Think Like a Publisher 2013: Chapter 3: Projected Income

Here we go again. It’s been over two years since I wrote the first version of Think Like a Publisher. And a year since I updated it into a 2012 edition. Stunning how time goes by.

Since I wrote those first chapters for the first volume, Scott William Carter and I have taught three workshops by the same name, plus an advanced workshop helping indie writers make more money from their books. And in the fall of 2012 Allyson Longuiera and I taught a Print on Demand workshop to help writers get their books into print and learn how to sell them. We are doing the full POD workshop again in May and doing Covers and Interior workshops online now.

And during those workshops and from comments and from hundreds of sources I have learned a ton more information. The indie publishing world has gotten by the early years of the “gold rush” thinking and has now settled into a new normal that should last for years if not decades. 2013 is the first year of that new normal.

Plus the publishing company I helped start (WMG Publishing) now has a full-time employee and three part-time employees and has published about 300 different book titles. And Kris and I have started a new distribution program called Ella Distributing Inc. that will launch in early 2013. (I will announce it here.) That company already has a full time employee and one part timer and will be growing quickly over the spring of 2013.

And the overall publishing business is now stabilizing with traditional publishers holding their own and indie publishing doing great.

As traditional publishers grab for more rights and become even more difficult to work with, more and more writers are moving to indie publishing. As they make the jump, they ask basic questions on how to do it, how to be treated with respect as a publisher, and even how to do simple things like setting up a publishing business.

An indie publisher is still a publisher, the same as any traditional publisher.

Think Like a Publisher 2013 is an updated version of the book from about a year ago, including some of what has changed and what I have learned over the last year or more. I’m sure in another two years I’ll do a fourth edition. 

Every few days I will post a chapter for free here with a link under the tab above. The 2012 edition is still available in book and electronic form. After I get done with these posts and reformatting the book, this edition will appear replacing the old one. But that will take a month or so.

Comments on each chapter are welcome and help us all learn, but keep the comments focused on the topic of the chapter, please.

I hope these chapters help you get a jump on learning how to be a publisher. And on finding an audience for your writing.

Chapter Three

Projected Income

To actually get a profit-and-loss calculation for a book project, you must now make some pricing decisions and projections of income.

Yeah, I know. I know. This is all so new, how can anyone predict how much money they will make on any project? Well, you can’t. Not really. But you can try. And you want to know a dirty little secret. New York traditional publishing can’t predict how much they will make on any book either.

But they try.

And that’s the key. To really act like a publisher, you need to understand what you are trying to gain. You need to know how many sales will get your expenses back. And you need to know at how many sales will you start making a profit.

So this chapter is about why you need to try to determine set income ranges, and how to do that at this moment in 2013.

This is the last of the basic three set-up chapters. After this one, we start getting into more detail on specific areas.

Caution!!

Here we go again, back into pricing. Remember, this discussion is about acting like a real publisher, not a hobby writer. Real publishers are in the business to make a profit. That’s the focus now, so please keep that in mind. If that is not your intent, fine.

Pricing

To determine any kind of income and sales potential, you must first make some pricing decisions. And you must decide as a publisher what your long-range goals are.

(Holy smokes have we had discussions about this topic here on the blog. Feel free to bring up the old questions again if you feel they have not been answered yet.)

Those of us involved with the starting of WMG Publishing Incorporated sat down and talked about long-range goals. We all wanted WMG Publishing to become, down the road, a decent mid-sized publisher of fiction of all types from many, many authors. You might decide that your publisher is just to publish your work. That’s normal for indie publishing and nothing wrong with that at all. Or maybe your business mission statement isn’t to make any money, but to have a lot of people read your work. Fine as well, if you are clear for yourself on that.

The choice of mission statement will also determine your standard pricing. And your pricing will determine also how you sell books, both electronically and in paper editions.

(Ignore for the moment promotion discounts. I will cover that in a later chapter.)

The values we set for WMG Publishing changed over time, which is also natural, especially in a growing and changing market like this one.  But the values I will be using for this discussion on setting income are as follows:

Electronic Publication (2013)

Short story: $2.99.

Gross Income Expected: $1.80 to $2.00 per sale. Use $2.00 for rough calculations.

(Note: If you don’t feel right about pricing a short story at this level, especially the shorter ones, add in an extra bonus story. Then add the first story as a bonus story on the second. Just to get the world length up and the value up.)

Short Novels, Short Collections: $4.99.

Gross Income Expected: $3.25 to $3.50 per sale domestic. Use $3.25 for calculations.

Regular Novels (over 35,000 words), Long collections: $5.99 to $7.99

Gross Income Expected: $4.20 to $$5.60 per sale domestic. (Use 70% of the retail price for calculations.)

(In the above calculations, Gross Income is after the fees and costs taken out by the bookstores and providers of electronic sales.)

 

POD Publication (2013).

Short Collections, Short Novels: $9.99- $12.99 trade paperback.

Novels, Long Collections: $15.99 to $17.99 trade paperback. (Might vary upward with extra long books.)

Gross Profits on both are in the range of $2.00 to $4.00 per sale, depending on where sold. Use $3.00 for calculations.

Note:

Also, I am not counting Audio editions at all. But that is a vast source of income coming into 2013. Do them yourself or use ACX, either way, audio is worth the effort, but calculate the costs just as with others forms.

 

Why Pick These Prices?

These electronic prices are under traditional publishing ranges, yet not too far under to seem to be a discounted price. Trade paperback prices are normal traditional publication prices for trade paperbacks in the size range indicated.

For the trade paperbacks, the price range also allows WMG Publishing to do catalogs and give 40-50% discounts to bookstores and sell to distributors as well.  (More on that in later chapters in Think like a Publisher.)

As I mentioned in the first post, there are three types of publishers. Discount publishers, high-end publishers, and middle ground publishers. We wanted WMG Publishing to be in the middle ground with the mass of most traditional publishers. To do that, the prices had to be in that range as well.

Also the price range we picked allows for promotional pricing at times when needed.

Again, all pricing decisions are based on the early mission statement and the hope for the future for WMG Publishing. With your own press, think about what kind of publisher you want to be, then figure your prices to fit in the range of that decision.

Also, keep some basic math in mind. If your motives are profit, you must sell ten books at 99 cents to make the same amount that you would make when you sell one book at $4.99. And since almost no traditional publishers do 99 cent novel pricing except rarely as a short-term promotion, a 99 cent price for a novel will label you as a discount or hobby publisher. Also, during the last year (2012) the 99 cent price range developed a reputation for low quality among regular readers overall. So caution there.

Calculating A Project’s Projected Income

Now comes the fun part. Hang onto your math brains. And let me stress again that not even traditional publishers know this number for a fact. If they did, publishing would be a very simple business without risk.

In traditional publishing, publishers have some tools to use in this area. For example, they can look at a book and then (like shopping in real estate) they compare to other books of the same length in the same genre with the same basic author recognition. So if a similar book sold 20,000 copies, then it is pretty safe to use that sales number in the current books calculation.

They also use an author’s track record. If the author’s last book sold 50,000 copies, then it is pretty safe to do a profit-and-loss calculation with that as the sales range. (And that projection then sets the author’s advance.)

But as an indie publisher, with no real track record yet, (and a world that is expanding into electronic publishing faster than most people can keep up with) how is it possible to make any real projections of sales?

Bottom line: It’s not.

Traditional publishers have functioned under the idea that a book is only active and available new to readers for a short time. Just like fruit in a grocery story. But unlike the produce model of traditional publishing of paper books, where books spoil and get pulled from limited shelving, electronic publishing doesn’t have that issue.

And neither does the new world of Print on Demand trade paper.

Our books don’t spoil. And we have unlimited shelf space to display our books until readers find them. And in this area, that makes all the difference. And we don’t print paper books ahead of time, but only to order, so we are not trapped into warehousing and shipping costs.

Traditional publishers had to hit their projections within a certain selling time frame before the book was pulled and another book took its place on the shelf.

Indie publishers have no real time restriction at all. So instead of trying to guess at a total sales in a set time to determine the amount of money that can be spent on a project so that the project makes a 4% profit, indie publishers can calculate a different number entirely.

The Break Even Number

(Or… At what number of sales does a book starts earning a profit?)

Actually, traditional publishers have that “break even” number sort of in their calculations as well, but pay little attention to it.

Indie Profit-And-Loss-Calculation

For traditional publishers in the produce model, this profit-and-loss calculation is done on computers and has many varied factors. And actually, you also can set up this sort of program on a computer to plug in all your factors on every book as well if you have that bent. Art costs, layout costs, overhead in your office, time it took to write the book, and so on.

I don’t care to do that much work, to be honest. But I do want to know at how many copies sold will the book or story start earning a profit for WMG Publishing.

And I want to know that number BEFORE I start into producing a project.

If the projected expenses are such that a book would need to sell 100,000 copies to start earning a penny, I’m going to back away from that project quickly. Too many things could go wrong and I sure don’t want to be like traditional publishing where a book that sold 50,000 copies could be considered a failure. (It happens more than you can ever imagine.)

So an “Indie Profit-And-Loss Calculation” would run simply like this:

All Actual Costs + Time Costs + Overhead Costs divided by Gross Income Per Book = NUMBER OF SOLD BOOKS NEEDED TO BREAK EVEN.

A Sample: A 5,000 word short story.

Your only actual cost is $10.00 for some art. Your time to write and launch the story is ten hours at a rate of $20.00 per hour. Your overhead costs for that ten hours are less than $20.00 so use $20.00.  You get $2.00 per sale. (You have no paper edition.)

$10.00 (art) + $200.00 (time) + $20.00 (overhead) = $230.00 divided by $2.00 = 115 books sold to break even.

If you average about 5 sales over all the sites over all the world per story per month, it will take you 23 months, or just about two years to break even on the short story and be into pure profit.

Of course, I am NOT COUNTING any income from a collection the story might be in. That would bring the break-even point in even closer.

A side note for short story writers. You can often get 6 cents per word and up for a short story to a good market. A sale to a good market also helps you advertise your other work and most short fiction markets return rights within a year. Worth considering for any short story. Do the math and add in ad value minus the lost income for the time spent marketing.

Example: 5,000 words x 6 cents = $300.00.  $800 value of 1/2 page ad in Asimov’s = $1,100 value.

Cost of doing the story is $220 (no art) plus two years lost sales time. (5 sales per month = $10.00 x 24 months = $240.00.   Cost out is $460.00.  Value in is $1,100.00.  See why I say it has value to sell short stories to top magazines? That advertising value makes all the difference.

Calculating Basic Average Sales Rate

My attitude about sales is that even though there are more outlets than I can count worldwide, (not counting bookstore sales of the POD) I want to do this calculation on the bottom of any sales I can imagine. My bottom calculation is 25 novels sold total per month across all sites around the world. And as I said above, my calculations for short stories are 5 short stories sold total per month average and 5 collections sold told per month average.

Now, at the beginning of an indie publishing career, that might sound slightly high, especially if you are only watching Kindle US numbers. But remember, before you even begin to see the sales for, say, January from Australia through iPad, it’s going to months later. And that is not counting that it might take three or four months for the book to even reach those Australian shelves through all the systems.

So, give things time to grow and don’t panic and get in a hurry. You are growing a business. (Again, a topic for a coming chapter.)

Just use the above math to figure how many books you need to sell depending on the price of your book to make back your expenses at the base rate of 25 sales per month for novels and 5 sales for short fiction and collections.

What happens next with the novel or story?

In traditional publishing, after 3 years you would have been paid your novel advance, the novel would have been published and vanished except maybe trickling along at 25% of net income for you from a few electronic sites.  And years and years would go by before you could even think of getting your rights back. Even if you signed a great contract. And that is very, very rare these days.

But for me, with my indie-published book, my novel or story is still just out there in thousands of stores worldwide, in a growing market, still selling. It has been there as inventory while I write and publish more and more and more books and stories to join it on my unlimited shelves.

The book just keeps on earning me money. Even bouncing along the bottom at 25 sales worldwide every month for a novel (counting paper copies), I will have a passive income every month. For doing nothing.

Let me say that again. For doing nothing.

At some point I will have been paid for my time, my expenses, and then the book or story just keeps on earning.

And in this new world, there is no telling how long that passive income could flow. No way of knowing. None.

But the key up front is to try to give yourself some basic income projections when deciding on a project. And if the costs are too high for the project to ever earn back, move on. That’s what any publisher would do and you are now a publisher, remember.

Learn to think like one.

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Copyright © 2013 Dean Wesley Smith

Cover Photo by Edward Fielding/Dreamstime.com

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This chapter is now part of my inventory in my Magic Bakery.  I’ve talked about the Magic Bakery a few times in various posts, but just think of this column as a pie and I am allowing samples of the pie here. Understanding the Magic Bakery is critical to making good money as a publisher. So I will talk about it in these chapters coming up as well.

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. The donations and the comments both after the posts and privately are really keeping me going on this. Thanks!

Tip Jar: Go To Paypal

 

 

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50 Responses to Think Like a Publisher 2013: Chapter 3: Projected Income

  1. harryipants says:

    Hi Dean.
    Great advice from you as usual.
    Just wanting to point out, as you’re mentioning Australia, that if anyone in Australia buys an ebook from Amazon, the writer only gets half the profit they’d have made if someone from the U.S or U.K had bought it. They pay only 35% for ebooks sold to Australia, along with many other countries. Apparently we’re some sort of third world country. Weird. It looks strangely like the U.S everywhere I go here.
    Now imagine you’re Australian, and you write Australian fiction. Presumably, a high percentage of your readers would be Australian.
    Would you
    (a) Not sell on Amazon?
    (b) Wish Amazon would be nicer, but accept that as an Australian you should just be happy that the wondrous benevolent ruler Amazon, in its infinite wisdom, even allows you to exist?
    (c) Put on your pink hand-wraps and black boxing gloves, write the word Amazon on the heavy bag, and feel marginally better for five three-minute-rounds each day?
    (d) Stop writing the stories that matter to you, change your name to Patterson James, and switch to ones about fast cars and big guns and slightly slow women, occasionally swapping around the speed and size of all three components of your stories?
    (e) Keep writing a lot so your stories get better and hope Apple and Kobo get a bigger market share?
    (f) Some other really cool plan you’re about to tell me?
    F would be awesome, but as great as I’ve found you to be, I’m thinking you’re gonna tell me to try E, and maybe a bit of C…

    • dwsmith says:

      Harry, of course it’s “e” because things always change and will keep changing. The key is to have the stories out there and in as many markets as you can. And Kobo and iBooks is a ton larger around the world than Kindle. A ton. Both have over 50 stores in 50 countries and growing like crazy. So it’s “e” mixed in with a little “g” which is stop worrying about Kindle, stop reading all the silliness about Amazon, and focus only on your writing and getting it out everywhere.

      And have fun.

      • (Apparently my internet connection went down when I tried to post this before — sorry if it ends up appearing twice….)

        I’m pretty sure most of my sales to Australia come through one of Smashwords’ partners (mainly Apple, I think).

  2. Vera Soroka says:

    I’ve just hired an editor and the cost is $300 Can. I figured I’m going to have to sale 75 e-books to cover my cost plus sell another 75 e-books to put towards editing the next book. I don’t know how long that will take.
    I’m anxious to get more than one book out but I don’t have the money to invest in more editing unless I find someone just to read it and find what I missed.
    It’s hard to be patient sometimes.

  3. Nancy Beck says:

    I will have a passive income every month. For doing nothing.

    This is the key for me. I put in all the work up front, and then keep bringing money in each month for however many years – without lifting a finger.

    Thanks for posting this. :-)

  4. nelson says:

    Nice points. Though if one has done this for a short time, shouldn’t they project previous sales into the future?
    Also I agree with the audio part. I think it’s huge, and one only need to see all the Audible (a great choice if one doesn’t have time for doing Audio) ads around for that.
    Thanks once again.

    • dwsmith says:

      Nelson, unless the book is exactly the same, previous sales on a new book won’t work. On a book that is selling, sure, you can make some educated guesses if you change your projections on the project after a year or so of sales on that one project. But I was mostly talking about new projects.

  5. Cerys du Lys says:

    You briefly mentioned audiobook stuff in here, and I was kind of wondering what your opinion is on ACX stuff? Mainly, do you agree or disagree with going the “royalty share” route?

    I completely agree with you on other aspects of publishing(basically everything) and how you shouldn’t give away a percentage of your “forever” royalties under any circumstances, but audiobooks seem like a strange case to me. I mean, technically the story is “yours” but the production copyright typically stays with the narrator, I believe? (Or so ACX leads me to believe, unless you flat out pay someone for it and discuss it with them, in which case I suppose it’s negotiable).

    But then you have a case of… if you shouldn’t “sell” a percentage of the royalties for your copywritten stuff, should you expect others to sell their royalties to you? They own their voice and the production of it, so if they followed your guidelines they would want to do a royalty share(since that’s the only royalty option they really have in this situation). Granted, you can always find someone who -will- do audiobook stuff for a set price(not too hard), but then it does get pretty expensive, too.

    Basically, I’m just wondering what your opinion is on this kind of thing? Should you wait until you can afford to pay the ~$100-200+ whatever an hour it is for a finished audio work, or is royalty sharing an acceptable alternative in this kind of situation.

    • dwsmith says:

      Cerys, we are using ACX for some things, doing others ourself. The ACX is fine. It’s seven years (very limited… I would be doing more work for New York if they limited their book contracts that way) and you have no money up front. Yes, the reader owns his work and you own yours, and if you kill it at the end of seven years, or he kills it, then that reading can’t be used again. But you don’t lose your story in any way at all and can do another reading. So no long-term problems that I have been able to see.

      And wow is the money nice. The key is the seven year limitation and the fact that they put the work up in the top places for sale, including iTunes.

      • Rob M. says:

        Dean,
        I found your blog a few months ago and have been continually impressed with your knowledge and candor. I have two question if you don’t mind addressing please:

        1. About the audio books…How do these sales compare on average with paper & ebook figures?

        2. I’m in the first stages of building a catalog and love writing short stories. Assuming the writing is up to snuff and covers, formatting, etc are professionally done, do you feel a large collection of short stories would create white noise that would hide my novels from potential readers? Should the shorts be published under a pen name to avout diluting the longer works or do they help build an author ‘brand?’

        Thank You,
        Rob

        • dwsmith says:

          Rob, on your question #2, there is no white noise. A story is a story is a story, no matter length. And any story can bring a new fan to all your work. You question is like saying the Beatles or the Rolling Stones should take all but their longest songs and hide them so that fans can find their longest songs only. ??? Nope. No sense.

          I don’t have actual numbers on audio, but now that e-books sales have slowed, audio is the fastest growing segment of book publishing. In a year I’ll have more person information and I’m sure other writers will have a ton as well. The ACX program is still fairly new for indie writers.

      • Roscoe says:

        Dean Wesley Smith promoting a service that puts up your work on the distributors in exchange for a percentage? Now I /have/ seen everything. :D

        • dwsmith says:

          Why? I have zero issue with a bookstore taking 40 or 50% to sell my books, or Baker and Taylor taking 10% to distribute my books to bookstores. They take no percentage of copyright. That’s where you are getting confused with what I have said. You never give away ownership, such as 15% of ownership to an agent or a cover designer or anyone else. But a distributor such as Smashwords taking 10% isn’t taking ownership. They are charging a fee for their service and own nothing.

          So you are confused as to what I have said. I warn writers away from ever giving ownership away. No distributor takes ownership just as Amazon doesn’t take ownership just as a bookstore doesn’t take ownership in your copyright.

  6. Keith Allen says:

    Very interesting info. I have setup a spreadsheet to do a similar calculation as you outline above. I am not considering overhead costs however. Out of curiosity, what are you including in your overhead costs estimate and how are you estimating the dollar amount?

    Thanks!

    • dwsmith says:

      Keith, the square footage of my office as a percentage of the total house square footage, then take that percentage for all utility bills and such. Get a monthly total, then divide that by the time it took to do a project. So if it took 15 days, that project gets 1/2 my monthly overhead for the office.

  7. Randall Wood says:

    Dean,

    I was looking forward to the next version of this post as I was hoping you would include your thoughts on hardcover versions. I know the profit margins are small, but the math I’ve seen and/or crunched myself still points to a profit. Since Creatspace doesn’t support hardcovers yet it would require going through Lightning Source, something most indie authors seem to shy away from for some reason.

    Your advice of making your book available in every format, and on every platform available, is very sound in my opinion; I just wonder why you haven’t touched on the subject of the indie hardcover?

    Randall

    • dwsmith says:

      Randall,

      I haven’t talked about it because it’s just another version of paper. And is available to indie publishers, yes, but expensive and darned tough to do. And mass market, the other form of paper, isn’t available at all to indie publishers without huge expenses and warehousing. (That might change.)

      As you said, you can do hardcover through Lightning Source, but the costs are tough unless you go with their “publisher” method, meaning warehouse method of buying a lot of books at once. POD is available, but expensive.

      Also Lighning Souce, unlike CreateSpace, is far more expensive just to use. They have fees for covers, interiors, and fixes. Where CreateSpace you can get through for no costs or $25.00 for extended distribution, Lightning Source will cost you upwards of $300 for the same thing. Also Lightning Source is owned by Ingrams distribution, which gets books into their system quickly, but it takes upwards of a month to get to Amazon and Baker and Taylor. CreateSpace is owned by Amazon, so it takes only days to get to Amazon but upwards of a month or more to get to Ingrams.

      So trade offs, yes. However, there just isn’t enough of an advantage these days except for very special books to run to hardback. And trust me, you haven’t had a headache until you’ve tried to lay out a dust jacket. (grin)

      • Jane says:

        Hi Dean,

        Not sure where you’re getting those numbers about Lightning Source from, but that’s not my experience.

        It costs about £50 ($80) to publish a book through Lightning Source. It’s £21 for the interior to be approved, £21 for the cover and £8.40 to be in the catalogue. You can approve the electronic proof for free, or order a physical proof for £21. And that’s it! You’ll need an ISBN too. If they’re running a promotion, set up is free if you order at least 50 copies of your book.

        You will only get charged for changes to proof or cover if you decide to make those changes AFTER you have approved them. So if you upload a cover, look at the proof and decide it needs changing before you’ve signed off on it, it doesn’t cost you any extra.

        It’s a long time since I looked at Createspace, but I think CS charges more per book than LS in order to claw back some profit. CS was such a pain waiting weeks for the proofs to clear customs because they had to be sent over from the states. If you are outside of the US, you also can’t buy your own ISBN to have your own publisher name on it (I think it’s a $10 fee?), you have to use the CS one. This matters less to me now than it did at the time, but it influenced my original decision to go with LS.

        As for distribution, my books are always up on Amazon within a week. You’re supposed to allow two weeks, but it happens very quick in my experience. Same with other sites like B&N and WH Smith.

        LS is great for customer support too. You have a named person who is your contact and they’ll usually reply to queries that day. Or you can use live chat at their website.

        CS has changed since I decided to go to LS. When I first tried Createspace, they wouldn’t put my book up on Amazon UK, only Amazon.com, which was infuriating (I had to go to Lulu to get my book on sale in my own country!!!), but that’s now changed, so if starting again I would definitely re-consider. But at the moment, I’m very happy with Lightning Source and I don’t think it’s any more expensive than CS (those shipping costs to the UK were horrible).

        I’ve not tried LS for hardbacks, but the option is there if I wanted it. Along with lots of funky stuff like colour books and even offset printing (get 1,000 copies of your book to insulate your garage!), if you want to go there.

        Gosh, that sounds like a staunch defence of the company, there. What can I say? Works for me!

        • Jane says:

          …you’ll only get charged for changes to your INTERIOR or cover….

          (need a proofreader, even for blog comments!)

        • dwsmith says:

          Jane, books now are shipped from the UK and from Europe, so that shipping problem is mute.

          I just roamed around on LightningSource again and the fees are not that cheap here. And now even CreateSpace charges some if you change after a book is approved, but honestly we’ve made changes and never been charged. Not sure why. They claim they do.

          And I do my short story paperbacks for free, so I sort of like CreateSpace. But to each his own I guess.

        • I haven’t really looked at LS myself, but what I have read makes it sound like a better deal than Createspace if you’re going to be selling hundreds or thousands of copies of a book.

          However, there’s no problem with assigning non-US ISBNs to Createspace books, and you don’t have to get print proofs, you can proof it online. The worst thing about them is that I get charged up to $15 in fees by the Post Office because Createspace won’t collect tax before shipping as Amazon would, so there’s a strong incentive to wait until I’m ordering at least a couple of hundred dollars worth of books.

        • Randall Wood says:

          I’ve had a similar experience with LS myself. I use Createspace for cheaper proofs and to move print through Amazon alone to avoid their “out of stock” issue. I’ve found that if a proof is good from CS then I don’t need a proof from LS as they come out virtually identical (other than the cream vs. white paper they use) so you can avoid the proof charge there.

          Everything else has proven to be worth the effort and expense. Customer service is great, metadata, direct shipping, etc. I don’t see why more people are not doing this, Grishom moved millions of books in hardcover alone last year.

          But as Dean says, to each his own

  8. Wow! A lot of numbers in this post (yeah, like that’s a surprise); but this one DID surprise me:

    “Regular Novels (over 35,000 words), Long collections”

    This is a little off topic, but… I know that these definitions are fairly fluid, but I was under the impression that 50K was considered a “short novel”. That’s the number I’ve been thinking of when I decide whether I’m ready to tackle a novel. Now your measure is that 35K is “regular”. Then what’s a “short novel”?

    I tend to write a lot in the 15-20K range. Sometimes 25K. Maybe I’m already writing short novels, at least by this definition.

    • Mark says:

      I also have been wondering about his definition, and how long are his “100” novels, are they “short” novels of 35k words or regular novels in the 70k range?

      Actually I would say 70k is “regular”. I wrote six novels this year, all in that range. 50k word books don’t sell for me. It is amazing the difference in sales 20k words can make.

      • dwsmith says:

        My hundred plus novels I sold to New York range from 55,000 words to 110,000 words. Most tended to be in the 70-75,000 range by contract.

        I much prefer writing in the 50-65,000 word range. Not because it’s quicker but because I don’t have to make up some artificial plot loop just to add in extra words.

        So Mark, there is no “regular” as you say. A good story is a good story. Only writers in the early stages and publishers under old contracts that need to justify their price points worry about length. In 1940 “regular” novel length would have been 35,000 words. In 1970, “regular” would have been 50,000 words. By 2000, because of costs of production and shipping and nothing more, regular became 90,000 words. Now, thanks to the freedom of electronic and shipping and printing costs finally hitting top and settling back down, the lengths are coming down quickly.

  9. Dean, I’m working on my third POD book and I have a question about pricing.

    It’s 6×9 trim and 192 pages. (55,000 words.)

    I had envisioned pricing it (before I poured it into InDesign and knew the page count) at $9.99. But that yields only 79 cents profit under extended distribution.

    $10.99 would yield 99 cents, but $10.99 seems like a really odd price point to me. And 99 cents still seems a bit slim!

    So I’m considering $11.99 ($1.59 profit) or $11.49 ($1.39 profit) instead.

    But the ebook is currently priced at $4.99. Will I need to raise the ebook price to $5.99 or $5.49, if I price the POD at $11.99 or $11.49?

    Most of my other titles are 10,000-word stories with ebook versions that I price at $2.99. (Will do POD when I form them into a collection.)

    But I do have a 159,000-word novel priced at $7.99 ebook, $19.99 POD.

    And a 22,000-word short novel priced at $3.99 ebook, $7.99 POD.

    I’d really appreciate your thoughts!

    • dwsmith says:

      J.M., the $10.99 and $11.99 are dead price ranges, meaning they do nothing for you. The jump is from $9.99 to $12.99. I’d go with the $12.99. It has worked out that for bookstore distribution and decent discounts to bookstores, you need to be in the $2.00 range on extended distribution. (They don’t have any direct relation, just using the $2.00 number as a marker.)

      And yes, if your trade paper is $12.99, bump the price on the e-book to $5.99, which is slightly under half of the trade and readers like that.

      Hope that helps.

      Cheers
      Dean

      • Thank you. That does help.

        Are you currently recommending that even shorter books have that $2 margin?

        I’d been aiming for $2 for 300 pages and up, but only $1 down at 100 pages. Should I be aiming for $2 on everything?

        • dwsmith says:

          Yes, for everything but my little short story paperbacks, which are only a short story and under 100 pages. But if you have a 200 page 8.5 x 5.5 book priced at $12.99, your extended distribution is $1.94.

          You can calculate all this for free on the bottom of the page at https://www.createspace.com/Products/Book/

          • I was asking about 100-page projects because I’m about to finalize one of that length.

            It’s 110 pages in 5×8 trim. (22,000 words.)

            The ebook is $3.99. The POD is $7.99.

            The margin on extended distribution is $1.02.

            BUT…I can still change that! And I’m wondering if I should.

          • dwsmith says:

            Yup, go to $12.99. Or at least $9.99. And your e-book price should be $4.99 at that length. My opinion.

          • Thanks!

            Planning to go with $5.99 ebook / $12.99 POD for the 192-page book.

            And $4.99 / $9.99 for the 110-pager makes sense, especially when seen against the larger pricing picture.

            Thanks for your feedback!

  10. margaret says:

    Thanks for your insights Dean. Does this apply to children’s illustrated works as well? I have two published internationally from the early 1990’s and am in process of getting my rights back. Have a series now and am grateful for your blog. You have answered my first Q. NO to traditional publishers. I have a Corp to use for self publishing and have some learning curves. Is CreateSpace a good one to get the illustrated books up on? Many thanks as I venture into this new pub world.

  11. Barbara says:

    What about pricing on children’s picture books. They have 32 full color pages. Pod will be 8 1/2 x 11. Any ideas would be greatly appreciated.

    • dwsmith says:

      Barbara, not a clue on children’s picture books. Just not my area I’m afraid.

      • Hi there, just wanted to add that POD picture books are a pretty complex topic right now but I have found the best place to look for information is the graphic novel / indie comics world. They are a different market but they’re dealing with the same types of printing issues, and they also have specialized POD distributors such as Comixology.

        I intend to experiment further in this area once all my illustrations for my WIP are done. Might be a while but I’d be happy to share thoughts on the process when it unfolds :)

  12. Roscoe says:

    How about short-shorts or flash fiction? I have a couple of stories that are 1-2000 words apiece. How many of them do I need to string together for it to be “worth” $2.99? 2000 words? 3000?

  13. Chris P. O'Grady says:

    Dean,

    As we wrap up 2013, have your views on pricing changed at all? The prevalence of free stories and those priced at .99 seems to be very popular. I’m a bit of a rebel, so I don’t necessarily think that since everyone is doing it its a good idea. A lot of people who seem to be successful indies are using the free stories to build attention and mailing list. The idea seems to be that the readers will then purchase the new work at the higher prices. Can you comment on this?

    Chrispy

    • dwsmith says:

      Chris, I’m doing a 2014 version of the book and all during the month of December will be updating it on my blog before it goes into the book. So will talk a lot about pricing there. Too big a topic to deal with in a comment. (grin)

      • Chris P. O'Grady says:

        Thanks for the quick reply, fair enough on it being too big of a topic. Counting on you to not so a 180 degree turn on us anyway, lol. Just finished up Heinlein’s Rules today. Really loved the series of videos and your approach.

        Chrispy

        • dwsmith says:

          No, no reverse. In fact, in the promotions workshops I give a lot of in depth answers as to why the prices have to stay in the range I have talked about for years now. It allows for sales and promotional pricing for short term events like a book bundle or Bookbub and things like that.

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