Quote:
Originally Posted by BearMountainBooks
No, this is not the case. They earn a high enough percentage on most books compared to the author that in fact, they can avoid a loss even when the book doesn't earn out. There are multiple articles about how these things break down, but the publishing industry does like to portray an advance that doesn't earn out as this huge loss for them. I used to follow several agent blogs and publishing news rags that had good articles now and then. I don't follow them now or I'd have links handy.
It is true that the bestsellers drive profit margin.
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As I said, it really depends on how close a book is to earning out. Obviously, the exact number depends on the publisher, the author, what the contract is and how good the publisher is at judging the market for a book (I use publisher here as the person who makes the publish/don't publish decision, not the umbrella publishing company). Most of the "make money on books that didn't earn out" that I see, tend to be big advances and big sales. The one that I link at the end, talks about printing 50K books and selling 25K books. You kind of need that level of sales to cover that $50K overhead that each title is charged. But quite a few books don't even hit the 10K books sold level, especially if it's a new author who doesn't have a big media blitz. One author blog I read talked about a first book and getting 5K in book sales on the first royalty statement.
So making a profit on a book that doesn't earn out really depends on if you are talking about someone who will sale in the 25K books range(best seller or well known author), or in the 5K book range (the vast majority).
url -
http://chipmacgregor.typepad.com/mai...-earn-out.html