Why an author turned publisher, and how the economics of publishing plays out
On July 13, 2014 | 0 Comments

Nicola Solomon, who heads the Society of Authors, laments that well over 90% of the cover price for a physical or ebook doesn’t go to the writer (in an article by Alison Flood in the Guardian). The implication is that the publishers are at fault.

Having crossed sides recently, to add publishing to writing, I’d say she needs to shift her focus. To have any chance of widespread distribution for books in the UK you need to go through one of two wholesalers, Bertrams or Gardners. The big boys doubtless get deals, but the wholesalers’ standard discount is 60%, some portion of which is passed on to booksellers. You still need a distributor, so there goes an extra 10%. Out of a cover price of £12.99, that leaves around £3.90. Out of that, you need to pay for design, typesetting, printing, postage and packing, review copies, competition copies (and entry fees … £180 to enter the Guardian First Book Award, for example), and in my case I throw in my editorial and everything else services for free. You get to see where that 90%+ goes … and it’s not to the publisher.

The only way a publisher can possibly make this pay is by achieving economies of scale. Printing costs take a dive when you print 500 copies, so that’s the goal for a small publisher like ourselves to head for. It’s puny – but our whole financial planning is based on the fact that most Man Booker shortlisted titles have barely broken that 500 sales barrier when the shortlists are first announced. Committing to printed copies is also tougher since it’s hard to estimate the proportion of sales that will be derived from ebooks. Print in the 1000s and you get deeper discounts from printers and wholesalers. It becomes still more economically viable if you severely reduce the font size and so print fewer pages on poorer quality paper.

I was in Waterstones last week, browsing for a new novel to read. Many I simply put down because the font size was too small. At least as a reader I can make an ebook readable. Part of my policy as publisher at Barbican Press is to deliver what I wold like as a reader and a writer. So our print books look grand, they have a handsome font size and generous line spacing – they are physical objects a writer can be proud of. The authors get true buy-in with their cover design and how the book looks.

That’s important – authors put years of care and love and inspiration and craft into a book, so we give due honour to that. What do we pay? We’ve tried for more, though have settled on 10% of RRP (recommended retail price) on the print books. Sticking with RRP is something of a throwback position where most contracts are shifting a portion of net sales. My own contracts with the big houses had that 10% of RRP on hardback sales as the starting point, the percentage figure declining with volume and paperback, and that always seemed minimal to me so I don’t want to offer less. Other figures (print costs / typesetting / design / postage) are fixed so it seems fair that the author should have some point of fixed unit sale. And we don’t pay advance royalties. But you can see that leaves us with £2.61 per copy to play with, including printing costs etc. In physical book sales, the publisher is left with pennies at best.

Then why do it? In Barbican Press I’m providing what I felt the need of as a writer – a house that offers a home to real quality, daring writing that the big mainstream houses might not be able to risk. One writer pal lost her contract for her next book because her previous one had only sold 30,000+ copies: it sounds crazy because I would love such numbers but I can understand it. Margins are so horribly tight that with the likes of discount sales through Asda it becomes a penny business for all. I also provide what I want as a reader – the very best books I have read lately are the ones we are set to publish (great ones already out and ten in the pipeline for next year).

Sphinx Pyramid ThorntonThat’s the romantic side of it all. There has to be an economic side too. In 2014 we are investing in publicity for two titles: a major digital marketing campaign for James Thornton’s SPHINX: THE SECOND COMING and a publicity campaign for Kate Horsley’s THE MONSTER’S WIFE (possibly with digital follow-through). The hard-copy books are a lead: for reviews, for competitions, for those proud book-in-the-hand moments: a book as a luxury object. We distribute through Central Books and for the moment avoid the 60% Bertrams / Gardner discount – it would be good to be everywhere in Waterstones, but I know too many instances where small publishers have been killed when Waterstones has returned unsold stock. The wholesalers do provide our books, but not in great volume. We give bookstores a 35% discount so Monsters-Wife-jacket-194x300they have something to play with (and make more than the authors and us, for sure) and may well go the Bertrams / Gardner route in the future, but that would be because it offers returns in the current bookselling environment to the author rather than because it’s worth the risk to us. We are part of the Amazon Advantage programme. The main hope has to be in ebook follow-through.

For ebooks, our contracts give the author 25% of net income. RRP percentages don’t make sense because an ebook RRP doesn’t really exist: discounts are the norm and the hard copy book sets the discount point. As an author I’ve argued in public forums for a 50% net share of net ebook income and been shot down. Publishers told me that would be totally unsustainable. Now I am a publisher, I know they are right. The ebook is where all those editorial, design, typesetting and publicity costs – that sheer production factor of a book – can be recouped. There’s an argument for increasing that author percentage when production costs have been met.

The Waterstones branch I browsed in was in Trafalgar Square. That’s prime real estate and I was frankly surprised to see it was still in business. I wouldn’t bet any publishing business on the future of bookstores. I was in the store because I had gone into town without my Kindle and needed a book. I indeed bought one (Rawi Hage’s Carnival from Penguin, £8.99 in the store but it would have been £6.29 with my free Amazon Prime delivery or £4.32 on Kindle) because it seems immoral to browse books in a store and then save money online. In the end though I downloaded the Kindle ap onto my phone so I could continue reading the novel I had left at home: Robert Harris’s splendid An Officer and a Spy , RRP £7.99 but bought as a £1.99 ebook.

I used to love the books of Picador. Their books had the dare and flair I liked. John Calder, Peter Owen in this country, Black Sparrow Press and City Lights in the USA, those are models for Barbican Press. The Press reflects my editorial tastes … one of our authors recognized it as a blend of darkness and humour, which seemed astute. We are building a terrific list that features wonderful writers … and is for a large community of readers who should love us and spread the word once they find us. We are small enough not to need to compromise. Digital allows for international publishing. The plan is to transcend formats, flow with the best means of delivery, and focus on what publishing at its essence is all about – great books.

Martin Goodman    @MartinGoodman2

@BarbicanPress1

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