Authors today have more options than they did only 10 years ago. Amazon is certainly the elephant in the room, but many, if not most, authors are quite dissatisfied with Amazon and how little of their retail price Amazon shares with them. Today I want to look at paperbacks and hardcovers and show you something that won’t surprise authors, but may surprise you as a reader. You may have assumed authors are making tons of money selling their books on Amazon, but that sadly is not the case. Did you know the average author only makes $2.00 to $5.00 from each book sale, and Amazon keeps the rest?

Over the years Amazon has been reducing the split they share with authors, and now they are down to 60% on paperbacks and hardcovers, but they deduct the printing cost from the author’s share, not from Amazon’s 40%.

Let’s walk through a clear example using a 240-page black-and-white book.

Printing Costs: Paperback vs. Hardcover

Amazon KDP uses a formula for printing costs:

Black-and-White Paperback

• Fixed cost: $0.85

• Per-page cost: $0.012

• Formula: Printing cost = $0.85 + ($0.012 × page count)

For a 240-page paperback: 0.85+(240×0.012)=0.85+2.88=$3.73 per copy [Total Printing Cost = $3.73]

Black-and-White Hardcover (Case Laminate)

• Fixed cost: $6.00

• Per-page cost: $0.012

• Formula: Printing cost = $6.00 + ($0.012 × page count)

For a 240-page hardcover: 6.00+(240×0.012)=6.00+2.88=$8.88 per copy [Total Printing Cost = $8.88]

Example Pricing Options

Paperback at $6.97

• Royalty share = $6.97 × 0.60 = $4.18

• Subtract printing = $4.18 − $3.73 = $0.45 net royalty for the author

• Amazon’s share is 40% of retail price = $2.79 net royalty for Amazon

Paperback at $9.97

• Royalty share = $9.97 × 0.60 = $5.98

• Subtract printing = $5.98 − $3.73 = $2.25 net royalty for the author

• Amazon’s share is 40% of retail price = $3.99 net royalty for Amazon

Paperback at $14.97

• Royalty share = $14.97 × 0.60 = $8.98

• Subtract printing = $8.98 − $3.73 = $5.25 net royalty for the author

• Amazon’s share is 40% of retail price = $5.99 net royalty for Amazon

Paperback at $19.97

• Royalty share = $19.97 × 0.60 = $11.98

• Subtract printing = $11.98 − $3.73 = $8.25 net royalty for the author

• Amazon’s share is 40% of retail price = $7.98 net royalty for Amazon

Hardcover at $24.97

• Royalty share = $24.97 × 0.60 = $14.98

• Subtract printing = $14.98 − $8.88 = $6.10 net royalty for the author

• Amazon’s share is 40% of retail price = $9.98 net royalty for Amazon

Hardcover at $29.97

• Royalty share = $29.97 × 0.60 = $17.98

• Subtract printing = $17.98 − $8.88 = $9.10 net royalty for the author

• Amazon’s share is 40% of retail price = $11.98 net royalty for Amazon

Most books on Amazon in terms of volume sell between $2.99 and $9.99, so the largest block of authors selling their books on Amazon are making between 45 cents and $2.25 net royalty per book! With taxes and shipping (free with Prime) consumers have to pay more than the retail price, sometimes an additional 20% to 30% of the retail price. This is another reason eBook sales are growing dramatically. There is far more value and much less cost with an eBook.