I have read through several years of your back posts and I have a quick question for you as an assistant agent with inside knowledge and also for you as a published author in your own right.
You mentioned in a couple of your posts that it is common to see advances for new authors in the 5000-7000 range but I can't find any information about royalties. You do mention in an almost off handed way that each time you sell a book you receive about $1.12. What sort of annual income is typical for a author that publishes one book every other year. I think I could write a book a year if not more but I know the editing and everything else can drag out the process. I have no idea what typical sales for a book are. I understand that it is completely dependent on how well the book is received, I'm just looking for averages here.
Making money is complicated. Let me explain as best I can.
(1) Advance. This is an advance on future royalties. It is usually lower than it should be. It used to be new authors would make at least $5000-$7000, now it could be lower than that. Publishers don't like to spend. Repeat authors in the same company will make more and more on each advance. Ten years ago, if you were an established fiction author, you would be making around 30K a book in advances, so if you produced a book a year, you were doing well. These numbers are generally not maintained for mid-list or anyone below mid-list.
Non-fiction is an entirely different story. There is a huge range in advances. Most I've seen are above $20K.
(2) Royalties. The royalty rate for fiction is, at bottom level, 7.5% off LIST price, meaning the price they print on the back of the book, regardless of what the store sells it for. 7.5% is considered the bottom; more reputable places will give 8 or 10%. Then there's something called "escalation" where if your book has sold a certain number of copies (say, 20,000) the royalty rate will rise because at that point the publishers have earned back all the money they spent on producing the book and are willing to give you a little more. A nice escalation is to 20%, or in the case of a ton of books, 30%. Escalation rates vary hugely from company to company and also based on expectations of how much the book will sell.
From what I've seen, e-book sales have their own rate (which should be higher, like 20%, but publishers are working to keep that down), or they're a higher rate off NET prices, which is a percentage of what the book is actually sold for and what the publisher gets back from the bookstore. Net royalties are usually in the 20-30% range, but I've seen them higher. We expect e-Books to move up and down in terms of royalties as publishers and e-Book sellers figure out what the hell is going on.
(3) Payment of advance. Payment of advance occurs before the book sells any copies, though sometimes it's split up so the publisher can hold on to their money longer (publishers have a lot of tricks to do this). For a smaller press with a small advance, full payment can be upon signing, meaning a month after you sign the contract and it goes back to the publisher and it goes through accounting, then to your agent, then gets back to you. Some publishers split it to two dates: (1) Signing of the contract and (2) delivery of the completed manuscript to the publisher. Additionally, it can be split up as (1) signing, (2) delivery, and (3) publishing date. If you get a $500,000 advance, your publisher is going to pretty eager to split up payments, because it could be a year to a year and a half between signing the contract and publishing the book.
(4) Payment of royalties. After you earn out your advance, you will see royalties based on how well your book is doing. If the advance is high, you may not see royalties for years and years and years or never see them at all. The publisher is still required to tell you what you've been selling (a royalty statement) during one of its pay periods. It used to be quarterly, but now some publishers have moved to fall and spring, meaning I'm paid my royalties in November and April. If the number is below a certain amount (say, $50), the publisher may hold onto it until it earns that amount. Publishers don't like writing $4.00 checks. If it's within the first 6 months of publication, the publisher may stipulate that they can hold back 50% of your earnings against returns of the books by stores, which will then subtract from your future earnings, and if there are no returns, they will release your earnings the following year. The following year, they can then take the amount they owed you the previous year that they held against returns and split THAT in half, and hold that half against more returns. In other words, if your book does well, publishers will perpetually owe you money because they will find ways not to pay you.
The only advice I can say when planning a writing career is: don't. I make most of my money from books, but I'm never sure when the next book will sell, the next contract will be signed, and for how much. I don't know my royalty earnings until I earn them. It's like having a job where sometimes you earn lots of money and sometimes you earn none, but most of the time you're lucky to earn just enough to say, "There's no reason to get a real job. I'm building my career." Or that's what I tell my parents.
Friday, August 20, 2010
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