Why Give Up Part of Your Profit?

I just saw someone post on one of the writing forums that they’d chosen to list their self-published how-to book only on their website because they were following someone else’s advice about not giving up their profits by listing on Amazon.

Result?  The person had sold two books in eight months and spent $500 to do it because it sounds like they didn’t go with a POD option either.

You often hear this “don’t give up your profit” argument when it comes to discussing self-pub versus trade pub.  As in, why would you ever trade pub?  They take so much of your money.

Well…

Because, ideally, you are giving up some of your profit in exchange for something of value.  Like good editorial services, competent cover design, marketing reach that you don’t have on your own, the ability to distribute your print books more widely, and the luxury of not doing it all yourself.

Same concept as with this poster who didn’t think they should go through Amazon because it would cost them something (30% to 65% of list price plus a little extra).  But you know what Amazon has that that person clearly doesn’t?  Reach.  An established customer base.  Access to people who might buy the book in question.

The choice to sell direct or through a distributor or both is a key business decision in all fields.  And many, many companies sell through intermediaries because it makes financial sense for them to do so.  (Many others sell through all channels they can find.)

I say don’t look at it as giving away your profit.  You can’t give away something you don’t have.  (Like sales at Barnes & Noble.)  Look at it as the cost of acquiring that particular customer.  And then decide if that cost is worth it.

With e-books, assuming no exclusivity that keeps me from selling elsewhere, no poor management that damages my brand or inhibits my ability to react timely, no concerns about the content of my book actually being freely available through the site for free, and that I have faith in the distributor’s ability to pay me fully and timely, almost every distribution channel is worth it.

I don’t have to make widgets.  All it costs me to load a book on a new sales channel is time.  But after those few hours it’s pure profit for every new sale.  Whether I sell 1 copy or 100, the time cost of writing that book is the same.  So, I’m not losing 65 cents so much as making 35 cents.  35 cents I couldn’t have made in any other way because that’s the only place to find that customer.

Just a thought.

As you can see from my list of assumptions, there are a lot of moving parts to these decisions.  There are reasons I only have 10 titles listed on Google even though I’m up to 65 titles now.  And why I pulled the one title I did have at Smashwords.  And why I’d need certain contract clauses to go the traditional route.)

But I do think there’s value in thinking of it not from the “what am I losing” perspective, but instead from the “what am I gaining” perspective.

 

About M. H. Lee

M.H. Lee is a speculative fiction writer currently residing in Colorado whose stories are sometimes dark, sometimes funny, sometimes darkly funny, but hopefully always thought-provoking and entertaining.
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One Response to Why Give Up Part of Your Profit?

  1. Dave Higgins says:

    This is where a thriving email list comes in: if you can get enough fans onto it, you can sell direct to them and have word of mouth to get more people to come; but without the email list, even your fans probably won’t check your website often enough.

    But even if you do get a huge email list, you still need Amazon and the other retailers in many circumstances: because the other thing they offer is perceived trustworthiness. While some people are fine giving up personal information and making transfers to strangers, many people (both not savvy at all and very savvy) are much more likely to trust a corporation than an individual to be both trustworthy and have good protection for the data.

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