The Profitable Publisher

Pete Masterson is a very generous man who shares his experience as a printer and a designer with many new publishers. He participates on many listservs, including the Yahoo Group Self-Publishing. It was on that group that the following piece first appeared. He has graciously given me his permission to quote it in its entirety:

Using the CreateSpace Publishing Plan Calculator that you can download from the CreateSpace web site (this is an Excel spreadsheet with macros). These prices are all based on a color cover and a black interior book.

A softcover book of 212 pages, 6 x 9 with a list price of $16.00:
CS standard plan, sold via estore you receive a net $7.06
CS standard plan, sold via Amazon you receive a net $3.86
CS ProPlan, sold via estore, you receive a net $9.41
CS ProPlan, sold via Amazon, you receive a net $6.21
Purchased direct from CS in small quantities for delivery to the publisher,
standard plan, you pay $5.74 per copy (plus shipping)
ProPlan, you pay $3.39 per copy (plus shipping)
Larger quantities may have a discount, but I did not see one show up
in the calculator up to 250 copies.

The CS ProPlan has a $39 start up charge per title. A $5 per year per
title fee is charged to maintain the listing.

———————————————
Using Lightning Source figures as comparison:
the same book with $16.00 list price:
With a 20% wholesale discount, you receive $9.14 per copy sold via LSI/
Ingram
With a 40% wholesale discount, you receive $5.94 per copy
With a 55% wholesale discount, you receive $3.54 per copy
The print cost per copy (in all cases) is $3.66 per copy
There is a start up cost of $75. A $12 per year per title fee is
charged to maintain the listing.

If you purchase copies direct from LSI for shipment to the publisher
this book would cost $4.08 per copy plus shipping.
This charge also applies to shipments made direct to customer at order
of publisher. (This charge is based on .015 per page instead of .013
per page for the interior. Cover charge is unchanged.)

orders of
50-99 units receive a discount of 5% (reduces unit cost to $3.88)
100-249 units receive a discount of 10% (reduces unit cost to $3.67)
250 – 499 units receive a discount of 20% (reduces unit cost to $3.26)
Over 500 units receive a discount of 25% (reduces unit cost to $3.06)
(plus shipping).

======
Analysis:

So, the CreateSpace ProPlan offers a slightly lower unit cost for
books shipped directly to the publisher — but does not seem to offer
any discounts for quantity purchases. (Per page rate is .012 for the
CS pro plan and .013 at LSI — the ‘cover’ charge is .85 for CS Pro
plan vs .90 at LSI — and this is the price difference.)

LSI gives greater flexibility in setting wholesale discount rates and
terms. Using LSI/Ingram distribution, the book is available to all
booksellers where CS is only available to Amazon. Using the CS
‘estore’ would allow a slightly better return on direct to buyer
orders from your web site.

In the end, the deciding factor is if the 20% discount through LSI is
more appropriate for your business plan or if limiting sales to Amazon
(and the CS ‘estore’) is suitable.

===============================================
Pete Masterson, Author of
Book Design and Production: A Guide for Authors and Publishers
Aeonix1@Mac.com
Aeonix Publishing Group http://www.aeonix.com
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This entry was posted on Tuesday, November 24th, 2009 at 9:46 am and is filed under For Authors, Publishing Answers. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.