In a recent post, Pricing Your eBook, I discussed the vagaries of setting a price on a book sold only in electronic form. That model is driven mostly by perceived value and target audience, when determining the price for a printed book you have a couple of other items to factor into your profit map.
Pricing a printed book is also deserving added thought because changing the price of an eBook is a simple matter. Changing the price of a printed book is not simple because the price is printed on the back cover along with the ISBN and bar code. Changing the price means changing the cover, which means service fees paid to your printer every time you make a change.
Cost of Printed Book Design
Unlike an eBook, printed books actually cost you money to produce, how much will depend on who you choose to produce your books and the styling of your books.
When I worked for The Community Herald, a printing company that printed a variety of newspapers, magazines, and catalogs, we could and did print books on a very limited production in Vanity press style. 50 to 100 copies was typical and it was very expensive. Other printing companies probably have the ability to do something similar, if that suits your needs, you’d just need to find them.
However, most authors will want access to much higher numbers of books at a much lower cost. That means using either Createspace, a subset of the Amazon Empire, or Lighting Source (http://en.wikipedia.org/wiki/Lightning_Source).
You could use a publishing assistance service like Outskirts Press, Lulu, or Book Locker if you want to pay for their packaged assistance service. Packages may include editing your manuscript, interior design, cover design, and marketing plans. However, these services do not print books, (even though some lead you to believe they do) they will sub-contract the actual printing; typically to Lightning Source.
Whether you buy a package or hire an editor, an interior designer, and an artist for front and back covers, these are out-of-pocket costs that you will need to consider when you set your pricing. Actual cost can be all over the map: a few hundred dollars by hiring upstarts trying to get established to many thousands of dollars hiring seasoned professionals. Compare prices, check references, and do not assume the “assistance services” hire pro’s to do their work.
You may eliminate one or all of these charges by doing the work yourself, but unless you have expertise in the field it is generally not wise. Books destined for an eBook reader can easily dispense with interior design and cover artwork is not as critical, but a printed book is a product in which the look and feel of it will be very important.
The Cost of Printing
Your printer will offer options on the size and shape of your book, paper you use for the pages, and style of cover.
Sizes and shapes of books that allow the printer to efficiently use standard paper sizes will cost less than those that require trimming away and tossing a large portion of each sheet. For example, a 5” x 8” book allows the printer to print two pages per sheet of 8½” x 11″ paper with room to trim the pages after binding where a 6” x 9” book would require over-size paper or printing one page per sheet and trimming away a large portion of each sheet. Efficiency saves cost.
Paper costs will typically run you 1 to 3 cents per page, depending on page size, color of paper, weight of paper, and finish (matt, satin, gloss); more for elaborate paper.
This handy [pricing guide from Lightning Source] gives us a basis to use for example pricing for the rest of this discussion. Let’s assume you’re producing a 280 page paperback at 5×8 inches, with black text only using the Print On Demand (POD) model. This runs 90 cents per unit and $0.013 per page which works out to $4.54 per book in printing costs.
Note there is also a $75.00 one-time set-up charge if you provide text and cover art in digital format. Much more if they have to scan hard copy into digital form. Add this to the nebulous out of pocket design charges from above that must be covered by sales before you actually realize any profits.
Let’s say you’ve done some research and determined that other books similar to yours are selling for around $16.00 and you decide to adopt that price as well. $16.00 per copy minus $4.54 in printing yields $11.46 per book in initial profit. Pretty good, right?
Cost of Distribution
Now you have your book set up with a POD printer and you’re ready to sell it to readers. How do you make it available to those readers?
You can buy copies of your own book at cost and resell them for the cover price through direct sales to the public. You can do this at book fairs, writer’s conventions and workshops, perhaps at an author spotlight day at your library, or by hoofing it door-to-door visiting bookshops. Distribution costs here would be the cost of shipping your books to you, fees paid to get into the convention/workshop as an exhibitor, motel and food costs while there and gasoline for travel to and from the event or driving from bookshop to bookshop.
You can offer your print book on your web site and ship them individually to your customers, using the Postal Service media mail rate. Createspace will allow you to set up a product page on their web site so you may link your web site to their page offering your book. They will handle the money and ship the book for you. Lightning Source says they do not sell directly to the public, only to bookstores, distributors and libraries. Although their FAQ page states, “Publishers can opt to use Lightning Source’s direct distribution service in addition to distribution through Ingram, Bertrams, or other distributors and wholesalers (see distribution partners) link here please. This allows your customer the option of ordering directly from you, the publisher… You save the in-bound freight and Lightning Source’s role is completely transparent to the customer.” There are fees associated with each program in the form of a commission paid to the printer for each book sold and shipped. Createspace lists their [fees here].
Online booksellers such as Amazon, Barnes & Noble, or Books A Million (to name just a few) can order your print book from Createspace or Lightning Source. Lightning Source lists Ingram, Baker & Taylor, Amazon.com, Barnes & Noble, Gardners and Bertrams as their regular distribution partners. Createspace lists only their own estore and Amazon as regular channels, anything more requires purchasing their Pro Plan
for a $39 one-time fee (per title) and $5.00 per title, per year. (NOTE: the Pro Plan has since been eliminated expanded distribution now costs $25.00 per title.) Buying the pro plan for your book also reduces your printing costs significantly and is well worth the money. Createspace charges a 20% of cover price commission on sales ordered through their estore, 40% commission on sales through Amazon.com and 60% commission on sales through their expanded channels, which would include Ingrams and Bertrams. Lightning Source lists only a $12.00 per ISBN per year catalog fee.
Our example book, selling for $16.00, costing you $4.54 in printing, if sold at the 60% commission could earn you as little as $1.86 net profit. Not so good, but doable as a worst case scenario.
Cost of Returns
The real kicker comes when you decide you want to get your print book into brick & mortar book stores. To do so you will need to offer these stores a deep discount (B&N requires 55% minimum discount) and offer them the option of returning books that do not sell.
Createspace’s user agreement states that they reserve the right to refuse returns for any reason: and they generally enforce this with book stores. They may accept returns from private sales, and may then choose to either place the book back on sale (this sale will not count toward your royalties because you’ve already been paid) or destroy the book and charge your credit card for the cost of the book plus a service fee.
Lightning Source does allow returns from distributors. If returned the wholesale cost of the book is charged back to your account and the book(s) may be shipped to you at your cost or stored (again at your cost) or destroyed.
Your $16.00 book, sold at 55% discount yields a $7.20 sale price, deduct $4.54 printing costs and you net $2.66 per book sold. However, for each book returned, $7.20 will be charged to your account, as well as a return fee (typically $1.00 per copy) for disposing of the book making your net a MINUS $5.54 on each book returned. If the order was for 20 books and only two came back, you’d be fine. If a significant portion of each order is returned by each book store, it will end up costing you money to have your books available in those book stores.
Cost of Promotion
Note that having your book listed with the big distributors like Ingram, Baker & Taylor, Gardners and Bertrams does not mean your book will be in every (or any) bookstore. To get it there, as well as avoiding the above losing scenario, you will have to do some promotional work.
To start with you have to convince the bookstore that your book is worthy of their oh-so precious shelf space. For example, Christine Rose offers this advice on getting your book into Barnes & Noble stores:
“Once it shows up in Ingrams database as returnable and at least a 55% discount, you’re ready to go. (Give it a few weeks to be sure.) Then you (as the publisher) must send two finished books, a letter of intent, and a detailed marketing plan to:
Diane Simowski, Small Press Dept., Barnes & Noble, Inc., 122 Fifth Ave., New York, NY 10011”
Did you catch the part about letter of intent and detailed marketing plan? You as the publisher, not the author, have to describe in detail how you plan to promote and market this book so people will come into Barnes & Noble stores to purchase it. Barnes & Noble does not say they will market the book for you. If they buy it, they will put it on a shelf and make it available to the public for a time.
To move copies of your book off the shelf you will need to advertise it, promote it, interest readers in it. That is a complex and often expensive proposition which deserves at least one whole post all to itself. The bottom line is: this is another out-of-pocket expense to be considered as you determine your book pricing.
Keep track of your out-of-pocket costs for design, printing, and promotion; consider them as you set a price. Track these against your sales so you know when you’ve broken even.
Research the market to see where your competition is pricing their similar print books.
If you want to get into bookstores, go with Lightning Source as your printer.
Carefully weigh the risk/cost against the benefit of being in bookstores and assess your ability/willingness to convince bookstores that they need to carry your book and readers to buy your book.
Have you produced a print book? Do you agree or disagree with the above? Please share your experience with us!