Author's fee

Author's royalty - This is what you get at the end of your book sales.

Whether you're a published author or self-publishing, if your book sells, you'll receive an author's royalty. But how are royalties calculated, how much is left over in the end and who all earns money from the sale of your book?

Who's making money off my book?

You may have written the book as the author, but there are still many other trades involved in the production process. For example, editing, printing and distribution also have to be paid for. In the book market, there are a number of participants in the value chain who claim a share of the revenue from a book sale. These include the publisher or self-publishing service provider and the bookseller. In this context, the trade margins for chain bookstores are as high as 40 percent. Also the costs for printing, cover, book's typesetting, editing and proofreading as well as marketing should ideally be covered by sales.

Whether and how much author royalties end up in your account depends on how many readers your book reaches.

Author's fee: How are royalties calculated?

Usually, the calculations for your author fee are based on the net retail price. This means the price that remains after deducting VAT. When publishing through a publisher, a guideline of ten percent applies for hardcover editions; for a paperback, a remuneration scale starts at five percent and can rise to eight percent depending on the number of copies sold. For e-books, the author's royalty is usually calculated on net publishing revenue, so the percentage looks much higher. Especially with self-publishing service providers, royalties of 70, 80, or even 90 percent sound enticing. But before you decide on a provider with the highest percentage, make sure you find out what's behind it. What services does the service provider offer beyond publishing?

Basically, you can expect higher royalties in percentage terms for e-books, because the production costs are significantly lower. These make up one of the largest cost factors for a printed book.

Net retail price or net publishing revenue - what's the difference?

When negotiating a contract with your publisher or self-publishing service provider, be sure to read carefully when it comes to author royalties: Are royalties based on net store price or net publishing revenue? While the net store price refers to the price that remains after deducting the sales tax of seven percent for print books and 19 percent for e-books, things look a little different for net proceeds. This is because discounts to the book trade, for example, are also deducted here before your royalties are calculated from them. The term net publishing revenue leaves room for interpretation and should therefore be checked more closely if it is in your contract. It is best to have a sample calculation shown to you. Because several items are deducted from the net proceeds, the percentage of your royalties should be significantly higher than if the calculation basis is the net retail price.

Assuming a paperback price of 9.95 euros and thus a net retail price minus VAT of 9.30 euros, you as the author are left with a royalty of 0.46 euros per book with a five percent share.

If the same paperback is calculated on the basis of the net proceeds, you deduct about 50 percent discount for the book trade from the 9.30 euros, which leaves 4.65 euros. If you also apply five percent royalties here, these are only 0.23 euros per copy.

Therefore, be sure to check the basis of calculation before signing a contract.

How much does a publishing writer earn?

An publisher takes over almost the entire value chain of a book: from editing and book typesetting to printing, distribution and promotion of the book in the book market. The work steps required for this are handled in the individual departments, the most important being editing, rights and licenses, production, marketing, distribution and press. All this has to be paid for with the income from book sales and affects your author's fee.

As a publishing author, you usually receive an advance. This is calculated from the print run and your fee per book. Small publishers and pure e-book publishers usually cannot offer an advance. However, in both cases you will receive royalties, which may be offset against the advance.

Assuming a gross retail price of 14.90 euros and a sold quantity of 2,500 euros, a calculation of your royalties calculated down to one book according to a list of the Voland & Quist Publishers look like this:

Gross retail price14,90 €
Net retail price13,93 €
Book trade discount and distribution costs./. 8,36 €
Author's fee./. 1,25 €
Editing and proofreading./. 0,24 €
Cover design and typesetting./. 0,31 €
Letterpress./. 1,98 €
Advertising./. 0,20 €
Balance1,59 €

From this balance, the publisher has to pay costs such as staff, trade fair appearances and rent. However, if he doesn't sell enough books, he is stuck with the costs. In contrast to self-publishing, this sales risk does not lie with you as the author when you sign a contract with a publisher. Assuming an author's fee of 1.25 euros per book sold, the advance or your total fee for a complete print run of 2,500 copies is 3,125 euros. Of course, the fee varies depending on the size of the publishing house, the print run and the individual agreements you make during the contract negotiations.

How much does a self-publisher earn?

A widespread opinion is that an author earns more when he publishes his book in self-publishing. Although a look at the royalties per book sold suggests this, the services of a self-publishing service provider are lower than those of a classic publisher and the author therefore bears more costs himself.

Editing, cover design, book typesetting, publicity - a publisher will do all these things for you when you publish your Manuscript submitted there and negotiated a contract. As a self-publisher, you have to take care of this yourself. And you should not underestimate the costs. Although there are inexpensive offers, you should definitely pay attention to the quality. No one will buy a book with an unprofessional cover, and if the text contains numerous errors or is illegibly typeset, the reader will quickly put it aside.

The costs for a book do not differ from those of a publisher, only with self-publishing, the author also takes over some of these costs and he also has a higher workload. With the help of price calculators of self-publishing service providers you can calculate your commission. If your book doesn't sellyou're stuck with the costs. Because here you bear the sales risk.

According to the annual Self-Publisher Bible survey, in which a total of 1,895 authors participated in 2020, the average monthly earnings of self-publishers are around 952 euros. However, about half earn less than 50 euros per month. To be successful in self-publishing, regular publications and target group-oriented marketing are crucial factors.

What are the costs for the publication?

When a book is published, you or your publisher will incur a number of costs. The text must be proofread, the interior and the cover must be designed and the finished book must be distributed and advertised. These costs are incurred up front when you don't yet know if your book will sell at all. Still, the investment is valuable and necessary. A book full of spelling mistakes and gaps in logic will get a lot of bad reviews, and if the cover looks unprofessional, your work won't even end up in the shopping basket. So to have a chance in the book market, you should invest in your book.

Costs for a publishing author

For you as an author, the costs are lowest when a publisher takes care of your book. Then he takes over the editing, has a cover designed and is responsible for the production and distribution. There are no costs for you as an author. But beware of printing cost subsidy publishers! If a publisher demands money from you in advance - often in enormous sums - you should definitely refrain from publishing. Usually the support from the publishers is minimal, your book will be published (at your expense), but afterwards you are on your own. Be sure to research publishers on the web or with fellow authors before signing any contracts.

Costs for a self-publishing author

If you decide to publish via a Self-publishing service provider you have to bear part of the costs yourself - whereby the publication itself is the least expensive, with some providers it is even completely free. Editing, cover design and book typesetting, however, are your responsibility as the author, and you are also mainly responsible for marketing. Some providers, such as tredition, support you with press releases or free review copies. Consider in advance what services you expect from a self-publishing service provider and find out what the one you choose offers. As a self-publisher, your service provider will take care of the production and distribution, which usually cost a four-figure sum each. The costs for printing are covered by the print-on-demand process ...only when your book is ordered.

Costs for a self-publishing company

If you want to self-publish your books, you have to cover all the costs involved. Especially production and distribution are large costs that should not be underestimated. Therefore, calculate carefully before you start a self-publishing company. Apart from that, there are many other considerations you should make in advance. A good feeling for the book market is indispensable as a publisher, and you also need an individual concept to stand out from the crowd. Can you afford the effort of To found a publishing houseyou achieve complete independence as an author.

Who earns more: publishing author or self-publisher?

The success of the book is not necessarily dependent on how it was published. Some self-publishers earn significantly more than rather unknown publishing authors. On the other hand, as a self-publisher, you incur costs as an author that would otherwise be covered by the publisher. Once you have a publishing contract, you don't have to worry about cover design and typesetting. To have your own marketing but there's no getting around it either way.

Especially if you decide to self-publish, you can minimize costs by being careful when choosing, for example, an editor and cover designer. This does not mean looking for the cheapest provider. Instead, you should find out which editor is a good fit for you and can actually help you enhance your book, for example, by having a trial editing session. While the cost of this quality is not to be underestimated, on the other hand, a high quality book is more likely to pay off and you will achieve more book sales.

Additional income as an author

As an author, you don't just rely on making money from book sales. Besides your royalties, there are other ways to generate income. This can be the sale of rights, such as for a translation. Merchandise for your books also offers a marketing effect. But beware: if you want to sell promotional items for your book, you have to have an Business register. It is best to clarify any questions with your tax advisor or the tax office. Also with Readings you can charge a fee to supplement your income as a writer.

Regular marketing measures are particularly important for a book's success anyway. This requires your own initiative, even if you publish through a publisher. Therefore, become active yourself, market your books on different target group-oriented channels and thus increase your book sales.

Conclusion

How much writer's fee ends up in your account depends on numerous factors. Just deciding whether to Publisher or self-publishing service provider has an influence on your royalties. Therefore, before signing a contract, find out exactly how it is calculated and keep in mind what services you will receive. When making your choice, don't just look at the percentage that will make up your author's fee. In the same way, as a self-publisher, you should not assume the cheapest offer for editing and cover design, but rather choose the one that promises the best quality for your project.

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