The Bottom Line

There are many things which need to be calculated when list pricing a book to determine ROI (return on investment…a quaint accounting term that means the ratio of money gained or lost on an investment (substitute your book) relative to the amount of money invested (substitute costs of preparing the book for sale).

When getting ready to publish a book, you have to factor in all those costs that occur before print time. This includes what you may have paid for professional editing, interior design/layout, cover design, ISBN number, plus the routine office drill of equipment, computer programs, paper, phone calls, faxes, etc. Okay, it is perfectly feasible to have shelled out $2,000 before the book ever heads off to the printer.

Using an average POD print cost (90 cents flat fee plus .013 cents per page print fee), we’ll price a book of 200 pages. The cost to print each book would be $3.50 per book (.90 + 2.60).

Okay, now how many books do we think can reasonably be sold? Want to go with 1,000? Then we need to add $2.00 ($2000 expenses divided by the number of books hopefully sold) to each book price to recoup our prepaid expenses. So now the true base price is $5.50 per book.

How much do you want as a royalty from the sale of each book? $5.00? But wait you’re want to sell through Amazon so you have to give them 55% of the list price. So you would have to set the price of your book at $23.35. ($23.35-12.82 (55%)-$5.50=$5.01). And if you go through Booksurge, your selling price would be $20.25 ($20.25-$9.72 (48%)-$5.50=$5.03).

What is the average price for a book in the same genre as yours? Be sure to compare apples to apples… Stephen King’s new 592 page hardback may list for $28.00 but if you are not quite as well-known and are offering a 200 page trade edition, you probably need to find something else a little more comparable. And what if you don’t sell 1,000 copies? What you only sell 500 or 250 or 100? Do the math substituting the new numbers…Yikes!

Demanding steep discounts on books that will seldom sell in high numbers is a proven path for making sure they don’t sell at all. That’s why Amazon is frontloading their costs. They’ll make money by charging $29.95 to join the Amazon Advantage program. They will charge set-up fees at Booksurge. And if it should accidently happen that a POD books actually is sold, they’ll take the lion’s share of that as well. (Gosh, you weren’t really in it for the money, were you?)

The book world is a tough place to make it. Cut corners in production and you have a sad, shoddy product even your mother may not want. Put in the necessary money to make it shine and you raise the number of copies you have to sell to break even.

And to be competitive in the market place means you may not be able to afford Amazon.