I made my independent publishing debut back in 2011, and if this journey has taught me anything it is that realistic expectations are critical to a productive, rewarding experience. Back then, “indie publishing” was still relatively new and largely untested. Indie wunderkinds, like Amanda Hocking, were making headlines for earning millions overnight. Many authors flooded in, hoping to cash in on the Kindle gold rush. Some did very well and others ended up disappointed.
Since then, we’ve all learned a lot about the independent publishing space, and it’s become a legitimate way for writers to make a name for themselves and reach readers. We’ve seen the arrival of career indies who are in it for the long haul as well as traditionally published authors who have crossed into hybrid territory to reap the benefits of both models.
But for writers who may be considering their options, it’s still not clear what one can realistically expect to achieve with independent publishing. Fellow Writer Unboxed contributor Donald Maass, president of the Donald Maass Literary Agency in New York, sent me a list of questions he frequently hears from authors who are considering going indie. Today, I’m going to address three questions that pertain to royalties, rights, and riches to help the undecided gain a realistic view of this path. As a point of comparison, be sure to check out Kathryn Magendie‘s recent post “Royalties: What This Writer Made, Once Upon One Time” for a candid view of her experience with traditional publishing.
Before we dive in, I should mention that I’m not a lawyer, accountant, financial advisor, or literary agent, so read the fine print in your contracts and user agreements, and seek professional counsel when needed.
- When an author publishes through a self-publishing platform, what share of revenues is paid?
Royalty structures vary by platform. The author’s cut is typically determined by the book’s list price, its physical attributes (which impact production costs), and distribution model. Let’s take a high-level look at how several key publishing platforms currently structure their royalty models:
- Kindle Direct Publishing (KDP) enables indie authors to publish and sell ebooks and paperbacks directly to millions of Amazon customers. Authors generally earn royalties equal to 35% or 70% of the ebook’s list price minus the distribution cost (which is determined by the ebook’s file size). Whether you earn the 35% or 70% royalty rate is dictated by KDP’s List Price Requirements. In a nutshell, if your ebook is listed at $2.99 USD or more, it qualifies for the 70% royalty rate; a list price less than $2.99 USD qualifies for 35%. Learn more about KDP’s ebook royalty structure.
- KDP also provides authors with the option to distribute their Kindle ebooks exclusively through Amazon by enrolling in a program known as KDP Select. When you enroll your ebook in KDP Select, it is offered for free to readers who subscribe to Kindle Unlimited (KU), a premium, all-you-can-read subscription service, as well as the Kindle Owners’ Lending Library (KOLL), which is available to Amazon Prime members. Participation in KDP Select will increase your royalty rate to 70% and make your title eligible to receive a portion of the KDP Select Global Fund each month. Since the KDP Select subscription model offers your ebook free of charge to subscribers, royalty payments are based on the number of pages each customer reads in your ebook for the first time, no matter how long it takes. In exchange, authors agree to a 90-day exclusivity period, during which they cannot sell the ebook through any other platforms. After 90 days, you can re-enroll or “go wide” by selling your ebook in other marketplaces. Learn more about publishing ebooks through KDP Select.
- If you’re publishing a paperback, KDP offers a fixed 60% royalty rate, less printing costs (determined by page count and ink type). If you enable Expanded Distribution, which makes your paperback available to booksellers and libraries through distributors, the royalty rate is 40% of the book’s list price effective in the distribution channel at the time of purchase, less printing costs. Learn more about KDP’s royalty structure for paperbacks.
- Barnes & Noble Press allows indie authors to sell hardcovers, paperbacks, and ebooks directly to millions of Barnes & Noble customers on bn.com. Authors earn 55% of list price for print books published directly through B&N Press or 40% of list price for titles published with a competitor and distributed to bn.com. Ebook royalties vary by price range and whether it was published directly or through a competitor. Here’s a breakdown:
- List price: $0.99-$2.98 USD, Royalty = 40% (direct), 35% (competitor)
- List price: $2.99-$9.99 USD, Royalty = 65% (direct), 70% (competitor)
- List price: $10-$199.99 USD, Royalty = 65% (direct), 35% (competitor)
- Learn more and try B&N’s royalty calculator.
- Apple Books for Authors is used by indie authors to publish and sell ebooks through Apple Books. Authors earn 70% of the list price, regardless of price point, with no delivery fees or exclusivity requirements. Learn more about Apple Books royalty structure.
- Kobo Writing Life (KWL) makes it possible for indie authors to sell ebooks and audiobooks directly to over 10 million people globally who read with a Kobo e-reading device or app. For ebooks, authors earn 70% of list when priced at $2.99 USD or more. For audiobooks, authors receive 32% of the list price for subscription purchases or 45% of list for a-la-carte purchases, provided it’s priced at $2.99 USD or more. KWL does not require authors to sign exclusivity deals. Learn more about Kobo Writing Life’s royalty structures.
- Google Play Books enables indie authors to make their ebooks available to more than 2 billion Android users globally. Authors earn 70% of the list price on ebooks sold to customers in more than 60 supported countries. The default revenue split is 52% for partners who have not accepted Google Play Books’ updated Terms of Service (TOS) and for ebook sales in certain countries. Learn more about Google Play Books’ royalty structure.
- Audiobook Creation Exchange (ACX) is a marketplace that connects authors, literary agents, publishers, and other rights holders with the talent to produce an audiobook, including narrators, engineers, recording studios, and other producers. It empowers rights holders, such as indie authors, to choose how to produce an audiobook (do it yourself or work with a producer) and where to distribute it. Whether you produce your audiobook through ACX or show up with prerecorded files, your royalty options are 40% for exclusive distribution (limited to Audible, Amazon, and iTunes for an initial term of seven years) or 25% for nonexclusive distribution, which enables you to go wide. Learn more about ACX’s production earnings and costs.
- A Royalty Share deal is an option for rights holders who want to work with a producer through ACX but don’t want to pay the production fee upfront. Instead, the rights holder and producer split the 40% royalty from each sale, providing each with 20%. To enter a Royalty Share deal, the rights holder must select exclusive distribution. If the rights holder opts to pay the production fee upfront, he or she can collect full royalties and choose exclusive or wide distribution.
If you don’t want to sell directly into the channels above, you can use a distribution platform with broader reach. Each has its own way of handling royalties:
- Smashwords offers global ebook distribution to major retailers and public libraries. Authors earn 60% of the book’s list price from major ebook retailers and up to 80% when the book is purchased through the Smashwords Store.
- Draft2Digital (D2D) is a global ebook distributor that takes 10% of the book’s retail price for each sale. It offers a free manuscript conversion tool, enabling authors to transform their manuscript from a Word document to high-quality ePub and .mobi files that will work on any e-reading app or device as well as print-ready PDFs to use with print on demand (POD) services. For added convenience, D2D recently unveiled payment splitting, making it easier for authors to collaborate on projects without having to worry about managing royalties. Learn more about publishing with Draft2Digital.
- IngramSpark brings global ebook and print book distribution under one roof, connecting your book to over 40,000 libraries, major retailers, and independent bookstores in person and online. Unlike many other platforms, Ingram Spark charges a setup fee ($25/ebook title, $49/print book title, or $49 for both when they are uploaded at the same time). In terms of royalties, authors are paid 85% of the net revenue received by IngramSpark for every ebook sale, regardless of the reseller. Compensation for hardcover and paperback copies is calculated according to trim size, interior color and paper quality, binding, cover, page count, list price, and more. Use Ingram Spark’s calculator to estimate how much you’ll earn on your print book.
- What happens to subsidiary rights such as audio, translation, and movie/TV? Do the click agreements give control of those rights to the platform?
Subsidiary rights refer to all other forms of your book besides printed and digital. They enable your book to be recorded as an audiobook, translated into foreign languages, adapted for film or television, and more. “Subrights” represent additional revenue streams for indie authors, so it’s important to know who controls them.
When using self-publishing platforms, like those mentioned above, authors generally retain all rights, including subsidiary rights. One exception is platforms that allow authors to enroll in an exclusive distribution model in exchange for a higher royalty rate. For example, enrolling in ACX’s exclusive distribution model limits you to selling your audiobook through Audible, Amazon, or iTunes for an initial term of seven years.
It’s important to read all user agreements carefully so you fully understand the terms to which you’re agreeing. These are legally binding contracts that can impact how you publish your work, where you can sell it, and thus, how much money you can earn. If legalese reads like a foreign language, it may be worth paying an attorney to help you understand what is at stake.
- Indie boosters tell of great riches reaped by writers who snub “New York,” but is that common? What is a realistic expectation for self-publishing revenues?
My dad always warned me to be wary of people who peddle tales of great riches. If it were easy to amass a fortune with independent publishing, or anything else for that matter, everyone would do it.
As with most things in life, your publishing experience will be influenced by your expectations. Success in indie publishing requires the discipline to regularly produce new work, a strong focus on marketing and publicity to build your author brand and ensure your titles get discovered, and a working knowledge of the publishing business. And even then, there are no guarantees.
Independent publishing requires authors to wear many hats as they write, produce, and promote their work, and that can be exhausting. But it can reward you with an unparalleled sense of pride, accomplishment, and yes, money. How much money? It’s hard to say, namely because no two publishing journeys are the same. Though I can’t offer you a hard and fast figure, I can share a couple of formulas you can use to forecast your financial future in independent publishing:
- Calculate your break-even point. Your break-even point represents the number of books you need to sell to recoup your capital investment. Let’s say you spend $3,500 on production costs, such as editors, book formatting, cover design, etc. For the sake of simple math, let’s also assume you earn $3.50 in royalties for each book sold. Your break-even point equals your total costs divided by the royalty earned per book ($3,500/$3.50 = 1,000 books). This quick calculation indicates you’d need to sell 1,000 books to break even on your investment.
- Back into your income goal. Consider how much you want to earn from your publishing pursuits and use that figure to calculate how many books you must sell to achieve that goal. Let’s assume you want to earn $100,000/year before taxes and expenses. To continue with the example above, let’s assume you earn $3.50 in royalties for every book sold. The number of books you’d need to sell to achieve your goal equals your income goal divided by the royalty earned per book ($100,000/$3.50 = 28,571 books). This calculation reveals that you’d need to sell 28,571 books each year to earn $100,000/year before taxes and expenses.
Once you know the break-even point for your book and the sales volume needed to achieve your income goal, you can use those numbers to build a plan to achieve it. These figures may suggest that your income goal of $100,000/year will be challenging to attain with one standalone ebook. It may inspire a plan to create multiple works in a variety of formats and languages to reach more readers. Or perhaps it will reveal the need to hire a public relations firm to gain broader visibility, form strategic partnerships to exploit untapped subsidiary rights, or focus on making bulk sales to other large book buyers, like schools, corporations, gift shops, and other non-bookstore organizations.
Final Thoughts
Independent publishing can be a rewarding and lucrative experience for authors who invest in themselves and take a hands-on approach in bringing their work to life. If this is a path you’re considering, take time to learn about the publishing business and talk with indie authors about their experiences. Approaching indie publishing with a clear understanding of what it will take to achieve your vision will help ensure reality doesn’t disappoint you.
Many thanks to Donald Maass for sharing these questions from authors who are considering independent publishing. Do you have a question about this publishing path or life as an indie author? Leave a comment below or email me (erika [at] erikaliodice.com], and I may answer it in a future post.
Are you an indie author? How has your publishing experience measured up to your expectations? What helpful advice can you offer to writers who might be considering this path?
About Erika Liodice
Erika Liodice is an indie author and founder of Dreamspire Press, where she is dedicated to teaching curious minds about unknown worlds through story. She is the author of Empty Arms: A Novel and the children’s chapter book series High Flyers. She is also a contributor to Author In Progress, the Writer Unboxed team’s first anthology. To learn more about Erika and her work, visit erikaliodice.com.
Thank you for this post! I’m going to bookmark it, as I’ve been interested in self-publishing a book, having gone the ‘traditional publishing’ route already.
Having gone through my experiences, I have a pretty healthy expectation range, and thoughts of “go back to the beginning Kathryn, the before, when you didn’t expect to make any money at all but you wrote your heart out.” And even so, we all want to be recognized! If not monetarily, then in some other way.
A good informative post.
Glad you found it helpful, Kathryn. Likewise, your post gave me new insights into the traditional publishing experience. So thank YOU for that :)
Thank you BOTH for sharing your experiences and wisdom!
Erica, great article answering some of these questions in-depth. Thank you–will share the link on the children’s self-publish board on SCBWI.
I was very glad to have broken even with my first independently published book, BOUND, within 3 months. The rest is gravy. This summer I published 3 little books–totally self-indulgent projects–with my daughter making line art for 2 beginning readers and one photo-book for babies. So much fun. Haven’t broken even on those yet because I’m terrible at marketing. But the trade books fund my SP books so I’m grateful to have a foot in both worlds.
Glad you found today’s post useful, Vijaya. Congratulations on recouping your investment in your first indie book—that’s fantastic! As for the others, stay tuned for marketing advice in an upcoming post :)
Excellent breakdown, well done Erika. I especially like the goal-oriented approach in calculating whether the indie path is right.
And, wow, an annual raw income of $100K sounds sweet. What authors might also want to consider is whether it is possible to sell 28,571 copies…and sell them at a price that yields a royalty of $3.50 per unit.
That is an answer one can’t get from math. Better would be asking indie authors what that takes. Indie boosters make it sound like a piece of cake, but the reality isn’t as easily baked.
Romance authors will tell you that a long backlist, rapid output (up to 12 titles a year, I’ve heard tell) and marketing-marketing-marketing are required. Successful indie authors inform me that they spend 50% of their time writing and 50% marketing.
Another thing you don’t hear as often is that a rapid pace of output is sometimes accomplished by fiction factories, which formulize the beats of successful print series, generate outlines and hire a roster of writers to execute them. There are indie spec fiction series out there which operate that way.
Can a lone author who simply wants to write a good book and get it out there find an audience of 28,571 in the Kindle bookstore, where it is said that 4000 new titles appear each day?
A small number have made it that way, and I have noticed a few things they have in common. The chief factor is obvious, but I hesitate to discuss it. I may already be in for a blast of online hate just for this comment.
Still, I think it’s important that anyone considering the indie path also consider a reality check. Same goes for the print path, too, of course, a topic for another day.
Thanks, Don. I appreciate you taking the time to share your insights and observations with all of us. I always learn so much from you.
When you initially sent me these questions I was thrilled to hear that authors are doing their homework and considering these factors before blindly jumping on the indie bandwagon.
When I chose to go indie, it wasn’t because I had any delusions about making millions overnight but because I am as excited about the business side of writing as I am about the writing side of writing. Creating plans to achieve my goals, building off my successes, and learning from my failures has been great fun over the years. Not everyone feels that same enthusiasm about the non-writing activities required to make a real go of indie publishing, and that’s OK. Choosing a publishing path should begin with self-awareness and, as you pointed out, a firm grasp on reality.
Erika, your taste for the biz and marketing side of things makes you a good candidate for the indie path. It’s worked for you.
Enjoying DIY, as you say, is another important–and non-mathematical–point to evaluate in choosing whether or not to follow that path.
I should mention, too, the “hybrid” author idea: some work indie published, and some traditionally print published. I don’t know of a great many success stories there, but they exist.
Erika, thanks for this helpful post. It is packed with useful information about publishing platforms, royalty rates, and great advice. I self-published my first novel and I am pursuing traditional publishing for my second novel. If there is no interest, I may consider independent publishing. It is challenging to generate significant sales and that is the main reason why I switched to traditional publishing. Thanks again and happy holidays to you and your family.
Great to hear from you, Chris! It is challenging to generate significant sales…with either path. Keep producing great work and experimenting with publishing options and promotional activities until you find your winning formula.
Good luck with book 2, and happy holidays to you as well!
Erika,
I’m so glad you have been doing this work and have presented it so clearly. I have been looking hard at it myself.
The casual word on the street is that Amazon is THE gorilla in the industry. So if one does not put one’s work up there, the results will be smaller. But your article seems to be even-handed about Amazon with Barnes and Noble offering another huge vehicle to be read.
Which platforms have you worked with and particularly, if with Amazon, can you offer some downsides and suggestions about other routes?
For authors with no following, is Amazon’s platform the best option? Thanks.
Good questions, Tom! My publishing philosophy is to “go wide” and distribute directly through all the platforms I mentioned in my post. My goal is to reach as many readers as possible, regardless of format or device, so I tend to steer clear of exclusivity models.
Amazon can’t be overlooked, regardless of the size of your following. For many authors (myself included) it represents the biggest slice of the pie in terms of sales. But why limit your reach and exclude readers who prefer to read ebooks on Nook, Apple, or Kobo devices or want to order a printed copy through their local indie bookstore? If you don’t want to sell directly through multiple channels, a distribution platform, like Smashwords or D2D, can aggregate the work for you.
If you have any other questions, let me know.
I have print through IngramSpark and ebooks through Smashwords. Ebook sales have been mostly direct from Smashwords, with Kobo, Barnes & Noble, and Apple all making an appearance too.
The majority of my paperback sales have been through Amazon. Actually, that’s not quite true. The majority of my paperback sales have been direct, to family, friends, friends of friends, and even a woman who came to my house to do a survey!
I’m not close to breaking even on my first book – the cost of professional editing was not inconsiderable – but my second book is a handful of sales away from breaking even. Looking forward to it!
Unfortunately, a lot of the marketing advice out there assumes that a) money will magically appear if you have something of value to spend it on, and b) you have the time and energy to engage with Twitter, Facebook, etc, etc – and don’t object to what you discover in the depths of their small print.
If I spent 50% of my writing time on marketing, I might sell more books, but I’d only publish one every five years or so, and that’s no way to build a career either.
Thanks for giving us a glimpse inside your publishing journey, Deborah. It sounds like you’re refining your writing and publishing process with each book and that’s worth celebrating. Striking the balance between writing and marketing is a challenge for many indies, myself included. In recent years, my perspective has changed and I’ve come to view my finite time and marketing dollars as a good thing, forcing me to figure out how to do more with less rather than my old formula of stretching myself too thin.
I’m an indie author/publisher. I’d always wanted to be a fiction writer, so when I was in a position to reduce my salaried working hours, I began my first novel. I loved reading mysteries, especially traditional mystery series, so that’s what I chose to write. Here’s my experience so far. I didn’t know what to expect when I started, but I’m not unhappy with the way things have gone.
Like many writers, I started out looking to get traditionally published. My first novel attracted some nibbles from New York, but I lost patience with the process. In 2011, I got a Kindle and realized I publish my own e-books. Due to my affinity for computers and my background in marketing, I found it easy to be my own publisher and publicist. (I was only working part-time then, and have since retired.)
My first two novels didn’t sell well early on, but mystery readers like series books so after the third novel I started getting messages from readers in the U.S. and Canada asking when the next book would be available. I’m now working on the 6th novel in the series.
It seems that my results are comparatively good for an independently published series. Three of my five novels were selected as finalists for independent book awards, and I get automatic royalty deposits every month that help supplement my retirement pensions. I sell directly through Amazon and Kobo, and to Barnes & Noble and Apple through Smashwords. I also have one German language edition that I published through Draft 2 Digital.
My print sales are via Amazon and Ingram’s Lightning Source (Ingram has since started Spark for self-published authors) but are a very small percentage of total sales. Most print sales are probably to libraries. Given I’m a Canadian, the Canada Council for the Arts sends me a decent check reflecting library borrowings each year.
I won’t go into much detail about my writing income, but I’m sure anyone considering self publishing would like some idea of what I consider relative success. From 2011 to today I’ve managed to gross somewhat more than $13K per book in mostly e-book royalties. Gross royalties for my single best year were less than $20K. The costs getting paid out of those royalties are primarily for advertising and promotion.
If I weren’t making money writing, I might have stopped by now. However, if it was just about the money, either I would be more disciplined and producing a new book every year, or I’d be doing something else.
I hope this information is of use to some of you considering self-publishing, and I wish you all the best, whatever you choose to do.
You bring up two very important points, Ruth. The first is the importance of publishing multiple books. Building a following takes time and usually requires more than one book. It’s a journey the author and reader go on together over many years and stories. Many indie authors get frustrated and give up after publishing just one book, which is a shame because the first book is only the beginning of the journey, not the final destination.
The second point is that for many of us this pursuit isn’t just about the money. I could make a lot more money doing something else, but writing gives me a sense of purpose and satisfaction I haven’t found elsewhere and that’s invaluable.
Write on!
Erika, thank you for this thorough breakdown of the options for authors choosing to go the independent route! I am a hybrid author, as Don Maass mentioned, self-publishing some books and going the traditional route for others.
I initially self-published to learn more about publishing and promotion. Whichever route I go, I tend to invest the same amount in marketing.
One thing I’d add is that, for me at least since I write in multiple genres, certain books are more appropriate for the indie route and others for the traditional one.
I’m a hybrid author who is now gearing indie only, because I make more that way and get regular paychecks. A lot of indie income hinges on your genre, number of books you get out, advertising, quality of cover art/edits, etc. As you said, indies wear many hats, but I’m at the point where I realize I can be far more responsive to what my readers want as an indie, and thus sell more books that way. Thanks for the post—shared on Twitter.
I feel incredibly lucky that I’m retired and on an adequate pension so I don’t need to make a profit – as long as I don’t spend out on editors, proofreaders and cover designers. This means that I’ve read my stories many times in many formats before they get submitted to competitions or published. It also means that my covers are of the minimalist variety, being unable to benefit from photoshopping skills.
I don’t have life-time left to waste on querying agents or publishers. My friends, children, stepchildren, grandchildren and other relatives have enjoyed my scribbles, and even one or two fellow-bloggers.
Writing is my hobby, honing it is educational and keeps my brain working. And I have no deadlines to stress me out.
Hi Erika,
Thank you. I have received a lot of confirmation for what I am about to do.
Shalom aleichem,
Pat