Tips for Authors: When do I get paid? How do most publishers pay royalties? What about FEP?

rss icon

“When do I get paid?”

Shahina and Victor Begg selling Our Muslim Neighbors.
AUTHORS CAN EARN MONEY RIGHT AWAY: While the publishing industry takes many months to deliver retail royalties to authors—most of our authors turn a per-book profit right away by selling their books at public appearances. In the first half of 2019, Shahina and Victor Begg have appeared at venues across the U.S. Victor is scheduled to give his next major author talk at Washington D.C.’s popular Busboys and Poets center on June 25. (Click their photo to learn more about that June 25 event.)

That’s a universal question from authors publishing a first book. Front Edge generally pays higher royalties than most authors receive from traditional publishers. That’s a distinctive practice listed in the 2018 Best Practices Code for Hybrid Publishers through the Independent Book Publishers Association. That means our authors are eager to know when they will receive a first check.

We also are known for paying more regularly than the majority of traditional publishers. According to Author’s Guild, America’s oldest and largest professional organization of authors, the majority of publishers pay twice a year. Our team has always encouraged authors to actively partner with us in book marketing, so paying quarterly made sense to us. Authors need regular sales data to plan effective outreach.

But, when?
And, why are there delays in royalties?

Q: So, how soon do I get paid?

A: It takes many months. That’s the answer that tends to disappoint first-time authors, according to the Author’s Guild. It’s a universal truth in publishing: Expect months to pass before that first check arrives. In fact, some publishers may not pay for the better part of a year due to various delays and snags in the system, including:

  • Major book retailers, and Amazon is chief among them, take months to pay the money to publishers that they can pass along to authors.
  • Delays—sometimes very long delays—are built into the system to account for customers who might opt to return their books. Some retailers give customers months to return a book and withhold revenue as a result. This gets even more complicated with bricks-and-mortar stores, some of whom have very long return policies with publishers.
  • There are many separate companies that send revenue to publishers—from a host of eBook sellers to various retail outlets. All of them have their own unique policies on payments. To complicate matters, some smaller sales channels won’t even make a payment to the publisher until their total reaches $50 or more.

Front Edge Publishing’s payment cycle

After the end of each quarter (March 31, June 30, Sept 30 and Dec 31), Front Edge Publishing creates statements reporting to our authors (and to the partner publishers for whom we provide services). We summarize the financial activity that occurred during that quarter—as well as the inception-to-date of the book.

Each quarter, we receive payments—and reports on pending payments—from many sources. We separate all that data into accounting records that correspond to each book. However, a pending report does not necessarily mean the actual revenue has been received in that quarter. All publishers experience the same delays in receiving these payments—always a period of months, sometimes many months. Publishers can’t pay authors until we actually receive that revenue.

We always advise authors that it can take half a year, or more, to receive your first royalty check from Front Edge Publishing.

Here’s a typical example of how that timeline could unfold:

  • January: A book is released for sale.
  • February: Sales data is reported to Front Edge.
  • May: That revenue finally is paid to Front Edge. At that point, of course, we already are well beyond the first-quarter statement.
  • June 30: The second quarter ends.
  • July: We summarize the second-quarter data in reports to authors (and our partner publishers) that we send out by the end of July.
  • August: The amounts in those statements are payable to the authors within 30 days of the quarterly statement, so by the end of August our authors can look for those checks.

Think that’s a very looong time to receive a check?

Remember: Delays are universal in publishing. And, many traditional publishers add other restrictions and take much longer before transferring funds. 

But, that’s not the whole story …
Earning Revenue Right Away

There is one big exception to the rule of long-delayed payments from book retailers like Amazon and Barnes & Noble—and this exception is very important to our authors.

Even before a new book is officially released via big retailers like Amazon, authors can immediately place an order for a quantity of books they can sell at public events. When that happens, an author is immediately pocketing a per-book profit—the markup on each book sold at an event. In fact, authors make more on these direct sales than on books sold via retailers like Amazon, because those retailers keep a significant percent of the book’s price for themselves. That’s often about a third of the Suggested Retail Price that is kept by the retailer—money that authors can pocket along with the rest of their revenue when they sell books directly to customers at events.

MORE GOOD NEWS:
Clear, concise royalty statements

The Author Guild also has complained about the length of royalty statements sent to authors—as if these many pages, packed with arcane terms and dense rows of data, were designed to confuse authors. In some cases, Author Guild columnists have argued that’s precisely a publisher’s strategy.

In one Author Guild column, last year, Juli Saitz, a noted expert on royalties, wrote: “I have yet to meet an author who can easily determine whether the payments on his or her royalty statements are accurate. And while I have rarely seen an author who actually suspects fraud, I have often witnessed authors who just ‘don’t know.’  “

As the manager of quarterly reports at Front Edge, I’m proud to say: We developed our quarterly statements to make them as concise and clear as possible. 

And, if authors have questions? We’re known for responding and explaining and clearing up any confusion.

Many author advocacy groups chronically complain about publishers leaving authors with a dense statement in hand, questions they want to ask—and a stone wall when authors ask for clarity. That’s what Juli Saitz was describing and it leaves authors confused about the data.

We don’t want that. In contrast, from the beginning, Front Edge has been a data-driven team. We believe clear data helps all of us make smart decisions. So, at Front Edge, you can reach us via email. You can reach us via phone.

If you want to use your own sales data to shape your marketing decisions, we can send you additional data about your sales. Perhaps you had a series of events in a one-month period—or you had several news stories published about you at some point—and you want to know if that period spiked an upswing in sales. If so, you may want to see a specific report on unit sales during a crucial range of dates. We can work with you to provide customized data reports if that will help you judge effectiveness of marketing efforts.

Why do we do that? We were founded by professionals who want to partner with authors in using the best data to shape our decisions. Transparency is one of our founding principles.

About Patty Thompson

Patty Thompson is the financial manager of Front Edge Publishing. Our authors hear from Patty at least once each quarter and sometimes more frequently if they request more specific data on their book sales.