First, let’s separate the two kinds of POD: there’s Printing On Demand and Publishing On Demand, and they’re quite different. Unfortunately, it can be hard to tell them apart.
The publishers are services like Lulu and AuthorHouse that take your manuscript and publish it for you, at your own expense. They call it self-publishing, but if you’re using their ISBN, they’re the publisher, and you’re not. It really does make a big difference.
The publishers offer a range of services, but they usually include design of the cover and text, and may include some copyediting. They rarely go beyond the template-level in design, which means that the books don’t usually come up to commercial standards, and usually can’t compete on the bookstore shelves. They also almost never offer a deep or structural edit, which is what makes the biggest difference to a book’s success or failure in the market.
The printers offer very few services indeed. They all print your book, if you have an appropriately formatted file. Many of them will also do the packaging and shipping of your book, and some of them will take orders for you.
But if you send your book to a POD printer, such as LSI or 360 Digital, you get a much lower cost per copy, and you avoid many of the problems inherent in a vanity press. And make no mistake, the Publish on Demand movement is just a new form of the vanity press.
So, when should you use either one? If you’ve read my posts at all, you know that the first and most correct answer is “It depends. . . . ” (in this case, upon your book and your market and your ability to support your book in that market). The second answer is crunch your numbers, using a Single Title P&L. Estimate your sales, your costs, and so on and so forth.
(Expect a very short, very inexpensive, ebook on how to crunch numbers from me in the very near future. Email me if you want to be notified when it releases.)
In general, I suggest that people use publish on demand when you expect to sell fewer than a few dozen copies. I’ve done that myself.
More often than not, I would suggest using print on demand when your book is selling a couple of hundred copies per year or less. At that point, the improvement in your sales if you get a better design and if you have your own publishing company is usually enough to be worth paying a little more for the services.
In general, if you believe your book will be able to sell profitably in bookstores, you should not use POD. POD originals (books that start out as POD, in either meaning of the initials) don’t have costs that are low enough to allow them to compete on bookstore shelves. Either the terms of trade offered to the stores are inadequate or the retail price has to be too high, given the cost per copy.
And last, but not least, if you think your book might sell more than a couple of thousand copies, then you should probably avoid a publish on demand contract at all costs. Why? First, because you don’t own your own ISBN. So you lose all connection between their edition of the book and yours if you decide you want to drop your costs and use offset printing. (And that will make thousands of dollars of difference in your bottom line.)
Second, because in those arrangements you very rarely own the rights to the design of the book. And the cover design is a critical part of your marketing momentum, too. So you’re taking a double hit if you switch.
That’s the short and most general version of my take on the subject. Do you think differently? Please do feel free to challenge me below. More opinions and information can only be good.