Karen Woodward: the business of writing

Showing posts with label the business of writing. Show all posts

Friday, May 3

How Many Books Would You Have To Write To Quit Your Job?

Ever wondered what the value of a book is?

Jeff Posey, project manager for Lucky Bat Books, tells us this in his post, What’s Your Novel Worth? NPV and Cash Flow. Not only that, he gives us the Excel spreadsheet he used so you can do it for yourself.

When Jeff talks about how much a novel is worth he's talking about its NPV or Net Percent Value. Here's what the NPV tells you:

... the NPV tells you the present monetary value of your intellectual asset if it generates the expected cash flow over the next forty years. It emphasizes the value of long-term steady flows of small amounts of cash, and also helps quantify the value of your time investment (you only have to write a novel once for it to earn income for forty years or more).

Clear as mud? Let's look at a few examples:

Example 1: The Casual Writer

Let's say you don't want to make your living from writing but you'd like to make enough to pay for the lattes you buy while you write.

You've published a novel and you plan on publishing another one every five years.

Number of books published: 1
Royalties per book per month: $15
Number of new books produced per year: 1/5
Money spent publishing each book: $0
Each new book boosts sales by: 15%

Estimated net monthly cash flow:

*- after 2 years: $3
- after 3 years: $10
- after 5 years: $34
- after 10 years: $174

Not bad. You might even be able to afford biscotti!

* These numbers are from Jeff's post, but when I ran them myself using his spreadsheet here's what came up:

*- after 2 years: $34
- after 3 years: $56
- after 5 years: $112
- after 10 years: $335

Example 2: The Professional Writer

You want your writing to be your main source of income.

Number of books published: 5
Royalties per book per month: $50
Number of new books produced per year: 2
Money spent publishing each book: $2,500
Each new book boosts sales by: 5%

Estimated net monthly cash flow:
- after 2 years: - $198
- after 3 years: - $70
- after 5 years: $780
- after 10 years: $8,224

Example 3: The Seasoned Writer

You've been doing this a while, your books sell well, and each new book helps the rest of your book sell even better.

Number of books published: 12
Royalties per book per month: $150
Number of new books produced per year: 3
Money spent publishing each book: $5,000
Each new book boosts sales by: 3%

Estimated net monthly cash flow:
- after 2 years: $1,753
- after 3 years: $3,710
- after 5 years: $10,371
- after 10 years: $50,414

Example: The Lone Gunman

I have a problem with using Jeff's calculations for real world concerns such as: When can I quit my job and make writing my full time profession?

Let's say you write one book, publish it, win the lottery, travel to Europe and forget all about writing. Here's what Jeff's spreadsheet told me.

Number of books published: 1
Royalties per book per month: $10
Number of new books produced per year:0
Money spent publishing each book: $0
Each new book boosts sales by: 0%

Estimated net monthly cash flow:
- after 2 years: $20
- after 3 years: $30
- after 5 years: $50
- after 10 years: $100

That seems wrong. If I only published one book and then, at least as far as my readers were concerned, disappeared off the face of the earth, I think it is much more plausible that, after 10 years, I'd be lucky if I sold $2 a month.

Yes, absolutely, if a writer keeps writing, keeps publishing, keeps blogging, then her backlist books are going to be much more visible and I could see sales staying strong even after 10 years. But whether they will increase, and whether they increase exponentially, is another question.

So, with this in mind let's redo Example 2. Instead of assuming a book will sell progressively more, let's assume that the sales will stay constant.

Example: The Part Time Writer

Number of books published: 5
Royalties per book per month: $50
Number of new books produced per year: 2
Money spent publishing each book: $2,500
Each new book boosts sales by: 0%

Year 1:
5 books for sale so $50 * 5 = $250 per month.
Net gain: $250 per month.

Year 2:
2 new books published ($2,500/12=208) * 2 = $416 per month
7 books for sale so $50 * 7 = $350 per month
Net gain: - $66 per month.

Year 3:
2 new books published = - $416 per month
9 books for sale so $50 * 9 = $450 per month
Net gain: $34 per month

Year 4:
2 new books published = - $416 per month
11 books for sale so $50 * 11 = $550 per month
Net gain: $134 per month

Year 5:
2 new books published = - $416 per month
13 books for sale so $50 * 13 = $650 per month
Net gain: $234 per month

Year 6:
2 new books published = - $416 per month
15 books for sale so $50 * 15 = $750 per month
Net gain: $334 per month

Year 7:
2 new books published = - $416 per month
17 books for sale so $50 * 17 = $850 per month
Net gain: $434 per month

Year 8:
2 new books published = - $416 per month
19 books for sale so $50 * 19 = $950 per month
Net gain: $534 per month

Year 9:
2 new books published = - $416 per month
21 books for sale so $50 * 21 = $1050 per month
Net gain: $634 per month

So, after 9 years, assuming her books keep selling, on average, $50 per month, this writer will earn about $1,000 per month.

But what if one has to pay (as many do) $2,000 a month for health insurance then $1,000 a month is a drop in the bucket.

How many books would a writer have to have on the market if they wanted to make $3,000 a month ($36,000 a year)

Let's approach this from the other end: How many books would a writer have to have on the market if he wanted to make $3,000 a month ($36,000 a year) and each book brought in $100 a month?

The answer: 30 books. Stretched out over 5 years that's 6 books a year or one new book every two months.

A highly motivated person could probably do that. Keep in mind, though, that once you have the books on sale they keep selling at the same rate so at the end of five years you can ease back a bit. Or not.

Word count

How many words per year would one have to write to produce 6, 80,000 word, books? Answer: 480,000 words.

If instead of writing an 80,000 word book one wrote, say, a 40,000 word novella, 6 books would only equal 240,000 words which is, I think, completely doable. 240,000 words is about 4,600 words a week or about 650 words a day.

Keep in mind that Kris Rusch writes as many as 1 million words a year! That means she writes, on average, 3,000 words a day and could complete approximately 24 40,000 word novellas in a year.

Also, keep in mind that books in a series can be bundled together and sold. To read more about this idea take a look at Dean Wesley Smith's post on the idea of a magic bakery.

If the thought of writing 24 novellas a year has left you a bit shaky, remind yourself that in my scenario you only need to write 4,600 words a week or about 650 words a day. Now get a nice hot cup of tea or coffee, give yourself a (short) pep talk, and start writing!

The bear knows you can do it. :-)

"Michelle, zoo manager/our tour guide" by BrianMoranHDR
under Creative Commons Attribution 2.0.
Click to enlarge.

By the way, there's more discussion of Jeff Posey's post over at Dean Wesley Smith's blog and at The Passive Voice Blog.

Wednesday, December 26

Writing in 2013: Bend don't break

I'm loving Dean Wesley Smith's new series for writers on how to set yourself up for success in 2013.

Over the past couple of weeks, Dean talked about writing basics:
- The difference between a dream and a goal.
- How to create goals that have a chance of fulfilling your dream.

In his latest installment--The New World of Publishing: How To Keep Production Going All Year--Dean talks about how to work through failure to meet a goal.

Everyone Fails

What is failure? Obviously, on one level, it's pretty clear cut. If, for example, you set the goal of completing one short story a week and fail to complete a story one week, you've failed.

Dean points out, though, that sometimes failure isn't a bad thing. If your goal spurs you on to write more than you would have otherwise, it was worth it. For instance, if a writer sets the goal of writing one short story a week but misses a few and only writes 47 that's still pretty great!

Dean gives this example: A couple of years ago he set himself the goal of writing 100 short stories. Life intervened, and he didn't get 100 stories done, but he did get over 30 finished before the end of the year. Not bad!

Would Dean have written that many short stories without his goal of writing 100 stories? Probably not.

Technically, he failed to meet his goal, but working toward that goal still helped him, and that's why we set goals in the first place.

The trick to succeeding: If you see that you're NOT going to be able to meet your goal, don't stop altogether. Just do as much as you can.

What To Do When You Fail

Failure is inevitable. The trick is not to let it stop you. Dean writes,

So here are my suggestions when life derails you and you miss your short-term goal.

1… Don’t even once think about catching up. Can’t happen and will make things worse.

2… Climb back onto your production challenge or weekly page goal as soon as you are able.

3… If life alters so much as to make the original weekly pace impossible, stop and reset a new goal for the year and for each week and then stick to that.

4… Somehow, with help or with some mechanism, remember these suggestions.

Great advice! Now I just have to live it.

Sunday, December 16

Writing Goals Versus Writing Dreams: How To Get From One To The Other

Dreams vs Goals

Wouldn't it be great to win the lottery? Or sell a billion books? Or have one of your titles hit the #1 spot on the New York Times Bestseller list?

These are dreams.

Dean Wesley Smith defines a dream as follows:

A DREAM is an object of desire over which you do not have direct control.

That's a paraphrase.

A GOAL is an object of desire over which you DO HAVE direct control.

This is Dean's example:

Dream: Winning the lottery.
Goal: Buying a lottery ticket every week.

Just because you buy a lottery ticket every week doesn't mean you'll win the lottery, but it's a course of action that will make achieving your dream more likely. And if you don't buy lottery tickets you are guaranteed not to win the lottery.

You have 100% control over whether you buy a lottery ticket each week. You have zero control over whether you'll win the lottery. There are no guarantees. You may win the lottery, you may not, but you're doing something to make your dream more likely to come true.

Goals And The Self-Published Writer

I think all new writers have a similar dream. They would like to, one day, be able to pay for all their wants and needs with the money their writing generates.

Before we look at what goals will bring us to that place let's look at the entrance requirements, the cost of the dream, what kind of person will be able to achieve it.

Dean Wesley Smith: What it takes to be a professional writer

Here's Dean's list of qualities:

1) Determination bordering on psychotic.
2) The ability to keep standing back up and going on when something knocks you down.
3) The ability to ignore the negative from all those around you, especially family and friends.
4) The hunger to keep learning writing craft and the knowledge you will never be good enough.
5) Fearlessness.
6) The desire to learn business.
7) The ability to control your own time and what comes at you.

Got it? Feeling that fearless psychotic determination well up inside you? Great! Now let's set some goals.

Goal One/Path One

Figure out how much material (short stories, novels, flash fiction, whatever) you could, reasonably, create in a year. From that, guesstimate sales.

1. Reconnoiter and inventory: What are you doing now

Each day for a week (Dean says 3 or 4 days) keep a log and record:
- How much time you spent writing
- The time of day
- Where you wrote
- Your mental state (e.g., Were you too tired to write until you had your coffee?)

Also record:
- How much time you spent reading.
- How much time you spent doing research
- How much time you spend on Twitter, Facebook, YouTube, etc. (That's my suggestion.)

Folks, this is an excellent idea! I set goals for myself every Sunday and, this week, this is my goal. For the next 7 days I'm going to record how I spend my time.

By the way, I want to do the recording for 7 days rather than 3 or 4 because my schedule changes quite a bit on the weekends. For me, it would be much more representative if I looked at the amount I work per week rather than per day.

Okay, that's the first step.

These next two steps don't have anything to do with the time of day your wrote at or where you wrote or what your mental state was like, that's for you, and it's (I think) valuable information.

I'm going to start a running log. Today, right after I finish publishing this post, I'm going to get a new notebook and make it my recording notebook.

2. Figure out your words per hour

This is what you'll do next Sunday. Take the data you've gleaned from (1) and figure out, on average, how many words you write in an hour.

3. Figure out how much you could write in a week

Take the data from (1) and (2) and figure out, on average, how many words you write a day. This will help you figure out how many books you'll be able to publish in a year. Of course you could do this from your words per week (words per week * 52 = words per year) but math is fun! :-)

An example:

Let's say you dutifully do your recording and one week from now have the following scribbled in your notebook:

The Data:
Writing time (time spend writing, not editing or researching):
Sunday: 2 hours; 1,500 words
Monday: 1 hour; 800 words
Tuesday: 5 hours; 3,000 words
Wednesday: half an hour; 500 words
Thursday: 3 hours; 700 words
Friday: 2.5 hours; 2,000 words
Saturday: None

Total writing hours that week:
2 + 1 + 5 + 0.5 + 3 + 2.5 + 0 = 14

Total words written:
1,500 + 800 + 3,000 + 500 + 700 + 2,000 + 0 = 8,500

First step: Calculate, on average, how many hours you wrote per day
14 / 7 = 2
Average writing hours per day: 2

Second step: Calculate, on average, how many words you wrote per hour.
8,500/14 = (about) 607
Average words written per hour: 607

Third step: Calculate, on average, how many words you wrote per day
607 * 2 = 1,212
Average words written per day: 1,212

Fourth step: Calculate, on average, how many words you'll write in a year
You could do this two ways:
8,500 words per week * 52 weeks = 442,000 per year
1,212 * 365 days = 442,380 words per year = (about) 442,000 words

Fifth step: Calculate how many novels you can write in a year
Let's say you want to write novels that are about 80,000 words long.
442,000 / 80,000 = 5.525

Let me say, wow! If a person writes only 1,212 words a day for a year, you'll be able to publish 5 novels that year? (I just did the math again.) Yep!

I read Dean's figures but it didn't sink in until just now. That's amazing! Over NaNoWriMo I discovered I could write 1,500 words an hour without too much difficulty. 1,500 words a day, one hour, and I'd have over 5 books at the end of the year!

Huh.

Well, editing is where my time goes. For every hour of writing I spend 4 editing the darn thing (writers can have a love-hate relationship with their manuscripts. A lot like teenagers that way ...)

Goal Two/Path Two

Figure out how much money you need to live and then figure out, from that, how much material (novels, short stories, whatever) you'd need to create in a year.

Let's say (this is the number Dean uses) you need to make 50,000 dollars a year from your writing. There are two ways of doing this, the traditional publishing route and the independent publishing route. Let's take the traditional route first.

Traditional Publishing Route

What can a new author get for a first book, or for their first few books? It's very difficult to judge, but let's say $5,000 per book. Perhaps the first book would be less, perhaps some books would be more, but let's say $5,000.

At $5,000 per book you'd have to sell 10 books a year to make $50,000.

That sounds discouraging and I don't mean it to. At first no publisher will give your book a big print run but as you continue to sell more people will want to read your books, you'll get larger print runs and so publishers will give you larger advances.

It just takes time.

Independent Publishing Route

Dean says that, at first, an indie author would be lucky to sell 25 copies a month. So, let's say they're lucky and that the novels are selling for, as Dean suggests, $5.99. That means (if they are being sold on Amazon) the author will get 70% or $4.19 (let's say $4).

Each month our indie author will make 4 * 25 = 100 per month or 100 * 12 = 1,200 per year. That means they'd have to have (50,000/1,200=41.67) 42 books in the Amazon store to make $50,000 per year!

Of course 42 books is entirely doable, but not in a year!

Which, I think, is Dean's point.

So, how long would it take you to earn $50,000 per year if you wrote 5 novels per year? That's easy: 42/5 = 8.4. It would take around 8 years for an indie author to make $50,000 per year.

Actually, that's not bad. That's doable! 25 sales per book per month isn't much and many indie books are priced at $5.99 these days.

Wow. I think this was, for me, Dean's most awesome post--and there've been quite a few!

Focus On What You Control

There are no guarantees. Your independently published book might sell less than 25 copies a month. Significantly less. Your traditionally published book might under-perform and your publisher might drop you (if memory serves, this happened to Laurell K. Hamilton with her first book Nightseer).

There's a lot we don't control but there's two things we do:

- (T & I) How much you write.

- (T) How many manuscripts you send out.

- (I) How many books (short stories, etc) you publish.

- (I) The quality of your published books (blurbs, cover art, formatting) and where the book is sold (the markets, whether you have a print copy, audiobook, etc).

Indie Authors: Focus on selling your work in as many forms as you can

Dean stresses, and for what it's worth I agree wholeheartedly, that it's a good idea to make your work available in as many formats as possible (ebook, POD, audiobook). Dean writes:

You control the attempt to sell. You don’t control the buying or not buying, but you control the attempt to sell.

I think that, even if an author doesn't sell a lot of audiobooks, it's worth doing for the exposure to another market. It is one more way for you to get discovered by readers/listeners. That said, producing an audiobook can be expensive, but you can do it yourself. (See: How To Record Your Own Audiobook: Setting Up A Home Studio)

Dean warns against exclusivity and that's an old debate, one I've written about previously a few times. (See: Does Amazon KDP Select Drive Away True Fans? and Amazon's KDP Select Program Has A Lot To Offer New Writers, But What About Established Ones?)

That's just a sample of Dean's advice. I urge you to read his article: The New World of Publishing: Goals and Dreams.

Thursday, September 27

The Key To Success: 3000 Words A Day

There are writers and then there are writers. In a recent post Kris Rusch reveals that she wrote 1,000,000 words last year. One million! That means she wrote nearly 3,000 words a day, each and every day.

My mind boggles! I think I might be able to do 3,000 words a day, but I'm not sure what else I'd have time for--but perhaps that's the point. One has to prioritize and non-writing related pursuits fall by the wayside. Specifically, fretting over and tweaking ones sales strategies.

Kris Rusch admonishes writers to concentrate on their writing as opposed to their sales since writers make money from the creation and sale of new work. She writes:

Stop trying to tweak your numbers on one platform in one or maybe two countries on a daily basis, and write more books. Publish more books. Use all of the opportunities available to you.

Stop watching the sales numbers and start watching your personal production numbers.

I wrote one million words last year, despite a pretty serious illness, some major personal setbacks, and problems of others that my husband and friends are still dealing with.

The million words are under my control. The number of sales, once a book is released, is not under my control. Not when you look at the worldwide market, at all of the distribution channels. I can get the work out there, then I have to trust it to sell.

Write more. Fret less. Stop watching your sales numbers. Beat my million words this year.

Wow! One million words. I can't get over it. I doubt many writers have been able to match her output. But that ties in with her other advice:

Your writing career isn’t about this month or next month or last month or even five years from now. If you do this right, your career should last for your entire working life. We’re all different. I’m 52, and I hope to have as many more working years as Jack Williamson had. He was still writing up to his death at the age of 98. That means I get another 46 years of a writing career. On top of the thirty I’ve already had.

I’m planning for that.

Why do I have the image of Kris Rusch in a Superman outfit? I marvel that she has any time left to read!

Kris' post (The Business Rusch: Watching The Numbers) has both inspired me and made me feel like a complete slacker! Okay, gotta stop chatting with you folks and write. :-)

Other articles you might like:
- Tips For First Time Writers
- Query Tracker: Keep Track Of Your Stories
- Penelope Trunk Discusses Time Management

Photo credit: WordRidden

Friday, May 6

Writer Beware: Contracts

I consider myself relatively knowledgeable about the business of writing, which is why Kritine Kathryn Rusch's post this week shocked me. I used to think of an agent as a writer's advocate, someone who would, among other things, help the writer negotiate her contract with a publisher, someone who would have the writer's best interests at heart.

In Advocates, Addendums, and Sneaks, oh my! Kristine writes that, for the most part, this is no longer true. For example:

I hadn’t realized until a few months ago that the adversarial relationship that sometimes existed between writer and publisher had moved into the agent/author relationship.

My first glimmer came when I looked at a former student’s agency agreement. Honestly, when the student contacted me to look over a contract clause, I thought the clause was in a publishing contract—at least that’s how it read in the e-mail. Then I saw the entire agreement and realized who had issued it.

The agreement called for the agent to have the right to represent the writer’s work in all forms for the duration of the copyright of the work, even if the relationship between the agent and the writer was terminated. I blinked, damn near swallowed my tongue, and told the writer not to sign the agreement. Even though the agency was a reputable one, this clause was horrible.

Too late, though. The writer had signed the agreement a year before I looked at it, and something had happened between writer and agent to call that clause into question.

I would urge anyone who is considering getting an agent to read Kristine's article. As I understand it, she isn't saying, "Don't get an agent," as much as she is saying that writers need to learn how to read contracts and then read them. She gives several examples of clauses to watch out for, as well as some rather nasty tricks that might fool even an experienced writer.

Friday, February 18

Another Great Post from Dean Wesley Smith

This is another post on the business of writing. Read it here.

Sunday, February 6

Dean Wesley Smith and the New World of Publishing

If you are a writer, or at all interested in the business of writing, Dean Wesley Smith's blog -- as well as Joe Konrath's blog -- is a must read.

Today Dean wrote about writing speed and how that influences which route a writer might be interested in going in -- indie publishing or traditional. It is one of the best articles I've read on the business of writing. His wife, Kristine Kathryn Rusch, has a great blog too and she is currently doing a series about the new world of publishing. Good stuff.

Happy reading. :)

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