BOOK CONTRACTS-PART TWO

 

Royalty Rates

 

Advances and royalty rates are usually a mystery to the author.  Both are fairly standard to a point.

 

·        Hardcover: the standard royalty rate for hardcover is 10% to 5000 copies, 12 1/2 percent to 10, 000, and 15% after that.  The problem is you have to be sure of whether it's 10% net.  The 10% of the wholesale price of the book are 10% of the cover price of the book.  Many publishers offer 10% minus what the bookstore pays for the book.  This would roughly make your royalties 5 percent not 10%.  Most major publishers offer royalties based on the cover price of the book. 

 

·         Trade paper: These are the larger soft cover books.  The publisher generally offers 7 percent to 20,000 copies and 10% after that. 

 

·         Mass Paper: Royalty rates for mass paper begin at 5% to 6%.  Can rise to 7&1/2 percent after 15,000 to 30,000 copies.

 

·         For mail-order and special sales (sales to anyone but bookstores) is generally one half of the regular discount.                                                                 

 

·         Remainder: when a publisher decides to stop printing your book and sells the remaining copies at a much reduced rate he specializes in what is called remaindering. That's when you're going to see your $20 book offered on a remainder table for 3 dollars.  Very devastating. For this eventuality you need a provision in your contract that lets you buy back remaindered copies at reduced rates. 

 

 Advance:

 

Every author dreams of a hundred thousand dollars or more in advance, especially first first-time authors, but that rarely happens.  The average advance today runs between $5000 and $10,000 and frequently below that. As a literary consultant I've had a few client advances over $100,000 but that's the exception.

 

·         The rule of thumb: it's possible to figure out about what you will be offered using this rule of thumb.  A publisher will offer an advanced roughly equivalent to the amount the book will bring in royalties the first year.  If your book is estimated to bring about $5,000 in royalties the first year that's about what they will offer you.  Five percent of all advances will run below $10,000 20% in the $10000-$30000 range, 5 percent above $30,000.  Generally a publisher will pay half at signing and half when you turn in the completed manuscript