Thursday, June 27, 2013

Just How Much Does It Cost to Publish a Book Anyway?

One of the growing clichés in independent publishing is that getting a book to market is cheap and easy. The reality can often be quite different, although it is certainly cheaper to go out on your own than it was five or ten years ago. The problem is I haven't seen many stories that define exactly what "cheap" means. Many of the comments on my last essay (See How to Find an Editor Without Going Insane) revolved around the cost of my editor. Since there might be a shortage of independent publishing economics out there, it makes sense for me to expand my costs beyond editing to the entire publishing process for my upcoming book Smooth Operator.

Disclaimer: Prices may vary. Past performance does not guarantee future results. Prices do not include tag, title or taxes. Check with your local dealer for details.

The Elements of Book Publishing
When I was in house counsel for an anime and manga company, the price we paid to sell comics and video (what real business people refer to as the cost of goods sold) were divided into five parts; acquisitions, production, advertising, sales and finance. I decided to break my costs down the same way.

Acquisition in this context means the creation of the manuscript. I set this cost at $0, even though there is a significant number of man hours put into the process (See Building the Better Novel series of posts). In addition there is an associated opportunity cost for lost wages that I could have made doing something else. I'm not smart enough to figure what that cost is, so I set it at zero to keep things simple.

Production has four costs:
  • Editing: $1,200 from Create Space (See How to Find an Editor). Other editors charged per word or per page for a 75,000 word manuscript and most of the prices were in this range.
  • Cover Design: $10 I do my cover design in house for the most part (because it's cheaper and kind of fun to do), but I get royalty free images from and $10 covers the licensing cost of a decent sized image.
  • Formatting: $40 from a program I called Jutoh that can create e-books in most major formats. Because I plan to use this program for all my books, I could amortize the cost across all titles, but for the sake of this exercise, I'll count the entire cost here.
  • Printing: $250 Create Space offers printing on demand, but there is an initial set up fee for this service (Note: if you only release an e-book, this cost is zero. I'm only adding it in because vanity compels me to put my books on my shelf.)
Production Subtotal: $1,490

Advertising has two costs: 
  • Online Advertising: $50. This will be split between Google and FB ads for a week after the launch of my book to specific demographic groups that are interested in my genre (See the Secret Struggle for the Magic It)
  • Press Release: $60 through on the day the book launches. Again this will be a targeted release that will improve the SEO of the book as well as notify the relevant journalists and bloggers.
Advertising Subtotal: $110

Sales: $0 When people say independent publishing is cheap, this is what they mean. I'm planning to use Kindle Direct Press for at least one cycle, but even if you use Smashwords, Kobo or Nook, there are no upfront costs for registration, distribution, shipping, storage, returns, or all the other little costs that publishers normally deal with. Of course, online book outlets take a significant percentage the revenue from each sale, but everybody has to eat somehow.

Finance: $0 I have a separate account for my publishing company and there are fees associated with maintaining that, but I don't factor that in here because I'd be paying those fees either way and this is complicated enough already.

Total Cost to publish Smooth Operator: $1,600

Of course, each of these costs could be boiled down to almost zero or expanded to tens of thousands of dollars depending on the writer. The key is to find a cost that fits within your budget and helps you create the best book possible.

Profit, Loss and Breakeven
Once I know how much my book costs, I can figure out how many books I need to sell for it to be financially successful. A book breaks even when the number of books sold equals the cost of making the book. When I was at Marvel, they had a complicated spreadsheet (called a P&L or Profit and Loss statement) that laid this out in great detail. My method is similar, but not as fancy because again, my brain capacity is limited.

The formula is simple: Breakeven number of books = Revenue per book/ $1,600

If my book sells for $2.99 and my share of each Amazon sale is 70%, I make about $2 per book. If that's true, then I need to sell 800 books to breakeven. Every book sold after that is pure profit that I can horde in my basement and swim around in like Scrooge McDuck from Duck Tales. It also follows that the more I can reduce my costs the fewer books I need to sell to break even. A higher per book price also reduces that number, but you don't want to set the price so high that readers won't take a chance on you.

Business vs. Pleasure
Now, I don't have a basement. And I won't be swimming in a pool of money from the sale of Smooth Operator. In fact, the chances that the book will breakeven are quite small. But that's OK. By definition, independent publishing is not a cash cow. If I just wanted to make money, I'd invest in the defense industry or start a meth lab. There are many other reasons to publish besides money (See The Other Benefits of Independent Publishing), but that doesn't mean the profits and losses don't matter. Understanding the financial aspects of independent publishing are just as useful as learning to build web pages or understand social media. Publishing can become a vehicle for broad types of learning, even if you can't make a swimming pool out of the profits.

As always, please let me know what you think of my random rambling.

Have fun.


  1. First, I like your rambling. Next: I spent a little more on my book because I track marketing costs. My publishing costs were a little less because I didn't hire an editor. Not a path I'd go down a second time. Then I got a professional (friend) to do the press release and it was very, very good. I made the front page of my hometown paper so I travelled there for a signing - coast to coast. I've been a guest at conferences but had to pay travel and I attended BEA to hawk my book. I also have a publicist who has gotten me on radio and TV. Lots of other details but bottom line I invested $7k. I've sold 1,000 books in the last six months so I'm a little over half way to break even. Anyone wishing to help can go to - William Sewell

    1. Thank you Mr. Sewell. I'm glad someone enjoys my rambling. What aspect of your marketing (press release/ publicist/ conference visits) do you think had the most impact on your sales. I only ask because I'm planning to write another post about my marketing plans and I'd like to get another perspective.

      Thanks again.

  2. Very interesting, and well written. I like it.

    1. Thank you Ms. Banks. Hopefully the novel will be as well written as the blog posts. ;-)

  3. Well done...again. I'm an accounting technician so P&L, COGS, finance, yadda yadda yadda are always in the back of my head. You've set out this process in a concise way that is easy to understand.

    I agree with all your practices and principles. And...when you are selling millions of copies, the financial aspect and knowledge will be invaluable when you have those piles of cash (to swim in cause you'll be living in a mansion). :)

    And you're right, there are many other reasons for me as well as to why I write. I make a hell of a lot more money at my day job, but that thrill of producing something that someone else may enjoy is what pushes me to write.


    1. In the end, we won't be remembered by what we do in our day jobs, Pam. Only the writing will live on. Until then, we can just swim in the pool of money. ;-)

  4. The one thing most people do not realize is that it is usually obvious when they use a template and design their own cover. It is a red flag to readers if the cover looks homemade. I have even sent friends to a professional designer because a graphic designer did their book cover. Graphic designers can do well, but a cover designer has a special talent for bringing your book to life! Everyone cannot do it. Yes, there are a there are a lot of "how-to" programs and free videos for making a cover but they are only good in my opinion for selling a pdf online. If you are going to enter the world of authoring, spend the money and get a professional cover designed. If the cover isn't up to par, how likely is it that people will even pick up the book? Look at the other book covers in your genre and compare. Remember, you can't cheap your way to rich!

    1. I think you are right Tracy. The only problem I have with bringing in a professional cover designer is that I dislike most professional covers as much as I dislike the DIY ones. My background with cover images is limited to the time I spent at Marvel, but I feel better translating my own vision for the cover into reality, rather than trying to explain it to someone else.

      Having said that, I do have a graphic designer creating the fonts for my next three books, only because that is the part of cover design that is the most frustrating.

      Thanks for the insight.

  5. Thanks for this good stab at providing an easy-to-read estimate of production costs for a single title. There are some costs I incurred that you didn't list ($35 copyright filing, $250 for ISBNs, setup fees for LSI). A couple comments on your figures:

    - As Tracy mentioned, most authors ought not try to create their own covers unless they're aiming for the crappy-indie-cover look. I used to be an artist but still spent $500 on my cover design and production (by Damonza), and it was an excellent investment. That's probably a more realistic figure for an author with little/no artistic talent.

    - The only money CreateSpace charged me was for the printed proof copy ($10). Did they hit you with some other fee? Lightning Source, on the other hand, has setup fees, fees to be listed in the Ingram catalog, and yearly distribution fees. However, there's nothing like being able to use the magic word "Ingram" when talking to a library or bookseller.

    Good luck on Smooth Operator!

  6. You're right about the copyright fee, Lance. I paid that before I sent to book out to beta readers, but I didn't include it in the overall costs. That was an oversight on my part.

    Several people have also corrected me on the Createspace charge, which I appreciate because it saves me $250. I'm planning to use Amazon's AISBN for now because I'm going through KDP, but maybe that $$250 should go to a real ISBN. I'll have to think about it.

    Hope your book sales are going well.

    Have fun.

  7. An investment of $1600 will probably produce negligible results. Thousands of undiscovered ebooks and books printed on demand prove this. Trust me, I know. My novel, Rebels on the Mountain, falls to about 1,000,000th in sales rankings in the Amazon store, then jumps to about 90,000th with the sale of just one copy. What does that tell you about the other 900,000 titles that it has passed? And, there are hundreds of thousands of more titles that fail to reach the "lofty" realm of 1,000,000th in sales. All of us have published on the cheap.

    1. So what do you think the solution is for those 900,000 writers, Mr. Durish?

  8. I doubt most people "publish" for a livelihood; it is one method for verifying Self.
    POD is a gamble for printers, the incidental cost of set-up for a book written off as expense.
    The real profiteer is the marketer.

    1. In most cases I know of, the independent publisher takes care of all the marketing, so there isn't a big revenue stream there.

      Also, the publisher can write off the publishing costs as a business expense if they form a company. A POD shop like Createspace make money off each book. There is no gamble for them.

      Finally, independent publishing is rarely anyone's sole means of income, but it can be profitable if done the right way. "Verifying the self" is a major benefit too, but we can do that and still buy ourselves something nice after we break even. ;-)