Tuesday 28 May 2019

How we calculate royalties




Who
When
Number
gross
print
Net
L
Nov-18
7
48
36.78
11.22
B
Nov-18
15
101.3
58.85
42.4
W
Nov-18
6
40.5
29.44
11.06
C
Nov-18
5
33.75
23.55
10.2
R
Nov-18
5
33.75
23.55
10.2
R
Nov-18
4
27
20.02
6.98
Al
Nov-18
1
8.25
6.83
1.42
F
Nov-18
5
33.75
23.55
10.2
G
Nov-18
30
202.5
118.94
83.56
Celebration event
Nov-18
20
120
76
44
LS US
Nov-18
1


2.48
LS UK
Nov-18
1


2.49
Amazon UK
Nov-18
3


3.9
W
06-Dec-18
3
20.25
   7.29
12.96
I
18-Dec-18
1
8.25
6.83
1.42
LSUK
31/12/2108
6


14.94

Who, when and number are probably self-explanatory. Gross is the amount paid by individuals ordering directly with us. Print is the price we pay for printing and shipping. Net is the amount per order we receive after all costs have been paid. Note there are no gross amounts for receipts from Amazon and Lightning Source. We pay nothing out in advance. The downside of the latter is that we don’t receive the payment until 90 days later.  
The second half of the spread sheet looks like this (note this is taken form a different example):  

Net
royalty
profit

RA





11.22
4.7685
4.7685

6.4515
42.4
18.02
18.02

24.38
11.06
4.7005
4.7005

6.3595
10.2
4.335
4.335

5.865
10.2
4.335
4.335

5.865
6.98
2.9665
2.9665

4.0135
1.42
0.6035
0.6035

0.8165
10.2
4.335
4.335

5.865
83.56
35.513
35.513

48.047
44
18.7
18.7

25.3
2.48
1.054
1.054

1.426
2.49
1.05825
1.05825

1.43175
3.9
1.6575
1.6575

2.2425
12.96
5.508
5.508

7.452
1.42
0.6035
0.6035

0.8165
14.94
6.3495
6.3495

8.5905

At the end of the year, 31 December, the royalties are totted up and divided by the number of authors in a book. However, they are not paid until the end of March to allow for the 90 day delay.
The “profit” is used to offset set-up costs. Once those are covered, any profit is shared between the partners. At the moment we pay ourselves no wage for editing, designing and marketing books. However, changes are afoot – watch out for the next post.                 

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