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3. If Publisher offers less than 30% Royalties on Gross Sale Price Find Another Publisher
The royalties paid should, at a minimum, be 30% of sales prices of each book. Be wary of contracts that give you some high percentage of net sales price. This is where fuzzy math can creep in and take away almost all your profits.
The factors you should use to determine whether or not proposed royalty is acceptable are:
•Whether it is based on gross or net sales amount (and if based on net sales amount, calculation must be on hard numbers (production costs, credit card processing fees, etc.) and not vague items ("administrative costs", etc.); •The actual production cost of book (Production costs on POD books should be between $3.50 and $5.50. Anything higher than that and you can bet that publisher is padding this amount to lower your actual royalty); •The size of publisher's distribution network and traffic to publisher's online store (the more places your books are for sale, more chance people have to find them); and •Marketing efforts publisher engages to inform readers of your book (if a publisher actually spends money to help sell your book, a lower royalty is not out of line). •Whether publisher treats itself like a third-party retailer (e.g. Amazon.com) and gives itself a trade discount to sell you book (For example, for a $15 book, Amazon gets $7.50 for each book sold, then remaining $7.50 is divided between author and publisher based royalty agreement. Some publishers give themselves a trade discount so in effect they end up making 80% of each sale for a book that you paid them to publish!)
Again, these are just basics of basics, but they provide building blocks of foundation of knowledge you will need to have before you sign a POD publishing contract.
Mark Levine is the author of The Fine Print (www.book-publishers-compared.com), which dissects, analyzes and ranks the publishing contracts and services of 74 of the top POD publishers. He is also the president of Click Industries which provides business incorporation services (www.clickandinc.com) and copyright registration services (www.clickandcopyright.com)