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Stuck on it.

This one thing I can’t quite shed my incredulity over such an utterly amazing anomaly . . . The publishing professionals admit that most, not some, but the majority of books produced don’t earn back their advances.

I’m sure that statistic is about to change because of the economic woes. Publishers won’t be doling out as many large advances to the lesser known or debut authors. And it’s been suggested there will be some very creative contracts negotiated which won’t be too lucrative should a book tank.

As I mentioned in prior posts, I attended a writers’ conference this year. When this statistic was presented with a comment indicating that 50% of the published books don’t earn back their advances, a savvy and reputable editor said two things. “Only 50%?” And “We don’t know what we’re doing.”

I think we’d all agree that predicting the success of any given book other than those written by authors who have garnered a following is impossible. Who in their right mind could have predicted the success of The Shack? Seriously. For those who loved and were changed somehow by the novel, they can’t imagine why anyone would question it. But for those who ranted about its theology or commented about its lack of quality writing, they can’t believe its success. And all those industry editors and pub boards who rejected it are kicking themselves as a result.

Regardless of what each individual editor in the industry looks for in a novel proposal, obviously from this astounding statistic, as a general rule, somebody isn’t doing a very good job predicting what will sell. Apparently there are a few pub boards who are out of touch with readers. They’re very familiar with those who read their top selling authors, but beyond them: not so much. Does anyone else interpret this statistic this way?

I absolutely marvel at this, and I can’t help but wonder if the marketing approach is somewhat responsible for this anomaly.

Thoughts?

Lord, the only thing I need is to be obedient to the direction you’ve designed for me. Help me follow that straight path, the one just for me. In the Name of Jesus, Amen.

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6 responses to “Stuck on it.”

  1. Dayle Avatar
    Dayle

    Given the small percentage that an author makes on each sale, I’m actually not surprised by this.
    In CBA, authors get 10-15% of wholesale, not retail like ABA. On a trade paper that sales 20000 copies, the author’s percentage would be about $8,000 to $10,000. But the bookstore and the publisher make about $100,000 each.
    I think the publishers push the idea of books not making anything so they can continue to underpay the authors. In other words, even if the book doesn’t earn back the advance, the publisher still hasn’t lost money. They only didn’t take as much of the author’s cut as they could have. A happy author is a loyal productive employee even if built on false pretenses.
    Every company I’ve worked for has done this. Hyperbolic example: Tell the employees how bad the company is doing so they won’t ask for raises and then drive off in your brand new Hummer on your way to your new cabin on the lake.

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  2. Nicole Avatar
    Nicole

    “But the bookstore and the publisher make about $100,000 each.”
    Um, what bookstore(s)? Certainly not the CBA stores. Most of them are struggling, some going out of business.
    I still maintain that if a pub board selects a novel, and it doesn’t make back the advance, somebody (or somebodies) somewhere in the process is making a “mistake” and misreading the market or ineffective marketing has failed to reach the target audience with the book. That’s a huge percentage. And most professional publishers will admit the bulk of their resources and their primary income ride on their top selling authors.

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  3. Bill Avatar
    Bill

    There is little wonder that “self-published” books are becoming more popular. Now, if we could just figure out how to market these books!

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  4. Nicole Avatar
    Nicole

    So true, Bill.

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  5. Dayle Avatar
    Dayle

    Nicole, I totally agree with your conclusion, I just don’t think the “not earning out advances” is evidence of it. That’s more of an accounting trick. It’s just my opinion, but I’ve dealt with enough executives to understand how they think. They never give away money for nothing. And, they always find a way to spin self-serving PR into something they wanted to do anyway.
    On a hypothetical book that sells 20,000 copies, each book sold represents about $14. The author gets about 60 cents. The bookstore and the publisher basically splits the rest: About $7.40 each. (This is horribly unfair in my opinion, but it’s reality.)
    My point being that publishers are “over-paying” the advance to a point that they know it won’t earn out because they secretly know the author is underpaid and they are trying to keep that employee happy and productive. (This allows them to select which authors they can take a chance on.) As JA Konrath once said, (I’ll paraphrase): the advance is what the publisher is willing to pay you for the book, not the expected royalties because they hardly ever come. This doesn’t happen in a vacuum. Your incredulity is well placed.
    It also allows them to use the “don’t earn out” phrase to keep certain authors from complaining about small advances.
    Not earning out does not mean the book didn’t make the publisher money. It just means that they gave the author a higher percentage of the profit. Instead of 10%, they may have paid them 14%.
    It’s kind of like when a huge corporation claims a 4 billion dollar loss last quarter because they expected to make 20 billion but only made 16 billion. I would love to lose money like that.
    Btw, I’ll be meeting with Robert L. tomorrow. He’s critiqueing my first 12 pages.

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  6. Nicole Avatar
    Nicole

    Thanks, Dayle, for the info. Sounds like you’ve done your homework. Very interesting way to do business, no?
    Give Robert my best–you’ll love the guy. Tell ‘im we’re long distance friends and I enjoyed your ms. Have fun.

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