Otherwise known as “how do I get paid?”

Some books are paid as a flat fee, which has the advantage of being fairly easy to understand. The other model you’ll encounter is an advance – an initial payment – and royalties.

This approach is a way of covering your initial costs, and also cutting you in if things go well. It works like this (round numbers used for convinience):

  • Royalty Rate: Let’s say that it is decided you earn a 10% royalty rate on a book that costs £10 – that’s £1 per copy sold.
  • Advance: You are paid a lump sum advance of £1000 at the beginning of the process.

Now you write the book and it’s published and on sale, each sale will earn £1 a time. But you also ‘owe’ the publishers £1,000. You don’t have to give that back, so let’s look at a couple of scenarios:

  • Your book sells 600 copies: If the book sells 600 copies, that’s £600 in royalties for you, but your advance was £1000, so your royalty statement will say -£400. You won’t pay anything to the publisher but you won’t get any extra. Yet.
  • Your book sells 1,500 copies: 1,500 copies means £1,500 in royalties – more than the £1,000 advance. This would mean you had ‘earned out’ and you would be paid £500 (on top of the £1,000 advance you already had).

Even if a book doesn’t ‘earn out’ in the first accounting period, it might do as long as the book is on sale. You will continue to receive royalty statements so you can track the book’s progress.

Staged Advances

It’s very common to split the advance payment into smaller chunks and pay them at key stages – for example ‘on signature‘ (of contract), on delivery of the material, and on publication. This ensures you hold up your end of the bargain.

Tiered royalties

Sometimes a publisher will offer a lower royalty rate for the first few thousand books sold, rising to a higher one. This reflects the fact that the publisher faces huge costs to get that first run out of the door, but obviously more sales come at lower cost – this is a way of cutting you into that success (or, looked at antoher way, a way to encourage you to keep promoting the book).


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