The Cost of Reading

Good news everyone! The paperback version of The Lost War is now available on Amazon UK. It will soon be on the other Amazon sites, and eventually available for bookstores to order.

A friend of mine recently asked me if reading a book through Kindle Unlimited was good for the author – i.e. did they still get paid a decent amount? Having just been through the process of publishing a much longer book (Carpet Diem was about 94k words, The Lost War is about 156k) I thought it might be interesting to let you know where your money goes when you choose a book.

The Lost War is available in two formats, e-book and paperback. (There will be an audiobook in the future, but I’m not sure when.)

Actual e-book captured in the wild

The e-book is available either to buy at £3.99 or through Kindle Unlimited, which currently costs £7.99/month and gives you access to any book enrolled in KU. In order to enrol in KU, a book has to be exclusive to Amazon.

If you buy the Kindle edition at £3.99, it breaks down like this:

VAT: £0.67 Delivery: £0.09 Amazon cut: £0.97 Royalty: £2.26

Unlike print books, the UK charges VAT on e-books. I don’t know what the justification is for that. Probably just “because they can” and nobody really realises the difference. ‘Delivery’ is what Amazon allocates as the cost of storing and downloading the file for you. It depends on the size of the file, so will be more the bigger the book is. The royalty is what comes to me.

If you read the book on Kindle Unlimited, then I get paid a rate per page read, based on the total fund Amazon has available from KU subscribers. That changes every month, but to use the most recently available figures (July 2019) that rate was about £0.0036 per page. Amazon calculates that there are 572 pages in the e-book of The Lost War, so that means the royalty, if you read it from cover to cover, works out at £2.06.

Now on to paperbacks. Obviously, there is more cost involved here. Paperbacks are physical things and lots of people are involved in the production and distribution of them.

On Amazon, The Lost War is for sale at £12.99. Here’s how that breaks down:

Print cost: £6.28 Amazon costs: £4.19 Amazon cut: £1.01 Royalty: £1.51

I don’t know what constitutes Amazon’s costs, but I’m assuming all the overheads, staff, storage and delivery are in there. I know that figure because I know I get 60% royalty on the profit, which means the ‘profit’ after print costs and overheads must be £2.52.

£12.99 feels expensive for a paperback, but I look at it this way: The Lost War is more than 50% longer than Carpet Diem, which sells for £9.99. So it’s less than a 1/3 increase in price for 1/2 again the amount of story. Print costs matter!

“Now with 50% more book!”

Now we come to bookstores. The Lost War will be available from bookstores, but not at £12.99. To sell it at that price would literally cost me money for every one sold. Why? Because there are more people involved who need to take a cut of the price. Bookstores ask for a wholesale discount of 55% off the cover price in order to stock a book. That’s a huge chunk of the price, and probably explains why small publishers and independent authors often don’t bother. But I wanted to try to make The Lost War available to as many people as possible, so I’m going to give it a try. The Lost War will be available from bookstores at the slightly eye-watering £15.99. Here’s how that breaks down:

Print: £6.38 Wholesale discount: £8.79 Royalty: £0.82

You might think that’s a lot, but wait – they also need to be able to return the books they don’t sell. And if they do, they generally destroy them, just sending the covers back as proof they haven’t been sold. If that happens, I still get charged the print price. So if a bookstore orders ten copies, sells nine and returns 1, the £7.38 profit from the nine sold is cut by the £6.38 cost of the one return, and I’m left with £1.

You might be wondering how on earth anyone ever makes any money from publishing books. Well, the big houses have an advantage – scale. They can print thousands or tens of thousands of books at a time, and that means they get a much lower cost per book, leaving them more margin to play with, and therefore keep the cover price down, helping to sell more.

This may come across like I’m knocking bookstores – and I’m absolutely not. I love bookstores. But they have overheads to pay, too, as do the printers, the paper manufacturers and the delivery companies who are all involved in the process of getting that story from inside my head to inside yours.

Really, I just want to explain where the costs come from, why books cost what they do and who gets your money. How you choose to read is a totally personal choice. I tend to prefer paperbacks myself. I like the feel of them in my hands, I like the smell of a new book and I like to have them on my bookshelf when I’m finished.

The irony, of course, is that the more you spend, the less I get! But that other money goes to support the jobs of people in all the other businesses that make up the publishing industry.

Anyway, I hope that was interesting, and I hope you enjoy The Lost War, whether in e-book or paperback.

Cheers!

J

3 thoughts on “The Cost of Reading

  1. It is interesting seeing the breakdown for the UK and comparing it to the US. Like you, I love the feel and smell of a physical book, but I’ve fully adopted the digital readers. I have an extensive TBR list and the reading device makes everything far more portable for when I travel. Also, I can get ARCs in digital formats days (or weeks) earlier than, print ARCs and read them on my Kindle. The percentages of royalties after all the costs and distribution charges are slightly better here in the states, as are the royalties for selling a digital version of the book. A nice thing my publisher does for its authors that I believe is unique to my publisher) is that they allow me to purchase a number of print copies (determined by contract) for resale delivered dead cost plus shipping, which is great for launch events. Once I exceed the contracted number of copies, they will still sell them to me at 55% off retail list price, the same that bookstores pay for the books.

  2. Thank you, it was very interesting to see that breakdown. I find it amazing that there are so many authors out there considering all the factors that make it so hard to make a living at it.
    Personally, I also like to have a physical book but I’ve been collecting them my whole life. I no longer have the space. Took a while to get used to reading on a device but now I love it. After all, the material is the same. I have so many more books now and so many new authors I never would have discovered otherwise.
    I loved Carpet Diem. I’m looking forward to reading The Lost War. And good luck, I hope you do well.

  3. Thanks, that’s very informative, and much as I like pottering in bookshops I rarely buy anything these days, I prefer having it with me on the phone for filling those time gaps, and I guess i’m happy you get a bigger share. When I do but a book I give it to a charity shop, who also get a cut, its a shame I cant do that with ebooks, I hope you also feel happy the charity gets a slice too

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