Writing & compensation

Different professions have different compensation schemes, and writing is no exception.

I’ll be looking into traditional publishing, as self-publishing or vanity presses mean that there’s no income until after the book’s published and you get a percentage of the sales.

A case that usually makes the news is a bidding war, which means that a variety of publishing houses bid on the manuscript until one of them wins, the contract’s signed, and the book’s eventually published. This is especially noteworthy when it’s a new author (or if it’s someone who’s only published a few short stories and suddenly has their first novel auctioned).

Bidding wars aren’t that common these days because the financial landscape of the industry has changed a lot over the past decades, but they can still happen (especially if you’re famous, like Barack and Michelle Obama). A couple more examples include Freya North and Paula Hawkins.

But moving away from bidding wars, the more normal contract with a publishing house (negotiated by a literary agent) is receiving an advance (either with a full manuscript submitted or with a partially complete one, although this latter case is uncommon, especially with new authors because agents require that you have a finished text before looking for representation). This advance represents an initial part of the royalties that the author will receive from the sales of the books.

How is this advance calculated? Well, it boils down to a few things (in addition to the publisher’s finances and expectations for the book, as well as the agent’s negotiating skills). The book’s genre may affect it because not all genres sell the same numbers, and thus publishing houses may simply expect fewer copies to be sold. The percentage of royalties per copy sold will also affect this, although an average is 10% (if your book sells for $10, you’re getting $1; if you sell 500 books, you get $50). Royalties may increase after a large number of sales—like 10,000 (this may or may not happen).

If you’re a successfully published author who’s already a household name or who can pretty much reach certain numbers, then the advance will be higher because the publishing house may expect the number of copies to be sold from the get-go to be higher. (And if you think that 10% sounds bad, keep in mind that a book’s price needs to cover the costs associated to the publishing itself [staff], marketing, the retailer, distribution, the agent’s commission, and a few more things, but I don’t want to digress.)

In the US, depending on the author’s experience, the advance may go from $5,000 to $50,000 (if you’re a new author, you’ll be closer to the first one). And as mentioned, the landscape’s changing, so new authors may get less than that and even famous ones may not reach the highest figure. In the UK, it’s around £2,000-£15,000, and I tried to find more references from other countries but the articles were outdated and I’m pretty sure the numbers have changed since 2012.

In any case, the advance anticipates a number of copies being sold, and it’s meant to help the author be alive throughout the publishing process (which can take a year or so), so that they don’t need to get another job and not have time to work on the manuscript.

After the threshold of copies is sold, royalties may be paid monthly or yearly, depending on the contract that’s signed.

While sometimes authors sell more than their advances, other times they don’t. It’s not that uncommon, actually. (In 2006, the average was 500 copies, and I’m not sure the numbers have changed that much, although keep in mind the difference between printed books and ebooks.) It’s important to know before signing the contract if the publisher will expect a return of the advance within a period or not. This isn’t the norm, but there are publishers out there that work like this.

There are also publishers that pay at publication, which means that authors will only earn the royalties of the books sold, and some offer a higher percentage of royalties if, for example, there’s no advance and after a certain number of copies have been sold (to cover the fixed costs of publishing the book).

Going back to royalties, these may also vary depending on the media: different formats (hardcover, paperback, ebook, audiobook) have different associated costs and different revenue expectations, and not all contracts will necessarily include all formats.

There may also be bonuses if, for example, a book is chosen for a popular book club.

There’s also the matter of rights associated to adaptations or adjacent creations. Books may be opted for a TV show or movie, but scripts may get stuck in development hell or they may not make it past a first attempt at adapting it (such as a TV pilot). However, the sales of these reproductions should be paid whether the project is successful or not. These rights (and the corresponding compensation) may be negotiated separately by the literary agent or they could be a part of the initial contract with the publisher. And just because your book’s movie rights are sold, doesn’t mean that you’ll be in any way involved in the production. Just ask…all the authors who’ve complained about their work being butchered on the big or small screen.

More things that may affect compensation?

The territories in which the book will be commercialized, the fee scheme in case of translations, whether the author will be going on a book tour…

So, as you can see, a lot goes into figuring out what compensation looks like, especially in volatile markets with very different national practices (and with some publishing houses having offices in different countries while others have to negotiate with external markets). And it’s tough to become a full-time author, but it’s doable. A lot of things have to work out. But it’s doable.

Moira Daly

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