What happens if someone returns your book?

KikiteNeko · May 17, 2008

Okay, so this is really just a curiosity question, since I'm still unpublished.

I know that authors get paid from their advance first, and it's been my understanding that once the book has sold past its advance, the author gets a portion of sales from each book sold.. Correct me if I'm wrong; that's what I'd been told.

So my question is, what happens if someone buys your book from a bookstore, and then returns it to the bookstore? Like if they got it as a gift and didn't want it, or they cracked it open and realized it wasn't their cup of tea. Does your profit get taken away?

William Haskins · May 17, 2008

goons come and break one of your ribs for each returned book.

Rowdymama · May 17, 2008

Is it a publisher, or a reader who bought your book? It's not clear, but I'll assume it's a reader. How can someone have bought your book yet you are "unpublished?"

If someone bought one of my books and then sent it back, I'd thank them very much and sell it again.

KikiteNeko · May 17, 2008

Rowdymama said:
Is it a publisher, or a reader who bought your book? It's not clear, but I'll assume it's a reader. How can someone have bought your book yet you are "unpublished?"

If someone bought one of my books and then sent it back, I'd thank them very much and sell it again.

Like I said, this is just a curiosity question. I meant if a reader bought your book and then returned it to the bookstore.

dpaterso · May 17, 2008

It's not instantaneous. Just because someone returns a book today doesn't mean your publisher will ask you to return your $2.50 royalty tomorrow.

Book sales will be calculated over an agreed period, after which money will change hands and any unsold books will be returned to the publisher.

The publisher will then calculate total sales and pay its author(s) due royalties, if any.

-Derek

dawinsor · May 17, 2008

The publisher keeps back a portion of what you're owed against returns.

Birol · May 17, 2008

Rowdymama said:
Is it a publisher, or a reader who bought your book? It's not clear, but I'll assume it's a reader. How can someone have bought your book yet you are "unpublished?"

If someone bought one of my books and then sent it back, I'd thank them very much and sell it again.

It's a hypothetical question.

Tomo, such situations as you describe are one of the reasons there is a lag between the publisher receiving monies and the writer receiving them.

loquax · May 17, 2008

It's like the sale of any goods. If you buy a mouldy orange and decide to get your money back from the grocery store, the grocery store then goes to the farmer to get their money back. The farmer then goes to the tree and gets their money back from the tree. Then the tree goes to the sun and gets its money back, although sometimes it gets its money back from the soil.

In general, the sun absorbs most profit losses.

rugcat · May 17, 2008

Publishers deal with that by what they call "reserve against returns."

windyrdg · May 17, 2008

You're confusing returns and RETURNS.
In the first case, Grandma goes to the bookstore and buys Sally a book. Sally takes it back because she doesn't like it and exchanges it for that erotic novel she's had her eye on. (Yeah, Sally's that kinda girl. What can I say?) Meanwhile, the bookstore takes the book Grandma bought and puts it back on the shelf.

Now, fast forward a month. The bookstore decides they no longer want to stock said book. They round up all their copies, put them in a box and send them back to the publisher's warehouse. Now, you've got a RETURN.

As someone said, the publisher always holds back some of the royalties for portential returns. How much and how long they hold it can be a sore spot with some authors. Of course, before you can receive any royalties, your book has to earn out. That is, it has to sell enough copies so that you're owed more than they've already advanced.

Agent Chip MacGregor has a couple of good posts on his blog about this topic. (chipmacgregor.com) If don't already, I'd suggest you begin reading agent's blogs. They're a wonderful source of information on many topics.

Rowdymama · May 17, 2008

This guy is an agent??

hammerklavier · May 17, 2008

Couldn't the store simple sue the mould?

loquax said:
It's like the sale of any goods. If you buy a mouldy orange and decide to get your money back from the grocery store, the grocery store then goes to the farmer to get their money back. The farmer then goes to the tree and gets their money back from the tree. Then the tree goes to the sun and gets its money back, although sometimes it gets its money back from the soil.

In general, the sun absorbs most profit losses.

maestrowork · May 17, 2008

tomothecat said:
Okay, so this is really just a curiosity question, since I'm still unpublished.

I know that authors get paid from their advance first, and it's been my understanding that once the book has sold past its advance, the author gets a portion of sales from each book sold.. Correct me if I'm wrong; that's what I'd been told.

So my question is, what happens if someone buys your book from a bookstore, and then returns it to the bookstore? Like if they got it as a gift and didn't want it, or they cracked it open and realized it wasn't their cup of tea. Does your profit get taken away?

Royalties are paid for copies sold. Once you earn out the advance (which is yours to keep, by the way, whether you actually earn out or not), you start to get royalties based on your contracted schedule. Returns are set against royalties. From what I understand, a lot of stores use a credit system, and they have an accounting period (30, 60, 90 days -- whatever). Sometimes cash is not really exchanged. Anyway, you don't get royalties every day or every month -- probably more like every quarter or six months. That means by then all the returns of that period would be tabulated against your royalties.

But don't confuse store returns with customer's returns. If the costumer returns a book (per store's policies), the book goes back on the shelf. It's not a store return. Now if, after six months, the copies did not move and the store decides to return all the remain copies (say, 40 of them), then they become "returns." That is the number to be tabulated by the publisher.

Stores usually keep the books for a period of time. The bigger you are as a writer, the longer they'll probably keep your books. Shelf spaces are very limited, you know?

Say during that period your publishers sold $10,000 worth of your books. At 10% your royalties would have been $1000. But there were $1000 worth of returns. So your actual royalty of that period would be $1000 - $100 = $900.

Gillhoughly · May 17, 2008

If it's a Certain Infamous Publishing Mill, the book being returned will be put back on the shelf, then its writer (who checks every day to see if anyone bought it) will notice.

The writer will hack into the store's security system, find the buyer who took it back, track him down, and demand to know WHY he didn't keep the book. Tears, threats, and police on the scene may ensue, depending on the stability of the writer and whether or not she brought her BFF along for backup.

The CIPM will tell the writer to try harder at marketing, this was all clearly her own fault, and forget to give her a royalty on it...even though she bought it herself to beg the store owner to stock it on consignment and should HAVE a royalty.

As for regular publishing venues, the posts above have covered all that really well.

TPCSWR · May 17, 2008

maestrowork said:
But there were $1000 worth of returns. So your actual royalty of that period would be $1000 - $100 = $900.

Think you added an extra 0.

Polenth · May 17, 2008

hammerklavier said:
Couldn't the store simple sue the mould?

Then the mould sues the orange, the orange sues the tree... and you're back to the sun again anyway.

James D. Macdonald · May 18, 2008

Don't worry about returns. They're the publisher's problem, not yours.

Triomferus · May 19, 2008

TPCSWR said:
Think you added an extra 0.

Nope, it was correct

.

David I · May 19, 2008

James D. Macdonald said:
Don't worry about returns. They're the publisher's problem, not yours.

Exactly.

But from a career point of view, you may want to know something about your return rates. In recent years, these have sometimes been huge; there are rumors of some novels having up 70% returns from the bookstore.

If your advance doesn't earn out by a little, that's not a problem. If your advance doesn't earn out by a huge percentage--and if most of the books end up remaindered--then you do have a problem. It goes on your resume, so to speak.

Yes, you get to keep the advance. But selling your next book may pose some problem. And the publisher will probably do a smaller print run. And the bookstores will look at how many they ordered last time and how many they sold, and adjust their numbers downward.

This is called the Death Spiral, and is an important plot element of Donald Westlake's grim and hilarious novel The Hook.

maestrowork · May 19, 2008

James D. Macdonald said:
Don't worry about returns. They're the publisher's problem, not yours.

But don't returns affect your royalties (beyond the advance)? But yeah, it's not something the writer should worry about.

Sunshine13 · May 19, 2008

Either way, glad to know this stuff. Thanks for the starter and repliers of thread.

James D. Macdonald · May 19, 2008

maestrowork said:
But don't returns affect your royalties (beyond the advance)?

Yeah, but only indirectly. A book that doesn't sell is one that you don't get a royalty on. It doesn't matter, really, if the reason was because no one picked it up off the shelf, or someone bought it but returned it the next day.

70% returns are horrible. But you mostly see those in massively-hyped books (1945 by Newt Gingrich, for example, or Monica Speaks! by Monica Lewinsky). If someone thinks your book will be a best-seller but they guess wrong, particularly if they get pyramids of your book beside the door in bookstores all over America which the readers ignore ... it's brutal.

blacbird · May 19, 2008

At least it means someone held it in their hands and maybe looked at it. That puts it waaaaay ahead of any of the books I've written.

caw

Bartholomew · May 20, 2008

The publisher eats the cost, assuming they already cut you a royalty cheque.

At least, they'd better. They can come get the money back when they pry it from my cold, dead fingers.

TPCSWR · May 20, 2008

Triomferus said:
Nope, it was correct .

But there's this (bolding mine):

maestrowork said:
your royalties would have been $1000. But there were $1000 worth of returns. So your actual royalty of that period would be $1000 - $100 = $900.

If you got $1,000 of royalties and there was $1,000 of returns you'd get nothing.

I'm not arguing for the sake of arguing, that mistake in particular grated on me. And I thought this was going to be a simple typo pickup.

What happens if someone returns your book?

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