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?
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I’ve had questions about all of this, so thank you for the information!
Thanks so much Rachelle! In all my years of reading blogs about writing I’ve never seen a post that answered the ‘advance’ question as well as you just did. Thanks for continuing to teach us!
Good to know – thank, Rachelle.
I didn’t get an advance on my soon-to-be-published novel, “Blessed Are The Pure Of Heart” – but I did get a somewhat better-than average royalty structure, and I’m content with that.
Even more so, since my novel was self-pubbed on Kindle, was seen by my publisher, and picked up from there. It still feels like I’m dreaming!
Lyn-strangely, that 15% of $10K and 15% of $1.12 is the same thing. My advance checks have all gone to my agent and then she sends me 85% of the amount (which is nice for tax purposes–I have a nice form to show what I made. But the $10K ADVANCE is for the first books sold and the agent keeps the $1500 of it. Then when the publisher earns that back (at $1.12 per book), then the agent would get 15% of each book AFTER that. That’s the nice thing about percentages.
Okay, makes sense now that I’m thinking about it. lol sorry for being strangely dumb on percentages! 🙂
Good info. I wasn’t aware of how those advances were paid out. I thought it came as one payment. Thank you.
Very informative, thanks Rachelle:)
I’ve heard of debut authors getting advances of 6 or 7 figures. I’m appreciate how rare that is and do not expect an advance like that. Quite the contrary, in fact. One author in particular sold a blockbuster debut for something like 2 million, and probably made the publisher money with it. However, the second book flopped and if she’s done anything since, I don’t know about it. It would seem prudent to take a smaller advance. Otherwise, it’s almost like racking up more credit card debt than you can handle, only instead of ruining your FICO, you hurt a career. My question is how that pertains to agents. 15% of a million dollar advance is significant. If an agent stood to make a huge sum and an author turned it down because he/she was uncomfortable with it, could that ruin the relationship? Perhaps this is something that should be hashed out between the two beforehand?
These are good analogy’s,most people dont Look at it that way.
No questions right now, just praying to someday take part in this world!
A true sign of a numbers geek:
I have a spreadsheet that details how many books I need to sell to earn out my advance, and how much money I’d make at each increment above that. It’s full of some nice, complex, fun if/then statements and formulas. It even calculates my super cool agent’s portion and my portion.
Now, I just need that book to SELL SELL SELL this September!!!
That’s awesome your book is coming out! I hope it sells well!
Krista, I think you’re the first author I’ve ever read who admits to being a numbers geek. I like numbers, but I’m not as adept with them as you are! Looking forward to reading your book, BTW.
Here’s my opportunity to sound stupid; what does ABA and CBA stand for?
I’ve always wondered about ABA vs. CBA advances. It sounds like they’re mostly the same, which is encouraging. 🙂
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Thank you, Rachelle, for this post. I subscribe to your posts and always find them helpful and to the point. This one is no different. It addresses every aspect of the advance topic and is more complete and easier to understand than similar posts I’ve read by other agents and writers.
Where does your 15% come in? Do you get $1500 of the 10k advance or 15% of the measly $1.12?
Rachelle, thanks for the good information. It answers most of my questions. And the ones still lingering in my head have been asked, so I’ll check back for your answers. 🙂
Rachelle, what would be a typical window of time that a publisher is willing to leave a new book on the market? (Shelf life.) I’ve heard it’s much shorter than years ago. If a book doesn’t earn out within X number of months, will they simply yank all copies and sell them for peanuts to a generic distributor? Or offer them back the author at a discounted price? Or…?
“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?”
Aw come ON Rachelle, you started with a MATH queston?? We had a long weekend up here, NOT FAIR to hit me with grade three math first thing in the morning!
Here’s one for revenge…if there was an enormous advance party pizza in your office fridge, how many slices would be gone before the green train went up the hill at 98 miles an hour in the rain with a headwind of 45 mph?
See? THAT is why writers need agents.
Math.
Yeah, I see your point. I was more concerned with what was on the pizza to think about the numbers!
Wow. Really? Shock and awe, PJ!
Totally not surprised.
“if there was an enormous advance party pizza in your office fridge, how many slices would be gone before the green train went up the hill at 98 miles an hour in the rain with a headwind of 45 mph?”
Purple, of course.
Ahahahaha!!! Well play TOSK, well played!
A slight chance of 75 depending on the angle of the winds Bob!
back to you trevere…
You just made “advances” less complicated than my wild imagination was thinking. At the same time, I can see why it’s VERY important for a person to not immediately quit their day job when they get a book deal given the way advances work, the amount of time it can take to get to a release date then the time after that to see if the advance is even earned out.
Thanks for some very clear information. It really puts things in perspective, too.
Absolutely I agree on this one,rachelle ur incite was very informative.
Solid information as always. You could spend a week on advances and royalties and still not cover everything. 🙂
Thanks, Rachelle, for spelling it out in easy to understand terms. It’s always good to be prepared!
Yes, I have a question. How are ghost writers included in the advance payments?
Thats a good question.I guess u could create a blog and send in a manuscript!
Writers work hard, often with no real understanding of the possible compensation,
Thanks for providing what often feels like taboo “insider info”
I’ve long wondered if some publishing houses could take more chances on unknown authors by offering no advances? I would go for that as long as there would be a true marketing push of some sort and not just a ‘sink or swim all on your own’ mentality.
Ted, I do know there are several new crossover-type publishers popping up, combining aspects of traditional publishing with those of self-publishers. Houses like Civitas Press, for instance, where if your book is accepted for publication, they will pay publication costs (unlike self-publishing which can be quite expensive) but offer no advance. In return, they pay a much higher royalty rate (60%, I believe) on all sales after the publishing costs are covered (can be as little as 1,000 copies until it starts being profitable through POD printing). Publishers like this are invested more in marketing because they still make a significant chunk if your book does well (again, unlike self-publishing where they’ve already made their money off your initial investment and you’re on your own at that point).
Seems a valid way to bridge the gap. In addition, you have the added benefit of having a professional team working alongside you with your project on editing, cover design, etc., the way you would with a traditional publisher.
The last time I got an advance was on my allowance when I was fourteen. I got it in order to take a girl to Six Flags. She was my junior high crush and rarely gave me the time of day, but agreed to be my date for a Youth for Christ day in the park. As soon as I paid for her ticket, she left me and went off with her friends. I was devastated and did not ask another girl out until I was in college. Therefore, I’d prefer not to get any advances, because I don’t want a divorce. Seems logical, no? 😛
Makes sense to me.
Awww, poor junior high school PJ. 🙁
That’s so sad.
But, umm, dude, I really doubt WHEN you get your book advance…that Six Flags will cover the excitement factor. You’ll be volunteered by your lovely wife to let her be your date in Maui. SOmebody might suggest that, but I don’t know who.
Well we’ll be married 25 years in August, so a Hawaiian trip is in order. Hopefully she won’t mind waiting until one of my books gets published. Perhaps our 30 year? B-)
Then bring her to lobster country for you 25th! Or at least buy her a nice set of earrings.
Congrats on 25 years in August! Me and hubby will be celebrating 25 years in August too. 🙂
Awesome! and thank you!
Congrats on 25, PJ!!! That’s awesome. I haven’t been married 25 years if you take all my marriages and add them together.
Thats the funniest joke Iv heard this morning after I read it 8 times.
Too funny, PJ. 🙂 I’m guessing your wife won’t mind any advances you happen to receive and share with her. 🙂
Well, hell. Now that you mention it–it was a dark and stormy night…. Okay, it was actually a warm, starry night on a church camp hay ride, and I was a tall and too-gangly 12. I made an “advance” on the little girl I’d had my eye on, and she brushed my arm away without even making eye contact. Took me till I was a senior who was headed to West Point to brush up the gumption to ask another girl out, myself.
Maybe that’s what makes us go Indie–we have a psychological “thing” against advances?
Well, Mr King, because “advances” are rather frightening. I spurned the “advances” of someone who then got arrested for grand theft auto because I dumped him.
West Point? Seriously? Wow. Have you written about that??? Blogged?? My eldest son would mow your lawn just to hear you shoot the breeze over a Coke and a burger.
“I spurned the ‘advances’ of someone who then got arrested for grand theft auto because I dumped him.” – Wow. No, all I did was sit and sulk and convince myself that I was the least desirable kid out there.
I haven’t done anything you’re suggesting, though I’m thinking about it. There was a time when I really didn’t want to think of what all I went through up there, but as I age I find those memories much more interesting.
In all seriousness Stephen, what you went through and the sharing of such, may be the hard earned wisdom and inspiration for young man who is struggling.
Well, thank you. All I can really say is “hold yer horses.” I’m writing the last chapter of my dissertation currently, and once that project is behind me I plan to pull out the brand I’ve already stuffed away: the Grumpy Dean. I plan on using my background at West Point and in business as well as managing the educational process at career colleges to build a blog and eventually a book around my thoughts about success in a tough and tumble world. But first, I gots ta finish this disser-friggin-tation.
If it helps, I can send you a few paragraphs of hub’s Master’s thesis.
Hi Jennifer and Stephen,
While you are waiting for West Point chronicles and dissertation defenses (new twist on defense, eh?) you can check out my Air Force Academy blog (just google “Anne Martin Fletcher”). And maybe, someday, Rachelle and I will be sharing an advance on my memoir about my first year there, “Groundbreaker.” Oh, Jennifer, tell your son that my lawn is open for mowing and sharing “war” stories, too!
thats the creativity of the young mind to the old dynasty of pen Lectures Stephen.
Hi – if the book doesn’t sell enough copies to earn back the advance, does the excess have to be repaid? Also, 8 percent doesn’t seem like much, is that a typical royalty? Ouch. Thanks for all the great info!
Jeane, once an advance is paid…it is yours. If you do not earn out your advance then the publisher may want a second look at your next novel…but everything on subsequent books depends on your sales. It’s business.
This post answered quite a few of my questions, thank you. One question I do have is what if the author gets the advance for three books ($15,000), but the first book is an instant best seller – is there room to negotiate for the author to receive more than the contracted $5,000 for the next book?
No, that would be very rare, unless there was an “advance bonus” specified in the contract. If the book is a bestseller, then you’d get paid later in your royalty checks.
Im an unpublished author right now for the time being.Im sure the publisher should have no problem negotiating 5,000 on the next book based on the creativity and sell number of the first novel.
Great article, thank you! I love when people with direct knowledge of a topic can summarize things so clearly.
Ditto to your statement, Jen! Rachelle is so good at synopsizing.