11 2018 monkey & books

What’s in a cover price? And why should authors care? (Part 1)

By Teika

Next March, I’ll be leading a workshop in the Nottingham Waterstones on behalf of Writing School East Midlands on the subject of ‘How to Get Published’. I’ve run a fair few courses on this topic before, and invariably they’re popular because getting traditionally published is still the ultimate goal of many writers.

To the puzzlement of some attendees, I always begin my courses with a brief history of publishing. I can sense their impatience; they’d rather get to the “good stuff”. You know, the actual secrets of how to get published*. But I ask them to bear with me, because, as with much of life, understanding the past helps to make sense of the present. And if you have a good handle on how the publishing industry works right now, then you’ll be able to make informed, and well-thought-out, decisions about your own writing career.

 

Publisher & bookseller BFF (?)

One very important thing to understand about the publishing industry is how entwined it is with the bookselling industry. And as such, it is vital to know something about the ins and outs of book retail. Consider a paperback published by a big press with an RRP of £8.99. How much of the cover price goes to the bookseller or shopkeeper? At my workshops some attendees will hazard a guess: £2? Or maybe £3? When I tell them that independent bookshops take just under £4 per book and that a chain or virtual bookshop will take around £5 per book (Amazon being the worst offender when it comes to pushing for an even bigger cut than that) inevitably, they’re shocked.

Often, we also need to factor in the costs of a distributor (a distributor delivers the book to the retailer from a warehouse). They take a cut (about £1 for their work). So that only leaves around £3 or £4 pounds. The publisher will need to pay the printer out of this, as well as author royalties). Let’s say the author gets 90p (10% of RRP, and that’s being generous) and the printer gets £1 or so, the publisher’s share then only amounts to a trifling £1 or £2. Nothing to write home about!

And that £1 or £2 needs to cover the costs of editing, typesetting, proofreading, cover design and ISBN of the book, as well as going towards covering the costs of running the business (salaries, rent, insurance, website running costs, accounting costs etc.) before you even start on making a profit.

Also, deep cover price discounting by supermarkets and Amazon will further reduce the publisher’s share (and hence the author’s earnings) to pennies…

 

The Book Business

Amazon is currently selling the paperback of Eleanor Oliphant is Completely Fine at £3.99. *Headdesk*

 

When you break down the cover price in this fashion it seems like a ridiculous model, and one that couldn’t possibly work (particularly when you factor in the ‘sale or return system’, whereby physical bookshops will send back unsold – and somewhat grubby-looking books – to the distributor. The publisher won’t get anything for those unsold books, apart from another charge from the distributor to handle the unsold stock…).

So how does the whole unlikely model work?

 

Let’s play the blame game!

Some may argue that it doesn’t work – not in any fair way to authors, at least, and some may argue that it’s all the fault of the retailers, who don’t even stock all the books that are published each year (it’s easy to forget that bookshelves can only hold a certain number of books). Are the retailers at fault? Well, yes, and no. Yes, because deep discounting and the sale or return model don’t have the interest of the authors and publishers at heart, though customers after popular and cheap books may argue otherwise. And no, because physical stores do have a lot of overheads – salaries, rent, business rates, utility bills etc. Really, the people making consistent good money from the physical stores are the landlords.

So, thank goodness for… Amazon? Well, yes and no. Yes, if you’re a self-published author, who would otherwise have no chance of selling your book in physical stores, and you’re looking to maximise your royalties. And no. No, because of, you know, the whole tax-dodging thing, as well as the way it treats its workforce. And no, again, because Amazon is both (virtual) landlord and bookseller, dominating the e-reader market and holding all the power when it comes to decisions over how to sell and market Kindle books, as well as how to treat the authors who publish with them. Remember, it’s the landlord that makes the consistent good money.

All in all, the situation for publishers and authors seems grim. Readers, on the other hand, are spoilt for choice when it comes to the sheer range of competitively priced books available to them. Hell, some readers decide to pay nothing for books at all, instead visiting ebook piracy sites.

The ‘fault’ of the whole wonky, fractured business model, lies at many doors.

 

Gambling, and how to not let the craziness get to you

But back to the original question. How does the industry continue to trundle along, even managing a £7.8 billion GVA (gross value added) potential contribution to the UK’s economy…? Well, it largely works in the same manner as gambling. The publisher’s one or two annual global bestsellers (which are likely to be genre books) ensure that enough £1-profit-margin books are sold to keep the business in the black and able to pay for the other books that are published that year that will have lost money or only sold enough to break even. The big win of the one (and rare) lucky gamble makes up for all the money spent on the less lucky gambles. From an author’s point of view this could be seen to be utter madness because, like gambling, there is no logic to it. And it can seem to be inherently unfair with seemingly unworthy books selling many more copies than far many “better” books. (That’s something for another post!)

Another way to look at the model is by not looking at it. I don’t mean that you shut your eyes to it and pretend like it’s not there, but to look at it slant (as maybe Emily Dickinson would). Be aware of how the model works; be aware that genre books have the likeliest potential of being the one lucky gamble; be aware that the odds are massively stacked against you; and then go write the book that you want to write despite the whole craziness of the model. Control what you can control – mastery of the craft, your platform, and your professionalism – and let go of the craziness.

Another wise saying springs to mind: Not my circus, not my monkeys.

 

11 2018 monkey & books

 

In part two I’ll be considering other somewhat different models.

 

*More on this later!

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