All About Advances
Let’s talk about advances today. Please keep in mind all of this information is very generalized and won’t accurately describe every situation.
First, what’s an “advance” anyway?
An advance is a “pre-payment” of the royalties the publisher expects you to earn on your book. Let’s say the publisher has agreed to pay you a royalty of 8% on the retail price of the book, and your book is going to sell for $14.00. You are going to earn $1.12 for each copy of the book sold. So if the publisher has paid you an advance of $10,000, how many copies do you have to sell to earn out your advance? Your break-even would be 8,929 copies. Your publisher has already paid you the royalty on those first 8,929 units sold. If and when your book sells more than that, your additional royalties will start accruing at the rate of $1.12 per book sold. The publisher will issue royalty statements (usually twice yearly) showing how many copies have sold, and if they owe you any royalties, a check will be included.
What is the average advance, in CBA versus ABA?
It’s impossible to give an “average” advance in either CBA or ABA. They’re wildly all over the map depending on so many factors. I’ve done contracts for advances ranging from $1,000 to six figures. I haven’t found ABA advances to be a whole lot higher than CBA for comparable books, but it’s true the big New York houses can generally pay more than the smaller independent Christian houses. Of course, there are plenty of smaller, independent general-market (ABA) publishers who pay smaller advances, too.
While there’s no average, agents can usually look at a proposal and make a pretty good estimate about the range the advance will end up in. We look at who the author is, what kind of book it is, where it fits into the marketplace, and how much platform the author has. It becomes clear what kind of advance the book should attract.
How are advances paid out?
Advances are usually paid out in halves, thirds, or quarters. The author gets the first portion upon signing the contract (within 30 days), the next portion after the manuscript is delivered and declared “accepted” for publication, and if there is a third portion, it’s due on publication of the book, and the fourth is due sometime after that.
Another question that’s been asked is about multiple book deals and how the advances get paid out. Here’s how it works. Let’s say you’re offered a 3-book contract with an advance of $10,000 per book, $30,000 total. The contract states you will get half of your advance upon signing, and the other half on delivery of an acceptable manuscript. So, after contract signing, you will get half of the advance for all three books. Half is $5,000, so you’ll get 5,000 x 3, which means you’ll get $15,000 upon contract signing.
Then, as you deliver each manuscript and each one is declared acceptable, you’ll receive the other half of the per-book advance. So, you’ll get three more checks for $5,000 as you turn in your manuscripts.
Is an advance negotiable, and if so, to what degree?
Most advances are negotiable, but that always depends on how much leverage we have. Are there other publishers interested? How excited about the book is the publisher? Is this book a perfect fit for the publisher? Is the book risky or more of a sure-thing? These and other factors determine how negotiable the advance is. On the lower end of the spectrum, particularly for first-time authors, a publisher may offer a small advance that’s basically “take it or leave it.” But as the value of the book goes up, and more publishers are interested, it generally becomes more negotiable.
How does the agent get paid?
The agent’s fee is usually 15% of the advance and royalties. In CBA, the standard practice is for the publisher to disburse two checks, one directly to author (85%) and the other to the agent. General market publishers normally send one check to the agent, who then turns around and sends the author their 85%.
Any questions on advances?
Image credit: stokato / 123RF Stock Photo