Royalty Rates

There is an article in the Nov/Dec issue of the IBPA Independent magazine written by Stephanie Beard, ‘The Royalty Rates Publishers Are Actually Offering’.  Ms Beard is the executive editor at Turner Publishing, and industry-leading independent publisher based in Nashville, Tennessee.  Turner has a backlist of over 5000 books and publishes 36 new books per year across all genres.

She says, “Over 100 publishers offered data for this article and responded to questions about royalty rates and release formats.  For these purposes, I am defining traditional publishing as a publishing house that releases books in print and, usually, e-book form that are then distributed through retailers, libraries, online sellers, etc.  These books are acquired by the publishing house’s editors and the rights are granted to the publisher through the signing of a publishing agreement wherein the publisher bears all or most of the editorial, marketing and distribution costs, and the author is, in exchange, pair royalties on sales derived from their books.

“With respect to responses about royalty rates, authors should expect to see rates based either on a percentage of the retail price set by the publisher or a percentage of net receipts or sales.  For royalty rates based on retail price, most publishers responded that their rates for paperback and hardcover formats were as low as 5%, averaged 7.5%, and were as high at 10% on hardcover.  In our poll, most publishers who responded pay their royalties based on net receipts or sales, which is the amount actually received by the publisher for sales of the books after discounts.  These amounts were surprisingly quite varied.  For paperback books sold. most publishers responded that their rates were between 10-15% (with the average being just shy of 12%) of net, with nearly every publisher noting that their hardcover rates are the same as their paperback rates.  The most surprising revelation came from e-books, which average 25%, but were sometimes as low as 10% and as high as 50% – proving that we are quite far from consensus across the industry when it comes to digital books.

“Publishers were also asked to share their subsidiary rights rates, which traditionally include audio, book club, foreign language, and other rights depending on the publisher’s  own abilities and rights programs.  The majority of publishers responded that their subsidiary rights are 50% of net, while there were some who offered as low at 10% and very few who offered rates as high s 70-80% (typically for audio rights).”

For me, a quick summary of all this is that authors working with a traditional publisher can expect royalties of about $1 per copy sold.

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