Tagged publishing

People’s Guide to Publishing: How Amazon Has Changed Publishing

For many years, new publishers and authors have posed questions to us about distribution. They want to know why distribution is so expensive and exclusive. It’s a much more complicated answer than they were expecting so we’re going to break that out in a weekly video series over the next few months.

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We are Breaking Up with The Big Boys


We’ve been holding on to a bit of news lately, and we’re excited to finally share it with you all! Here’s founder Joe Biel with the details…

Joe & Ruby deliver books by bicycle.

Starting January 1, 2019, we will be managing our own distribution just like we did for over ten years. Not only will we no longer need to move thousands of books back and forth between warehouses, creators get paid more for each book sold. And we won’t be selling to Amazon. Why. you ask? Well, my grandparents were German immigrants who came here in the 1800s for labor unions and worked to achieve the 40-hour work week…which was then abolished in our lifetime. When Microcosm was just getting off the ground in 1997, I interviewed Ian Mackaye of Dischord Records. He explained that a publisher is only as independent as their distribution is. He was seemingly taking a jab at “independent” labels who handle all of their manufacturing and distribution through a major but his point sticks. 

Microcosm has always tried to work with independent companies, because they feel most comfortably aligned with our mission, values, and goals…but we’ve watched over the past dozen years as each independent distributor gets gobbled up and responds to the demands of the increasingly demanding monopolies.

We’ve watched as our peer publishers either throw in the towel or sell to one of the monopolies, neither of which we are willing to do. We feel that independents need to be independent and the best way to do that is to build an outpost of our own, a shining star where we can continue to thrive instead of relying upon the whims of any global corporation.

So we are returning to our roots to create the world that we want to see within our weirdo clubhouse. 

We will be parting ways with Legato/PGW/Perseus/Ingram in January and have already built new warehouses and software to make this possible. Few events in the history of Microcosm have improved our morale and brought our staff together like this has. As always, our intent is to expand our distribution at the same time. Our new sales people (now a team of four) excitedly understand our books and have more time and focus to dedicate to them. For the first time ever, our back catalog will receive as much attention as our new releases. Within a few years, we intend to begin offering these services to other publishers.

This isn’t as staggering a change as it sounds. Reviewing the numbers, we have come to realize that we know better how to distribute our books than anyone else that we’ve tried to partner with. We’ve handled roughly 75% of our distribution even across these past seven years. The simple fact is that the underground is much bigger than the mainstream.

To ensure that we are still actually serving all of the stores and readers that are interested in our books, we’re bringing on Book Traveler’s West (West Coast), Como (East Coast), and Fujii (Midwest) to actively visit and solicit our books to stores. We will continue to be distributed by Turnaround in Europe and will be working with the same distributors in Australia, Canada, and the rest of the world as well. Readers and stores can still buy books directly from our website, microcosmpublishing.com.

​We are redoubling our efforts to sell direct and to independents instead of helping monopolies like Amazon continue to grow at the expense of others. Perhaps more importantly, we will not be accepting their terms that increasingly just serve to crush everything in their path. If you want to help support the indies during this crucial time, go to your local shops and buy books, and encourage your friends to do the same. They will remember moments like this forever.

We hear from people almost every week that our books are saving their lives, and we feel that we have an obligation to extend that as far and wide as possible. There’s an unspoken rule in the underground that what we do is secret but when these rules don’t serve the goals, we have no choice but to break them.

Joe’s next book, A People’s Guide to Publishing, can help anyone inspired by our journey learn the lessons and wisdom that got us here today.
Check out the kickstarter project here!

Read the more industry-jargony version of this news with more details on Shelf Awareness.

Or, if you want to know more about what this’ll mean, check out Elly’s breakdown.


If you ever need help with ordering, please contact Sidnee Grubb | Customer Service (1-503-799-2698).
For press questions, interview or sample requests, contact Cyn Marts, publicity director, cyn@microcosmpublishing.com.

On the Podcast – Bringing Your Book To Its Audience

Microcosm owners Joe Biel and Elly Blue bring you a workshop they presented at the Pacific Northwest Booksellers Association regional trade show, about the importance of connecting your work to an audience and the vitality of putting books in boxes (and all of the various dangers and how to avoid them).

Link

Business of Publishing: How to Write a P&L statement

This is the ninth post in our ongoing Business of Publishing series by Joe Biel, the author of A People’s Guide to Publishing. This edition tackles an important but more advanced question, “how much can I afford to spend on the book that I am publishing?”

While, on the surface, any answer to a question like this seems to be built from a steady diet of bullshit, books are remarkably consistent. Unlike cookies or soft drinks, most books are not branded. A book from a major house sits next to your book and others from indie presses. If you’ve successfully developed your book, you are providing each reader with enough information to make a choice based on their own experiences, observations, and tastes.

Let’s begin! For those following along at home, I’ve created this spreadsheet that you can download or duplicate and edit. And as you’ll see, there are fairly predictable formulas for everything.

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The upper left hand corner begins with the title, author, and book’s release season. Lines 5 and 6 include retail prices for each format. If you’re doing a hardcover, you’d include that as well. Lines 9 and 10 list the author’s royalty by format as well as any advance payment that they receive. Traditionally this advance is your projected first two years of royalties paid in advance.

Line 13 is income from selling film or translation rights or foreign territory rights but it’s best not to plan for this in advance since even commitments can fall apart as the licensee changes their plans.

Beginning in column D, lines 4-5 predict what will likely be the sales in bookstores as well as returns and revenues. These numbers are based on your comparable titles and their selling habits. It’s best to be conservative here so that your expectations are reasonable and you aren’t shocked when you see your actual sales and returns.

Lines 7-8 predict similar sales in the direct market, which would include sales at your own events, via your own website, to non-trade stores that buy non-returnable, and books sold to the author. Again, these numbers should be conservative and based on figures in reality that you are seeing elsewhere.

Scooting over to column I, we’re looking at the publisher’s expenses for putting the book together from editorial to production to licensing to eBook conversion to paper, printing, and binding costs. Fiddle with these numbers to see what you can afford for a project before committing with an author.

Next, back on column D and lines 12-16, we’re looking at sales minus returns minus development costs minus author royalties. This will tell you what your gross profit is.

Next, we subtract operating costs (“the bottom line”), like rent, staff, telephones, envelopes, warehousing, etc. These should comprise every expense that you’ll have to pay for even if you don’t work on a book during a given month. Subtracting your gross profit from your bottom line will tell you how much actual profit the publisher is earning from each book. In this example, it’s less than $62. This example represents the most statistically likely outcome for a book like this. Publishing is about volume so to make up for these low returns, you can either produce tons and tons of books (called a “paper mill” in the industry”) or land a few heavy hitters every year. Your choice, kind of.

Another vital part of the P&L is to evaluate a year or two later how well the book did against expectations. If a book does not sell as well as expected, it’s important to figure out why. Was tons of new competition added? Did interest in the subject fade away? Was it revealed that the author’s cure for cancer was actually bogus and their credibility tanked? Was there a major developmental error in the cover/title/subtitle that confused readers about what the book offered or how it was unique? Answer these questions. Similarly, if a book did better than expected, it’s similarly important to figure out why and repeat these events with other titles.

Alternately, to demonstrate how these traditional contracts still benefit the author, I showed an alternate royalty model where the author takes 50% of the profit. But as you can see, comparing cell G29 to G15, 8% of the cover price ends up being more than 50% of gross profit in most cases until you really land a bestseller.

Due to Amazon’s immense marketing budget and campaign to convince authors that publishers are greedy and obsolete, many authors don’t understand why the traditional 4-8% paperback royalty is still much more in their favor than self-publishing on Kindle and CreateSpace so I’ve made a chart for that too.

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