What follows is an easy and zero-cost way for book publishers to generate book royalty statements for copyright holders in a matter of minutes.
Note: As of mid-2019 this post is 5 years old. Some aspects may be dated. However, the core lessons hold true for the new author looking to self-publish or an entrepreneur looking to start a small publishing business.
When a new publisher is looking at printing options, there is a temptation to print too many copies. The more books the publisher orders, the bigger the discount the printer will give. It is very easy to fall into the trap of asking for a quote for 1,000 copies and ordering 5,000. The discount of 25% to 50%, or even more, that the publisher would get by ordering 5,000 copies causes the publisher to forget everything discussed in the book pricing chapter.
I was guilty of this mistake, once. Then I vowed to never again forget one simple rule: print only what I have sold. Today it is easy for a publisher of any size to use offset printing, Print-on-Demand, or electronic formats to publish their books. These options allow the publisher to develop a game plan that will stick to this simple rule.
Here is how it is going to happen.
- The new publisher establishes an imprint with one or more books that will sell.
- A website is built for the imprint. This includes a book submissions page with information on how to submit book proposals.
- The initial books are successful and penetrate the market, the publisher gains new contacts in the industry, and the imprint becomes known.
- Authors and others learn of the imprint and the submissions roll in.
- An undisciplined, new publisher sees these submissions and gets excited. This enthusiasm leads to taking on projects that the publisher doesn’t know how to market.
- Alternatively, the disciplined publisher browses the submissions, finds no leads and thus rejects all submissions, and then continues with the original business plan.
Book pricing is difficult and a bit like cold fusion—many people claim to have discovered the key to success, but none can prove it. That being said, there are steps that publishers can take to eliminate some of the magical guesswork from the process of setting prices for books.
Publishers must always remember why prices exist. Prices exist to create profit. The publisher should strive to generate their desired profit from the primary audience. Understanding the primary audience and the price elasticity of the book within the primary audience is critical to designing success and achieving profit goals. What follows is the method that I use to decide prices for books.