An occasional and mostly self-serving record of self-publishing my debut novel, A Hole in the Ground, with possible tips (or warnings) for others thinking of doing the same.
My dad spent the bulk of his career as a bookkeeper for a local car dealership. He also kept the books for some small businesses after hours. I remember sitting at our kitchen table and watching Dad’s fingers fly across the adding machine, accompanied by the music of the printout: Takatakataka. Gzzzzzz. Takatakakataka-TAK! Gzzz-zzz-gzzz. It was amazing.
What does this have to do with self-publishing? Well, I never mastered an adding machine and certainly don’t have a way with numbers, but I do like a clean balance sheet.
Publishing your own book means taking care of business – all business, from printing and postage to sales and distribution. Keeping track of those expenses and revenues not only helps determine profit (or loss) but also provides a surprising boost of encouragement.
A Hole in the Ground is my third book but the first to be self-published. The other two were produced by very small publishers, meaning print runs of roughly 600 copies and distributed regionally – very much the model I’ve followed myself, except I’ve gone even smaller, 300 copies.
For my last book, not counting my own direct sales, I received from the publisher $1.35 per retail copy sold. For my self-published novel, I’ve calculated after expenses that I have cleared roughly $9.62 per copy. A big difference. In terms of pure profit, self-publishing has been more financially rewarding than the other two published books. (Although, don’t get excited; see image below.)
The downside is that there is a good portion of books out there right now I can’t factor into my accounting. That’s because they’re in the limbo known as “consignment,” neither sold nor unsold, the Schrodinger’s cat of sales. I’ve been lucky in that some retailers have purchased my stock outright at 60 to 70% of the cover price. With consignment, it’s the opposite; they stock my books but I have to wait until they actually sell before I get my 60 to 80%. That wait can be up to six months. Plus, I’m trusting the retailer to honour the deal and follow up with payment, if any. If they don’t, then I have a problem. But such is the compromise for the self-publisher; retailers are wary, and you just want it in their store (or gift shop), so you take what you get.
Direct-selling through Amazon, incidentally, also involves major delays in payment, particularly for new sellers. In this scenario, Amazon expects the seller to ship to the buyer right away. That means the seller has to cover the shipping up front and wait to be reimbursed. In my case, it’s taken over a month to receive my first payment from Amazon.
So there’s a lot of cash and stock going out, and revenue trickling in by multiple means – direct sales, online sales, retail sales and consignment.
A simple bookkeeping system helps keep track of it all. I’m using one of the many pre-set Excel spreadsheets, this one called “Simple Monthly Budget,” and it is. It allows me to break down my revenues and expenses by category, and it calculates the bottom line automatically, complete with a bar graph for us creative visual thinkers! Accounting is not a strong point for a lot of artists, so good on Microsoft for keeping it simple.
I’ve even added notations to keep track of who I’ve billed, who’s on consignment, at what percentage, and whether they’ve paid.
I’ll legally have to declare this income on my personal taxes for 2016. Tracking my expenses will (hopefully) allow me to offset some of the damage. I’ll get back to you in April…
But there’s more here than just record keeping. When you’re self-publishing, you look for small victories, whether it’s selling two books at a seniors’ luncheon where you expected to sell zero, or entering a cheque from that retailer who’s been holding out on you. Making accounting entries reminds self-published authors that this is serious business, that what they are doing is real, that their foolish venture is not so foolish.
It’s likewise encouraging to see that bottom line because the revenue tends to arrive in dribs and drabs. And likely goes out just as quickly. I haven’t seen a sudden windfall. So the balance reminds me that, despite seeming lack of evidence, I’m actually making a modest profit.
Less happily, it can tell an author that it’s time to cut her losses. But again, unless you’ve severely under-priced your book or created a supply far exceeding demand, chances are you will make some money on your self-publishing venture. (Read more about how I reduced the risks through Kickstarter.)
Accounting creates structure amid the chaos of creativity. I don’t have the satisfaction of takatakataka-gzzzzz, but watching the numbers change on my spreadsheet is its own kind of poetry.