This is the 5th article in my publishing series. Non-publishing content will return in February, so if you are reading this and aren’t interested in this topic of publishing, please check back then.


This article is aimed specifically at people who have decided that they are thinking about Self-Publishing. Let’s face it, if you sign with a publisher, big or small, they will be setting the price and you won’t have to worry about it.

So, you’re selling the book yourself. What do you charge for the book? What’s a reasonable price? How much of that should you expect? All of these questions can be answered by economics: supply and demand. The next five weeks I’m going to talk at length about costs, price, and other factors concerning the money part of self-publishing.

There are three main schools of thought when it comes to publishing: 1. Make the price point of the books as low as possible in order to attract new readers. 2. Make the price point of the books exceptionally high because you put a lot of hard work into the book. and 3. Basically charge more or less what everyone else is charging.

I’m going to walk through each of these approaches, but first we need to understand some basic terms that will come up. Gross Profits – this is what you are paid in total from the retail sales, after the distributor/retailer takes their cut. Net Profit – the amount of money that you end up with in your pocket from each sale after expenses are paid.

It should not be at all surprising to anyone that the concepts of Price and Profit are positively correlated. A higher price point does mean, higher profits, but only in the simplest and most abstract sense. This kind of thinking completely ignores the other variable: demand.

So, let’s pretend that I have an ebook that I want to sell. I’m new and no one has heard of me before (largely true for me too). I could sell it at $0.99 with the idea that a lower price point will attract more readers. Sure, I might only get $0.50 for every book sold, but I’ll sell a bunch of copies because it’s only a buck and people don’t mind spending that. Right? Well, maybe. But under this super-low price point you really aren’t doing yourself any favors. Even if you sold 100 copies in a month (which aren’t typical sales volumes for an unknown self-published author…) you’d only clear $50. The thing to remember here is that people have a sense of quality about the things that they buy. So if they see a book that is only $0.99 one of the first thoughts they think is: this book is cheap. And if it’s cheap, it’s probably not very good. Especially if there are other books of similar length being sold for more. It’s very easy to think that the low price points will attract the economic readers, but this is a fallacy. If you only had $5 to spend on a book, are you more likely to gamble that $5 on a “bargain book” that you’ve never heard of, or are you more likely to spend it on a book that seems well put together? The majority of people will not gamble on the bargain books. People still strongly believe in the old adage “you get what you pay for.” While some people have successfully used the $0.99 price point to make a small fortune, those tales are more uncommon than they are common. They are the exceptions, not the rules. Granted, there is a time and place for this price point, more on that later.

If the low price point is generally bad, what about a high price point? It’s true, if I’m charging $15 or $20 for an ebook then I will have a much higher profit margin, right? Well, again, that’s true. But it still ignores that pesky problem of demand. Why would any customer spend $15 or $20 on your amazing ebook, when they have more than 3 Million other options? At least a few hundred thousand of those are going to be in genre they are looking for and at a lower price point than yours. Sure, on the whole, Non-Fiction books generally cost more than fiction books, because research. But there are some people who try the extreme approach, like this publisher who is charging $16,870 for an ebook edition. (Yes, I’m serious: Or this publisher who is charging $11,850 for an ebook edition. ( These publishers aren’t going to sell many ebooks, especiallly when their paper versions are orders of magnitude cheaper. This may be a typo in their pricing… or they could be thinking “if I sell just two copies per year, I can pay rent.” It’s really hard to tell. What is important to realize is that unless you are an A-List, NY Times Bestselling Author, pricing your ebooks at $15 and $20 is a mistake. No one knows who you are yet. Your books might truly be amazing. They might truly be the best books ever written. But no one will buy them. High price comes from trust. Trust comes from reputation. Reputation comes from time. Why do people shell out extra money for a luxury car? A luxury watch? What makes Starbucks Coffee better than Brand X? How much of that is a real, noticeable, measurable, and quantifiable difference in quality, and how much of that is simply brand loyalty? Anne Rice, Stephen King, Margaret Atwood, James S. A. Corey. People are willing to spend more money on those authors than they are on you. Is it because their books are really quantifiably better? I can’t say, I haven’t read your work. It doesn’t matter. The point is that there is a perceived value. People have read books by those authors before and decided that they like them. They have earned the trust of their readers over time that allows them to charge more. Unless you’re already a NY Times Bestselling author, or you’ve won some literary awards, your best bet is not over charging for your books. Not yet.

If this story were Goldilocks and the Three Bears, we want the price point that’s just right. The middle of the road price point; the one that everyone else is using. That’s our target area. It’s a small target, about 3 meters wide, not much bigger than a Womp Rat. And you can hit it, with or without your T-16 back home. (If you don’t get that reference just pretend that you didn’t read it and keep going).

But Price is only one part of the equation. There’s also Cost. Price-Cost = Profits. This will come up again next week as well, but for now the important thing is to realize that not all printing options are created equal. Without going into specifics, let me just demonstrate something with a clear message: you must understand how your profits are calculated.

Let’s pretend that we have a hypothetical fictional paperback novel. For the sake of this example let’s also pretend that the retail price is $10 (mostly just because it’s easy to do the math).

Now, suppose that the retailer takes their cut of 30% ($3). That leaves $7 as the Gross Profits. But, you still have to pay for the printing, which is $5. The entire $5 comes out of your Gross Profits, and you are left with a net profit of $2 per book.

Now, let’s use that same hypothetical paperback book, but we’ve used a different imaginary distributor. This one pays the $5 printing fee first. That leaves $5 in Gross Profits. Then they take their 30% out ($1.50), which leaves a Net Profit of $3.50 per book.

It doesn’t take a math genius to see that the first example is more distributor friendly, while the second example is more author friendly. As a general rule, always try to find vendors that subtract the “hard costs” before taking their percentage fees.

Some exceptions and general guidelines to the above:

What about the “economy” price point? It has a time a place. One time, during sales. Definitely note that it’s a sale – it speaks to that concept of value. Also, you can do “price matching” through many distributors. This is where the customer will get a discount on the ebook after they buy the paperback copy. Another good thing for this price point is a Novella or short story. Something that’s published, but not quite a full length novel. This price point ($0.99 – $1.99) are perfect for those. Some people have also tried using the lower price for introductory novels in a series. They do the first book at a low price to get readers hooked, and then raise the price on the rest. This has a mixed bag results from other authors I know – in some cases it’s not as effective because of the reasons I discussed earlier about perceived value. In other cases, it makes the customers angry because they feel like you pulled a bait and switch on them. You gave them a sample at a lower price to hook them and then jacked up the price on the rest. I don’t personally use this method, so I can’t report on it first hand, but I have heard mixed reviews from others.

For general fiction novels (more than 50K words) the general price range for ebooks seems to hover between $2.99 and $6.99 for indie published ebooks. If you wanted to split it further, 50-75K are typically between $2.99-$4.99 and 75K+ are $4.99-$6.99. This is by no means a hard rule. You can make your price whatever you want. I’m simply reporting what “the market” is at as of right now on Amazon. This is what other people are doing. If you deviate too far from these and you aren’t a well-known author, your sales may (likely) suffer.

Non-Fiction ebooks can get away with charging a bit more. I’ve seen these range from $4.99 – $19.99 for ebooks. But it depends entirely on how long the book is, the notoriety of the author, and the author’s credentials. As an example, if you had to choose between buying a book from someone with no credentials and no reputation, or from a college professor that they’ve never heard of, who would you pick?

In conclusion, when you are doing your estimates of price and profit, you would be remiss if you forgot to include “demand” in your equation. It’s really a multivariate calculation and missing that component can affect your bottom line. Almost everyone knows how to calculate profit margins on a single book. Many people do not ask the follow up question to that: how many books am I likely to sell at this price point?

Stay tuned next week and I talk about distribution options.

Profit & Price