Career

Author Accounting 101

by Steve Laube

Roll of money

You are a published author. You must be rich!

You are an agent. I know you are rich.

If it only were true.

A couple weeks ago we peered at the bottom line for the brick & mortar bookstore, now let’s attempt to do the same for the author. Please remember this exercise is generic, your mileage may vary. As before we will use some round numbers so we can all follow the math.

Let’s start with that $10 retail price book we dealt with before. The publisher sells the book for $6.00 to a store. That creates a “net price” for the publisher. Be aware that some contracts pay the author a royalty based on the retail price and some on the net price.

The net price is $6.00. They author’s contract pays them 15% of the net price. That would mean when this book was sold to the bookstore the author’s account was credited for 90 cents.

This particular author was paid an advance of $9,000 to write the book. That money is like an advance on your allowance when you were a kid. You must pay back the advance before you earn more money. So if each book sold earned the author 90 cents then how many copies must sell before the $9,000 is “earned out?” The answer is 10,000 copies. On the 10,001th copy the author earns an additional 90 cents.

But because the royalty is based on a net price the royalty paid will depend on each sale. Some books will be sold at $6.00, some for $5.00, some for $3.00. It all depends on the situation. (For example the books you see on the spin racks in the grocery store are sold to “rack jobbers” at a very high discount to enable them to pay each person in their distribution chain. The author gets less money but sells more copies.)

If the royalty rate were based on the retail price (say a 7.5% of retail rate for paperback, which is a standard number among the “Big Six” [soon to be Five]), then the author would receive 75 cents per book no matter what the publisher sold the book for.

Out of that $9,000 advance mentioned above must come the author’s expenses. Research materials, conference fees, travel expenses, etc. All are deductible at tax time (April 15th is next week folks!) And those are just the business expenses. If you are a normal person you have housing, car, food, clothing, etc. to pay for as well. But unless that advance is a lot higher it’s going to tough to pay your mortgage with the advance money you have received.

When I teach this at conferences I usually stop here and ask, “Is this making sense?” “Are you following the math?” Most will answer yes, but the room is deathly quiet because I’m talking about money.

I also ask the room “Can you make a living as a writer?”
D.Q.Y.D.J. is the correct answer.

Don’t Quit Your Day Job.

That sounds grumpy and negative, but it is a reality. Most authors do not start their career with a million dollar advance and a legion of fans. They build it slowly but surely over time. In the beginning they struggle mightily to make ends meet and to justify the time and energy. Just like anyone starting a small business.

I heard one highly successful author say during a keynote address that her hourly wage for her early books worked out to less than 50 cents an hour. Now, of course, she writes full time and speaks full time. But in the beginning it was a struggle.

The writing profession is a marathon not a sprint.

Why is your percentage so small? Read this article for the short answer.

A number of writers are turning to the new opportunities by self-publishing via e-books and see the potential for greater income. There is no debate from me as to the potential for success. A number of writers find this as the solution to their money problems. But just like every small business venture there are successes and failures. Your mileage may vary…. There is no single solution for every writer. One writer I know has a very steady income from ebooks, but still works part-time at a day job to make ends meet. This writer would be considered successful by any standard, but still has to supplement their income. The writer has grown the writing side of their world to the point that they must now decide whether to make the jump to full-time in the hopes that revenue will increase because they will have the time to devote all energy to writing.

And if you are interest in Publishing Economics 101 see this post from October 2011.

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Gotta Love Numbers

I didn’t attend kindergarten so my initial encounter with numbers happened in first grade. One day, we were working on math problems. As we finished, the teacher let each of us choose a stick of modeling clay. The colors were red, green, brown, and gray. I really, really wanted red. Green would have been OK, but definitely not brown and certainly not gray. I urgently scratched numbers on the ruled paper with my fat, green pencil. Still, everyone who liked red beat me. Even green got snatched up. By the time I got to choose, I was stuck with brown.

Then came a test. I didn’t understand the problems the teacher wrote on the board. I decided if I made up my own problems, I would get an A. I viewed this as a great solution to an otherwise insurmountable dilemma. But I soon found the teacher disagreed. Furious and frustrated, she called my mother for a conference. On the paper was a big red F, circled several times.

“Why did you make up your own test?” Momma asked.

I answered, “I didn’t like the one on the board.”

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Focus (Part Three)

I’ve always enjoyed photography. But it wasn’t until I came to understand the power of focus that I loved taking pictures. Focus helps you tell the story that you see in the picture. Whether your focus is on what’s close to the camera:

Or what’s in the background:

Or on the minute, microscopic details:

Each aspect gives us a different story in the same picture.

Our careers in publishing are like that, too. There’s so much involved in what we do—big picture, little picture, microscopic picture–and we need to understand it all. But here’s the thing, we don’t need to make every aspect the primary focus every day! Trying to do that too often leaves us befuddled and confused. For example, how many of your days have started like this:

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When Your Agent Makes You Speed Up

by Tamela Hancock Murray

Since I wrote last week about when your agent may make you slow down, I thought this week it might be fun to write about why your agent may make you speed up. Now, speeding up is never, never to occur at the risk of writing less than your best. Story craft, along with  care and attention to detail, are always musts for fiction and nonfiction. But there are times when we need to speed up.

Immediate Vacancy

Many is the time that I receive notice from editors looking for submissions when they need to fill a slot right away. Perhaps they are working on a special Christmas project, or a contracted author has been unable to meet a deadline. They may call on agents they know to be reliable with a list of equally reliable, talented authors, to help them fill that hole right away. So when your agent calls and says, “I know you’re working on a suspense/historical/devotional manuscript. Are you able to meet a deadline of two weeks from now for an editor in need?” At this time you can either accept, decline, or even ask the agent for another two weeks or so. Working with your agent, you may gain a well-deserved contract more quickly than you expected, along with the gratitude of your new editor. This is a very good reason for authors to work with agents, because agents tend to be privy to this type of inside information.

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Refine Your Focus

Let’s talk about Focus.

I like Webster’s definitions:

Focus (noun)

a : adjustment (as of the eye or an eyepiece) for distinct vision

b : the position in which something must be placed (as in relation to a camera lens) for clearness of image or clarity of mental perception

: a central point: as

a : a center of activity or attraction or one drawing the greatest attention and interest

Focus (verb)

1a : to bring (as light rays) to a focus : concentrate

3 : to adjust the focus of (as the eye or a lens)

intransitive verb

1: to come to a focus : converge

2: to adjust one’s eye or a camera to a certain range

<newborn babies cannot focus for several months>

3: to concentrate attention or effort <she was already focusing on her next role>

I love it that focus is both a noun and a verb. We need to understand both the essence of focus and the actions that build or hinder it. Take a look at Webster’s definitions again. What particular words or phrases jump out at you?

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Why Your Agent May Slow You Down

Your agent may slow you down.

And this is good!

And, why is that?

I’ve been a writer myself, so I understand the frustration you must be feeling as you read my words. Who wants to slow down? Believe me, when I was waiting for my first book to be published, I only half-joked that it would be released posthumously. So I understand that writers don’t want to wait another ten minutes to see their books published. But those ten minutes — or more — are worth the wait.

Craft takes time. That’s why I tell my clients, “Take the time you need. Submit when, and only when, you are ready.”

Sometimes writers feel a sense of an artificial deadline. Perhaps an editor has put out a call for a certain type of book. Or a key editor will be judging a contest. Or a promising conference meeting has just occurred. So let’s hurry!

No, let’s not hurry.

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Down in the Valley

Imagine awakening one morning, not knowing where you are, utterly unable to move or speak. Imagine coming to the slow realization that you are in a hospital, and that the people all around you are looking at you and talking to you, but you can do nothing in response. Imagine doctors telling that, at the age of 43, you’ve suffered a stroke that has caused what they call “locked-in” syndrome, where your body is frozen but your mind is fully functional. Fully functional…and trapped. Imagine realizing that the only thing you can move is your left eye. That’s it.

One eye.

Such was the case for Jean-Dominique Bauby (Jean Do–pronounced jhan doh–to his friends and family), a one-time editor of ELLE magazine. I’d never heard of him until I caught the fascinating docudrama, The Diving Bell and the Butterfly.  But get this: the movie is based on Bauby’s memoir. Written after he had the stroke! Remember, now, he can only move his left eye. That’s it. He cannot speak. Cannot respond in any way except to blink that one eye. And he wrote a memoir.

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When You Hit the Wall of Discouragement

by Steve Laube

 

I recently received the following question from a client (an award winning author):
Is it common for an author to hit a wall of discouragement? To feel as though they’re working so hard for so little? To question why they’re doing this?

Unfortunately it is quite common. Doesn’t mean it aches any less. Sort of like getting old…everyone does and it aches, but it is a common malady.

I recently read a blog by a writer in the general market who wrote, “Why am I doing this? I work so hard for so little money only to have critics tell me I have no talent at all.”

It truly comes down to whether your calling is stronger than the frustration and anguish of the writing process.

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Age is Just a Number

by Steve Laube

Last Friday in the comments Dr. Richard Mabry wrote, “Tired after doing a few household chores that never used to leave me dragging. Now I’m ready to be up and dancing. Age is just a number, isn’t it?”

Then on Saturday I spoke at the Christian Writes of the West mini-conference where one of the writers asked “Do older writers have a chance? Especially if agents and publishers are looking for a long career investment?”

It is a great question. Does it matter how old you are? No it doesn’t. When your proposal lands on our desk or on an editor’s desk it is the words on the page that speak to us. I rarely even think about the writer’s age, ethnicity, economic status, or any other non-writing ability classification while I’m reading the sample chapters. Of course there are exceptions. A few times I could tell the author was very young by the way they were writing a romance scene…they simply had not yet “fallen in love” and couldn’t quite express it in a full way.

We have a number of clients who are in their 20s we also have a number who are in their 70s. What matters is whether they’ve written a great book and have a platform (for non-fiction) to sell it from.

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Proper Care and Feeding of …You!

Thanks so much for all your thoughtful responses last week. I gained a great deal from reading and pondering them. This week, I’d like to take a look from the other side of the desk. As an author myself, I know how hard the writing gig is. And I know a LOT of authors, published and not, who have hit speed-bumps -or even felt like the Editor/Publisher/Agent semi just flattened them in the middle of the publishing highway. As hard as agents’/editors’ jobs may be, the author’s job is pretty tough too. You spend months and years working on your craft, only to have everyone tell you how to do it better. And then there are the lovely people who keep asking when you’re going to get a real job, or would you mind baby-sitting today since you don’t have a job, or any of a multitude of other ignorant comments that nibble at us like rabid ducks as we struggle to be creative.

Sadly, the criticism and ignorance doesn’t end when you get published. Just read some of the reviews on Amazon, Christianbook.com, or Barnes&Noble. Or ask an author to share his or her reader letters with you. I know one group of writers that gets together once a year and gives out a prize for the worst review/reader letter. Some of them are, to say the least, brutal. Let’s face it, when your words are on the printed page, you can pretty much know someone isn’t going to like what you said or how you said it. And the ol’ Internet has made it waaaay too easy for folks to share their blistering thoughts.

No, writing isn’t easy. Not by a long shot.

So here’s what I’d like to do.

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