ADVANCES, ROYALTIES AND AGENTS, oh my!
- A Primer on Traditional Publishing
…is just that. It is an advance against the royalties the publisher expects you to earn.
If your book cover price is $10, and your royalties are 10%, then you can expect to make $1 per book sold at that cover price. (Often, your publisher may sell for less when in bulk. And when that happens, you make 10% of the amount the book sold for, so a lot less.)
So…if you receive an advance of $5000 (which would be considered a nice advance in Canada from a traditional publisher) then you would have to sell 5001 books before you would start seeing royalties. (At least. It may be more like 7500, if they’ve sold some of your books below cover.)
In Canada, royalties are supposed to be distributed quarterly, according to standards set by TWUC (The Writers’ Union of Canada). But this standard is not law; often, publishers ignore these guidelines and pay royalties semi-annually.
Example: Melodie sells 1200 copies of Rowena Through the Wall from Oct. 2015 to Dec. 2015. She has already ‘sold through’ her advance in previous quarters (see below for an explanation of sell through.) The royalties on these sales will appear on the March 15 royalty statement. So in fact, for a book sold Sept. 1, she won’t see her $1.50 until March 15, nearly 6 months later. And that’s with the best publisher.
This is the term to describe if you have ‘made up’ your advance. Let’s go back to that example of a $5000 advance. If your book has sold 5001 copies, you have ‘sold through’ your advance.
This is a key event in the life of your book, and a critical thing for your book to achieve. If your book doesn’t sell through, then you are unlikely to get a new book contract from that publisher.
You can see why a large advance comes with stress. The smaller your advance, the easier it is to sell through.
(Even if you don’t sell through, you keep the full amount of the advance.)
An agent handles the business side of your writing (contracts, etc.) Agents typically take 15% of your income.
So, if you received an advance of $1000, an agent would take $150 of your advance. Now you can see why it is so hard to get an agent. They don’t want $150 for all their work – they want $1500 or more! So until you are getting advances of $10,000, it is hard to get an agent.
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