.
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Distribution arrangements (internet & mailorder sales)
are set up and continue without your involvement.
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The publisher handles the mechanics, though you still are
involved with promotion. (The Author is the best salesperson for the book)
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Startup expenses may be completely covered by the publisher
if the book fits the publisher's interests.
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(you are expected to provide electronic copy that has been
reasonably thoroughly edited)
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A POQ publisher is more willing to risk resources on a book
when there is a common mission.
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The publisher is invested in the success of the book.
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Once past break-even, the book provides a steady stream of
income.
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Time from manuscript to market is typically six months to
a year (depending on complexity, permissions and editing).
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last modified, April 12, 2004
