ADVANCES, ROYALTIES, AND THE MONEY SIDE OF PUBLISHING

A lot of misinformation flies around about the money side of publishing. So let’s take a look at the realistic world of getting published. Despite rumors to the contrary, it isn’t likely that you will get a Million-Dollar Advance for your book. If you do, you owe me lunch. Million Dollar Advances are reserved for writers with huge “sell-through”, think Stephen King. Most new authors, if they get an advance at all, may receive several thousand dollars, think $5,000 and be happy if it is more than that.

It’s called an “advance” for a reason; it is an advance against your royalties. If you don’t make that advance back, you may have to pay the money back. So a sound business practice is to put the money in the bank and NOT take a cruise to the Bahamas. Otherwise you maybe swiping money out of your child’s college fund to pay the publisher back.

Most small or medium-sized publishers will not pay an advance and in many ways that’s great because the money you earn is the amount calculated for your royalty check.

ROYALTIES:

Book royalty rates are all over the place. Where once the royalty for a book might be around 15%, the decline in hardcopy books has forced most of the rates into the 10% realm with some royalty rates going as low as 5 to 7%. Too bad for writers because this is where you are going to make your money.

You need to read the portion of your contract regarding royalties carefully. Most royalties are calculated on the retail price of the book, but some are not, so pay close attention to this section and if you can’t understand it, ask someone.

Your contract will probably say that royalties are calculated once or twice a year and that you will receive payment on June 30 and/or December 31. Remember that’s when they send out the check not when you will get it.

There’s probably another clause in the contract you should give some attention. It is usually titled Reserve Against Returns. The bottom line is that the publisher can hold a certain amount of the money due to you back, because there may be returns of your books from booksellers. The language in the contract may be a bit vague, so you might not know how much money due to you will be withheld. Most of the reserved money minus return payments should show up in your next check.

As I stated previously the royalty and payments on your book can be confusing and frustrating. If you don’t understand a section, ask you publisher’s representative for clarification or contact a reliable literary attorney. Keep in mind that you may have a wonderful family attorney, but that attorney may not have any experience with publishing contracts.

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