February 17, 2009

93% for Me. 7% for You.

We publishers, no matter how large or small, would fucking love to make 93% on every single book. God, think of what we'd do with all the money. But in truth, we often make less than the writers. How is that possible? Well, let's take a look. Someone walks into City Lights, plunks down a ten dollar bill (plus loose change), and the book is theirs. Right? Where does the money go?

Of the $10 cover price, a publisher is lucky to receive $4.50 from a store. (I'm using a 55% discount as an example here.)

Of the $4.50, the average author gets .70 cents, leaving the publisher with $3.80.

Say the book cost $1.50 to print (a 15% unit cost is pretty standard). Now, the publisher has $2.30.

Publishers who don't own their own warehouses must pay an outside company for storage, fulfillment, shipping and other miscellaneous costs. For our little publishing company, we end up paying about 20% of sales to the warehouse—the majority of that is for storage. That's .90 cents on a $4.50 sale, and now we're down to $1.40.

When we had sales reps (in better days), our reps took 10% off the sale price, knocking the profit to .95.

From this .95 the publisher must find a way to pay for copyediting, typesetting, and cover design. (Sure, these are only one-time fees, but they must be paid for, and generally paid for upfront, before any profit is ever seen.) Now, consider this, we haven't started talking about rent for an office, insurance for the books, accounting fees, legal fees, telephone, office supplies, advertising... and this doesn't even allow for a salary for the publisher.

Some businesses cut costs by printing overseas. But I've always believed in printing in the U.S. And people might say a 55% discount to a bookstore sounds high, but that's the standard discount Amazon.com takes, and Amazon requires the publisher to pay shipping, as well. Some discounts are lower, and some are higher. We once made a massive sale to a major distributor. The company received an enormous discount, but our rep cut her fee so that we could make the deal work. So, sure, there are different places to skim here and there. If you print more books, your unit cost goes down. We've never really been able to do that, but I understand the concept.

At Pretty Things Press, I strive to do for my writers what I would love for a publisher to do for me. We've paid to print postcards and bookmarks and to place ads in BUST magazine. Honestly, the only way we have survived is that we are able to operate on the barest bones of a budget. There are many months when I don't draw a salary at all, and we've skated through this economy based solely on my freelance work. That fact, and the concept I have of not going out of print with books, is what makes us work. I put so much effort into these beauties, I want to keep them in print as long as possible. Slow and steady wins the race, in my opinion, proven by the fact that even though our books aren't for sale in most brick and mortar stores, Naughty Stories from A to Z has sold more than 20,000 copies, Down & Dirty has sold nearly 15,000, and we've gone into the fourth printing of Naughty Spanking Stories, putting 10,000 copies now in print. My goal is to create classic smut that people will want for years to—you guessed it—come.

Still, I just have to shake my head at the naive belief that for every buck we get, 7% goes to the author and 93% goes into our coffers. God, I'd love that. Whatever the fuck a coffer is.



Erobintica said...

Obviously whoever wrote to you did not do ANY homework. Most of the folks I know who do - or try to do - the small press thing end up subsidizing what they do - it's a labor of love more than anything else. I'm glad you're able to make a go of it - even if it's not getting you 93% - hehehe. Wouldn't that be nice?

I think it's great that you used this as a post. There are a lot of people out there that don't know - who actually believe that writing and publishing is lucrative (the exception makes the rule). I'm living with someone who is in the magazine biz and that is imploding at a furious pace right now - kinda scary.

Here's to ANYONE who is dedicated to trying to keep us reading!

Oh, and I for one would be interested in your take on the whole cover issue thingy. I know that what's on the outside has no bearing on what I buy or read. And I'm not just talking erotica here - this goes for everything. I may like what's on the cover - be it a box of cookies or a steamy before bed read - but I know enough to only care if what's inside is any good. But maybe I'm weird that way.

Alison Tyler said...

Hey E,

It's not the first letter like this I've gotten. In fact, early in my twenties, I fielded a call from a husband of a writer. The husband was a lawyer and said to me, "Your contract is really great." (long pause) "For YOU."

Our contract actually is really super fair. I've recently received two contracts from publishing houses that were so anti-writer, I couldn't sleep. Contracts with clauses that say, "This clause survives the termination of the contract." (I call this "the cockroach clause.")

And yeah—subsidizing is sort of the name of the indy game.


P.S. I do have feelings about the book covers. But, like I said, I'll snark about that another day.

BadAssKona said...

Thank you for going through that little exercise. It's always good to inject some reality into the process! Personally, I can't wait to make 7 cents on ANYTHING I write!

Alison Tyler said...

Yeah, being paid = priceless. I did forget to mention (a ton of things including) one way our other publishing house survived is that I wrote a lot of the books—so that 7% went toward my salary. The other is that we used to sell to three different book clubs. They pay a massively reduced cost, but their cash infusion helped subsidize our printing costs. I mean, by adding their order to what we'd normally print, our whole unit costs went down. But what I learned when the last of the book clubs (in our industry) went under is that I never could actually afford to print based on what we were receiving. I was only able to make ends meet based on the *next* book club check. So now we are printing 95% fewer books, but I am not existing on false numbers. Just the cold, hard facts.


Charlotte Stein aka The Mighty Viper said...

Jesus please us. Whatever happened to people just being happy that they're getting offered a contract?

And yeah, I know that's probably a dangerous way to think about things. Likely as a writer I will wind up getting screwed. But I am also well aware of how lucky I am to get anything published at all.

Alison Tyler said...

Well, see, I understand both sides. One of my very first contracts allowed the publisher to excerpt 25% for his own use. What he wound up doing was excerpting 25% of four of my different books—creating a new book and not owing me any money. So I've learned to read contracts carefully. But at the same time, I can see things from the publisher's POV, as I am the daughter of one. So I try to be a writer's publisher and a publisher's writer. Sometimes you can't make a contract work. But I always do try to be as gracious as possible.


Anonymous said...

Very interesting post. Definitely makes me appreciate even more the people behind my growing, sexy collection of erotica. And my resulting, amazing sex life.

And as a straight woman, I adored the Frenzy cover. Sexxxy. I'd love to have those heels.

- Jessica

Charlotte Stein aka The Mighty Viper said...

"What he wound up doing was excerpting 25% of four of my different books—creating a new book and not owing me any money."

Wow. That's awful.

But the way I look at it- these are your credentials. The fires you've been through that have made you a good and fair publisher/editor. So good and fair that you often address completely ludicrous concerns and agitations on your blog, even when they perhaps don't deserve a second more of your time.

Not that you're wrong to address them. I think the fact that you do is what makes you orsum. You do a lot for writers- perhaps more than you even know you do.

Emerald said...

Thanks for sharing all this, Alison. I find it very gracious of you to offer this information to the readership of your blog.

"What he wound up doing was excerpting 25% of four of my different books—creating a new book and not owing me any money."

Ack, how disgusting. :/

Alison Tyler said...

What's funny about the publisher who excerpted from me is this. I think he really likes me. I mean, I believe that I'm one of his favorite writers. He called me up when he was doing this to say, "Hey, I'm just letting you know that I'm stealing from you." It made him happy. It's hard to know how to deal with people like that.

Here's the thing about contracts that I find the most annoying. Sometimes you'll find something that feels really unfair. I got one recently that said I would agree to do publicity at the request of the publisher—and pay my own expenses, etc. etc. Well, I like to say I'm a shut-in. I don't go out a lot. And I wouldn't want to feel obligated to make appearances. When I pointed out that I wasn't interested in the clause, the response was that they'd never force me to do it.

Well, then take out the clause. That's the part that irks me. If you see something's unfair, don't just assure me that it won't happen. Don't put the clause in the contract.

When I start to see things like that in contracts, I get really nervous. I worry that I'm going to miss something that will come back to bite me. Like the 25% clause.

Live and learn. Right?

And I love being orsum. Thank you.


Angell said...

Thanks for posting this. I too am one of those writers that just dream of being published. If it ever happened that I could make money off of what I love to do, then I'd be happy. But, like most creative endeavours (which is the story of my life) very few of us get paid very well to do what we do.

And to me, that's ok. Because if it was easy - everyone would do it.

EllaRegina said...

He called me up when he was doing this to say, "Hey, I'm just letting you know that I'm stealing from you." It made him happy. It's hard to know how to deal with people like that.

Wow. Just wow.

Thanks for this post.

Smut Girl said...

I try to ask polite questions and save the being an asshole part until I really know how things work. Since I do not want to store things, hire people, pay them etc. I gladly take 7% or whatever percent and try to keep my assholiness (made a word up for you there) to myself.

And yeah. We all know how super selfish you are, what with sending everyone prizes for contests and giving away books and promoting people and helping people. God. How do you live with yourself, Cruella? ;)
who is in a mood...

EllaRegina said...

Smut Girl said...

...what with sending everyone prizes for contests and giving away books and promoting people and helping people.

This is true!

Not to mention gaggles (schools?) of costly bath ducks shipped ashore. Seriously! Generosity in spades.

Isabel Kerr said...

Welcome to retail 101, right Alison? It's a thankless job. You (and most of us) do this because you love it. You seem to be the most generous editor I've ever met, and that includes, with your time, encouragement and support.

Besides, you're really sexy when you get all business-like. ; )

Alison Tyler said...

Oh, thanks, Isabel. I put on my pencil skirt and spectator shoes to really address the situation!

I wanted to add that this is simply *my* experience in publishing. I mean, I do *have* experience. I was raised in a house where people made books from scratch. But I know that at larger publishing houses, the costs can slide here and there.

What annoys me is when someone has no experience but decides to expound on how things work. Oh, look at you, you fat cat publisher, keeping down the poor little writer. God.

But I've said this before—I would be a publisher if I won the lottery. I don't consider myself an artist, or anything. In fact, I told a friend the other day, that in my head, I see myself as a mechanic who works with words rather than engines. And what I make is books. I work and work and work, and when I'm done, I have a book in my hands. It's glossy. It's pretty. I can polish the cover and slide it onto the shelf. I don't do it for 93%. Or for 3%. I just do it because that's what I was raised to do.

Books are in my blood.

Neve Black said...

I hope I never stop feeling the butterflies in my stomach when a publisher/editor likes my work enough to want to publish it. That's just a great feeling and not just for me, but any writer out there.

Sure, it's nice to get paid, but really in my heart I feel like I've accomplished something just to have finished writing the story.

I think I would encourage the author to look into the costs of self publishing. He/she might quickly sing another tune, and it would be called, "100% all me, baby!"

Alison Tyler said...

And that's a whole different road I could go down. I don't know if you mean ebooks when you say "self-publishing," but I have a problem with the standard royalties for ebooks. Because some publishers are giving authors more than they'd get for a print book, but less than I think they should get.

With an ebook, you don't have printing, storage, fulfillment, or shipping costs. And those are a *huge* portion of the expenses a publisher must pay. Also, now a lot of publishers are doing kindles at the same time as they do print books, so there really isn't much of an added expense. So, I honestly think authors should get 50% of ebook sales.

But that's just me.


Neve Black said...

Hi AT,
How would you like to negotiate my contracts, going forward? :-)

I wasn't referring to e-book publishing here, but I hear what you're saying.

You would know better than me, but I've been told true self-publishing (not e-book) cost anywhere from 5-10K. If 93/7% doesn't like the terms, well then, don't the self-publishing door option hit you on the way out. That wasn't very loving of me, was it? I'm sorry. Fifty lashes to me.

p.s. I think it's really odd that 93/7% was negotiating about a contract that didn't even exist yet also. You must scratch your head often and think, "What the hell?"

Alison Tyler said...

Oh, yes, you're totally right, Neve. Or as Sommer said, I could just say to the person, "Fine, I'll take the 7%, you take the 93%, and here are all the bills you'll need to deal with."

But I do believe that people who have that drive, *should* start their own company. Ebooks are definitely a way to break in.

Publishing is changing. Both writers and publishers need to understand that fact.


Laila Blake said...

I so agree with you, there. They don't have to publish with you or any other small or large press, they can do it themselves. It's a valid choice.

As a writer I get really prickly when i read people say I am just glad to be published at all, because so many bigger publishers seem to take advantage of that attitude, readers take on that attitude as in "haha, you think you deserve to be paid for your hobby, that's funny" and I can just ake my head lol.
I think it's fair to ask a publisher where the money goes if you don't know and feel something might be wrong there -- in a polite and nice way. But for a print book, how can anyone assume the rest goes to you? wow. *shakes head*