The Economics of Self Publishing: A Real World Perspective

Where does self-publishing fit into the shrinking and fragmented book market? This question is especially relevant now that self-publishing has become more accessible and competition for readers heats up. The answer is that self-publishers are best suited to create their own markets and readerships. There is no way to get into the large chains unless distribution is established and even then they take anywhere from a 45 – 55 percent cut. Then there is the issue of returns which has plagued major publishers for years and new small publishers just aren’t equipped to handle.

In one survey conducted by a major industry source, Publisher’s Weekly; of the over 11,000 retail outlets for books, almost 4,000 of these are Wal-Mart stores. The sad truth for self publishers about Wal-Mart’s great market share is that it is a lot of the same, focused on selling a narrow range of titles in a very high volume.  The chances of getting a book in their stores is limited to say the least. There is dwindling space on bookshelves as big chains focus on bestsellers and independents grow localized, niche and used book markets. The other problem with Internet sales, which Amazon.com has the strong hold on, is that consumers are drawn by finding used titles. This basically means a lot of authors won’t be retiring off their royalty payments.

The only way a self-publisher will thrive is to avoid this no-mans land of middlemen and sell direct. This entails a whole lot of marketing wizardry and focused promotions that utilize local markets, as well as the Internet. Consider the basic math of the situation for a new self-publisher who has decided to utilize distribution channels to access the major chains; for 100 printed copies of a 100 page (b/w) book, production cost is about $5.00 a piece, so unless a publisher sets the price at $15 or more, there is minimal profit in sight.  In the end a self-publisher is going to have to heavily promote and market a book on their own, but lose half their cost just to distribution. If you are going to build promotions for a self-published title anyway, it makes less and less financial sense to give away profits to middlemen.

Print on demand publishing is an accessible and tempting tactic in this new style of bookselling, but is still an expensive option. Although solutions such as CafePress and Lulu dangle large distribution channels to prospects, the unit cost per single book production is simply too high to make any tangible profit.  The self-publisher’s alternative is to print a realistic amount of copies and reach out directly to all viable markets. These arenas include the World Wide Web as much as, if not more than local or niche markets.

As the above table illustrates, new self-publishers need to establish realistic expectations on business aspect of their publishing endeavor. We recommend our customers consider the distribution method they intend to use when deciding which program to use to obtain an ISBN and barcode.  ISBN's obtained through the Independent Publisher Program have a non-descript registrant identifier listed as Independent Publisher, but all copyright and distribution rights are retained by each publisher.  This is a perfect solution for author/publishers opting for the self distribution method. Regardless of which program is selected, our agreement with Bowker enables us to upload our publishers' book data directly to  Bowker's Books In Print database.  Please feel free to contact one of our customer service representatives (a live human who answers the phone) to discuss your options