Sometimes I browse books on Amazon just to see what is new and fresh. One fear of mine is that one of my ideas will be written by another author and I will be forced to abandon the project, or respectively bow out, without cursing, if necessary. I've come across a novel which at first had me panicked. The Last Bookstore in America was the book, written by Amy Smart. I panicked because I thought I would have to abandon one of my favorite projects. Thankfully, this was not the case because both our stories are very different. After reading the premise and a few of the reviews, I let go a big sigh of relief. But then something else happened: I started browsing around Amy Smart's site, and I found this cool bit of info. I always fantasized about being a writer but had no idea what their payment process was like. Amy cleared all the confusion away. And, since I found it so interesting and thought her new exclusive novel-in-progress kindle book needed more readers, I've decided to share this with all of you.
Without further ado, here's Amy Smart, explaining the business of publishing:
[ When I first started writing books (you can find out about my other books here), I was surprised by how secretive, befuddling, and un-transparent the money side of the business was.
For one thing, authors get paid in a very strange way. We get an advance--a check up front when we sign a contract--and when the book sells, we get paid royalties on every sale only after the advance has been paid back. The amount that an author receives for an advance is generally a secret, unless it's a very large, shocking number, in which case everybody finds out somehow.
But let's take a normal advance of, say, forty thousand dollars. You might get half up front and half when the book is finished. Your agent gets 15 percent. So basically, that $40,000 translates to $17,000 up front. After taxes (including self-employment taxes) you might be left with $10,000. Let's say you can somehow live on $2000 per month. That gives you five months' worth of income to get your book written.
When the book comes out, you get paid royalties of anywhere from 7.5% (for paperbacks) to 10-15% (for hardcovers, depending on how many copies sell) of the cover price. Which means that authors make about a dollar for every paperback that sells, and two or three dollars for every hardcover.
And that money comes in 6-9 months after the book sells. Writers usually get paid twice a year, once in spring (for July-December's sales) and once in fall (for January-June's sales). Because bookstores can return unsold books for a full refund, publishers often hold back a 'reserve for returns,' meaning that you don't get paid for all of the books that sold because it is expected that some of them will be returned.
It is also surprisingly difficult for authors to know how well their book is selling. We obsessively watch our Amazon sales rank because it's the only real-time data we have access to. Publishers can usually tell you how many copies have been shipped out of their warehouse, but that's not the kind of data that really does you much good.
When I'm on a book tour, people ask me all these questions that I don't really know the answer to:
How many books do you sell the week after you're on NPR?
--I have no idea.
Do you sell more books on the east coast or the west coast?
--Huh. I don't know.
Do you see an uptick in sales of your older books when a new one comes out?
--Who can say?
So authors operate with an astonishing lack of data about how their own products are selling. That's one of the reasons I'm so interested in the idea of digital books. Imagine: real-time data! Fast payments! Instant feedback!
So in the name of transparency, here are some facts and figures about The Last Bookstore in America. I'll update this as I go along, so check back.
Scribd: On Scribd the book is priced at $1.81. After Scribd takes its 20%, plus a 40 cent per-transaction fee, that leaves me with $1.05, the same royalty I make on $13.95 trade paperbacks.
Kindle: On Amazon the book is priced at $2.99. After Amazon takes its 65%, I'm left with the same $1.05 I make on paperbacks.
So why, you may be asking, do books cost so much if the author only makes a dollar or two?
First, the retailer gets 40-50% of the cover price.
And what's left goes to editing, design, marketing, printing, and distribution, not to mention those advances that don't earn out. None of that comes cheap. Read a great discussion about book pricing here and here.
But my novel, being a novel-in-progress that has not benefitted from editing, design, marketing, printing, and distribution, is not priced to factor in those expenses. Why should you pay for what you're not getting?
Here's what I have spent to date.
$10 to register the lastbookstoreinamerica.com domain.
$200 for cover and blog header design from a freelance designer I found on eLance.
$60 to get the book professionally formatted for the Kindle because I didn't want to learn how to do it myself.
$0 for editing. A few writers and editors I know read the manuscript and offered comments, but I didn't pay them--I traded my time for theirs in a variety of ways--reading their manuscripts, helping them with a website or some other thing they needed assistance with. A couple friends read it and asked for nothing in return, but they know I owe them a favor. (Freelance editors can be found here and typically charge a few thousand bucks.)
$0 for publicity. I'm getting the word out on Twitter, Facebook, on this blog, and through my friends.
Total: $270. So that's my budget. This is not, of course, a realistic budget on which the brave new world of digital publishing can be based. But for a beta test of a novel-in-progress, where all I'm asking is for feedback from a community of readers, it's all pretty feasible.
And I'm still considering a print version if anyone seems interested in that. More soon.
Meanwhile, I'd love to hear your thoughts about the financial side of what is, after all, a business as well as an art. ]