The Economics of Your Publishing Options
One of the biggest questions that comes up when deciding who to publish with is the cost of the publishing process and the return on investment. How much will it cost you to publish your book and how much are you expected to see in royalties from selling your book. This post will cover, generally speaking, what the costs are for the three main publishing methods rather than focusing on specific companies and practices.
What are the economics of publishing with a traditional publisher?
Upfront and author costs
With a traditional publisher the high point is that you typically won’t have any upfront costs. This means you won’t have to invest anything into the company publishing your book in order to have it published. You present your idea to the publisher and they handle everything for you (you do have a lot of upfront labor costs of creating a book proposal and doing the lion’s share of the work for how your book should be marketed). You also don’t have to worry about buying your own books to sell. A traditional publisher should have connections to book stores and markets to sell your book to.
Royalties and returns
The downside to this is that you will typically receive a very low amount of royalties. Typically ranging from 10%-15%, Breaking that down, if your book was selling for $15 dollars then you would be looking at $1.5-$2.25 per book. Selling 100 books would only net you $150-$225.
Another thing to consider is if the publisher will give you an advance. If the publisher takes on your book, they may give you money to help you complete your book. However, an advance is just that—an advance. You have to pay that money back typically in royalties. So if the publisher gave you a $3000 advance, you have to pay that back through your royalties. You won’t see any of your royalties until the advance is paid back meaning if your book doesn’t sell enough, you may not see any royalties.
Part of working with a traditional publisher is also working with an agent. Since traditional publishers are highly selective and will only take a small percentage of the book ideas pitched to them, you typically need an agent. An agent will help you get your foot in the door and be the middle person between you and the publisher. However, you also need to pay your agent and they will either take a portion of the advance or a portion of your royalties or both.
If you want to learn more about traditional publishing click here.
What are the economics of self-publishing?
Upfront and Author Cost
The full cost of self-publishing varies greatly depending on who you hire and how much you’re willing to spend. The cost can range from $150 – $70,000. It all depends on what you need and making sure that you hire the right people.
In order to self-publish you need a team to help you with the cover design, editing, formatting, marketing strategy, and project management. Having a solid team of experts will ensure that you have a successful book launch and book sales. There are also marketing costs like creating and designing a website, promoting your book on social media, and purchasing promotional materials.
Another thing to consider is that you will need to either buy your own books through an offset printer or use a print-on-demand strategy (Amazon KDP and Ingram Spark are the top two print-on-demand options). Offset printing prices tend to be lower, but the warehousing, shipping and fulfillment often outweigh the benefits of this model, when you could have used a print-on-demand service and paid more per book, but have access to greater distribution. You want to make sure that for each book you have printed you have a strategy for how you are selling it. The last thing you want is to order 500 books and have 50 boxes lying in your house.
If you’d like a more indepth break down about the cost of self publishing check out The PYP Book Cost Blueprint.
Royalties and returns
The biggest upside to self-publishing is that you make 100% of the profit for each book that you sell directly. You can adjust your price based on the printing cost and how many books you are selling directly to someone or a company.
When selling your book to a bookstore, they will take a portion of the royalties. The amount that they take varies and you will need to build a relationship with a bookstore or a distributor. You need to make the connections with distributors in order for them to even consider buying your book. This also means negotiating how many books the distributor is willing to take for a certain percentage of each one sold.
You are responsible for marketing your book to industry standards. If you do you have a better chance of seeing a return and profit from your book. This is dependent on you though. Making sure that you effectively market to the right audience, build the right connections that you need, and getting people hyped about your book both before and after the initial launch of your book are critical to your success.
If you’d like to learn more about self-publishing click here.
What are the economics of publishing with a hybrid publisher?
Upfront and Author Cost
Each hybrid publisher have their own upfront costs. Depending on the services that they offer and what areas of the publishing process they focus on—the price can be anywhere between $2,000 – $100,000. This isn’t to say that the $2,000 upfront cost means that the publisher will do a sloppy job or that $100,000 will be a top tier job—you have to do your homework and research what you are getting for your money. You are paying for the publisher’s expertise and help navigating the landscape of the publishing process.
Some hybrid publishers only focus on the editing aspect leaving the marketing, formatting, and cover design up to you. Other’s put a heavy focus on marketing, focusing only a little on the design of your book. All of these factor in to how much the upfront will cost. You need to invest in your book regardless so determine where your blind spots are and find a hybrid publisher who can supplement your skill sets. For example, a publisher that doesn’t focus on marketing means that you will need to spend the resources to market your book effectively. Or a publisher that doesn’t focus on editorial content or quality means you are going to have to pay additional for comprehensive editing. These are all ways in which the price tag continues to go up and before you know it you’ve spent twice as much as you wanted to.
Royalties and returns
Each hybrid publisher has different royalties, these typically range anywhere from about 50%-75% for each book sold. The average for hybrid publishers is about 50%. This largely depends on what services are being provided by the publisher and how much the upfront cost is. At PYP we pay our authors 85% of their royalties.
A hybrid publisher that has a focus in marketing will help to ensure that your book is marketed towards your audience unlike traditional publishers who are marketing your book to their audience—this distinction is important to understand while in the editing process. A good hybrid publisher (not all are created equal) will stick with you while your book is still an idea to after the publication date. They will assist you in post publication, providing help with marketing, and connecting you with relevant people to help elevate your book and brand.
If you would like to learn more about what PYP offers click here.