Are those impressive royalty percentages on a publisher’s website based on gross sales (the list price), or are they based on net profits the publisher earns? Are you already confused? If you are a new author, you might be. Don’t worry. We will make this common ploy, which bad publishers use to trick authors, easy to spot.

Let’s be honest. Most people don’t read the fine print. They read a headline on a publisher’s website, and truly believe that the “royalty percentages” the bad publisher is posting online are based on the list price of the book.

NOPE!!!

Authors who are new, and don’t know any better, make assumptions. They only look at that glowing, large percentage rate, which the bad publishers usually put right on their homepages.

What are those assumptions? Most authors think that they are getting that percentage of the list price. For print books, that’s exactly how it works with BookLocker. But we don’t splash our royalty percentages on our homepage, because that’s just tacky.

However, most so-called “publishers” nowadays do indeed do that. They try to trick authors into thinking they’re getting much more than they will in the end. Of course, they know that most authors aren’t going to read the fine print. They count on that!! And then they have those authors in their greedy clutches!

We’ve discussed the 100% royalty scam previously, and we will again below. But first, we’re going to talk about NET ROYALTIES. But before that, let’s look at what royalties are, and how much authors typically earn from traditional publishers.

Royalties are what authors earn for book sales in exchange for giving the publisher the rights to sell their book.

I want to interject here that BookLocker does not take ANY rights from authors. Authors retain all rights to their manuscripts, and even the production files for their book. That includes the interior and cover print-ready PDF files that BookLocker creates. Most companies, even ones that charge authors, do not give the authors the rights to their production files. Again, BookLocker does. Some bad actors in the industry even charge authors hundreds to thousands of dollars more for their production files. Our philosophy at BookLocker has always been, if you wrote it, you should own it!

You might be surprised to learn that most legitimate publishing services companies/self-publishing companies pay FAR higher royalties than traditional publishers do. I’m talking about legitimate publishing services companies. Unfortunately, the bad actors/scammers now far outnumbered the legitimate ones. By thousands!

Back in the day, a co-author and I landed a traditional contract with St. Martin’s Press. We were offered a measly 8% royalties based on the list price for the paperback. Unfortunately, new authors are no longer offered advances by traditional publishers.

Worse than that, if you’re an unknown author, traditional publishers won’t even promote your book now. They expect you to do 100% of the promotion. And they expect you to pay for it! That means no book signing tours for you! No newspaper ads. No magazine ads. No press releases. No nothing! Only if your book takes off (due to YOUR efforts!), might they start throwing money at marketing for you. But that almost never happens anymore. Unless your name is Stephen King or J.K. Rowling.

For e-books, traditional publishers typically only pay around 20% of THEIR net proceeds. That doesn’t make any sense because they upload an e-book to, for example, Amazon, and they don’t have to do anything else. Everything’s automated. Why is the author only getting 20%? That’s a pathetic percentage! Booklocker pays 55% to 65%!

The net proceeds part does make sense for e-books. For example, Amazon will pay a publisher half as much for an e-book if it’s purchased by someone located outside of the United States. Even if that customer uses the amazon.com U.S. website, the publisher still only earns half of what they would if the book was purchased through Amazon.com by someone located outside the United States. Again, most traditional publishers also pay around 20% net on those.

Booklocker pays 55% to 65% net based on the price of the e-book. That average is three times what traditional publishers pay authors for e-book sales.

What all this means is that publishers never know how much they’re going to earn from an e-book sale until they get paid by Amazon (and other ebook retailers). That’s why they have to pay e-book royalties based on NET proceeds. But, again, a measly 20% is highway robbery in our opinion.

Keep reading. I’ll try to make the rest easier to understand. 🙂

I was contacted by an author today who didn’t read the fine print in other publishers’ contracts, and who claimed our royalties were far lower than everybody else’s. They’re actually far HIGHER. Again, he was not reading the fine print. The other companies he was looking at had big, fat royalty percentages on their websites, but the author had to read the teensy tiny fine print to see how much he would really receive. After I explained to the author how it works, he signed up with BookLocker.

WHAT ARE NET ROYALTIES FOR PRINT BOOKS? This is what shady publishers do to trick authors into thinking they’ll be getting much more than they will! If you read a contract, like almost nobody does, and you see the word “net” when discussing print book royalties, unless you ask, you won’t know that you’re about to be tricked, or downright scammed.

The publishers that author I just mentioned was looking at were quoting the percentage the author gets after everybody else gets their cut (retailer, printer, distributor, and the publisher). That’s how it always works. BookLocker is just completely transparent about how we present the royalty information. Most other publishers are not.

BookLocker’s royalties for print book sales through BookLocker.com are 35% OF THE LIST PRICE. That means authors always know how much money they’re going to earn each time a print book sells. For retail sales, we have to give a 40% discount to the distributor, which they share with the retailers. What that means is the distributor and retailer pay a discounted price for the book, they sell the book at the standard list price, and they keep the extra as their profit.

For retail sales, BookLocker pays 15% of the LIST PRICE on print books. If you do the math, you’ll see that we split the discount with the author. We earn 20% less and so does the author. Even the 15% based on gross is far higher than the vast majority of companies pay. Remember, St. Martin’s press was only paying 8% for a paperback based on the list price. And that is standard for new, traditionally published authors.

So, let’s once again talk about 100% royalties. When most new authors see that, they assume they’re getting 100% of the list price. They don’t think about the printer, the distributor, and the retailer. To veteran authors, that might sound silly, but that’s really what new authors think – that they’re getting 100% a list price.

Companies claiming to pay “100% royalties” often offer the  author a discount if they sign up RIGHT AWAY! They are counting on authors to not have time to read the fine print!

In my opinion, companies offering 100% royalties are definitely trying to scam authors! They’re assuming that a large percentage of authors coming to them will not understand what that means, and will make the assumption I mentioned above.

Never, ever use a company that uses deceptive language to trick authors into thinking they’re getting something they are not. If they’re doing that with royalty percentages in the fine print, can you imagine in what other ways they are tricking and scamming authors?

And, for those not reading the fine print, some shyster’s add things like this to their contract:
– They might pay their stated royalty percentage for the first few copies sold, but after 100 copies, they might lower that royalty percentage.
– They might state that, after the first 100 copies, the author earns 100% royalties after that. But they won’t pay the author anything for the first 100 copies. And, there’s that 100% royalties scam language again!

Again, if authors don’t read the fine print, they might be in for a world of hurt later.

BookLocker doesn’t play any of those games with authors. We have several lawyers who have published books through us over the past 27 years, and NONE of them have EVER requested any change to our contract.

Use BookLocker. You won’t be sorry. 🙂

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Angela is not only the publisher of WritersWeekly.com. She is President & CEO of BookLocker.com,
a self-publishing services company that has been in business since 1998. Ask her anything.

ASK ANGELA!