The Truth About Royalties

***This article only pertains to my experiences with electronic publishers.  I have no idea how the "Big Boy" publishers in New York handle things (Del Rey, Bantam, Avon, etc.), but it's probably not too much different.***

Authors are like artists.  We paint our canvas with words, allowing our readers to step into our world for a short time.  And also like artists, our paychecks can be somewhat disappointing.  There are many "starving" authors out there.  Simply because you are "published" does not mean that you will be rich, let alone famous.

I have learned that your own fame is directly related to your own promotion.  If you are not willing to hit the pavement and get your name in front of people, you will not succeed as an author.  It takes the average person (or so I've heard) *seven* times of hearing about something before they buy it.  People are just wired that way, I guess.  Always looking for a bargain or putting things off until payday and then forgetting about it.

So your fame is also directly connected to your royalties.  I know a few people who complain about their checks, but they don't do a damn thing to promote themselves!  There's plenty of things you can do that doesn't cost you money.  Gather is one example.  MySpace is another, as well as a website, a blog, and even a group on Yahoo or Google.  You can also schedule electronic chats with your readers on certain review websites and sometimes, even your publisher will have a chat room online.  Having a newsletter doesn't hurt either, and before you gasp at the postage, don't worry; nowadays you can do it electronically through email.  :P

However most electronic publishers pay you quarterly.  The first quarter of the year is Jan., Feb., March, and then you get paid by the end of April.  So your pay months are the months *after* the quarter is over: April, July, October, & January.  (If you're really lucky, you'll find a publisher that pays monthly.) 

On top of that, most publishers that I've worked with have a ceiling that the author must reach before a check is cut.  If you sell two books and your royalties are only $3-$5, you won't get a check that quarter.  Most royalty ceilings are $25, however one of my publishers is $50. 

In my personal opinion, $50 is too high of a ceiling.  Especially for the newbie author who doesn't have a backlist of books--it will take them forever to get to $50--especially if they don't promote themselves.

Now, while this doesn't seem like a lot of money, you must understand the way royalties work.  Say your book sells for $6.95, then 35% of that (the standard for most e-publishers) is about $2.43.  If we round that up to say $2.50 per book, then all you need to do is sell 10 to 11 books to reach the $25 ceiling, right?  Well, technically yes.  However, this is only through your publisher's website.

Your royalty rate will decrease if your book is put on a vendor's site such as www.fictionwise.com or www.amazon.com.  My publishers currently have a 20% royalty rate for vendors, since vendors also take a cut of each book sold.  So that 20% becomes $1.39.  Then, suddenly, you need to sell about 18 books.  And if your book is in print, then your royalties suddenly drop to 5-7%.  Why so low?  Because everyone wants their cut.  The publisher, the printer, the bookstore, the author....

Here's what the print royalties look like for a book that costs $6.95.  If your publisher gives you 5%, then that's about $.35.  If they are generous and give you 7%, then that's almost $.50 a book.  Suddenly you need to sell between 50 to 72 books to reach the $25 ceiling.  Ouchy.

Imagine.  Do you think you could sell upwards of 100 books without even promoting? 

Yes, it is possible.  However, this possibility assumes that you're published at one of the Big Boys, who can get you into every bookstore known to man.  There, you've got the chance to sell thousands of copies. 

The blessing and the curse of the Big Boy publishers is the royalty advance.  It's a blessing because you have instant gratification for your published work.  You have money IN HAND.  How great is that?

Now, like that gawd-awful debt you have with creditors, you must "pay back" that royalty advance with your sales.  You don't earn another red cent until that advance is paid in full.  Authors make most of their money with that royalty advance.  Especially authors who write for publishers who only publish their books on a limited print run like Harlequin.  They have their Intrigue and Desire lines up only for about 6-8 weeks before they go "out of print".  

Can you make back your advance?  Sure, probably.  Will you get much more than that?  It might trickle in after your print run, but your book will not always be a cash cow.  So how do writers get "rich"?  They continue to write books.

Older books that have already been around the block still sell because of new readers.  If a new reader reads your latest release and like it, they'll go searching for your backlist.  They want to know what else you have written. 

In this way, an author's career is built on an entire library of books.  So those of you thinking to make it big with your One Big Novel, be prepared for disappointment.  Unless you're chosen for Oprah's Bookclub, you've got to be willing to write a book, then write and another and another.  And another.

And don't take for granted that the publisher will push and promote your book for you.  That is a myth that too many newbie authors believe.  Publishers do things to a point; sending books out for review and whatnot.  But it's the author who actually connects to the readers.

So if you want to be an author, be prepared.  The "fame" and the "money" don't really come until you have books behind you and more in front of you. 

Know the truth about getting paid your royalties and don't be afraid to toot your own horn for promotion.  If you never toot it, then you'll never sell a thing. 

~~Becka

http://www.RebeccaGoings.com