Everyone loves a bargain, but as the Fairtrade movement has shown, a good deal for the consumer can add up to a poor deal for the producer. Authors want their books to reach as many readers as possible, but they also need (and deserve) to be paid. As ALCS’ 2018 survey showed, the average income of an author is just £10,500.
Publishers and authors do not control the price at which retailers sell books. However, a reader’s buying choices can have a considerable influence on retailers’ prices and therefore author incomes.
If a price is unrealistically cheap, it can damage the author’s reputation and lead to the impression that books are a cheap commodity and reading is an experience that’s not worth very much.”Philip Pullman
Independent and chain high street booksellers
Most authors receive full royalties on books sold by high street bookshops, and the physical presence of books on the high street showcases the importance of reading, culture and learning. Many local bookshops also play an important community role, providing venues to promote reading groups and authors.
However, in addition to staff costs, independent bookshops and chain high street booksellers pay premium business rates for their high street presence. They do not have the space or clout to stock books in bulk, so they generally pay more for their stock than online retailers and supermarkets. They also cannot afford to treat bestsellers as loss leaders.
These overheads mean that high street booksellers often cannot compete with online retailers and supermarkets on price alone. But where they win hands down is in the experience for book buyers. The joy of browsing physical books and discovering a new work by a favourite author, or being led by serendipity to discover a new author, is not an experience that can be replicated online.
But while sales by independent bookshops and chains work well for authors, those retailers need customers to survive. So please, support your local bookshop.
Public libraries provide a huge community benefit, offering free access to books and local resources. Although there is no charge for users, authors still receive a royalty on the initial purchase of their book by the library and a modest payment (called PLR) of around 8p each time their book is borrowed.
However, many local libraries are facing threats of reduced funding and closure. We urge all readers to use and support their local library, and get involved with local campaigns if your own library is at risk.
Amazon and other online retailers
Amazon has done much to raise the profile of books and ensure their wide availability. With its print-on-demand and ebook facilities, it is a strong outlet for self-published works which might struggle to find a publisher, or another bookseller willing to stock them. Particularly with some forms of genre fiction, it is meeting what would otherwise be a gap in the market.
However we have concerns about some of Amazon’s practices. For a start Amazon is not subject to the same tax regime as high-street bookshops.
Amazon also sells new and used books from various external suppliers alongside regular retail sales, directly competing and often at prices which undermine regular sales. The ‘New and Used’ tab for a book often displays a bewildering number of offers at wildly differing prices. Assuming that ‘used’ means second-hand, an author will not receive a royalty on such sales, and even ‘new’ in this context simply means ‘pristine’ rather than ‘a first sale of a book on which the author receives a royalty’.
Some of these cheap books are remaindered stock or surplus stock initially bought by mail order companies or book clubs. Some are heavily discounted titles intended for export. For instance, we are aware of cases where only a hardback has been published in the UK but a paperback version is available in some other territory, and those paperbacks have leaked back into the UK market. In all these examples, authors receive very low royalties on the initial sale, and none of course on that copy’s re-sale on Amazon. At the same time, these versions cannibalise regular retail sales and can undermine the economic viability of publishing the work at all.
We are urging Amazon to commit to the undertakings it gave to authors at its inception by prioritising regular retail sales and making it very clear to buyers whether or not a copy is one which will generate an author royalty. We also urge Amazon strenuously to police territorial rights. Where it is within their power, we look to publishers to regulate the circulation of what can end up as cheap second-hand copies.
Ultra-high discounts or special sales are where a publisher sells large numbers of a book to a retailer at a huge discount. Authors receive much lower royalties for this type of sale. They are particularly prevalent in supermarkets, discount high-street booksellers and general retail chains.
Mail order companies such as the Book People buy in large quantities outright, rather than sale or return, so the publisher is paid up-front. In return, they demand very high discounts from publishers, sometimes as much as 80% or more. When the retailer has acquired stock outright, and very cheaply, it is likely to offload any unsold copies under ‘New and Used’ on Amazon, where those copies compete directly against royalty-generating sales.
Neither publishers nor authors can control the price at which the retailer sells the books, even if a very low selling price undermines authors and high-street bookshops.
Second-hand and charity bookshops
Second-hand books have an environmental advantage and it is great to see books shared and loved, but authors receive no royalty or other payment from sales of second-hand books. Charity bookshops have an economic advantage over high-street booksellers because they stock for free, are staffed by volunteers and are exempt from business rates.
Ebooks and audiobooks
Authors receive a royalty on legitimate sales of ebooks and for ebook loans from public libraries. However, watch out for the following:
- Free download sites – almost all such sites are illegal. Publishers and authors receive no remuneration for ebooks downloaded from them, and many are fraudulent setups designed to harvest credit card details. Please don’t be taken in.
- Ebook lending sites – ebook lending is usually unlawful in the UK unless it is done through public libraries or other sources authorised by the author or publisher.
- We are concerned at Amazon’s market dominance of the ebook market which enables it to insist on large discounts from publishers, and to sell ebooks at 99p or give them away for free. Don’t forget there are other ebook retailers out there.
- 20% VAT is charged on audiobooks but not on physical books and ebooks. This means that for a £10 audiobook, £1.67 will be deducted in tax leaving less revenue for the publisher and author. We believe that reading of any kind should not be taxed and that VAT on audiobooks should be abolished.
There is no doubt that the true benefits of reading, both to readers and to wider society, are immeasurable, and of course all authors want to be read – so do please keep reading – we hope that this information might help inform the routes you take to discover the books you enjoy.
- 9 October 2018 – Product guide: ethical and environmental record of 24 booksellers | Ethical Consumer
- 9 August 2017 – Amazon UK Services sales soar but corporation tax payments halve | The Bookseller
- 4 August 2017 – Pullman leads writers condemning ‘pernicious’ book discounts | The Guardian
- 31 July 2017 – Pullman calls for reintroduction of fixed book prices | The Bookseller
- 27 July 2017 – Beware the Special Sale – Nicola Solomon’s ‘seven steps’ open letter in the Bookseller, and supported by Philip Jones.
- 7 July 2017 – Exclusive discounts? We need to talk about hardback sales – Tamsin Rosewell of Kenilworth Books, shared and backed by Philip Pullman, and republished in The Bookseller