 | 458 REVIEWS OF BOOKS creating both the idea and the reality of the ::
and as the physical commodity of the business of publishing patron, and between the writer and his book, surface at times of financial crisis for
http://fh.oxfordjournals.org/cgi/reprint/12/4/458.pdf |
 Copyright (c) 2007 Gail Richards
Especially if you self-publish, you will want to set up a financial model. While no one can tell you with any certainty how many books you can expect to sell, you can be precise about what you will spend to get an idea of how many books you must sell to break even and then turn a profit.
More important, you need to consider opportunity cost. The time away from your business that you spend authoring a book will be time away from clients. But it is time invested in the intended return of more and usually larger client projects once you are recognized as an author.
It is a reasonable strategy to decide to break even on a book (or possibly take a loss) on your first book on the basis of book sales alone. Your real financial gain may be to your primary business, and your book may be one method of marketing for that business.
Big chain stores and Amazon.com have significantly changed the publishing industry over the past decade. The good news for the consumer: Books are less expensive and more readily available than ever. Amazon.com regularly discounts 30 percent off the retail price of books.
Where does this 30 percent come from? It comes directly from the publishers profits and ultimately from the authors royalty. It is estimated that only 10 percent of books published are profitable to both publishers and authors. Because this leaves about 90 percent of books that either break even or lose money, publishers have had to decrease their costs in order to stay in business. Cost reduction usually takes the form of offering fewer services to authors, especially first-time authors. Unfortunately, they are essential services that formerly helped increase the odds of success. For instance:
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The New Financial Realities of Book Publishing