Which is more profitable: self publishing or traditional one? Introduction: To self-publish or not to self-publish, that is the question. While many aspects should be considered, such as the ease of each option or the potential for sales, this article focuses solely on the monetary side. If you've read my book Best Advice, you know I prefer the simplest approaches. Let's apply that here as well. Traditional Publishing Costs: We'll consider an average book price of $10, which falls between the average prices of an ebook and a paperback. This allows us to disregard the printing cost for self-publishing. With traditional publishing, the process is straightforward with two main players. The author typically receives between 10% to 20% royalties and an advance payment. However, as a newcomer, you can forget about the advance payment and the 20% royalties. You'll likely be in the 10% range. To send a decent copy to a publishing house, you need a good developmental editor, who, according to online sources, charges at least $1,500 for a 50,000-word book. It's pretty straightforward: the author makes $1, and the publishing house makes $9 for every book sold. The publishing house handles all the work related to your book. Given all that, the first 1,500 copies sold yield no return to you. Self-Publishing Costs & Considerations: For self-publishing, the royalties are usually around 70%, but you handle all the related work. Books do not sell themselves, so you must cover all marketing costs. On Amazon, cheap keywords won't get you clicks, and effective keywords cost at least $1 per click. According to the KDP community, every 10 clicks should result in 1 sale. Don't be shocked if your initial sales have a negative return. Like any business, early sales often incur losses because you need to invest before generating profits. Break-Even Point & Profit Comparison: Let's break down the numbers: For your first 10,000 books, you will lose $3 per book. This is based on a $10 book price, $7 royalties, and a $10 marketing cost (10 clicks at $1 per click for 1 sale). This totals $30,000 in losses. At the 10,000 sales mark, you might reach 1 sale per 3 clicks. You will earn $4 per sale ($7 royalties minus $3 marketing cost). At this rate, you need to sell 7,500 units to recoup the $30,000 marketing expenses/losses ($30,000/$4 profit per book). This means you need to sell 17,500 units to break-even. Assuming no further marketing costs after breaking even, your net profit per unit will be $7. To make a profit equivalent to traditional publishing earnings you need to sell an additional 2,650 units, bringing your total to 20,150 units. The exact calculation is ($16,000 + X * $1 = X * $7), where X represents the additional number of books sold above the break-even point of 17,500 copies. The left side of the equation represents the total profit earned from traditional publishing (17,500 copies at $1 per copy minus the $1,500 for the editor plus the additional X sales at $1 profit). The right side represents the profit from self-publishing after breaking even at 17,500 copies (where you earn $7 per unit sold). In simpler terms, to equal the profit from traditional publishing, after selling 17,500 units to break-even (while you earned $16,000 in traditional publishing), you'd need to sell an additional X number (2,650 units) of books with self-publishing. Choosing Between Traditional and Self-Publishing: Depending on these numbers, self-publishing would likely be more beneficial if you anticipate selling more than 20,150 copies (17,500 to break-even + 2,650 for equivalent profit). Otherwise, consider traditional publishing if it's an option. It's important to remember these are estimates, and actual results may vary. Additional Considerations for Self-Publishing: You can calculate your potential earnings based on your book's pricing. As a newcomer, you may encounter suggestions for free promotions or platforms with large reader bases, but remember, nothing truly comes for free. You might need to exchange services, like reading others' books in exchange for reviews on Amazon, or invest in paid promotions to reach potential buyers. Other marketing avenues, such as hiring a publicist or collaborating with influencers, also come with costs. You might opt for free methods and succeed, but success in this case often requires numerous factors to align in your favor. Conclusion: Ultimately, choose wisely considering all possibilities, and always weigh the cost benefits of any expenditure. Remember, investing more in marketing can increase your book's chances of success. Also, ensure your book is well-written and designed to appeal to your target audience. For instance, avoid niche topics like the history of typewriter machines if you expect a mass appeal. Above all, recognize that your book won't sell itself. When you first publish, it may not even appear in the first 20 pages of search results, even if readers search for its exact title. You need to actively promote your book to catch the attention of potential readers and improve your sales prospects.
Published: June 11, 2024