Today, Cave Art Press welcomes publisher Joe Biel. With the publishing world experiencing a world-wind evolution, it is paramount for writers to know what a reasonable contract looks like, as well as for publishers to realize that one contract does not fit all. We are pleased Joe is sharing his expertise on publishing contracts.
Strangely, the one thing that is impossible to find information about even on the vastness of the Internet is what a “typical” publishing contract looks like. There are many reasons for this, most notably that everyone wants to privatize what they offer, at least as much as they can. One reason for this is so that contracts can vary a little bit from author to author, depending on the situation. With the work that I’ve been doing since founding Microcosm Publishing 20 years ago this February, I always take a different tact: “What would happen if we were more honest and open about how the whole machine works?”
I’ve written quite a bit about various aspects of publishing as well as my new book, Good Trouble, about how Asperger’s influenced my 20 years of publishing experience, but today we are going to focus on contracts.
WHAT IS IN A CONTRACT?
For most authors—as well as most publishers—an acceptable contract is the best one that is being offered. There’s little reason to hold out for a better contract unless there are reasons to believe that one exists. Publishing is saturated with supply: there are far more authors than publisher opportunities, so if you receive an offer that feels fair, you should probably take it. But also for that reason, authors tend not to read their contracts and simply form their expectations and plans around what they have heard or experienced elsewhere.
In reality, every contract lays out “when you do this, these are the consequences.” Some aspects benefit or protect the author. Other parts are obligations for each party. And other parts stipulate what happens if one party fails to do certain things or penalties for a lack of overall success, like having to pay back an advance or buy back unsold books before they are turned back into paper. It is typical to have a mutual liability clause. It will outline that the publisher will not face legal consequences for the author’s actions and vice versa.
The basic components of a contract are an outline of what the work is and what it will look like, a plan for compensation for the author, a series of author obligations, an outlining of territory that the contract pertains to (paper or digital, United States or world), a schedule for completing the work as well as various dates that the publisher is operating on, some expectations of what the publisher will produce (formats, if rights sales are lined up, etc.), how sales reporting will be done to the author, an outlining of promotion, distribution, ownership (is it work for hire or does the author retain the work or is the work the composite of many people’s contributions that creates an amalgamated new work?), as well as what happens in various best and worst case outcome scenarios. Of course, remember that everything in a contract is negotiable (in theory) and you can strike out sections that do not work for you. Wield that red pen responsibly but talk it over as a team, not as adversaries!
The most argued about part of a contract is the advance, the amount of money paid for completion of the work in expectation of future success and royalties. Unfortunately for authors, advances have shrunk steadily over the last ten years. Only the major houses (Penguin Random House, Simon & Schuster, Harper Collins, etc.—publishers that constitute over 50% of total book sales) and fiscally independent mid-list publishers that operate on family money and have enough cash flow to pay a substantial advance for a new book. As a result, if you are working with an indie, even a relatively large indie, your advance will likely range from $0-$2,500.
The lack of advance does not mean that the publisher does not believe in the book. In most cases it simply means that they don’t have money to fall back on in the event that the book does not recoup it quickly enough. Check the contract to see if the advance must be paid back if the book does not recoup. Regardless, if a publisher does not recoup on their advance, it is unlikely that they would work with you again so the best thing to do is work together for the success of the book as a team.
Regardless of the advance, a much more important number is the royalty percentage. If the publisher will be producing the book in multiple formats, they should have a different royalty for each format. Hardcovers typically pay 8-12% of the cover price to the author. Paperbacks tend to pay 6-8% of the cover price. eBooks tend to pay at 15-30% of cover price. Translation rights can pay as much as 20-50% of the sale. Of course every contract is different and should improve with your success.
I have seen contracts where the author must pay a certain amount of money to be published or a certain amount of money is garnished for undefined expenses or undefined staff time. This kind of unaccountable cost for an author doesn’t sit right with me. Typically “pay-to-play” contracts are scams that only benefit the “publisher.” Don’t do anything you aren’t comfortable with.
Typically the contract will outline how much content (often expressed in a final word count or illustration count) the author must provide and when it is due in various edited forms. It should also outline if the author is responsible to index the book as well as providing things like photography or art. Typically there is a deadline for a first draft, a follow-up deadline for developmental edits, a deadline for line-edit revisions, and a time for final proofing. If things like this are not stipulated, it’s prudent to ask. If nothing else, make sure that you are on the same page.
Typically there are clauses that establish that the work is original to the author (nothing is plagiarized or used without permission) and that certain standards of quality and consistency must be met in the final work.
Often the author will have obligations for how much they must promote the book, that they must take part in interviews that the publisher schedules, and even that public signing events or appearances at conferences or a book tour are required as part of the agreement. Some titles don’t require this level of author support but look for language about it in the contract.
A publisher may ask for exclusive film/TV rights, eBook/digital rights, audio, hardcover, and paperback rights all over the world. This means that while the author owns the content of the book, only the publisher is allowed to sell it to other publishers in the above formats. This might be in your best interest but it also might not. Ask if the publisher has staff or an agency that actively sells movie rights or if they just take a piece of the sale when it happens. Are they actually intending to produce eBooks and hardcovers or just prevent another publisher from doing so? Does the publisher retain a rights sales agency or have in-house staff that actually pursues these sales? In my opinion, it’s rude to take world rights in every language if a publisher isn’t actually equipped with the resources to sell to the whole world. If a French publisher was interested in your book, would your publisher have the mechanism to make that happen better than you would on your own? Do the rights expire or renew in perpetuity? Under what grounds can the rights be canceled or transferred? Push them to explain when the publication date would be for each format. Ask the publisher who their trade distributor is and how many sales staff they retain to represent your book. If a publisher does not have a trade distributor (or a large in-house staff), I would ask some follow-up questions to make sure that they will actively sell-in your book to stores and do a better job promoting it than one person could do on their own. Besides title development and market research, the reason that publishers exist is their relationships and resources that it wouldn’t make sense for a single author to have.
Plan for the worst-case scenario and well as the best-case scenario. The average book with publisher support sells only 3,000 copies in its lifetime. That means that plenty sell far worse. A store can return books to the publisher for an entire year after their order. This creates a lot of unknowns about the success of the book during that first year.
How will sales be reported to the author? At what frequency? How much collaboration will the author have on marketing and publicity? Is there a way for the author to bring ideas and resources to the table other than selling the book to their platform?
Sometimes the most important parts of a contract are the parts that outline what happens if the book flops. Does the author have to pay back the advance? I’ve met too many authors whose book was deemed a failure by their publisher in the first year. Suddenly, they had to choose how many unsold copies to buy because the rest would be pulped.
Almost more Earth shattering, what happens if the book is far more successful than anyone planned? Does the contract hold up? We once had an author request that he be paid in 20% of the books from each print run. That worked out great until we had sold over 40,000 copies and he needed to rent out a storage unit for his 8,000 books. We renegotiated for an agreement that scaled better and worked for both of us. Often times, strangely, it’s success that is most disruptive to a book. The strain of constant revisions, reprints, and financial management to make sure that everyone is getting what is owed to them is much harder on everyone involved but it’s what we all dream of! So keep your agreements and financial records tidy!
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