Open Source Thinking: Author Pay Rates

The Good Fight

Super Hero Monster Hunter: The Good Fight from Emby Press is now available in print as well as for Kindle. Check it out for several amazing stories by yours truly and many other great authors! It’s the start of something big.

So in light of the post yesterday, I’ve been thinking some about how much we would be paying our authors for their work. But I’ve been thinking more and more about the slog to earn our stripes as a professional publishing company.

As I’ve noted before, being a professional author is harder than ever. And the joy and joke is that publishers need to pay off their starting cost debts and return to black on top of the need for authors to get paid. Granted, the debt isn’t much to surmount and people often supplement themselves with another career.

But let’s do some quick math here. E-books typically sell for either 35% or 70% royalties. Some may rush to point out the changes to Amazon’s royalties, but I would counter that it only applies to Kindle Unlimited and Lending Library. For the sake of argument, let’s say that the listed price is $5. Thus, at best we’re earning $3.50 and at worst, $1.75, and none of this includes printed royalties.

On the costs side, let’s focus strictly on what we’re paying the authors. In the past, the anthologies we’ve released have used pure profit sharing. This “nonprofit” (no entity keeps the money, just the creators) approach gave authors incentive to keep pushing the book after the release, and we had no real start up costs to worry about— we used the “free” ISBN from Amazon, and everything worked via a private contract rather than officially starting a company. There was no reason to preserve income because the project was never in the red.

This time around, we would have a minor debt to pay off and need additional capital to grow.

If you’re not willing to pay your authors what they’re worth, someone else will.

The usual approach for small press publishers is to compensate authors with token payments, exposure and a free copy of the book. Overall, not a bad package in lieu of professional pay for a fledgling writer. Let’s say that a publisher pays its authors $15 per a short story. A twelve story anthology costs $180 for the authors alone. And this doesn’t include cover art or editing (for which the business owners will probably be responsible.) If the sales are fifty-fifty on the 70% versus 35% royalty rates, that’s around $2.62 per sold copy.

That means to cover the authors alone, the book has to sell 69 copies. If you optimistically sell just 70% royalty stories, you can actually earn that cost back in 48 sold copies. If just the 35% rate, 103 copies.

So that is the most basic model. Lower the price of the book and you’ll have to increase sales. It also doesn’t cover the cost of the cover art, which one can technically do if they use a public domain image (possibly acceptable) or no cover (not recommended.)

Now here’s the secret about artists. The average price of cover art is roughly $500. This is a stiff price to beat in the sales, but there’s actually some economic flexibility if people don’t mind paying for the difference in time.

DenariusExplained, a professional artist might have a back list of interested clients willing to pay $500 or more around the clock during the best of times. But on occasion, there maybe a lull in the number of demanding jobs, during which time it makes sense for an artist to take a lesser paying job as long as there is a very distant deadline and a patient customer.

So if you go to an artist and ask them, “I have a limited budget for this, but I’m also in no rush. Can we work out a lesser rate with expected delivery in 9 months? I understand if higher priority jobs come along in the mean time.”

And chances are, you can probably work something out depending on the artist’s schedule and professional philosophy. It helps if the artist is interested in the work you’re doing, because their muse needs inspiration too. But if you go rushing to them, exclaiming that you need this image and you need it now, now, now… well, have five Franklins ready at the very least. Because exposure doesn’t fill the pantry.

Which brings us back to the original point. Yeah, cover art will add more to the cost although as I said, there maybe room for some flexibility on that. Yet here’s what I suspect a lot of small press companies face: costs (should) inevitably grow.

Why are they growing? Well, the biggest reason would be author pay rates. If you find a good author who is willing to work for $15 a pop, they’ll probably be ecstatic to be published for the very first time. After a few more stories, they’ll start to wonder if maybe they could earn a bit more, so they start searching. Are their short stories worth $25? Yes, so what about $50? Sometimes? Can they get 1 cent a word? 2 cents? Always hunting for that professional rate of 5 cents a word.

At a 5,000 words pay cap at 5 cents a word, that same twelve story anthology suddenly costs $3,000. Chances are, that cover artist cut you a deal before because you were a small company. But if the authors are earning that kind of money, then the artist will probably want the average professional rate of $500. That means a game of professional ball costs you a minimum of $3,500. And there are bound to be additional costs I haven’t factored into the equation.

If you’re not willing to pay your authors what they’re worth, someone else will. If your readership base isn’t large enough to support higher rates, then your writers will start seeking a company who pays better and has a larger audience. If you’re not paying attention to the market, it’ll kick your ass.

A blog post I once read mentioned that large publishing companies seldom cultivate writers anymore. It took me less than a minute to realize why; major publishers really don’t need to, not when you have hundreds of small companies willing to gold pan for them. Even if the little guys don’t realize it until they back a winner who brings in the readers… and then gets poached.

It’s a ceiling that stops many small press companies. And something every publisher has to bust through to join the major leagues.

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