Monday, April 18, 2016

Are You Being Taken Advantage of as a Writer?

By Janice Hardy, @Janice_Hardy

My original plan was to start the writers’ struggles topics today, but over the last week, I’ve spoken to two separate writers who had some misconceptions or lack of information about writing and publishing which could have gotten them into trouble. It seemed like a good time to revisit the basics of how publishing works to protect yourself from being scammed. (Wednesday, we'll start with balancing writing and work)

The Cardinal Rule of Writing

The most important thing to remember, is that money flows TO the writer.

Unless you’re self publishing, writers NEVER pay to be published. A legitimate agent will never ask you for money to represent your writing. A legitimate publisher will never ask you to pay for your publishing costs to print and sell your book.

If someone asks you for money in order to publish your book, that’s a HUGE RED FLAG that something is wrong. Proceed with caution and investigate to make sure you’re not being scammed or taken advantage of.

If you’re unsure, or just want to make sure, visit the long-running writer watchdog site Preditors & Editors, which has spent the last twenty years gathering information on publishing to protect writers. If they say watch out, walk away. Another great site is Writers Beware.

Now let’s look a little closer at how the various writing professionals associated with publishing work, starting with a few common terms used.

Please note that this covers just the general basics. Publishing is complicated, and there will be situations that fall outside these generalities, but it will give you a foundation on which to work from.

Advance: An advance is the money paid to the writer “in advance” of expected sales of their book. You get to keep that money unless you default on your contract, even if the book doesn’t sell many copies.

Earn Out: This is when the book has earned enough money to “pay back” the advance through royalties. The book has earned out and all future royalties go to the author.

Rights: Rights are the permissions the writer gives to publish their work in a particular form (such as print) in a particular territory (such as North America or English Language). For example, First North American Rights give a publisher permission to publish the manuscript for the first time in North America. World English Rights mean they can publish the manuscript anywhere English is the primary language spoken. World Rights means everywhere. Foreign language rights are permissions to allow the book to be translated and printed in that language. Electronic rights and for ebooks, audio rights are for audio books, and there are TV and movie rights, and merchandising rights (to name a few). The publisher basically “rents” the rights for a period of time (based on the contract) and at the end of that term, the rights revert back to the writer and they can do what they want with them.

(Here’s more on publishing rights)

Royalties: The type of payment structure that pays a percentage of each book sale to the author. General range is 6-9% for paperbacks 10-12% for hardcovers, 25% for ebooks. It’s common to see the royalty rate scale as more books are sold. For example, 9% for 5,000 books, then 11% for the next 10,000, and 12% for anything over 25,000.

How Writers Get Paid

Publishing works off of a royalty payment system, which means publishers pay the author an advance (in most cases), and then a percentage of each book sale after that. If the writer has a literary agent, the writer pays a small percentage of what they make to that agent.

Using numbers for easy math, say the writer sold their book for a $10,000 advance, with 10% royalty, and the book will be sold for $10. That means the writer get $1 for every book sold. They need to sell 10,000 copies to earn out the advance. At book sale number 10,001, they start getting $1 for every book sold. If they sell 50 more, they make $50. If they sell 100,000 more, they make $100,000.

Royalties are paid every six months (roughly) in traditional publishing, and some smaller publishers have shorter payment schedules.

How Literary Agents Work

Literary agents work off commission, they don't charge writers a fee to represent them. They get 15% of whatever the writer makes, and they don't see a dime until the writer does.

Fo example, if they take on a client, and it takes them a year to sell that client’s book, they make no money in that year from that client. If they sell the book for a $10,000 advance, they make $1,500, the writer make $8,500.

There might be the occasional business or tax expense the writer is responsible for, but these are minor and not fees. With everything going electronic these days, even these incidentals might be gone.

Agents handle the contract negotiations, submit the manuscript to editors at the big publishing houses (which the normal writer can't do without some connection), guide careers, deal with problems with the publishing houses or editor, handle selling foreign rights and TV or movie rights, etc. Many also help their clients edit and develop their books before submission.

How hands-on an agent is varies wildly, from no editorial help and little hand holding, to intensive editorial help and a lot of hand holding and communication.

Having an agent is up to the writer, and you’ll find a wide range of opinions on the topic. Some writers are very pro-agent, others very anti-agent. Each writer has to do their research and decide if an agent is right for them, and if so, which agent is the right fit.

In most cases, the writer has one agent who represents all their work. Some agents represent a writer for a period of time and they renew their agreement when that ends. The writer can terminate the relationship if it isn’t working out and find a new agent if they’d like. It’s a business relationship. Agents represent the writer, not a single book. Good agents are concerned with helping writers grow their careers.

(Here’s more on finding and submitting to agents)

To get an agent, the writer writes a query letter and submits that letter (and sometimes the first three chapters) to agents. Multiple submissions are expected with queries.

(Here’s more on writing query letters)

How Publishers Work

Publishers are business that create and sell books. The person who runs these companies is also called “the publisher,” but when people speak of publishers they usually mean the business, not the person. It is a publishing house.

Publishers pay writers for the rights to publish their books, and they get an advance (this vary, but can be anywhere from a pittance to major six- and seven-figure deals) and then royalties after the book has earned out that advance.

Publishers range from the Big Five (Penguin Random House, Macmillan, HarperCollins, Hachette, and Simon & Schuster) to medium sized, to small, to micro. Some pay bigger advances, some offer higher royalties but no advance, some are more partners in structure. There have been a lot of changes over the last few years in the industry as self publishing and online book sales have changed things.

Generally speaking, the larger the publisher the more money and distribution (such as bookstores) they offer, the smaller the publisher the more personal attention provided. It varies of course, but smaller publishers have been using the "we treat you like a partner not a product" approach to compete with the larger publishers.

Some small or mirco- publishers are wonderful, but there's a lot of variance in how they work and what they can do for a writer, so be wary here. Some have no ability to distribute and market a novel, and are basically doing what any writer could do through Amazon on their own and nothing more. Proceed with caution and understand what these publishers can and can’t do for a writer or their books.

(Here’s more on finding your path to publication)

How Editors Work

Editors come in two flavors: those who work at publishing houses and buy manuscripts, and those who work freelance and help writers with their manuscripts.

Publishing house editors are the ones a writer will work with after their book is sold. They’re responsible for helping the writer get their manuscript ready for publication. They are paid by the publishing house.

Freelance editors are hired by the writer to help them develop or edit their manuscript. Prices vary according to services, but a general range is from $25-100 per hour. Proofreading services can be lower, and can be on a per page or per word basis.

Payment varies, but typically the writer pays a deposit, and then payment in full is due when the work is completed.

If the writer is pursuing a traditional publishing path (submitting to agents or publishers), they DO NOT have to hire an editor to “get the book ready” to submit. The book should be professional quality before submitting, but spending money on editors is not necessary nor required.

However…if the writer wishes to hire a freelance editor to help them improve as a writer, or because they’re having trouble with a story, or feel it will give them the best chance of success, AND they can afford it, by all means hire an editor. They can be very beneficial.

(Here’s more on hiring a freelance editor)

Is the writer is pursuing a self publishing path, professional editing is a must, as there will be no publishing house editor to look over the work. Costs involved here will vary wildly depending on what resources the writer has (such as friends who can edit), and what they can afford to pay.

(Here’s more on saving editing costs)

How Self Publishing Works

Self publishing (or indie publishing) is a viable option for today’s writer. We call places like Amazon and iTunes “publishers,” but they’re really distributors, because the writer still owns the rights to the books, where a traditional publisher buys the rights. Amazon has made it easy to publish (it can be done in mere minutes), and costs nothing (the costs come in the work it takes to get the book ready to publish). Barnes&Noble has a self publishing arm as well, and writers can also publish and distribute through iTunes, Smashwords, Kobo, and others. Some charge fees, and some offer editing and design packages.

These distributor/publishers take a 30% commission for every book sold (on average). They pay monthly royalties. There are no advances.

The costs come from the editing, proofreading, and cover design of the book. This can run into the thousands, but there are ways to get those costs down considerably. My Thursday Indie Authors column have a lot of information there on going the self publishing route.

There are a LOT of options for self publishing, so it’s critical to do the research before pursuing this path. Prices and services vary wildly.

(Here’s more on the indie authors series)

Do the Research No Matter Which Publishing Path You Take

Take advantage of the information out there for writers on reliable and legitimate writing sites. Do the research on each agent you want to approach, investigate the publishing houses you submit to, understand how any self publisher works before signing anything. You are your own best protector against getting scammed if you put in the work to understand what you’re getting into before it’s too late.

Clearly, there’s more to know about the publishing industry than what these 2000 or so words can tell you, but if you’re a new writer exploring the business, these basics will give you enough information to hopefully avoid anyone trying to take advantage of you.

If you have questions or concerns, please ask someone or visit reputable blogs or writing sites for further information (mine included).

Do you have any questions about how publishing works I didn’t cover here?

Looking for tips on planning and writing your novel? Check out my book Planning Your Novel: Ideas and Structure, a series of self-guided workshops that help you turn your idea into a novel. 

Janice Hardy is the founder of Fiction University, and the author of the teen fantasy trilogy The Healing Wars, where she tapped into her own dark side to create a world where healing was dangerous, and those    with the best intentions often made the worst choices. Her novels include The Shifter(Picked as one of the 10 Books All Young Georgians Should Read, 2014) Blue Fire, and Darkfall from Balzer+Bray/Harper Collins. The first book in her Foundations of Fiction series, Planning Your Novel: Ideas and Structure is out now.

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  1. Very helpful article, but I think there is an error in the paragraph about rights:
    "The writer basically “rents” the rights for a period of time (based on the contract) and at the end of that term, the rights revert back to the writer and they can do what they want with them."
    Shouldn't the first instance of "writer" be "publisher"?

    1. Oops, it should indeed. Thanks for catching that! I'll fix it ow.

  2. Thanks for the great information. It was a clear summary of options available to authors. As someone new to the field, I found it very practical.

  3. awesome, janice! thank you for starting at square one. i appreciate your time and experience and insight. thank you again.

  4. Thank you, Janice. That was one of the most comprehensive articles I have ever read on how the publishing business works.

  5. Hi Janice. Thank you for taking me through the basics of publishing. This was very helpful and timely, especially to writers who are new in the industry. - Tanisha

    ChatEbooks recently posted

  6. This article was extremely helpful, I had a pretty good idea of how publishing worked, but this clarified a few doubts I had.