$1,974.48: Notes on a first royalty check
Or, how my book made $200k but not for me
This time last summer, I logged into my publisher’s sales portal and discovered that my book had “earned out.”
That had been my goal all along—to earn out—and yet the realization still had me crying in a parking deck. Maybe you saw the essay I wrote for Electric Lit about this.
In any case, if that term is new to you, “earning out” simply means that your book has generated enough sales revenue to cover the amount of the advance you received from the publisher.
Here are the basic steps involved:
When you sign a traditional book deal, the publisher usually provides you an advance payment against future royalties. This lump sum is paid before the book is published. It’s what people mean when they talk about “advances.”
After your book is published, you earn royalties based on sales. These royalties are a percentage of your book’s retail price. The percentage varies according to the exact terms of your contract, but the average is around 10% to 12% of hardcover sales, and runs as high as 25% of audiobook and ebook sales.
To earn out, your book must generate enough royalties to equal the amount of the advance. For example, if an author receives a $20,000 advance (as I did) and the royalty rate is 10%, the book must earn around $200,000 in sales to earn out the advance.
Once you’ve earned out your advance, additional royalties arrive in check form, just slipped in amongst all your junk mail, every six months or so.
This brings me to the check I recently received for $1,974.48. My first royalty check ever.
Remember how I said I earned out as of July of 2023?
That’s when my additional royalties began accruing. So the check I recently received for $1,974.48 reflects my cut of sales for the last six months of 2023, minus my agent’s 15%. (Because agents earn 15% of your advance as well as your royalties.)
By my calculations, during the last six months of 2023, my book earned roughly $20,000 in sales. I estimate my book’s total sales revenue as around $220,000 so far. So why don’t I have $220,000 in total book earnings in my bank account, but more like 10% of that, and why I am not mad but glad?
This is really a larger question about the economics of traditional book deals. Ryan Holiday mentioned in a recent email that if he’d known how well The Obstacle Is the Way was going to sell, he’d have self-published it, and I get it. He’s got an exceptionally large and devoted following.
Me? Not so much, and that’s not me being modest. I don’t regret going with a traditional publisher, not a bit. That was the dream. I can’t run the numbers now, having no access to the alternative timeline in which I self-published, but my sense is I earned as much by going this route as any other.
Just like in the breakdown above, I now earn ~12% of hardcover sales and 25% of ebook and audiobook sales. But most of my sales, as in over 50%, are hardcover. I think that’s because the book is reasonably priced, at $20 for full retail, with some retailers discounting it further off their own bat. What’s more, Barnes & Noble pretty specifically aims the book at gift shoppers—shelving it in stores beside titles like How Not to Get Murdered in a Quaint English Village and Frog and Toad Are Doing Their Best, and listing it under “Books to Make Them LOL” in its holiday catalog, which matters because my holiday-season sales at Barnes & Noble are a significant chunk of my overall yearly sales. Meanwhile, on Amazon, they knock the price down to less than $13, plus the algo links it to other Poe-themed gifts.
Long story short, a lot of my sales are what you call “gift sales,” and a lot of them come from brick-and-mortar stores and/or from being bundled with similar gifty products, like so:
Granted, my total sales are not anywhere close to blockbuster territory, but I am happy to say that they exceed 10,000 in hardcover, which is basically what got me to this stage of receiving checks. Meanwhile, the book is still selling. The hardcover just went into a modest third printing. I sort of feel as if I wrote myself a very modest annuity.
Lest this seem like some lame humblebrag, I should add that your average New York Times list-maker sells in two-ish weeks what I sold in two-ish years.
And you can see that I’m not exactly getting rich off it. That $1,974.48 is welcome in my Wells Fargo, but it’s pretax and does not cover even one full month of rent for me, not that I’m complaining.
I share this information because to the extent I have an author brand, it’s in sharing this kind of information, and because oh God this is SUCH an opaque business. Details regarding sales, details regarding book deals? Hard to come by. You basically can’t find out sales numbers unless someone discloses them. Neilson BookScan does publish some sales data, but for various reasons, those numbers are undercounts, not reflective of a book’s actual total sales, and oh yeah, a subscription to BookScan is like $5,000 a year. As to book deals, #publishingpaidme figures, while helpful, don’t portray the whole of a book’s economic life.
All this makes it hard for authors to understand their sales and earnings in context. And it makes it hard for aspiring writers to understand what they’re getting into.
As I’ve said before, achieving your great big author or artist dream is worthwhile, commensurate to what our friend Miley called “the climb,” and at the same time, it’s probably unwise to go thinking it’ll pay your rent. Or mine. Maybe. MAYBE. I could be wrong! Let’s go to the tape.
How my numbers compare to book-publishing industry averages
To save us all the googling, I had ChatGPT prepare some context, which I then fact-checked. Basically, the answer to any question about the rewards of traditional publishing is “it varies,” whether we’re talking about advances, the percentage of authors who eventually receive royalty checks, or average book sales. All that said, we can roughly benchmark like so:
What’s an average Big 5 book advance?
Book advances from major publishing houses, often referred to as the Big 5 (Penguin Random House, Hachette, HarperCollins, Macmillan Publishers, and Simon & Schuster), vary depending on the author's track record, the anticipated sales of the book, and the genre. There is no fixed average because advances can range from a few thousand dollars to multimillion-dollar deals for high-profile authors or books expected to perform exceptionally well.
For debut authors or lesser-known writers, advances might be more modest, in the range of $5,000 to $50,000. Established authors with a proven sales record and a substantial platform can negotiate much higher advances, sometimes reaching into the six or even seven figures.
What percentage of Big 5 authors “earn out” and receive royalties?
It's challenging to pinpoint an exact percentage across all Big 5 publishers as this information is typically proprietary. Generally, larger advances make it harder for authors to earn out, especially if the book doesn't meet sales expectations. On the other hand, authors who receive smaller advances may find it easier to earn out and start receiving royalties sooner. (For instance, me.)
As persistent publishing-industry gossip has it, only around 25% to 30% of Big 5 books ever earn out.
What are average sales for fiction and nonfiction titles published by the Big 5?
The average sales figures for Big 5 published books depends on genre, author popularity, marketing efforts, and market conditions. Here are some general insights:
Literary Fiction: Literary fiction titles from Big 5 publishers typically have lower average sales compared to commercial fiction genres like romance or thriller. On average, literary fiction titles might sell anywhere from a few thousand to tens of thousands of copies over their lifespan.
Commercial Fiction: Genres like romance, mystery, and thriller tend to have higher average sales. Successful titles in these genres might sell tens of thousands to hundreds of thousands of copies.
Memoirs and Biographies: Depending on the subject and author's platform, memoirs and biographies can sell anywhere from moderate to very high numbers. Bestsellers can reach hundreds of thousands or even millions of copies sold.
Self-Help and Personal Development: Popular self-help and personal development books from Big 5 publishers can also achieve significant sales, often reaching tens of thousands to hundreds of thousands of copies.
So there you have it. I hope this post has helped you understand more about the economics of traditional publishing. It’s only been sitting in my drafts for… two months? More? More. I really wanted to add some thoughts on book #2, but I think that’s another post.
Questions? Happy to answer in the comments. Concerns? I have some too. Hit me.
A good link
In case you missed it, here’s an earlier post I wrote about making less than minimum wage, writing the book.
I loved this beautiful Courtney Maum post about “leaving room for the unexpected when it comes to publishing success.” Relevant to my interests. Maybe yours, too.
Kimberley Harrington wrote a great thing about how “a memoir is not The Truth.”
As always, thank you for reading. I’m wishing you the best with monetizing your manuscript, or burgeoning TikTok career, or whatever it is,
Cat
P.S. Speaking of all this, book sales and reach and whatnot, ratings and reviews matter so so so so much. If you’ve read it, and have 10 seconds, I’d really appreciate a quick Amazon or GoodReads rating. TIA.
This was so helpful as I repeatedly see writers claim that publishers are no longer interested in memoir. I imagine there are instances of individual publishers being disinterested in this genre but I have been suspect when I hear this.
Thanks for sharing all your data. The one thing that authors looking at career paths don't have enough of is data.
After twelve years, I've come to the conclusion that one size doesn't fit all. I've interacted with a fair number of authors, some of whom were traditionally published and some of whom were indie. Some in each group were joyful. Some in each group were miserable. A lot were in between. And some were hybrids, with a foot in each camp. A lot of these transitioned from trad to indie or vice versa.
Way back in the early seventies, I submitted short stories to magazines. Rejections, but some encouraging notes. In the early eighties, I submitted my first novel to several publishers. Crickets. In 2012, after real self publishing existed, I tried with another novel. Not exactly a best seller, but at least, more than crickets happened. Twenty or so novels later (and a few other pieces), still closer to crickets than to bestseller, but at least, I've reached a fair number of readers who liked or loved my writing. Indies have higher royalties and more control over the process, but also higher expenses and less likelihood of hitting the very top (#1 bestseller, awards, movie deals). I do know some indies who make a living at it, though. I don't come close, but I'm happy, anyway.
Authors need a crystal ball, but we're never going to have one. Short of that, having clear goals and examining what data there is seems to be the best approach.