Wednesday, June 8, 2011

Distribution and Pricing-The hardest part of Self-Publishing

So you’ve written the great American novel.

Now how do you sell it?

That’s the question many authors don’t have an answer for when they go into self-publishing.


The biggest mistake many self-publishers make in getting their book to market are with pricing and discounts. Many writers often write a great book only to shoot themselves in the foot when it comes to pricing their titles for retail sales.

Readers aren’t going to pay $21.99 for a novel. That’s not a competitive price for fiction.

To get a competitive price an author has to go out to the bookstore and look at the books in their genre. Look at the barcodes and price complimentary titles from low to high.

After checking out those books it’s time to do a little math. In self-publishing the formula for a retail price of a book is usually calculated by the number of pages times the price per page plus the price for a cover. For a paperback book this formula would be:

240 pages x 0.013 a page +0.90 = $4.02 for the printed book.

To gain a profit for the publisher, the price of the printed book ($4.02) is multiplied by, 2.5 or 3.5 times. This multiple varies by subject matter and content. A specialized nonfiction book would be much priced higher than a novel.

Using the formula for the paperback book mentioned above:

$4.02 x 3= $12.06 (low)

$4.03 x 3.5 = $14.07 (high)

(These numbers are usually rounded to a retail price of $12.95 or $14.00)

Why is the price multiplied? A smart self-pubisher understands that the sticker price won’t be the actual retail price. The retail price on the barcode is usually mitigated by a retailer discount. All publishers offer a retailer discount to give bookstores, vendors, and other retailers incentive to stock their titles because they’re getting them for a little above the printing cost.

A competitive retail price for a book factors in the printing cost and a large retailer discount. A publisher can stock books on Amazon.com with a minimum 20 percent discount. However, brick-and mortar bookstores won’t stock a title without a minimum 40 percent discount. Some of the larger retailers won’t even consider stocking a book on their shelves without a 55 percent discount.

To get the retailer discount:

Multiply the retail price times the discount then subtract the product from the retail price On the $12.95 book with a 40 percent discount:

$12.95 x 0.40 = $5.18 retailer discount

$12.95 - 5.18 =$7.77


On the $14.00 book with a 40 percent discount:

$14.00 x 0.40 = $5.60 retailer discount

$14.00 - $5.60 = $8.40

This retailer discount usually brings the price customers pay for a book in the stores and online down to $10-$12, a price that allows a self-published title to compete with other trade publishers.

What the author makes in royalties is the remainder from the discount subtracted the printing costs.

On the $12.95 book with the 40 percent the formula would be:


$7.77 - $4.02 =$3.75

On this book the author makes: $3.75.

On the book with the $14.00 price tag:

$8.40 - $4.02 =$4.38
So the royalties would be $4.38 on the $14.00 title.


If the discount is lowered, to twenty percent these royalties can pay much more to the author than the standard ten percent off the cover price publishers offer. $3.75 and $4.38 per copy is much more money to make than $1.29 and $1.40 per copy.

The second component self publishers struggle with in marketing their books is distribution. Most titles published and self-published are distributed in the U.S., Canada, the UK and the European Union are distributed through Ingram and Baker and Taylor. In fact most of the paperback titles by houses and self publishers are printed through Ingram’s Lightning Source!

There are smaller local distributors with their own discount formulas, who serve vendors and small bookstores but Ingram and Baker & Taylor are significant to self-publishers because they offer titles to Amazon, Barnes & Noble and other online retailers.

Self-publishers who are serious about having a retail presence not only need to offer Ingram and Baker& Talyor a deep discount, but they are also advised in order to they have to make their books returnable.

Listing a book as returnable means books a retailer buys can be sent back to the publisher in the case they don’t sell for credit on new titles. Usually this process takes years; returns cost a retailer money. So usually bookstores and other retailers will discount a book or remainder (sell it to outlet stores like airports) before returning it to a publisher for credit.

For a self-publisher listing a book as returnable may seem risky, but it is worth it. Along with the lower discounts, it gives retailers incentive to stock an author’s titles on their shelves.

Getting those titles on the shelf? Well, that’s another story. An author will have to get out their best suit, a sell sheet and go out and press the flesh at local bookstores. They’ll have to build word-of mouth through readers to get a “buzz” at bookstores to get them to order their titles.



1 comment:

  1. Good stuff Shawn. It goes in my permanent file on writing and business. I'm an old hand at being published, but a newbie in indie and self-publishing. I'd love to see you put a few articles like this in a slender, inexpensive book and do us all a great service.

    You continue to bring us useful information in a crystal clear and well organized way -- so helpful. That's why your blog is listed on my website and why to me it's a blog for all seasons.

    Carry on as only you can!

    ReplyDelete