When I first conceived of this project, I found myself idly coming up with great new wrinkles on my plan every day. By the time the project was live and the book was for sale, my idle moments had become brutal self-criticism sessions in which I lambasted myself for making stupid mistakes. But thanks in part to some forethought, and in part to luck, none of my mistakes were terminal, and now I find myself returning to the pleasant creative daydreams about how to improve the business.
This month, I'll take you through my course corrections and what I learned from them, and my one blunder of the month—which I consider an acceptable blunder-level. After all, if you're not making one big dumb mistake per month, you're probably not being adventurous enough, right?
The area of my greatest concern to date has been lackluster sales of my print-on-demand paperbacks. These sales are far, far below the level I'd planned on, and while they've picked up a little since the last time I wrote, they're still poor (a mere 182 copies sold since December). But I have identified three major causes for this poor performance.
First, they cost too much. Second, they weren't being automatically recommended to the great bulk of my readers who use Amazon. Third, I hadn't solicited or received any reviews for the book, erroneously believing that I could use Twitter, my blog, this column, and my e-mail lists to generate enough word-of-mouth to attract customers. That strategy worked fine for the high-priced, limited edition hardcovers, sales of which have generated enough profit to pay for postage on 150 review copies, which has not been insignificant. A disadvantage of living in the U.K. when most of my readers are in the U.S. is postage, about £8.20 ($13.11) for every review copy sent overseas.
But the effort has begun to pay off. There are a half-dozen high-profile reviews pending as I write this, including a major financial daily that I can't name at press time (I'll let you know how that worked out next time). I also have a small stack of review copies remaining should any other reviewers want one. Just email me at email@example.com.
Pricing, however, has been a tougher nut to crack, but I think I've finally nailed it. After much discussion, Lulu has agreed to put me into its high-volume category, which drops my net to $8 for a paperback with a list price of $10, which is much more affordable, even with Lulu's shipping costs, which are proving to be a major competitive disadvantage relative to Amazon, where readers are accustomed to free shipping with minimum orders or through the annual flat-rate Amazon Prime product.
I very much wanted to offer the book on Amazon. I know firsthand how well Amazon's recommendation engine works, and without Amazon availability, every sale of one of my other books was a lost opportunity for With a Little Help. But now that the book is listed with Amazon, it comes up as a possible additional purchase.
Getting the book on Amazon was much harder than I anticipated. At first, I considered selling the book using Lulu's wholesale channel, which can feed into Amazon. But once both Lulu and Amazon had taken their cut of the book, my net price would have been in nosebleed territory, somewhere in the $20 range. Add to that a $2 royalty for me and the book would be remembered as one of the most expensive short story collections in publishing history.
In order to list on Amazon at a decent price point, I needed fewer wholesale discounts. For me, that meant cutting out Lulu and listing directly on Amazon through CreateSpace, Amazon's own POD program. But CreateSpace, frankly, is a pain in the ass. First, it refuses to print any book that already has an ISBN somewhere else, a very anticompetitive practice. To overcome this, I had to create an "Amazon edition" of the book with a slightly different cover and some additional text explaining the weird world of POD publishing.
But the fun was just beginning. CreateSpace also has a cumbersome "quality assurance" process that effectively throws away all the advantages of POD. For example, every time I change so much as one character in the setup file, CreateSpace pulls the book out of Amazon. A human being must recheck the book, and then I am notified that I have to order (and pay for) a new proof to be printed and shipped from the U.S. to London. I then have to approve the proof before CreateSpace will notify Amazon that the book is ready to be made available again. It can then take three to five days before the book is actually back for sale on Amazon. Practically speaking, this means that fixing a typo or adding an appendix with new financial information costs about $20 upfront, and takes the book off Amazon's catalogue for two weeks.
The net result is that the "Amazon edition" of With a Little Help ($12, but with Amazon's superior shipping offers) is slowly but surely diverging from my Lulu editions, which have appendices giving up-to-date financials and up-to-the-minute corrections listing, and thanking, the readers who identified the typos.
A persistent shibboleth of publishers in the e-book pricing wars is that print costs and logistics are not a substantial part of the clearing cost of a finished book. I had taken this on faith. But now, I think someone's fiddling their figures. In my case, nearly all of the production for my book was free, and I've still ended up with a product with a net cost that is higher than the net cost of a trade book. What's more, I'm producing the book on the same sort of equipment that many publishers use (think of how many Lightning Source titles are in the average publisher's backlist) and either direct-retailing them, or wholesaling them to Amazon. The incremental, physical cost of selling each book, not including sunk costs, like publicity, payment processing, etc., has proven to be 75%, or more, of the cover price.
Large publishers surely do better than this. For one thing, much of their list is being produced in mid-size runs at a substantial print discount. But clearly, the only way that physical costs can be negligible for publishers is by discounting all the amortized apparatus, logistics, and staff necessary to produce the printed objects.
But let's get back to the retail stuff. Beyond Amazon, I really wanted to get some other retail exposure, and not just because I'm a sentimental former independent bookseller but because a book on a shelf in a store is an advertisement for itself. I want to be on those shelves. And now, I will be…in Australia.
Turns out the the University of Melbourne bookstore has a comparable POD press, and they've offered to wholesale my books in the Australia/New Zealand territory. Notably, a disproportionate number of the hardcovers I've sold have gone to readers in Australia, and I've always drawn big crowds when I do lectures and readings there, so I'm thankful to have a local option to get the book into those readers' hands. I hope that other POD equipped bookstores will see this, and get in touch. Let's talk.
Now, on to the finances. Hardcover sales stand at 60 (gross sales: $16,238), but I've had my first spoilage. A copy from the first batch never arrived to a purchaser in America and had to be replaced from stock. I blame the stupid "snowpocalypse." Lulu sales now total $578.91. Including the $10,000 story commission for "Epoch" and the money I get from writing my Publishers Weekly columns about the project, my total income is $35,625.31.
Also, the first thing I did after I turned in my last column was add a donation box to the e-book and audiobook download page, and I changed the price descriptions from "free" to "pay what you like." Previous to this, I'd relied upon donors visiting the site and making a donation from a dedicated page. I also added, as a guideline, the lowest, highest and average donations at the time ($2, $50, and $10, respectively). Literally, within minutes, donations began to come in. I've now booked about $700 in donations in the past month, the equivalent of 350 paperback sales. The donations came from 29 donors, and the average has crept up to $15. The new high score is $200 (whoa!). And, total donation to date: $1,208.40.
My major expense in the past month has been £1,700 ($2,718) for postage and mailers for review copies. Along with postage on special editions and a few more SD cards for the special editions' covers, as well as $60 for various CreateSpace setup and proof fees, total expenses now sit at $22,886.56. The net: $12,738.75. That's up a little from last month, and the donations and new sales just barely beat the cost of review copies.
It has been three months since I became an actual for-profit publisher, and I feel like I'm just now, finally, hitting my stride. Next month, we'll see if some positive press and the lower prices can shift the book into a higher gear.