One argument that always comes up is the advance earned when signing a Traditional Publisher, but very few such articles take the time to explore this aspect of the equation.
Because I’m feeling physically down and having trouble wrapping my head around the edits I should be doing, I opened my spreadsheet instead.
I used this article from The Passive Voice as my starting place.
Say the writer in question receives a $5000 advance and $1.49 a book for a TP and $6.99 SP.
Under TP this author sees no royalties until the advance has been paid out. Meaning 3356 books must be sold before they see any new money. (Please note I’m rounding all calculation up for simplicities sake.)
Under SP this author must sell 716 books before they’ve made the same money as the advance. Should this author ever sell 3356 books, they will have made $23456.
Remember also that advances do not get paid out all at once. They could be dolled out in 2, 3, or 4 payments between the moment of signing and the book hits the shelf. (1,2, or 3 years?)
Some people do point out that stores like Amazon take a distribution fee from the author’s royalty. The actual amount being dependent on how many megabytes the book takes up. Other online bookstores may have similar charges.
So let’s say the say author looses $.30 a book to distribution for a net of 6.69. Now this author has to sell 748 books to match the TP advance and will only make 22450 when they match the 3356 book mark.
What if the SP author shells out $2500 for editing and a cover? This new $7500 break even point (versus the TP advance) now requires 1073 sales and will reduced the 3356 book match point to $19950.
Someone is bound the mention the whole arena of marketing. In theory, the big TP house does have an equally big marketing machine to help boost your numbers. If the word I see on social media is even somewhat accurate, the kind of author who receives a $5000 advance is going to get little or no help from the marketing machine.
I’ll take that a step further. When researching potential TP houses for my own WiP ALL of them have made it clear they expect me to have a pre-existing on-line presence and some idea of what MY marketing plan will be. Everything I’ve read on the subject suggest the author who comes home with a whopping $45000 advance will only see a marginal increase in marketing clout come their way. That kind of support appears to be reserved for the BIG (6-7 digit advance) players.
I’ll be the first to admit this is a rough overview that fails to take into account innumerable nuances that can affect the numbers I’ve used. I also don’t address the question of how long each book is kept available for sale, if ever for those who never win the TP lottery and make it to the acceptance phase.
Okay, I also gloss over the SP quality question except in the mention of paying out significant money for editing and cover.