Originally Posted by pdurrant
Publishers usually make money on a book even if the author doesn't "earn back his advance".
e.g. 5,000 hardback print run.
$25 dollar retail price
$12.50 wholesale price
$2.50 print cost.
10% retail price royalty
Only sells 3,000 copies.
$12,500 print cost
Publisher profit(loss): $15,000.
Author royalties: $7,500. Didn't earn out the advance. Keeps all of $10,000 advance.
The book didn't earn out the advance. The publisher still made 50% more than the author.
You are only using print costs. What about costs for ads and promotions, transportation, storage, proof-reading and editing, etc?