Who is the real use most of a book publishing? Is it the author, publisher or anyone else?
Let us take an example. A typical novel in bound format has been selling (f Prize) 140 SEK from the publisher, which gives a target price of 300 SEK out in bookstores, but the price is almost never out. Instead, it goes on perhaps 219 SEK in ordinary bookstore and down to 179 kr of nätbokhandlarna and department stores.
I'm not good on bookstore economy so I do not know how good business dealers are actually doing. Many bookstores have obviously profitability problems. Can anyone familiar bookstore person to explain?
It should be added that the publisher did not get 140 SEK. Retailers have on average 15-20% discount - say 17% to a figure in our calculations - and I count also the so-called marketing grant as a discount.
The author gets a royalty on the f-cost 140 SEK, traditionally around 27%. But there are things that reduce the royalties (eg, lower royalty rates at book club sales). Therefore, let us say that the author, on average, 23% in royalties. (Writers' fees listed below are gross amounts, before deduction of social contributions and taxes.)
This means that the 219 crowns - that the book will cost in the bookstore - distributed as follows (figures are rounded): author of 32 SEK, 84 SEK publisher, retailer 91 SEK (24 SEK in savings and a £ 67 surcharge) and VAT SEK 12.
Publisher of course, some expenses. We look at their 84 kr.
The novel in the example is a debut book. A circulation of 3000 copies allows therefore makes sense. Let's say that the book costs 17 SEK / ex pressing. 51 000 SEK payable to the printers. It is not so easy to create interest for debutants by just ads and purchased campaigns, so we are happy to add SEK 30 000 in marketing. Instead, we work primarily with getting reviews and publicity for the book. We print up advance copies and send out review books. 10 000 for this.
But before we have come so far needed a book cover, a break (layout) of the pleading, author photo and proofreading. Most of these services buy publisher from freelancers. SEK 38 000 in total for this might sound a lot, but there are market prices.
Add to this the publisher's job with this book. Thus, no overhead costs, but only those hours that publisher, editor, sales, marketing and PR people spend on this particular debutant novel. At least one hundred hours, it is about total and a snittlön, say SEK 25 000 so does this work 20 000 SEK (including social security contributions).
Note that I take in quite low in the publisher's expenses - I just want to give you an example based on the lowest possible initial wager.
We expects that the publisher pays an average of 5% of book sales in the distribution cost.
Publisher SEK 84 has thus been divided on employee wages / freelancer 21 SEK, 18 SEK printing, distribution 6 kr, PR / marketing 14 dollars and continuing to the publisher SEK 25.
(The printing cost / items will increase - 17-18 kr - because we can sell up to 2800 copies of the edition of 3000 copies, the rest is used as a legal deposit to include a writer and reviewer.)
In this example, therefore the author a total of 90 160 SEK and publisher 69 432 SEK. In contrast, only 2 000 copies were sold of the edition of 3000 as it had the author received 64 400 SEK and 6880 SEK publisher. If you go lower than 2000 copies sold means the issue fairly quickly a pure loss for the publisher. The author is always protected by the so-called garantihonoraret amounting to 50% of total royalties for the author's first edition and payable in advance.
Something like this looks like the economy for a large proportion of the books published in Sweden today. But why give in this case, publishing into this, when they know in advance that a publishing projects might not go with any great profit? Well, it's about building authorship - to believe strongly in the quality of the author and the future demand for his books.
By initially taking great risks in a number of authors' careers is hoped that one or more of the authors Partnerships will reach editions in at least 10 000 copies. With the traditional royalty system serves as publisher more money than the author and can recover their previous losses. At the same time is the first major requirement for publishing the larger edition is, in terms of enhanced public relations and marketing efforts, which eats up some of the increased profits.
(Piratförlaget model differs from the above by the publisher and the author always earn as much when you get up in the larger editions. For short runs, however, the author who makes more money than the publisher, even in Piratförlaget.)
Besides the hope that a writer is to grow, many publishers of loss-making projects for their literary importance. It is absolutely indefensible, particularly from a goodwill point of view, but no publisher can survive alone in this, unless they base their operations in various literary aid money.
So it is this reasoning that is the foundation of the publishing economy. Being willing to take many risks and losses, but then make money on the few writers who actually sells really well.
The Swedish publishing market holds, of course, numerous exceptions to the above example, but the basic principle is the same for most publishers. In an upcoming blog post I will show the distribution of the corresponding financial calculation would mean to the future of book market, where e-books and new sales channels changes the cost situation as revenue opportunities.
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Interesting. It is exactly this kind of thing needs to be explained. Transparency again. I saw a small record label (can not remember which) that the pie chart showed how the client's money was divided between different parties. I think of more things to come. It's so easy for us outside the industry to just see it as a kind of parasite.
Really good post Mattias. Interesting and good that it is highlighted in light
Very interesting to read! Always speaking with numbers.
As usual, interesting Mattias. This is really nothing new though it is new is that you open the presents, which is good. It is the only way to eventually get to the stability and confidence agreement with authors and other stakeholders.
For me, the great educational problem for a publishing company that in a sensible way to charge for editorial work. Linda Skugge thought that people should write and do not edit much, but myself, I feel that the editor making and editing should evolve and get better as fast and sloppy. For basically wanted all readers, authors, publishers, critics, etc. have such good books as possible. Good books takes time and effort and it is difficult to see how much it costs and is worth. Compare for example. with how difficult it is to put quality journalism and reportage in clear figures + or -.
"Publishers have understood some overhead" type.
But it is apparently not the author? The author has considerably larger overhead. Food, rent, etc. are just the beginning.
Counting the costs for one party but not for the other, is the basis for the much-criticized Hollywood-type of calculation (which lands on the example family, Tolkien did not receive a penny of the super success of the LOTR movies, for "overhead" have eaten it all up).
Of particular interest is that it is also the author's expense to deduct tax effects. Taxes on individuals' work tends to be significantly higher than corporate taxes.
But it is not the basic problem. It is rather how the economy is changing as printing costs, will result in no large trucks have to drive out to the cellulose core, expensive bookshop premises, etc.. It should in my view, mean * really * a lot cheaper books (E-form, that is), but the question is whether publishers accordingly will cut down on their claims of how much of the pie they should have?
When word processing and desktop publishing came, which simplifies and speeds up editing and publishing substantial, the authors, no part of the rationalization. Rather, they were worse conditions. The post said that the author of "traditional" get 27% of the F-price, but the fact is that the more traditionally existed until the 90th century the so-called framework agreement which gave the author 16 2 / 3% of the ÅF price - and there will be more.
What happened to the profits from the computer in the issuance? The authors received less.
It is recognized easily that computers gave large productivity gains - I'm talking not about the network here. Just send it to avoid a paper manuscript for a typesetter who write the text one more time saved Multum. The actual editing is of course faster, too. What is not proof reading software? Should we dump the save anyway half korrläsningsjobbet? What does not the publisher's computer management? Development of cover was simplified through image editing. ETC. All of this existed 20 years ago.
But despite the fact that publishers could streamline and cut costs, the authors less.
It might not be complaining too much (and Piratförlaget have for writers favorable model, it is recognized), but the question is indeed complex. Publishers must focus on their share of the cake will fall.
-Ahrvid
Good review, Mattias.
But if we expect that a book takes a year in claims of an author's time, will earn him / her in your example, only half as much that year that the publisher's economist, in 5000 sold items - and it may well be perceived as a bit unwarranted. The creative force sas valued lower than the administering.
Ahrvid have a Poong with the author also has costs. But then the author may well organize themselves so that the overhead is handled in the best manner, for example in a company.
I think it's important to remember that almost all the publisher's costs are also a writer who publishes the book itself - it should even when printed layouts, marketed etc etc etc. There are a publisher that cost, not necessarily the publishers who profit from individual authors .
But certain stage, the question is as complex as Hound of the Baskervilles!
Ahrvid: The costs I mention only those which arise from the publisher assume the book for publishing. If I could even count all the other costs the publisher has, that publisher's counterparts to the author's "food, rent, etc.", so there would be no money left to the publisher's profit on a sold-out run of 3000 copies, but rather a loss. That's why publishers must have some really selling books to get it all to go around.
It is not a livelihood, I take up. Your parable of Hollywood's assessment methods are not Applicable here.
What's next will be the subject of my next blog entry on publishing economics, so it may concern I am not here.
You mention how previous technological advances made it easier for the publisher - and cheaper - and that it should have done that the authors thus would have received a larger share of the pie than they received. I myself have not been in the industry over the older technology shifts. But it would be super interesting to count on this and see how the costs and time changed. I take it is not self-evident that contemporary work by computer support is always cheaper than those days more manual methods. But this is just speculation - until I or someone else looked at it.
Kjell Ake: As I write in response to Ahrvid above, I take the example is not at all up livelihoods. A writer is a risk, there is no fixed monthly salary. Sell few copies, it pays not at all, they sell many copies you earn more than the "publisher's economist."
Jonas: You are quite right that nothing in the blog entry is some news and it's not even a few secrets. One can as an individual matter which publisher at any time and the publisher would have no reason to withhold these numbers. It is common industry knowledge. And that's enormously important that publishers are clear about this even before the authors. The cooperation between publishers and authors is based on much more than just a contract - trust, understanding and friendship is just as important. I think it is a very exciting effect on you for the editorial work. Anyone who has been close to publishing the work know how much the editorial work means for the published books - for some titles, it is more, others less. While it is enormously important for the publisher to highlight the author as an independent brand, it should not be labeled that there is a team of people around the author. Thus invisible deliberately editorial work. Clash between showing and hiding is clear.
Joshua_Tree, Leffe and Frida: I am glad you enjoy my attempt to tell you about things that are everyday knowledge of the publishers, but as we are cash-on and then spread further. Given the enormous number of more visitors this was compared to what I have, so it is clear that I will continue along this line.
Very interesting. Naturally, I am just in the beginning to give out my book myself and therefore have everything on my own shoulders.
Also want to thank you for your wonderful site Chapter1 where I of course are included. It is thanks to the one I currently write more than I ever did and totally think about regarding my job career.
I add your blog to my favorites list.
Take care!
To Mattias:
Well, if a publisher consistently manage to sell out in editions of 3,000 copies of the books, I am convinced that it goes round, and more than that - including all costs. (The problem is rather that not all books sell out in an edition of 3,000 copies).
I still think that it is not relevant to calculate the net for one party and brutta for the other. But hell, for publishing the economy looks now is not that interesting. That is how it will look like in the future * * E-books.
My rule of thumb (= you can interpret it roughly, and there may be exceptions) is that the "natural" price of a digital e-product should be 10% of the corresponding analog physical product. And that's because the physical production is lost, that distribution is virtually free, that intermediaries should disappear and the fact that the price falls, the number of items (and more items should be price / ex drop).
If a physical book now costs 300 SEK, an E-book of the same title costs 30 kr - but then the rule of thumb is approximate, we can be generous and say 50 SEK. It's also about what a physical paperback book costs, so a newly released "regular" edition can compete with a re-printed paperback.
I can imagine that the author should get 30 SEK, 20 SEK publisher. About 3000 items sold will be 90 000 to the author, 60 000 to the publisher. Can a publisher afford to edit a book for 60 000 SEK? Yes, I think so. There should be a few months' salary, and such a long time need not be. It should go in much less time, so there may be a gain to m.
I note that the numbers will be rather close to those you have in your example. (But it requires then that a lot of overhead cost goes away.)
Another problem is that the books are competing with other media. We are inside the world of books in the hearts and minds may not want to acknowledge that some prefer video games, Facebook, reality shows on TV, MP3 music, etc - but there it is. So the question is what future books should do to at least maintain its share of people's time and attention?
One answer I have is: short stories. I tend to nag about it, but I think short stories are a perfect shape for a chopped up, stressful age. Shorter works you can read in the pauses, when you have time. But there may be multiple answers.
But some answers to try to do is unhappy. Tie-in books by celebrities, in any case inferior detectives (I like detective stories, but there seems to be an over-production!), Conspiracy novels a la Dan Brown, the endless sequels to old successes, yes, I do not know everything. What is the 2000s winning literary form and / or genre?
-Ahrvid
Mattias:
It's just that I think is an interesting approach to cultural creation.
Ie: those who create artistic works are presumed to be "risk taking", while the person administering the same work does not have to be there.
I think the old artist myth haunting. Piratförlaget systems with shared cake is a way to balance out artist myth, I think.
Publishers are certainly also risk taking, but can spread their risks in a completely different way than the individual author. Right?
Interestingly, the numerical summary. Guessing that you take in the cost of sales (pure "sit down with booksellers and hammered home the message" in addition to marketing) and inventory in the distribution cost? Wondering if the printers are those that live best in kalylen so far :-)
Hello and thanks for a great blog!
Naturally, I think there are too many black paint publishers and talk about the thirst for profit. As I see it, it is fortunate that the publishers are, otherwise we would never see any good books on the market.
I also think there is an over-boiled potatoes, or perhaps an entire pot, in the fact that Dick seems to be the only one that applies everywhere. I think this is a more important debate than people to hold on to scold the publishers are taking "too much" of the pie.
Ahrvid (good to see you here!): I do not know what you are living in the world where 60 000 is equivalent to a couple of months (rather around 3 weeks with VAT, social costs, material costs and office) and the distribution and marketing for an e-book is negligible. To build an attractive system for the distribution is extremely costly. And to hire such as Amazon-like models is hardly free.
Mattias: Interesting discussion, I think Piratförlaget model makes perfect sense. Furthermore: "The cooperation between publishers and authors is based on much more than just a contract - trust, understanding and friendship is just as important." I'm glad you realized it. Publishers who departs from this cause namely personal and financial disasters in their environment.
One more thing: For me it is obvious that publishers, economists and others in many situations to earn more on the book than the author. It's all about supply and demand (fortunately softened by a lot of passion for the industry). It's very easy to find people who want to write novels in his spare time, more difficult to find someone free to engage in double Italian accounting and korrläsning. Likewise, I paid more for boring recipe editing the work of others than when I write articles with a byline.
Anitha: Good luck with the book publishing! It is not easy to be self-publishers, but hugely useful and instructive. I have some relevant experience from the mid 90's, but I can imagine the possibilities of reaching today's larger, mainly due to social media.
Ahrvid: In my example, I took only the basic costs that a publisher has a book project. There are a variety småkostnader beyond this and of working at a publishing company dedicated to treating the issue as a whole rather than that it can be economically tied to a specific project. So the publishers that never comes up in the editions of 3000 copies, it may be difficult, unless they receive literature support or get financing from other sources.
I do not agree with your reasoning on profit sharing in the future. For as soon as there is no intermediary of e-books between publisher and reader, so of course want the broker to be paid. And do you really think the publisher's only task is to edit the book? If the book will get a proper distribution is needed is probably a lot of marketing and PR as well. But I will come back to these things in an upcoming blog post about publishing economy in the future.
Kjell Ake: Risk-taking for the author (and other artistic professions) is an interesting topic - and damn sensitive. I'll think about whether there is any good way to discuss it. I'm not afraid to take up sensitive issues, but I would rather take them down on a practical level than just discussing theoretically.
Ann: Distribution costs include warehousing and distribution. Selling expenses squeezed me into the hundreds of hours that the publisher's employees spend on the book. I know it is very conservative, but I wanted primarily to show how publishers' business model looks like. That in fact it is even worse for the publishers' finances the sale of limited editions is a different matter.
Magnus: Everything goes in waves. For some years now, Dick position was strong. And the detective story in itself I think is not a problem, there are many mysteries that are of high class. However, I believe that of all genres who are threatened by the release will be a backlash and worst books of the genre are removed. To publish a detective is no shortcut to success of a publishing house, only if you give out a good detective story.
Lisa: I agree with you in the criticism of Ahrvid. Sure, we can not exactly know what the future will look like and it will probably be a number of parallel methods for book sales. But to wipe out all the middlemen are often much harder than you think.
As for the distribution of money between authors and publishers are not the last word, it is an area where a development will be done, but I know damn well not exactly what will be the final result. The author is the basis for the entire operation, the publisher is the breeder and the broker.
Kanon post!
It might not directly be super relevant for me to send out a manuscript to various publishing houses right now, BUT, I am very happy to see this information.
Which I appreciate!
THANK YOU!
By the way, let me dikt-/novellbok now within a month, check out my website for more information http://www.ChristianLarusson.n.nu (a little surreptitious advertising)
Christian: Thank you! Glad you liked the post!
Hi,
Found this blog post when I searched for royalties for authors. You write that these are traditionally about 27%. Do you know if it applies to fiction or is it different there?
I have been offered significantly lower for a fiction book related to image processing, etc. for photographers.
Thank you.
/ Peter
Hi Peter,
It tends to be pretty much lower royalties on books such as contain images or where the production / printing / binding in any other way is more expensive than for a typical pure textbook. Royalty on a non-fiction book can thus be almost a little about anything, depending on other expenses and also depending on the division of labor is between the publisher and author.
Regards,
Mattias
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