Book Pricing Basics
Setting the Retail Price For Your Book
Book pricing involves many factors, but the atmosphere of the general marketplace is arguably one of the most important to consider. One of the biggest mistakes a self-published author can make during the book pricing process is setting the price too high (effectively pricing their book out of the market). The cost to print your book is not the only factor to consider when setting your retail price--you need to also consider the cost of comparable titles, the “look and feel” of your book, the subject matter, etc. This is not to say that you need to undervalue your book, but be realistic when pricing your book.
When a traditional publisher takes on a new title, they make all of the major decisions about the book, including book pricing. These publishers have sales, marketing, and distribution forces all weighing in on the book’s price. They know what the market can bear and what the customer is willing to tolerate in regards to book pricing.
As a self-published author, the retail price of your book is ultimately your decision. It’s completely understandable to be concerned about your margin and to want to see a profit, but readers don’t share this concern. They don’t care what you paid to print your book, and retailers don’t either. The consumer wants competitive book pricing that is in line with other books in the genre.
With over 3,000,000 books published each year in the U. S. alone, it´s dangerous to think that your book is good enough to stand alone in the marketplace and that book pricing isn´t an issue. You need to price your book in the range of what is acceptable within your genre (non-fiction, fiction, how-to, etc.) and category (history, business, mystery, etc.).
How can you find out what this price range is? Do your research. Take some time to really think about your book before you reach the pricing step. Consider your target audience, other books in your genre/categories, your overall book design, and your print specs (trim size, paper weight, page count, etc.). Then peruse Amazon.com, your local bookstore, or another well-stocked retailer and find titles that match yours as closely as possible, taking special note of how they’re priced. This research will also be invaluable to you when thinking about how to position your book in relation to competitive titles.
While there are no hard and fast rules to retail book pricing, here are some general guidelines when setting the price for your self-published book.
Pricing A Non-Fiction Book
Book pricing should be in line with similar books in the market. It´s reasonable to charge a slightly higher price for books that contain a fair amount of research, statistics, endnotes, charts, graphs, color interior, and/or other details that make it a fairly extensive and unique book. You should also consider the finished trim size (e.g., 6" x 9", 5-1/2" x 8-1/2", etc.) and page count of your book.
Pricing A Fiction Book
Here the page count comes more prominently into play. If your book is a 375-page novel, it´s reasonable to ask $16.95 for it. Most average-sized trade paperback novels fall into the $13.95 to $17.95 price range.
While we do suggest a retail book price for our customers, and use our experience to determine a price that we feel is appropriate, the final decision is yours. Make sure that you have done all that you can to understand the market, and price your book accordingly. An overly-inflated price will cause you to lose your competitive edge before your book ever even reaches a retailer!
Pricing An eBook
There are a few rules that come into play when you decide to set the price for your eBook:
- An eBook must be priced at a minimum of $0.99 in order to be sold through third party retailers. This is because each retail website charges a small service fee for the download of the eBook file.
- Research has shown that customers are more willing to purchase an eBook if it's priced significantly lower than a paperback or hardcover book. Data has also shown that eBooks priced between $0.99-$3.99 on average have a higher unit of sales for their authors.
- Certain retailers will pay higher royalties if your eBook is priced between $2.99 and $9.99. For example, Amazon.com will pay out 70% of the retail download price as long as your eBook is between $2.99 and $9.99. If it priced above or below these margins, Amazon.com will only pay out 35% of the retail download price.
- Take your audience into consideration. Will they be more willing to read your eBook if it's sold at a low price? Probably!
- Do some research. Look at other eBooks that are in the same genre as yours. What price are they being sold for? Be competitive!
When should I start thinking about book pricing?
While it’s great to start thinking about your retail book pricing right away (that way you can start to check out competitive titles early), the retail book price isn’t finalized until your book has been fully designed. This means that your book cover is complete, and that your text has been typeset. The retail book price is suggested at this point because your book dimensions must be final in order for us to determine print costs (which we consider when suggesting retail book pricing).
How do I determine what percentage of my retail book price I will make from the sale of each book?
When we suggest a retail price, we break down how trade sales will work so that you can see your net earnings. As a general rule, you can anticipate a wholesale discount of 55 percent, which is applied to your retail price. A 55 percent (55%) wholesale discount is industry standard, and allows wholesalers to sell your book to retailers at a 40 percent (40%) discount (also industry standard). Depending on your distribution options, you may also need to deduct the percentage that the distributor takes of the wholesale.
Breakdown for Expanded Distribution Program:
Let’s say that your book has a retail price of $14.95, costs $2.00 per copy to print, your wholesale discount is 55 percent (55%), and that the distributor takes 18 percent (18%) of the wholesale. Sales through the distributor would be calculated as follows.
$14.95 (retail price) - 55% (wholesale discount) = $6.73 (wholesale price) - $1.21 (18% distributor’s fee) - $2.00 (print cost) = $3.52
In this case, you will have already paid for the printing up front (as books in distribution are not printed on-demand). This means that the print cost will not be deducted when sales are reported on your monthly distribution statements, but that you’ll need to deduct it in order to calculate your true net earnings.
Breakdown for Distribution to Online Retailers (POD Distribution):
In this case, let’s say that your book has a retail price of $14.95, a wholesale discount of 55 percent (55%), and a print cost of $4.08 per book. Sales through online retailers would be calculated as follows.
$14.95 (retail price) - 55% (wholesale discount) = $6.73 (wholesale price) - $4.08 (print cost) = $2.65
Books in this program are printed on demand, which means that the print cost will be deducted on the actual monthly royalty reports.
Book pricing and royalties can be confusing, but good planning now will save you a headache down the road. We hope this helps clear up some of the confusion about book pricing.