Taxes, calculus, string theory, the way people vote—these are among the things that will never be clear to me. Advances and royalties, however, are pretty simple, so it's a shock every time I'm reminded how many authors and illustrators don't know how it works.
So an editor calls you up and says, "I'm very excited about this manuscript, and I'd like to offer you an $11,000 advance against a 5% royalty."
What do you say?
Now, for god's sake pay attention. You say, "That's wonderful! Could you tell me what print run and price point you've got planned?"
The editor replies, "We're planning on a 12,500 copy first printing, and the book would retail for $16.99."
You say, "Thanks so much. This is very exciting, but could I have a couple hours (or days, whatever will make you comfortable) to think about it?"
The editor says, "Sure. I'll look forward to your reply."
Now you break out your calculator and use this equation: print run (12,500) x retail price (16.95) x royalty (0.05) = $10,618.75.
This dollar amount is what a 5% royalty will earn you if all of that first printing sells. This is your starting advance. As you can see, the editor has rounded up to the nearest thousand.
So that's good. Now you start negotiating.
If all of this has come as news to you, get yourself a good book like Negotiating a Book Contract and read it.
And then...
ReplyDeleteSo you call the editor up. What do you say?
You say, "I'm so excited about having this published at X publisher. I wonder, could we bump the advance up to $13,000? I'd also like to talk about escalations—after the first print run, could we raise the royalty to 6% until 30,000 and 7% thereafter? And I assume we're speaking of royalties on list rather than net?"
Then the editor might counter-offer with 5.5% to 50,000 and 6% thereafter, or something, depending on the publisher.
Your words are like gold! Thank you for continuing to offer up such valuable information.
ReplyDeleteWell, well, well--now that's information!
ReplyDeleteMerci!
Yes, do remember to check whether the royalty % quoted is on retail price, or net (price received). This seems to be sneaking into the latter more often lately, and even 10% of practically nothing if the book is greatly reduced to clear stock, isn't going to pay your bills!
ReplyDeleteAny suggestions on what/how to negotiate a contract where the royalty is based on net and they are not flexible on that? Ask for higher advance?
ReplyDeleteAsk for a higher royalty.
ReplyDeleteNICE ONE! Thanks EA!!!!
ReplyDeleteThanks for such an informative post EA!
ReplyDeleteIt is a question that it's easy to forget to ask (I suppose because it seems perhaps a little arrogant maybe?) but a subject where it's vital to know what to expect. Thanks again.
And, not to make your life difficult EA, but this is another way that agents serve the author. Agents know how to negotiate book contracts to maximize the potential earnings for the author (or they should.) The more the author earns, the more the agent earns...so they have a vested interest in retaining salable rights and upping percentages.
ReplyDeleteI love how the assumption is that $10,000 is a normal rate. When I've only once seen $4,000 once in my 13 book experience. The rest were lower.
ReplyDeleteI'm still trying to get publishers to offer $5,000. But they plead poor.
I guess it's a goal to reach for, tho.
- 15 years in the business and still writing.
But, 2, 5, or 10...an advance is an advance, so the more important number is the earnings percentage. I'm not knocking a high advance...it gives one more money to promote the book. And that's exactly what most of the authors I know do with their advance monies...promote, promote, promote.
ReplyDeleteEA, what do you think of this business of authors spending their advance on promotion?
ReplyDeleteI'm not sure all editors are so quick to offer up these numbers, especially print runs. I've asked this question in the past and I've gotten a lot of hemming and hawing instead of a clear answer...
ReplyDeleteI agree with the mystery around print runs. I've never heard this information volunteered as part of the initial offer.
ReplyDeleteout of curiousity...
ReplyDeleteI assume that the stated print run is a measure of the publisher's expectations. As such, are those numbers generally accurate? I mean to say, if the catalogue says "print run: 500,000" and then there are a million retail orders, you could quickly print more -
but if there are only only 35 retail orders and people just don't seem that into it, would you not print as many?
... and at what point is it too late to pull the plug entirely?
Thus proving the need for an agent!
ReplyDeleteThank you. Thank you. I do words but not numbers, so will study this closely.
ReplyDeleteMy first book is being recommended to the publisher's editorial board in early Oct. and I hope this kind of phone call comes my way soon.
Meanwhile I will break out my calculator as I hope/plan for my first conversation along these lines.
Thanks again for this good, hard info.
EA, a question about this kind of negotiation--
ReplyDeleteDoes the publisher generate a range of estimates for the advance (for example, $4000-$6000) and offer $4000, being prepared to go up to $6000 during negotiations, or do they just generate one estimate and say, "Take it or leave it"?
This is gold, EA, and contrary to a couple of comments here I think proves why one does not need an agent. There is a skill to this, but it is not rocket science. By handing this pain-in-the neck but accomplishable task over to an agent, you give that agent 15% (or 30%, illustrators) of your income from that book for the life of the book. Forever. There are some agents out there who are worth that. Most, I would anonymously insist, are not.
ReplyDeleteWell, the first role of the agent is to get your book read by a buying editor. They (the editors) are drowning in slush, so an agent who can get your book read earns, im my opinion and experience, her 15%...the fact that she can also make sure I get adequate percentages, and don't sell too many rights away, is gravy.
ReplyDeleteThis is a most interesting thread and offers a lot to think about. Thanks for starting it!!
ReplyDelete
ReplyDeleteI can't thank you enough for all that you have done for me. About 2 year ago I my partner had misunderstanding, we had both made BIG mistakes in our relationship. He ended up moving away from me to pursue a new life. I knew in my heart that he would be the only one to make me happy. I was relieved when I found your email: voodoafricapower@yahoo.com on a site about what you have done. I requested 1 to 2 day casting of the reunite us love spell and within 3days frank company had relocated him back to our hometown where I still lived. We immediately reconnected and move in with each other I can't really thank you enough Dr Okoja.
Wales publications are offering the most appropriate Wales publications are offering the most appropriate Research Paper Editing in UK to allow you to be the one who gets selected for publishing the research in top ranked journal.
ReplyDelete