Book Royalties 101: Are you keeping 100% of yours, or is your publisher getting all the money?

March 19, 2021

Book Royalties 101: Are you keeping 100% of yours, or is your publisher getting all the money?

You’ve probably heard the term “book royalty” get tossed around a lot in publishing. But what does it really mean?To put it simply: a book royalty is the amount that a publisher pays an Author for the rights to publish their book. While simple in concept, this can bring up a host of other questions for first-time Authors:

  • Do Authors start earning royalties right away?
  • How much can you earn as an Author?
  • What’s the typical profit margin on a nonfiction book?

 

What Is a Book Royalty? Traditional Publishing vs Self-Publishing

Traditionally, a book royalty is the amount that a publisher pays an Author in exchange for the rights to publish their book.

Royalties are calculated as a percentage of book sales. For example, an author might earn 7.5% royalties on every paperback sold and 25% on every eBook sold.

Royalties are typically found in traditional publishing, where Authors sell the rights to their book to a publisher. In self-publishing, “royalties” don’t technically exist the same way, because the Author sets the prices and decides on their own profit margin.

How Traditional Publishers Might Be Limiting Your Potential

Even though they’re a common way for Authors to make money, royalties don’t always work in an Author’s best interest. That’s because a royalty-based financial model forces publishers to focus entirely on book sales. 

Authors have plenty of ways to make money, aside from selling their book. They can give talks, find new clients, consult, launch a product, become a coach, or build a personal brand. Of course, it’s great to have a book that sells a million copies, but that’s an extremely rare event.

For  traditional publishers, royalties are the only way to earn money. It doesn’t matter if an Author gives 50 talks per year to packed rooms of thousands; If those talks don’t translate to direct book sales, they have no value for a traditional publisher.

It’s unfortunate, but the royalties model forces publishers into a short-sighted focus when it comes to Authors and the power of books. They only buy books that they think will sell in large numbers, and they have to market them to the largest audience possible.

In the long run, that narrow focus can be an obstacle for Authors who want to use their book to expand their personal brand or achieve other goals.

Amazon’s Self-Publishing “Royalties”

When you self-publish, you keep the rights to your works. That means, technically, Amazon’s payments aren’t  “royalties,” even though that’s what Kindle Direct Publishing (KDP) calls them.

In self-publishing, the author is given a royalty rate based upon the self-publishing platform that the author uses to publish the book. Book royalty rates on self-publishing platforms are typically standard and consistent for all authors, and will typically only vary depending on the type of book (ex: eBook, print, hardcover). When you self-publish through Amazon’s Kindle Direct Publishing, royalties are paid out monthly, approximately 60 days after the end of the month in which the royalties are earned. See the Amazon Royalties page for more information. 

You have two royalties options for KDP eBooks: 35% or 70%. The choice for higher royalties might seem obvious, but there are some stipulations involved, like pricing and geographical availability. You also have the offer to enroll your book in the KDP Select program, which offers a different royalty structure altogether. 

No matter which royalties plan you choose, here’s an important point: Authors on KDP keep complete control over their book’s price and promotions. You have the right to use the book however you want to.

At the end of the day, your book should be working for you, not the other way around. Pick a publisher that lets you keep 100% of your royalties!

Elite Online Publishing takes absolutely nothing from your book sales! All you have to worry about is the print cost and the small amount that Amazon charges to produce and sell your books. On Amazon, authors receive 60% of their royalties.

Find out more about self-publishing with Elite Online Publishing, and learn about our Bestseller GUARANTEE here.

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