Setting the right price for your book is crucial to its success. If you do not set the right price, you may do more harm than good to your sales. When pricing your book, you need to take into consideration many factors.
There are generally two methods that you can use to arrive at the price tag of your book. The first is the traditional or the bottom up method. It is called bottom up because you start your calculations from the bottom and gradually go upward to get the best price for the book.
In this method, you first take the production cost of your book, add the trucking costs and multiply the sum by eight to arrive at the magic figure. The reason to use this high multiple factor is to cover the commissions/profits of distributors, wholesalers, and stores, all of which demand a heavy cut of the list price of the book. Without the support of this distribution channel, you will be unable to deliver your book to the reader/buyer.
Usually a distributor’s cut is about 66%, wholesalers take up to 55%, and stores take 40% of the list price. Then the costs involved in promoting your book have to also be taken care of. Promotion is an expensive business and you will need to shovel back nearly 25 to 30% of the gross amount.
The least expensive way of promoting your book is to seek reviews. They are one of the most effective means that also costs the least. However, they involve sending review copies of your book to various newsletters, magazines, newspaper columns, and other opinion molders.
Remember that these review copies are books that are not sold, and therefore you do not get paid for them. They are sent free and the cost involved is considered promotional advertising expense. Depending on your subject and target audience size, you may have to send out hundreds of copies. One important factor that has overriding priority over the cost of production, while considering the final price, is the genre/category of the book.
Another method is the top down method. The principle here is to price your book according to the price of similar books in the market. The price that is given on the back page of the book should be in line with other books in the market, because retail prices are established not by the cost of production, but by the marketplace.
To find out market prices, visit bookstores that stock similar books and check the prices. You also need to note other points like the shape, quality and type of paper, and binding to determine what your reader/buyer is prepared to spend.
You must also keep in mind the target buyer segment when determining the price of your book. If it is targeted at teenagers, you need to make it low priced with a soft cover. Books for professionals like lawyers, doctors, accountants, technical experts etc. should be hardcover editions with dust jackets and can be priced higher, say around $80 to $100. Business books should be priced at around $35.
Pricing a book is a subjective issue and there cannot be any hard and fast criteria to fix the price. However, what is discussed above can enable you to proceed in the right direction while determining the price of your book.
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