Book Advances?

You might not get a contract for a second book. Kinda depends on how much it didn't sell out. You don't have to pay it back, though. The only time you'd have to do that is if you did something bad (plagiarize, for example).

Or your advances for future books will get smaller. And, of course, you won't get any royalties on the book that doesn't earn out its advance.

Realistically your writing career will begin to have a slow, agonizing, spiraling death.

Thats assume you even get another contract after you crash and burn on the first.

Unless you are in breach of contract for specific things stated in said contract, you don't pay advance money back.

How it affects your career depends on the size of your advance and how poorly (or well) the book sold. If you received a $500k advance for one novel and you only sell 10k copies...yeah, that's bad. Of course, a modest advance on a book can not earn its advance out, but still make money for the publisher.

Rather than asking whether you earned out (most books don't), ask whether your second book sold more copies than your first.

And, as others have said, assuming you turned in the book at all, you don't have to pay the advance back.

So I have a question too, and this thread seems like the appropriate place for it.

An advance is what you get when you've been offered a contract, but before you start working with an editor right? ? It's supposed to keep you with the company, is my understanding.

So, if the publisher then decides they don't want your book, through no fault of your own, do you have to pay the advance back?

I ask this for a serious reason. I'm on Disability payments. BUT, I have to report my earnings (if any). So, if I got an advance of let's say $20k, then that would basically mean no disability payments for a year (or until I ran out of money). So, if there's a chance that the publisher will want the money back if they opt out of our agreement, then I'd prefer not to have the advance and just get paid on publication, because as soon as I have the advance, that's the money I have to live off. If, 4 months later, the deal falls through and I have to pay all of it back, I won't be able to, because I'll have had to have spent some of it.

So yeah, this one has me a little worried. If a publisher wants out of a contract, do you owe them the advance?

Cliff Face said:

So I have a question too, and this thread seems like the appropriate place for it.

An advance is what you get when you've been offered a contract, but before you start working with an editor right? ? It's supposed to keep you with the company, is my understanding.

So, if the publisher then decides they don't want your book, through no fault of your own, do you have to pay the advance back?

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Well, there's two kinds of advances.
#1--you have already written a book. You've submitted it to a publisher. They've decided to buy it, and they give you an advance for it. "Advance" doesn't mean that the book hasn't been submitted yet, or written yet... it just means that the book hasn't started earning royalties yet.

#2, and I think this is what you're talking about--You get an advance for a book you haven't written. For example, let's say you've written the first book of a trilogy, and the publisher loves it so much that they want to go ahead and buy the next two books even though they haven't been written yet. Or let's say you've written one book, and the publisher is so enthusiastic about it that they want to make sure you stick with their house for your next book and can't demand a hugely larger advance. Or you're Stephen King and the publisher wants to make sure they get to publish the next Stephen King book, whatever it might be. In these scenarios, you'll get paid part of your advance before you actually turn the book in. (You might get paid 10% on signing your contract, 15% when you submit an outline and first chapter, 50% when you actually turn the book in... it almost certainly won't come all at once.)

In scenario #2... it CAN happen that you send the book to the publisher, they decide they hate it, and cancel the deal for your book. It really depends on the terms of your contract what would happen with the advance in that case, and what your options might be. And that's something you should look at with your agent and publisher when you do get a multi-book contract.

Usually you see advances as half on signing, half on turn in and acceptance, or one-third on signing, one-third on acceptance, and one-third on publication.

If they don't accept the book, usually you keep the on-signing money. Check your contract. It is possible that you'll find language to the effect that if you re-sell the book to some other publisher after they've turned it down, that you'll have to repay the portion of the advance you've received out of the new publisher's advance.

Your agent will guide you.

"#1--you have already written a book. You've submitted it to a publisher. They've decided to buy it, and they give you an advance for it. "Advance" doesn't mean that the book hasn't been submitted yet, or written yet... it just means that the book hasn't started earning royalties yet."

My question was: you've written a book, you've submitted it, you get an offer to publish, but they want to edit it first. So the question was do they give you the advance BEFORE editing? So basically, once they've done a couple rounds of edits, if they don't want it anymore... that's what I was getting at.

"In scenario #2... it CAN happen that you send the book to the publisher, they decide they hate it, and cancel the deal for your book. It really depends on the terms of your contract what would happen with the advance in that case, and what your options might be. And that's something you should look at with your agent and publisher when you do get a multi-book contract."

I'm guessing this translates to my question pretty well. It'll be part of the contract stipulation as to whether you have to pay the advance back. But I'd still like to know if my definition of advance was correct - that you get it after an offer and before edits.

Thanks.

Cliff Face said:

An advance is what you get when you've been offered a contract, but before you start working with an editor right? ? It's supposed to keep you with the company, is my understanding.

So, if the publisher then decides they don't want your book, through no fault of your own, do you have to pay the advance back?

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An advance is basically an advance against royalties. It's the amount of the money the publisher, after doing their handy dandy Profit & Loss statement, decide they think the book will make you in royalties. This advance is what is offered when the deal is made--it is advance payment for what they hope to eventually see your book make.

However, no money will make it to you until the contracts are signed. Different houses work differently, but the standard is 1/3 on signing, 1/3 on acceptance of the final manuscript, and 1/3 on publication. My house worked in halves, which breaks down to: Deal made late August, began working with editor almost immediately while contracts were negotiated, signed contracts in October, received first check later that month.

Once a publisher has committed to a book, there aren't a lot of reasons for them to suddenly change their mind. If they do before contracts are signed, then no money has changed hands yet and you're fine (except for being obviously heartbroken). If they change their mind after the contracts are signed, then they need a reason to break the contract, as stated in the signed contract. Mine states specific reasons why I or the publisher can terminate the contract, and what specific amounts of monies paid must be repaid.

This is all, of course, my experience with a large house. It's possible that advance-paying small and e-presses work differently.

James D. Macdonald said:

Usually you see advances as half on signing, half on turn in and acceptance, or one-third on signing, one-third on acceptance, and one-third on publication.

If they don't accept the book, usually you keep the on-signing money. Check your contract. It is possible that you'll find language to the effect that if you re-sell the book to some other publisher after they've turned it down, that you'll have to repay the portion of the advance you've received out of the new publisher's advance.

Your agent will guide you.

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Ah, that's what I was looking for. Thanks.

ChaosTitan said:

An advance is basically an advance against royalties. It's the amount of the money the publisher, after doing their handy dandy Profit & Loss statement, decide they think the book will make you in royalties. This advance is what is offered when the deal is made--it is advance payment for what they hope to eventually see your book make.

However, no money will make it to you until the contracts are signed. Different houses work differently, but the standard is 1/3 on signing, 1/3 on acceptance of the final manuscript, and 1/3 on publication. My house worked in halves, which breaks down to: Deal made late August, began working with editor almost immediately while contracts were negotiated, signed contracts in October, received first check later that month.

Once a publisher has committed to a book, there aren't a lot of reasons for them to suddenly change their mind. If they do before contracts are signed, then no money has changed hands yet and you're fine (except for being obviously heartbroken). If they change their mind after the contracts are signed, then they need a reason to break the contract, as stated in the signed contract. Mine states specific reasons why I or the publisher can terminate the contract, and what specific amounts of monies paid must be repaid.

This is all, of course, my experience with a large house. It's possible that advance-paying small and e-presses work differently.

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And thanks too. Wow, lots of responses in such a short time.

Cliff Face said:

So the question was do they give you the advance BEFORE editing? So basically, once they've done a couple rounds of edits, if they don't want it anymore... that's what I was getting at.

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It depends. However, since it can take up to several months to negotiate contract language, it's very likely you'll start working with the editor before contracts are signed/money changes hands.

Unless an author is being seriously unreasonable about revisions (or likewise, and editor is being crazy with requests), I can't imagine an editor suddenly deciding they don't want it. Generally, before a book is acquired, an editor needs approval from other people. A lot of time goes into choosing books and publishers don't take offers lightly.

I do know of a book that was canceled after being bought--the acquiring editor was laid off, and the editor the book was consequently assigned to wasn't enthusiastic enough to keep going forward with the book. The author got to keep the advance she'd already been paid, in that case.

As long as we're on the subject of advances...

Is it possible to turn down an advance in favor of a higher percentage of royalties? Would a publisher go for that? More importantly, would your agent kill you for wanting to try it?

Fredster said:

As long as we're on the subject of advances...

Is it possible to turn down an advance in favor of a higher percentage of royalties? Would a publisher go for that? More importantly, would your agent kill you for wanting to try it?

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No idea, but it's doubtful. And as a new author, you'd be crazy to want it, because the number of copies sold is never a guarantee. Authors like Stephen King can get away with low advance/higher royalties because publishers know he'll sell.

ChaosTitan said:

No idea, but it's doubtful. And as a new author, you'd be crazy to want it, because the number of copies sold is never a guarantee. Authors like Stephen King can get away with low advance/higher royalties because publishers know he'll sell.

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Everyone says that most books don't earn out their advance. Seems like it would be advantageous for the publisher to go this route if an author was willing, doesn't it? They (the publisher) wouldn't have nearly the up-front risk.

Fredster said:

Everyone says that most books don't earn out their advance. Seems like it would be advantageous for the publisher to go this route if an author was willing, doesn't it? They (the publisher) wouldn't have nearly the up-front risk.

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The amount paid to the author is, typically and generally, only a fraction of their up-front expenses. And not a particularly large one.

willietheshakes said:

The amount paid to the author is, typically and generally, only a fraction of their up-front expenses. And not a particularly large one.

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Exactly!!!

Fredster said:

Everyone says that most books don't earn out their advance. Seems like it would be advantageous for the publisher to go this route if an author was willing, doesn't it? They (the publisher) wouldn't have nearly the up-front risk.

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Moonrat has an excellent post explaining this part of the business:

http://editorialass.blogspot.com/2009/11/whats-difference-between-earning-out-my.html

Fredster said:

Is it possible to turn down an advance in favor of a higher percentage of royalties? Would a publisher go for that? More importantly, would your agent kill you for wanting to try it?

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Anything is negotiable. Some authors have been known to bypass an advance and instead stipulate that the publisher put the monies into marketing and promotion. Seeking the advice of your agent is the best way to answer this, but keep in mind that your agent makes a living collecting a commission for work done. Few agents would want to go this route without an alternative means of income such as a larger portion of your royalties.

As a gambler, the idea of fighting for a bigger royalty percentage certainly appeals to me. I guess it would come down to my confidence level (assuming the publisher and agent were agreeable) -- do I think my book will do well enough to make the gamble worth it for that extra 1% or 2%?


It's fun stuff to think about, like winning the lottery.

Joe Moore: thank you for commenting, which led me to check out your books on Amazon and read an excerpt of the first one. Looks like I have something new to ask for for Christmas.

What I would consider is getting a standard deal on the first book, then seeing how many books I sold (surely the publisher could provide those details after, say, a year, or before you sign the next contract - number sold from publisher to stockists would be royalties regardless of if the public bought the books, right?) - once I know how many books I sold (and have got an estimate of how well that went based on publisher's opinion) I would then do a little math and determine how much money I'd get by raising royalties 1% (assuming same number of sales for next book) - then I'd offer to reduce my advance by that much for the increased royalties. This is the gamble that makes sense to me... Slightly better sales and suddenly you're well-to-do.

But I'd only consider it. I'm not much of a gambler, so I'm not sure I'd go through with it, although if I became a bestseller then I'd definitely be looking at ways of increasing royalty percentages.

(surely the publisher could provide those details after, say, a year, or before you sign the next contract - number sold from publisher to stockists would be royalties regardless of if the public bought the books, right?)

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No.

Royalties only happen when readers walk out of the bookshop with the book in their hands.

Everything else up to then is multiple sets of interlocking credits. Bookshops don't send money to publishers when they order books. Nor do publishers send money to bookshops when the bookshops return books. Bookshops pay the difference between the number of books ordered and the number of books returned. And royalties are based on that difference.