Erik Sherman's WriterBiz

A spot about the business of writing as seen by a freelance writer. That includes marketing, sales, contracts, copyright, planning, research - in short, the business end of writing.

Name: Erik Sherman
Location: Massachusetts, United States

I'm an independent writer and photographer who covers business, food, technology, books, media, general features, and pretty much anything appealing that results in a signed check. My work has appeared in such places as the New York Times Magazine, Newsweek, Newsweek Japan, Fortune, Inc, Fortune Small Business, the Financial Times, Advertising Age, Saveur, US News & World Report, and Continental

Wednesday, February 27, 2008

New Amazon.com Service No Bargain

Someone on a private email list mentioned seeing CreateSpace, an Amazon manufacture-on-demand and fulfillment service that can print books, CDs, or DVDs as people order them without your doing any fulfillment. I just looked at the pricing model they have and can say pretty confidently that using this service would be a good way for a self-publishing writer to quickly go broke.

The only giveaway is the pricing page. They get a percentage of the sale plus a fixed per copy price. This cost rapidly adds up. As an example, say that you have a 264-page B&W book. According to the chart on the page, the fixed charge per copy would be $6.78. In addition, they want 20% of the list price if you sell through them or direct, and 40% of the list price if you sell through Amazon.

Let's say that you set the price at $20 a copy. If you sell through the CreateSpace page, you pay 20% plus the per copy price, for a total of $10.78, or over 50%. That's hardly a way to do well in self-publishing, because you'll have the editing and design costs, marketing, etc.

If you sold through Amazon, they'd want, 40% off the list price. Now, it's not clear whether that's the only percentage they want, or you'd also have to have one of the Amazon Advantage accounts as well. Say you don't. That means the cost is 40% of list, which is $8. But you still have to take out the $6.78 per copy cost, with a total of $14.68. You'd effectively pay close to 73% royalties to Amazon, and that not quite 27% isn't going to cover all your costs of creating the book in the first place, so you could conceivably lose money on each sale. Better to find another way to get yourself into print.

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2 Comments:

Blogger Computer Clarity © 2004 said...

You're right, Erik. They set up CreateSpace to compete with Lulu but it looks like a bad deal.

Borders now partners with Lulu. I have a new blog post on it here: http://releaseyourwriting.blogspot.com/2008/02/borders-offers-self-publishing-packages.html

It include the ability to publish in-store too.

Helen Gallagher

February 27, 2008 3:39 PM  
Blogger adam said...

Createspace added a Pro account recently. With the same example of a 264-page B&W book, it looks like the fixed charge is now $4.28 plus the same 40% variable charge of $8, for a total charge per book sale on Amazon.com of $12.28 or 61% of list price. There's a one-time charge of $50 per book for Pro, but this if you sell more than 100 copies, the fixed charge quickly drops in cost per sale. Looks a bit more competitive for experienced writers that have a better knowledge that they will sell a good amount of books.

Also, You can make wholesale orders for only the fixed and per-page charge, for sales in other channels (like for distributing to other stores). The charge per book on wholesale would be $4.28. Keep shoppin' round.

March 26, 2008 2:23 AM  

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