Monthly archives for June, 2012

The New World of Publishing: Some Real Perspective on Pricing

After all the comments on the last post about electronic pricing, it became very, very clear to me that indie fiction writers seem to think that pricing an electronic book is done in a vacuum. They just make up some number that feels right or is what they heard and then stick to that price without any thought of customers or history of publishing or what anyone else in publishing is doing.

And most importantly, writers give almost no thought to the perception of the buyers. The decision is often made on pricing because it’s what the writer likes, or how the writer personally buys, or what the writer can afford. That’s usually as far as the thinking goes.

And worse yet, indie books are often priced because a writer doesn’t think their work is worth the same as a traditionally published book. That’s just flat sad.

Of course, all the confusion makes sense considering how new all this is and that indie publishers are just writers who (before now) never once thought about how a price got put on a book, electronic or paper. Just not something that comes up in the “training” of being a fiction writer.

Honestly, as a writer, I can’t remember ever having a conversation longer than a minute about pricing of any of my books in thirty years of writing. Just never happened. However, when I was the publisher of Pulphouse Publishing Inc., pricing was a constant topic from before we published our first book. Hmmmm….

And then, of course, over the last few years, we had major bloggers who pushed the 99 cent idea and the cheaper-the-better idea in a race to take all indie publishers to the bottom of the electronic pricing structure. This race even went so far as having indie writers figuring out ways to give their books away before Kindle allowed it.

Yeah, it got that bad and still is among some groups of indie writers.

As is normal with most fiction writers, any thoughts of logical business just flew out the window with the sudden new power and control over their own work.

Thankfully, that strange, no-thought pricing trend is starting to shift as more and more indie writers are understanding they have to run their own publishing companies, even though they only publish their own work. A publisher is a publisher is a publisher.

And some of us writers feel our work and our time has value, which is also changing the discussion.

Book Pricing: Some Minor History

A few short years ago most paper books were sold in real brick and mortar stores or large box stores. Then came electronic books and electronic bookstores and the world started to shift.

A few short years ago the major publishers and some of us smaller publishers (Pulphouse Publishing Inc. for example) had the knowledge and the ability to access the book distribution system. Most writers thought it far, far too complex to worry about. Then came electronic books and electronic bookstores and the world started to shift.

A few short years ago three things happened. Distribution directly to the readers became possible, the silliness of thinking of self-publishing as a bad thing got shot in the head after fifty years of life, and some midlist writers finally got completely sick of the bad contracts and even worse treatment from traditional publishers.

A few short years ago some writers started going directly to readers with electronic books (helped along greatly by the KDP program and the brains of Mark Coker at Smashwords).  And some of us jumped on early and got publishing and talking and teaching other writers how to climb on board. And the focus was on electronic books because they are so darned simple to produce and get to readers (even with the costs I’ll talk about below.)

A few short years ago, even though electronic publishing at the time was only a few percent of all books sold, indie writers seemed to latch onto that area of book sales with all their focus because it was easy.  And honestly, even at a small percent of available readers buying electronic books, the money was stunning for some writers.

And now, two plus years later, we find ourselves here, almost to the new normal in publishing.

Today, traditional publishers are making large profits and print books are still being produced (no matter how much some writers wanted that to stop). Electronic books have exploded to 20% of the total book market and is looking like it will level in a few years around 30%. Stunning growth when looked at with a business reality and in a short time frame.

And finally, today indie writers are starting to catch a clue that the future for their personal publishing company is in doing both electronic and paper books (just as traditional publishers are doing) and reaching 100% of their reading public. And thanks to indie publishers, the number of paper books went up 6% this last year (2011). Again, amazing growth and only starting.

So Back to Pricing

When a publisher (all traditional and some small presses and very few indie publishers) sets a price for a paper book, the publisher (in general) looks at the following factors in a profit-and-loss calculation:

1) Costs of product (author)

2) Costs of production and overhead

3) Costs of distribution (discounts including bookstore percentage and shipping)

4) Desired profit levels after all costs

In traditional publishing, those factors are worked into a profit-and-loss sheet with projected (hoped for) sales over a fairly short period of time. (Remember, to traditional publishers, books are still just like fruit that spoils. That’s still how most of their accounting systems work.)

To a small or mid-size press, the concern is getting the money spent on the book back as soon as possible and then letting the book sales grow over time for the profit. So small and midsize presses tend to walk a line between indie and traditional presses in this area, with books being both fruit and nonperishable goods at the same time.

Most indie presses, meaning writers self-publishing, tend to take a longer-term look. That’s also what I have talked a lot about here. Get in for the long haul and let the money just flow every month, even though it may only be a trickle for a year or two or more. Just keep writing and thinking long-term. Books don’t spoil when you own the copyright.

But indie presses, how do you set your book prices with the above factors?

Actually pretty simple, but it requires some math, so hold on…

Indie Press Calculations

1) Cost of product.

This is the cost of the time it took you to write the book at a reasonable rate, the cost of the overhead of your office space, cost of supplies, and so on. (Yeah, I know, you ignore that, but stop being naive and start giving your time and your work some value. If you don’t, no one else will.)

2) Cost of production and overhead.

This is the cost of your time to do covers, both paper and electronic, the cost of proofing your book, cost of your time formatting, the cost of your time uploading your book to all the sources. And if you must, the cost of your time for promotion.

3) Cost of Distribution.

For paper, figure a bookstore discount of 50% of retail cover price and a distribution fee of between 5 and 10% to get it to the bookstores through an indie distributor. (This is outside the extended and Kindle distribution on CreateSpace. I will be talking about the wave of indie distributors to bookstores over the next six months.)

For electronic, figure the discount of the major electronic bookstores and distributors. For example, in the $2.99 to $9.99 range you get just under 70% from Kindle for most sales. Smashwords takes 10% of similar numbers, and so on. (If you are pricing your novel under $2.99, I have a hunch this post won’t help you because you don’t have enough common business sense to even get the best discount for your work.)

4) Desired profit levels after all costs.

Figure all your costs, figure how much from each source with each price you would be getting, and then figure where your money comes back to you and when you books start breaking into a profit per sale. To do this, just as traditional publishers, you have to make a guess at sales.

(I have the numbers I use below that have proven over time to be fairly close for writers with more than a few books up under the same name. Not all. Some do more, some do less. So figure your own guess as to future sales and remember, it is a guess. And as I have talked about before, for the calculations below my time is worth at least $50.00 per hour when working for myself. I tend to charge $250 per hour and more when working for others. Not kidding. Write and edit as much as I have over the decades and you can get that rate as well. Or better.)

For example:

Three months to write a novel. 80,000 words. 80 hours at 1,000 words per hour plus 20 hours to fix mistakes makes the hours spent at a nice round 100 hours. No supplies for ease of calculation. $50.00 per hour x 100 hours = $5,000.00. (Do your own math at your own hourly rate and time to write a finished novel but please don’t mention it here. We’ve been though all that.)

Cost of production is $20.00 for a good cover art and twenty hours to build the covers and format the book for both paper and electronic and launch it in both electronic and paper. $25.00 for extended service on CreateSpace and $100.00 for proofing costs. Cost total then is $50.00 per hour x 20 hours = $1,000.00 plus $20.00 plus $100.00 plus $25.00 = $1,145.00.

Total Costs of the novel is $6,145.00. Keep that number firmly in mind.

Next Step: Costs of distribution. First look at your page length of your paper book and calculate your price plus $2.00 profit for all sales in extended distribution. (There is a chart on CreateSpace that helps with this.)

For an 80,000 word novel and decent trim and font sizes, this will usually take the price of a trade paper to the $17.99 range, which is fine in a trade paper.

Say your book publisher costs are $5.00 per book from CreateSpace (you get this exact number when you order the first proof). Retail cover price is $17.99.  Give a bookstore 50% max and a distributor another 10% of that and what do you have left over? 40% of course.

$17.99 x 40% = $7.19 minus the $5.00 costs is a profit margin per book of $2.19 before creation expenses in steps one and two.

(This is pretty close to the edge for my tastes for novels because in many instances there will be group shipping costs involved which will range from $.60 to $.85 per book. But for this example, you get the idea. And sometimes shipping costs will be paid by the buyer or the distributor, so that’s not on every book.)

Again, each book will be different, but make sure you  have that level of margin on both the extended distribution systems through CreateSpace and the outside distribution to bookstores. That will make sure you also have the same profit margin or better on other distribution methods as well as they emerge. And this also gives you a much bigger profit margin when the book sells directly through Amazon or CreateSpace.

Setting Electronic Prices

So back to the point of all this finally: Setting your electronic book price.

You have a paper edition of your book on sale for $17.99. Each paper sale will return at least $2.00 back against the $6,145.00 costs of doing your book. ($145.00 out of pocket costs, $6,000 time costs.)

So that will take about 3,070 paper book sales to return your investment in money and time completely. Possible, given enough years and some luck. But now we can add in the electronic sales to cut those years down some.

Note!!!!  When setting your electronic price, never forget that your paper book is listed and shows up at $17.99 on Amazon and B&N and iBookstore and Kobo and other places.

Now, are you going to want to price your electronic novel at 99 cents and link it to the $17.99 book with the same cover and title????

Of course not. That would just shout problems to every reader who sees it. And kill the sales on both sides.

The range of electronic book pricing that goes naturally with a $15.99 to $18.99 paper edition is $6.99 to $8.99 electronic.

In other words, readers like electronic editions OF NOVELS to be a little less than half of the paper edition. Generally.

Not a lot less, but a little less than half if the book is a full novel length. (I will mention shorter collections below.)

That price range feels right to book buyers and feels like a deal to electronic book buyers.

For example, this is what every buyer will see on all electronic bookstores.



So what do the electronic buyers think? “Wow, good deal on that Kindle edition.” And more likely they won’t give it much thought at all because it looks natural and professional.

But any price too far under that for the electronic edition gives the readers a bad feeling. And makes them question the quality. And then not buy either edition.

In other words, set your electronic price in relationship to your own trade paper edition.

Also it would not hurt to make sure that your price looks comparable to electronic editions put out by traditional publishers.

In this instance, price is NOT an advantage. You cut your price too much and you cut your sales as well.

Electronic book prices are not set in a vacuum.

To finish off the math.

Electronic… $7.99 x 65% = $5.19 profit per book before set expenses of costs and time to produce.

(This is an assumption of sales…make up your own for your own profit and loss statement.) Sell 25 electronic copies and 25 paper copies per month (worldwide and assuming you are distributing to bookstores).

So, now having the data to use for the 4th question, how soon will your set costs and time costs be back in your pocket?

Electronic… 25 copies x $5.19 = $129.75

Paper… 25 copies x $2.19 = $54.75 (adjust for higher rates on sales direct or through Kindle and/or less copies sold. This is just an average for this example.)

Total income per month (assuming these sales numbers) is $129.75 + $54.75 = $184.50 per month.

$2,214.00 per year.

Less than three years to recoup your set and time costs at that level of sales. And all sales from there are just pure profit after production and distribution costs.

(I can say this right now, since a number of you questioned my math on the short fiction post. WMG Publishing Inc, without any real bookstore distribution yet, is doing better than this number on four author names and a dozen different books. I used very low numbers here for my calculation.)

As promised, let me give you an example of a 20,000 word five-story collection.

Using the same calculations as above….

With a decent trim size (5.5 x 8.5) and decent font (not too large or too small), a 20,000 word collection will run about 110 pages or so in a paper edition. Price the paper collection at $7.99or $8.99 to keep it in the same price range as the major digest magazine prices of the same look.

Your cost is about $2.20 for that book from CreateSpace. Extended distribution will get you about $1.00, which is fine for a short collection. (Longer collections should be priced like a novel for the most part.)

$7.99 x 40% = $3.20. Minus $2.20 = $1.00 profit per sale on outside distribution, about the same as the extended distribution number.

Now move to electronic pricing.  

Remember you have a $7.99 – $8.99 trade paper edition on the screen.  What electronic book price will look good and normal to a book buyer?

$4.99. That looks fine even though it isn’t exactly under half the price. At these low prices, book buyers do not expect the half price for electronic, but they do expect the price to be considerably less than the paper and near half price.

This is what every buyer will see on all electronic bookstores for a short collection.



Looks fine and reasonable and professional.


Electronic pricing should not be done in a vacuum.

I know all of us started this indie publishing road just pricing our books with no consideration to anything but how we felt and what we would buy. And a lot of us followed some seemingly-good advice to price our books and stories into the bargain bin on some strange thinking that we were in competition with traditional publishers.

Books and publishers are not in competition except to publish the best fiction possible. But honestly, that’s up to the writers to write great stories and the publishers to get them into the hands of as many readers in as many forms as possible.

Sound familiar since you are now wearing both hats as an indie publisher?

I have grown to hate the price discussions because all I tend to get is comments like “I don’t feel like pricing my books that high.”  Or, “My mother would never buy a book priced that high.” Please, hold on those comments this time, would you?

In my opinion, it’s now time for some logical thinking when pricing electronic indie books. That’s the kind of discussion I would love to have.

Also, I am sorry to bust a real tightly-held myth about traditional publishing, but electronic books DO HAVE COSTS for traditional publishers. They have author costs, employee costs, expensive overhead, art, proofing and so on. All very real out-of-pocket costs for a traditional publisher.

So should traditional publishers just give those electronic books away for 99 cents and hope to get all the money back on the paper books only? Of course not. Electronic books are just another way to distribute books to readers and need to be figured into any profit and loss calculation.

And why electronic books are near the half price of a paper book is because of the costs of production of a paper book and the costs of delivery of a paper book and the return system that is still somewhat in place for traditional publishers. The costs are still there, but not as much and readers know that, which is why readers expect the lower electronic prices, but don’t expect them to be too low.

The vast majority of traditional-published books follow the basics I laid out above and price their electronic books to a profit and loss calculation, trying to predict sales and time of sales just as I did above. And for the same reasons.

Are there exceptions in both directions? Yes, and I don’t want to hear about them here to be honest.

So when pricing your next novel, do the calculations for your time. What kind of hourly wage do you get at work? Use the same number for your writing and production time. Add in exact costs, and then figure out how long at each price level it will take you to earn back that money.

A hint: Three years is a good time period. And what traditional publishers tend to use on their profit and loss statements.

Stop pricing your ebooks because it “just feels right” or “because I’m afraid I’m not worth more” or “because I’m afraid to go that high.”

Use math, use basic business practices to understand the value of the product, the art, that you create.

I’m having a blast with both the writing and the publishing these days. But that doesn’t mean I don’t want to be paid for my writing and my work.

I value my books and my writing and my time. I will price my books like the were priced when I sold them to a traditional publisher. Readers are used to that.

And I want to make the publisher’s slice of the pie as well for my work as a publisher.

And that’s even more fun, to be honest.

Have I said lately how much I love this new world?

Copyright © 2012 Dean Wesley Smith

Cover art copyright Philcold/Dreamstime

This chapter is now part of my inventory in my Magic Bakery.  I’m giving you this small slice as a sample. I’m giving you a taste, but not selling any of the pie. 

In fact, this article is about 3,100 words long. I could have written a short story in the same amount of time.

If you feel this helped you in any way, toss a tip into the tip jar on the way out of the Magic Bakery.

If you can’t afford to donate, please feel free to pass this chapter along to others who might get some help from it.

And I would like to thank all the fine folks who have donated over this last year. I don’t always get a chance to respond, but the donations and the comments both after the posts and privately are really keeping me going on this. Thanks!

Tip Jar: Go To Paypal



The New World of Publishing: Book Pricing from Another Perspective

Teri Babcock posted the following comment on the last article I wrote in this series and I asked her for permission to move it to the front page. Thanks, Teri, for permission to use it here.

Teri’s comment is spot on the money in many ways, at least from my opinion. So even through I hate talking about pricing of e-books, it is an important topic for indie writers and Teri’s great comment really hits home. 

And, of course, I will make some comments after his post as well.



Went over to the Kindle boards, remembered why I don’t go there. A lot of people arguing with the pricing of short stories above 99 cents. And I thought again about the professionals I’ve heard speak about pricing goods and services. I thought about one of them in particular who consults with people to maximize their incomes, and what he would say about selling books.

He doesn’t work in the publishing industry, and he doesn’t have a pre-existing mindset about where book prices should be. He would base their price on a number of factors, one of the important ones being ‘perceived value to the consumer’.  He would look at how much people will pay for other things of similar value, and price similarly.

He would also look at ways to increase the perceived value, so he could charge more.

He would look at all the short stories and say ‘It takes 15 minutes to read? And it was fun? Okay. charge 5 bucks.” And when writers squacked in horror, he would say “Starbucks sells fancy coffees for $5 that take 15 minutes to drink. They sell millions every day. Did you enjoy the story as much as the coffee? Yes? Well, no problem.”

And the writers would come back with “but there was actual substance in the coffee… cream and coffee beans and sugar…” and the he would respond with “yeah, and if I really like the story, I can read it again. I can’t drink the coffee again. I can lend the story to my friends. I can’t say to my friends, ‘gee you should taste this coffee, it was really good, you can try it when I’m done with it.’

He would tell you that it is not good practice to set anything, no matter how ‘small’, at regular price at the very bottom of the price structure.

The bottom price should be reserved for sales exclusively, and used only in an integrated, strategic way to give you more sales traction and build your brand.

If people said “oh, well I’m new, and I don’t have name recognition so I have to sell cheap to make sales” he’d say, no. Set the price you want to regularly sell at. From that price have sales, or other promotions that give an incentive to the consumer to try your new stuff. You’re telling the consumer that you know they are taking a bit of a risk on a new, unknown quantity, so a price break makes it more appealing. Once they’ve tried your stuff, then they know if the regular price is worth it to them.

You are always educating the consumer as to what your product is worth. The regular price will come to be perceived as its true value. You don’t want to set that too low. You steal from the consumer the thrill of getting a deal, you steal from yourself the flexibility to build and expand your brand appropriately.

And some writers would say “well, I’m pricing my stuff low because, in addition to my being a new writer, I think it is not quite as good as some of the more established authors.”

He would say “Don’t sell it unless it’s good. Do you think I’m going to be grateful that you took and wasted 15 minutes of my time and only charged me a dollar? My time is valuable. I’d pay $5 to have my 15 minutes back.

Do you think when I started as an accountant I told people ‘this isn’t my best work, so I’m going to give you a discount’? No. I did my best work, I gave them a price break from my regular rates – and told them I was doing this – as an incentive to try someone new, while I built my business. As my reputation grew, I didn’t need to do that anymore. And everyone knew what my regular rates were. With my reputation, I was able to support further price increases.”

The big difference between people paying $5 for a fancy coffee every day, and balking at paying $5 for a short story is this: consumer expectation. Starbucks has been training consumers to pay a high mark-up for their coffee for a long time. Consumers might grumble occasionally, but they still show up every day and pay $5. The writing e-market has been doing the reverse, because it is now a market of the commons, and the majority of the commons have no experience with marketing and sales.

The first and last tool of the unsophisticated sales-person is always to reduce the price. Like a chain-saw, price reduction is a powerful tool, but if it is not used carefully you can cut your own leg off.

I’m sure this finance guy would set his bottom price for stories at 2.99. He would not give up the 70% profit margin by dropping below that. If he perceived a need to set a sale price below that, he’d probably just make it completely free, rather than setting it at 99 cents, since there is so little profit at that price point anyway. And for a limited
time. There’s good reason Amazon sets the KDP Select free limit to 5 days.

Anyway, unlike the squackers, this guy makes his money making other people money. And I’m sure he would agree with Dean’s pricing… and say he hasn’t gone far enough yet.


Dean here… Thanks, Teri. Wonderful and clear and spot-on-the-money from a business perspective.

And I think you are right, I haven’t gone far enough yet. Right from the start I argued with all the talk from all the places about discounting books too low and for no reason. And now, because of that start, it’s going to take indie publishing years to recover the public mindset of that 99 cent price.

And it is a mindset we caused by the early adaptors being so eager to make sales and give their books away for no sound business reason.

As I have said over and over and over, every writer and indie publisher is different. My hope is that an indie publisher will make a clear decision as to where to price their books. Clear and thought through from the perspective of history and business.

Just a little publishing business perspective.

In publishing there are (and have always been in one fashion or another) three areas of book selling. High end, mass, and discount. 95% of all books (in history) were sold in the middle end, the mass area where consumers got used to paying a certain price for a mass market paperback, a different price for a trade paperback, and yet a higher, but normal price for a hardback.

The high end books (in history) were the signed collector’s editions with added content and art.

The discount publishers (in history) published directly to the front discount shelves of big bookstores or discount mall stores. If a regular mass book got to those shelves or into a ten cent bin in the front of a store, it was because it didn’t sell and the store wanted to get ride of it.

Readers expect all three levels. Even with the new electronic distribution. They expect the middle prices to be the good books. They expect the very expensive books to have added content. They expect the discount books to be either poorly done or not wanted.

It’s called “perceived value” as Teri mentioned and it has been a major factor in publishing for centuries.

When you, as an indie publisher, decide to price your novel to 99 cents, you are shouting to readers over and over that your book is not wanted and has no value and is just being moved out.

If you price your electronic novel from the $4.99 to $7.99 range, you are telling your customers and readers the book has value and is a normal traditional book.

If you price your book electronically over $12.99, you better have added content or a demand like a bestseller with a million fans who want to read it now.

Nothing has changed in publishing, folks. Electronic is just a new delivery system that allowed writers to take control and get directly to readers. If you decide to indie publish, understand the business of publishing enough to at least tell the readers (with your price) that your book has value.

Now, go ahead and shout at me, but realize I will not put nasty comments through. Discussion is fine, anger you can take to another blog or to the Kindle Boards.

And thanks once again, Teri, for the great comment.

The New World of Publishing: Insulting Your Writer Friends

This week my wife, Kristine Kathryn Rusch, talked in her blog about a topic that has been bothering me for some time. And a problem I saw coming years ago. And one that makes me sad that the problem has finally arrived.

That problem, put simply, is writers angry at other writers. The reason?  A writer’s choice on how to publish a book. 

— Some indie writer on some blog or comment starts going on about how all traditional books these days are bad and I want to raise my hand and say, “Uh, excuse me, over one hundred traditionally published novels here, and not all of them are bad.”

— And then at the same time, on some other blog or comment, some traditionally published writer starts going on about how all indie books are bad and I want to raise my hand and say, “Uh, I’ve put up over 250 indie books and not all of them are bad.”

I am simply making choices for my own fiction, and people are insulting me.

Truth, folks. Sometimes I go indie, sometimes I go traditional, and I love the ability to pick and choose. And I advise writers on both sides. And I teach choice.

But it seems other writers don’t want me to have that choice, and clearly don’t want that choice for themselves.

I am finding this stunning, but not surprising, actually.

What I find really stunning is that writers now have options, and it seems that MOST WRITERS HATE HAVING OPTIONS. It makes them angry.

My poor little brain just hurts at the idea that any writer thinks that having publishing options is a bad thing.

I suppose those writers would be happy with just one big publishing company with only one imprint and only one magazine so they wouldn’t have to strain themselves on deciding which publisher to send a book or story to. Or happy if all traditional publishers failed and only their little publishing company was the only one left.

I don’t honestly know. But it sure seems that a vast number of writers HATE OPTIONS with their publishing choices.

And even more stunning is this hating-of-choices in not limited to beginning writers who haven’t yet found a clue under a nearby bush. No, this hatred and insults also comes spouting out of the mouths of some of the top bestsellers who have been beaten by a thousand clues over the years.

The hatred on this topic comes from everywhere.

Go read my last post explaining how it is possible for writers who work really hard and take a long-term approach to their writing might make a living with short fiction. And notice that to make a living, I used BOTH TRADITIONAL AND INDIE publishing?

That made one poor blogger so angry, he said I was running a “scam.”  All I could do was laugh, since I guess my suggesting a writer must work hard over a lot of years to make a living is a scam. (Kris heard about it and laughed and wanted to know what I was doing with all the money from the scam. Yeah, I was wondering the same thing.)

So even a post suggesting balance gets people really, really angry.

Indie writers flat declare they will never traditionally publishing and traditionally published writers find all kinds of ways of insulting writers who indie publish as if their method is the superior method. Why??????

Let me ask that again…  Why???????????

And why insult the people on the other side of your choice???  Remember, no matter which side of this topic you decide to insult, you are insulting me and my wife at the same time, since we comfortably do both.

So for kicks and jollies, (all mine since this post and the one by my wife will make no difference) I want to lay out a few ways the choices have helped writers. All real examples, I’m afraid.

Example One: A friend of mine is doing a wonderful series of books traditionally published. My friend also can see the value of indie publishing other work and had planned to write some extra material to indie publish, not only to make more money and have more fun writing, but to support the traditionally published books which were coming out one per year.

As a smart writer who likes the traditional editor my friend works with, my friend told the editor about the plan for indie publishing a finished book. The editor, also being smart, asked to see the new book and decided to pick up speed on my friend’s publishing schedule and buy the new series. My friend doubled the published books-per-year and more than doubled the money.

The option of indie publishing for my friend helped push my friend’s traditional books in ways not thought of.

Without the indie publishing option and my friend’s willingness to use it, the old traditional schedule would have continued and my friend would not now be writing a second series.

Example Two: A good friend of mine got a contract from a traditional publisher. Two-book deal pretty much buying rights forever and giving low royalties and such. My friend, being smart, got a lawyer and they worked on the contract, but in the end, the traditional publisher would not budge.

Before choices, my friend would have been stuck either taking the deal or putting the books in a drawer or trying to find another publisher with better contract terms. But my friend also knows indie publishing and had done some short fiction and knew what was possible, so the series came out indie published and has made my friend twice what he would have made from the poor deal with the traditional publisher. In just one year.

My friend had a choice and my friend’s writing career did not die right there as it would have five years ago faced with the same decision, but without the indie option in his corner.

Example Three: Amanda Hocking. I have seen this pattern over and over in just the last year or so. A newer writers starts off indie publishing for one reason or another, has good sales, gets approached by a traditional publisher and decides to do both. I don’t know Amanda Hocking, but from following her, it appears she is still being sane and sound on both sides of this fence. She sold books for a reported total of four million to St. Martin’s Press and she’s still indie publishing other work.

Now that’s smart.

Example Four: And then there is my wife, Kristine Kathryn Rusch. And other writers like her, including Laura Resnick who touched on this very example in a comment on my last post. I have talked to many writers with this issue. But let me use Kris as an example here and why choice suddenly is very important for her and her readers.

Over the years my wife has published a lot of novels, many, many of them in series. And she is still publishing traditionally.

But writers like my wife and Laura and many others care about their readers and their fans. And traditional publishing often has to drop an ongoing series for one reason or another. Up until the last few years, writers like my wife were constantly answering mail from their fans who asked about the next book in a series. Her response was always difficult because she had no choice (because the series could not be published by another publisher.)

In this new world Kris has a choice to finish some series for the fans. So last December the 8th book in the Retrieval Artist series (Anniversary Day) came out of WMG Publishing. And the next book in the series (Blowback) will be late this fall.

Kris also has plans to do the last three books of the Fey Series to finish the Third Place of Power, and she has plans now to write a new Smokey Dalton book in her acclaimed Kris Nelscott mystery series.

My wife, and writers like her, now have choices. Kris still writes for traditional publishers, but she also can give her fans the next books in long-lost series.


When you hear yourself making some firm and angry statement about another writer who is doing something (either traditional or indie) you don’t either understand or like, take a deep breath. And ask yourself the following questions:

— Do I really understand that writer’s situation and life and writing methods?

— Would I do the same thing in his position?

— Why does his choice make me so angry?

—- And why am I so afraid of other writers having choices?

And that’s really where this all comes down.

Another writer’s choice does not impact you in any way. Stay out of their business, make your own choices, encourage and learn from other writers.

If you don’t want to add a choice of publication into your world, that’s fine. Don’t. It’s your career. Your choice.

But please stop insulting other writers. You may not like another writer’s choice, but honor them for their choice and try to understand why they are making that choice.

And learn from them.

As a writer who published my first short story in 1975 and my first novel in 1988, this new world of 2012 is fantastic and wonderful and I love the choices I now have.

And I love the learning and the excitement.

It would make an old guy like me just giddy if I wasn’t being insulted from both sides all the time.

And, oh yeah, have I said lately how much I love this new world and all the choices it offers me as a writer?


Copyright © 2012 Dean Wesley Smith

Cover art copyright Philcold/Dreamstime

This chapter is now part of my inventory in my Magic Bakery.  I’m giving you this small slice as a sample. I’m giving you a taste, but not selling any of the pie. 

I could have written a short story in the same amount of time it took to write this, so I hope I haven’t insulted anyone.

If you feel this helped you in any way, toss a tip into the tip jar on the way out of the Magic Bakery.

If you can’t afford to donate, please feel free to pass this chapter along to others who might get some help from it.

And I would like to thank all the fine folks who have donated over this last year. I don’t always get a chance to respond, but the donations and the comments both after the posts and privately are really keeping me going on this. Thanks!

Tip Jar: Go To Paypal


The New World of Publishing: Making a Living with Your Short Fiction

Way back, over two years ago now, I did a post in my Killing the Sacred Cows of Publishing series called “Myth: You Can’t Make Money Writing Fiction.” You can find that article either in any electronic bookstore or for free here. If you are having trouble with thinking about making money with your fiction, that post might be worth the read even though I wrote it two plus years ago. Especially those of you thinking of staying almost 100% traditional publishing.

But in this post, I want to go after a saying that used to be almost 100% true before three years ago. “You can’t make a living writing only short fiction.”

Not so true anymore.

Why this topic now? And why again, since I have touched on this at various times in various ways in various posts? Well, as I sit here in my office at WMG Publishing, in the other room Kristine Kathryn Rusch is working with a group of professional fiction writers. The topic of the workshop going on out there in the big room is “Short Stories.”

For those of you who don’t know my wife, she is the only person in history to win both the professional editor Hugo Award and a Hugo Award for her short fiction. She is also the only person in history to be in all four Dell Magazines in the same year. (Asimov’s, Analog, Ellery Queen, and Hitchcock’s) And she has done that four out of the last five or six years. She has also been nominated for just about every award there is in short fiction in both science fiction, fantasy, and mystery and won a bunch of them. The eleven writers in the other room are having a great time, learning a ton, and being worked harder than they could have imagined.

So the workshop and all the focus this week on short fiction got me thinking about the math of short fiction and how that has changed so much in this new world of publishing. And how a good short fiction writer can now make a living with their short fiction. They might not get rich, but a living wage is very, very possible these days. And maybe a nice retirement income as well.

Requirements Needed For a Writer To Make a Living Writing Only Short Fiction

1) A Work Ethic.

I started to say “speed” but so many writers think of speed-of-writing as speed-of-typing and no matter how much some of us say that isn’t so, it doesn’t cut through that myth. So I’m going to start calling “fast writers” simply writers with a work ethic.

For your information, I type between 750 words to 1,000 words per hour and I have to take a break every hour to protect my hands and arms. I am pretty normal on that pace it seems after talking to hundreds of professional writers over the years. If you can go faster, good for you. Don’t tell me. My little four-finger-typing has served me well over the decades. Typing speed means nothing.

What is important is work ethic. How many hour-long sessions can you do in a day? In a week?

Once more to the math that just makes myth-believers angry and frees the rest of us to do what we want.

If you type 250 words in 15 minutes, and considered your writing important enough to type for 15 minutes every day, you will finish 91,250 words in one year. Or about one longish novel. (Sorry, but it’s true. 250 words x 365 days = 91,250 words. By the way, I passed 250 words in this article somewhere in the middle of the paragraph about Kris above.)

Note that if you type for 15 minutes every day and produce 250 words and work only on short fiction, by the end of a year you would have completed about 18 short stories of average length of 5,000 words.

If you work for one really, really tough hour of writing (snicker) five days per week, and take two weeks off from the really rough pace (more snickers), you will produce (1,000 words x 5 days x 50 weeks =) 250,000 words in one year. Or about three novels.

Or about 50 short stories (at average length of 5,000 words).

That’s right. 250,000 words in a year. Working one hour per day and taking the weekends off and two weeks vacation.

So to make a living writing short fiction, you need a work ethic that will drag you to the computer at least one hour per day, five days per week. I know that’s tough. But if everyone could do it, there would be a lot of writers making a living with their fiction.

(Sorry, this work-ethic topic just makes me very snarky. And please don’t give me your pitiful excuses about having to research or think about your story or build character worksheets or rewrite your story a dozen times to make your story dull and boring and just like everyone else’s story. And please don’t talk to me about how your day job is 60 hours. I have heard all the excuses and am not interested in why you can’t dig out one hour a day average out of your life. If you can’t do that much, stop claiming you want to be a writer. At least to me. Thanks!)

2) Writing Across Many Genres

If you want to make a living at short fiction, you need to understand and be able to write in most of the main genres. And if you think you can’t write in a genre, then you haven’t tried yet.

The main genres that short fiction sells well in are science fiction, fantasy, mystery, romance, erotica, western, mainstream, thriller, and all the subgenres of those genres. The more you can write in the different genres, the better off you will be in the long run. Of course, all genres, including literary short fiction, sell at one level or another, so don’t let genre thinking limit your writing.

Yes, I know, you might need to have a few pen names and build them all. As I said… “in the long run.” It will take longer to build more than one name in just volume of work available to the readers. But trust me, it’s better to have three different authors pouring money into the cash stream than just one.

3) A Love of Short Fiction

If you don’t love short fiction and read it all the time, don’t even think about this. Use short fiction at times to help your other work and learn how to write it well. But don’t even think of making a living with it alone.

So what is a living wage?

Now let me come at this topic from another direction. What is a living wage?

That’s going to depend on your overhead and what part of the country you live in. $25,000 per year might be enough in some places. $100,000 a year might not be enough in other places. All depends.

So I’m going to go with something reasonable as my number. $40,000 per year for the rest of this article is a living wage. Figure out what’s good for you and do the math accordingly as I am going to do below.

Income Sources

Okay, quickly, I want to outline the different major sources of income from short fiction. And under the Magic Bakery thinking, there are a lot. But many will not happen for every story. So I’m going to just list some of the major ones here first and then go into details later.

1) Sell your story to a magazine or anthology

2) Indie publish your story

3) Group your story into a collection (or collections) and indie publish the collection(s) both electronically and in paper format.

4) Audio sales

5) Overseas sales to overseas magazines and publishers

There are many others, including movie sales, apps, and secondary print markets, but for this discussion, let me just stick to the top five.

Some of the keys to the above five are pretty simple.

For #1 you must only sell your work to five-cent-per-word markets and up that return the exclusive rights to your story to you no longer than six-to-nine months after publication. Maybe one year at most. (Most magazines and anthologies will keep nonexclusive rights beyond that to allow the story to stay in their issue or anthology, but that is no big deal since you can republish and control your story. The key is that the exclusive rights must come back fairly quickly.

For #2, you must price your short story at at least $2.99 and if your story isn’t long enough, add a second bonus story or other bonus material to the mix for the reader. (I know some of you don’t like this idea. Fine, keep your story at 99 cents and keep making 35 cent in the discount bin. No problem for me, and not something to talk about in this discussion.) You also must dig out the few hours extra per week it takes to publish your story and do the cover.

For #3, you need to price your collection decently and also get it into paper. We are moving our collection prices at WMG Publishing slowly to $3.99 for a 20,000 word collection and then up from there. Most of our short five-story collections go into a paper version for $8.99. You also must dig out the few hours to do the collections every time you fill another one.

For #4, either do your own audio recordings of your short fiction and sell them through the different sources, or go to and run through their program. Better to have some stories going one way, others another way. No matter what, getting the audio cash stream running is the key.

For #5, you need to be aware of overseas markets and contract them at times to see if they are interested. (They often take reprints.) Yes, there are places to find overseas fiction markets. And yes, just as here, magazines buy from writers from all around the world. This takes time to build, but can be a slow but steady source of income once you have magazine editors overseas that like your work.

Building a Career and Income

I know a lot of you beginning writers out there are upset that your first novel or first short story didn’t sell. Or even your 30th short story isn’t helping the flow much. And we can go on for a long time about the reasons. Another time.

For this, I am going to assume you are mailing appropriate stories to top magazine markets, indie selling your stories in every electronic market, doing collections as often as you can, and pushing toward audio and overseas markets. In essence, using at least the five major ways of earning money from short fiction.

SALES ASSUMPTION: I am going to assume each indie-published story and collection sells an average of five copies around the world each month. Some stories will sell none, others will sell thirty. Again, the number is five for both the short fiction and the collections from ALL sources, not just Kindle.

Average!!!  Remember, average!!!

Will you hit five copies average early on? Not unless you are really lucky and writing in some genre that you are hitting dead center. Most of us take a lot of time to average five copies. Some writers I  know haven’t done it in the first two years of this new world, others have. It all depends on dozens of factors. Again, a later topic.

Even more frightening is that most writers don’t know how many copies every month they are selling. They look at the Kindle numbers and get depressed. Remember, Apple has thirty-two stores at last count around the world and Kobo has even more. Amazon has five. Think world and long term.

And by the way, “long term” means longer than six months.  I am going to talk about the third year from the start of a short story writing program. Nothing sells well if you only have a few titles out.

Okay, how will all this work out? Time to find out.

— You write 50 short stories in a year. They average around 5,000 words.

— You keep doing that for a second year and a third and so on.

— You and your first reader think that about 25 of the stories each year are appropriate for mailing to traditional magazines and anthologies. (Romance has no short fiction markets, so most of those would just go indie right off the bat.)

— You are good enough storyteller and marketer to sell 5 stories to those traditional markets the first year and ten per year after that, since some of the stories from the previous year are still on the market..

Income from Point #1 during the third year: 5,000 words x 10 stories = 50,000 words x 5 cents = $2,500.00 income per year. (Chances are it would be more than that, but let’s stay low.)

The advantages of doing this are far more than the money. Those traditional sales to magazines and anthologies push new readers to your indie published work as well and help you get on award ballots and into organizations and so on. Some of the best promotion a person can get is by selling to a major magazine or anthology and they pay you to advertise your work in their magazine.

— The other stories each year are published indie. And also the ones that are coming off the market after exhausting the good-paying traditional magazines. Or they have been published and reverted to you from the market after a sale.

— By the end of the third year you will have written 150 short stories and have about 100 of them indie published.

Income from Point #2 during the third year: 100 stories x 5 sales per month average = 500 sales per month around the world. Income from sales is $2.00 per sale. So 500 x $2.00 = $1,000.00 per month or $12,000.00  for the year. (Again, a lot of factors to drive this number up or down such as number of pen names, ability of storytelling, ability to do covers and blurbs, and your choice of topics.)

— Each story needs to be in at least one five-story collection. So by the end of the third year you will have 20 five-story collections published.

— Each story needs to be in a larger collection with at least ten or more stories. So by the end of the third year you will have at least 8 large collections.

— Five-story collections priced at $3.99 electronic and ten-story collections priced at $5.99 electronic. Profit from the first is $2.50 (rounding) per sale and from the large collections $4.00 per sale, again rounding.

Each collection also needs to be in paper editions, but let’s just round that money into the five sales for now. But it might be pretty large as your list of books grow and you get them into bookstores down the road.

Income from Point #3 during the third year: 20 collections x 5 sales per month = 100 sales x $2.50 = $250.00 per month or $3,000 per year. 8 large collections x 5 sales per month = 40 sales x $4.00 = $160.00 per month or $1,900.00 per year. (rounding)  Total Income from Point #3 is $3,000 plus $1,900 = $4,900.00

Income Points #4 and #5: Just assume if you are doing them they are making up for any shortfall in the numbers above. Given a few years, audio could bring you in a few thousand per year easily, if not more. I know a number of people who are making a ton more than that. But for now, we’ll leave these out of the calculations. Too much to explain. Just call points four and five insurance back-up.

So during year three what is the total income? Are we close yet to making that $40,000 per year income?

$2,500 + $12,000 + $4,900 = $19,400 for year three.

Nope, only about half way after three years. (Remember I said long term?)

So year #4 you add in another fifty stories.

Your traditional sales of $2,500 stay the same under Point #1. (Remember, you are getting paid to advertise your own work in their pages.)

You make 50 x 5 = 250 sales per month x $2.00 = $500 per month more x 12 = $6,000 more per year from Point #2

You have ten more short collections and say four more long collections. The math works out to about $2,400 per year extra.

So each year you keep up the pace you add into the mix about $8,400.

So at about halfway through year six you will go past the $40,000.00 per year income figure.

And it should keep climbing as long as you are writing. (It will level and drop slightly if you are not, but still a nice steady retirement income for a long time.)


There are lots and lots of ways this could go better or go worse than the numbers I laid out above. Let me list some.

— Success or failure on such a plan will depend on your ability to write stories people want to read and traditional editors want to buy. That means (as you write) you must continue to work on your craft and skills as a storyteller. If you don’t do this, just forget even trying this. You must have a hunger to get better every day, every story.

— Success or failure on such a plan will depend on your ability to make sales traditionally with short fiction. The more times your stories appear in traditional magazines and books, the better your indie stories will sell and the better the reader base you will slowly build. (Note: An ad in Asimov’s/Analog is about $800 per page. They pay you instead for filling ten pages with your story. And then give your story back in a few months.)

— Success or failure will depend on your ability to learn how to do good covers, keep your costs down to almost nothing, learn how to do active blurbs, and that you keep up with the changing technology. (If you hire out the work of laying out covers and books, forget this. You have to do it yourself for your own publishing company.)

— Success or failure will depend on your ability to get to writing regularly most days, and when life tosses you a  monster, you go back to writing when you get through the issues. This is the most difficult for all of us. I’m just now climbing back on the writing after a long life event that took me away for nine months. It happens. You climb back on and keep going.

— Success or failure will depend on your ability to think long term with your planning. (Watch, most of the comments I will get about this post will be about looking at their short-term sales on a few stories. Those mean nothing I’m afraid.) Average. Become a better storyteller. Think long term.

— Success or failure will depend on your ability to start and push new cash streams such as audio or overseas sales or whatever is coming next. You may discover that over time your biggest cash stream isn’t something that exists right now, or that I didn’t mention. 

But, all that said, it is very possible these days for a good short story writer to make a nice living writing only short fiction. You have to love it like I do. And you have to love writing it and be challenged by it.

But no matter what your belief is about the chance that writers can make a living with only short fiction, the math does not lie.

You might not agree with my assumptions. Fine. Change the sales to three sales average around the world every month, including paper for the collections. It will take you a few years longer to get to the goal. It will still happen if you write the stories and make it happen.

We are just entering  a new golden age for short fiction. For those of us who love to write and read short fiction, this new world is just heaven.

Ten years ago I never dreamed making a living with short fiction was possible.

But it is possible now.

Have I said lately how much I love this new world?

Copyright © 2012 Dean Wesley Smith

Cover art copyright Philcold/Dreamstime

This chapter is now part of my inventory in my Magic Bakery.  I’m giving you this small slice as a sample. I’m giving you a taste, but not selling any of the pie. 

In fact, this article is about 3,100 words long. I could have written a short story in the same amount of time.

If you feel this helped you in any way, toss a tip into the tip jar on the way out of the Magic Bakery.

If you can’t afford to donate, please feel free to pass this chapter along to others who might get some help from it.

And I would like to thank all the fine folks who have donated over this last year. I don’t always get a chance to respond, but the donations and the comments both after the posts and privately are really keeping me going on this. Thanks!

Tip Jar: Go To Paypal


The New World of Publishing: Prices on Covers of Indie Books

A while back Joe Konrath (in one of his very interesting blogs) suggested that maybe indie publishers should not put prices on their POD books. And he seemed to have a logical argument for his position as Joe often does.

My first reaction to that suggestion was negative, I have to admit. But then I decided to give it a harder look and just not jump to a sudden judgment. I wanted to see if Joe’s idea had merit in this new world of publishing.

Also, since everything is changing so much these days, I was willing to look to see if this part of publishing was changing as well.

So I have spent the time since that post by Joe thinking it over, talking with indie bookstore owners, and also looking up some history to make sure I had things straight.

First Some History

Interestingly enough, back in the 1800s, some books had prices and some didn’t. The ones that did tended to be for the masses, while the literary novels of their time done in leather hardbacks didn’t. (I imagine the thinking went that if you had to ask the price, you couldn’t afford it.)

This is the world of the “dime novels” and “penny dreadfuls.”  Wonderful stuff. I have a bunch of both in my collection.

As the pulp magazines took over into the early part of the 1900s, the price on the covers continued in the same fashion, with some exceptions. Books that publishers thought might have a large audience had a price, for the most part. All pulps had prices, often either a dime or a quarter. Most contained full novels and short fiction and some articles.

Then in the late 1930s the mass market paperback was introduced, of course with a price on the cover. And from there all books in that form had prices. It was during the early 1950s that almost all publishers also started putting prices on hardback books, with very, very few exceptions.

So for sixty years all books have had prices on them. It’s standard and the other evening as I was sorting out collectable paperbacks from the more standard stuff, I was using price as the first indicator.

My Very Small Survey of Bookstore Owners

Four to be exact, so not really a survey of any sort. I asked four bookstore owners their thoughts on buying books that didn’t have cover prices on them.

All four were very put off by the idea. In other words, all four hated it, which made me stop even bothering to call more store owners to talk about the idea.

One said, (and I quote) “If some lazy publisher thinks I’m going to look at an invoice and do stickers for all his books, he can keep them.”

When I asked a couple of the owners about ease in discounting the books without a price, both wondered how their customers were even going to know if the book was discounted or not without a cover price originally on the book to compare the discounted price to. (Actually, someone else in one conversation asked the question and the bookstore owner agreed.)

I found that the most compelling statement any of them said, to be honest. How do you discount when you have no “first” price to discount from?

One store owner just laughed at the suggestion, shook his head, and said that was the worst idea he had ever heard. And then changed the subject. (Indie bookstore owners are not ones to pull punches. Remember, my friend who died in August was an indie bookstore owner as well and he was one of the most blunt people I have ever met. I wish I could have asked him as well, but I’m pretty sure he would have given me that “Bill look” that I got from him with really strange or stupid comments or ideas.)

I even talked with a used bookstore owner and since he prices all his books off the original price, taking into account condition and rarity, he didn’t like the idea either.

My Opinion?

When Joe Konrath suggested the idea, my first reaction was that it was a really, really bad idea.

Numbers of people asked me what I thought of the idea right after Joe’s blog and I told them I was thinking about it, but didn’t like it.

Well, now I have thought about it, talked with a few friends about it, tried to talk with a few store owners about it, and I still hold my original position. And my position was firmed up by looking back at the history of prices on paper books.

I think that NOT putting a price on a paper book is a really, really bad idea. Period.

In other words, put the price on the back of the book, down near the bar code.

Not putting a price on your paper book flies in the face of sixty-plus years of publishing and it’s a battle not worth fighting with everything else going on right now, even if it was a good idea, which I do not think it is. That detail of publishing is not changing. At least not at the moment.

Books are not like cereal on a grocery store shelf. Books are priced. If you don’t price your book, you will make indie store owners mad, make discounting a paper book almost impossible to be of value, and just label your book as an indie press book.

In this area, do what all publishers do and price your paper books.

And that is my opinion. Now go back to writing.


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#21... The Basics of Designing Science Fiction Covers ... Allyson Longueira .... 8 videos... $50.00

#22... The Basics of Designing Mystery, Cozy, or Thriller Covers ... Allyson Longueira .... 8 videos... $50.00

#23... Paying the Price: A Working Writer's Mindset ... Dean Wesley Smith.... 10 videos... $50.00

#24... Writing into the Dark: The Tricks and Methods of Writing Without an Outline... Dean Wesley Smith... 12 videos... $50.00

#25... Reviews: The Good, the Bad, and the Ugly... Dean Wesley Smith... 10 videos... $50.00

#26... Organization... Allyson Longueira... 8 videos... $50.00

#27... Confidence... Dean Wesley Smith... 10 videos... $50.00

#28... Stories to Novels... Dean Wesley Smith... 9 videos... $50.00

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