Quality

Quality is your first consideration.  If your publisher accepts anything that comes "over the transom," your book will be associated with others that are poorly done, and bookstores won't take the publisher seriously.  A publisher that doesn't care what type of work goes out under his imprint also doesn't care whether or not your book gets sold.  

Although industry rates for professional editors range from $2.50 a page to $12.00 a page and more depending on how much work the book needs, it’s better for you in the long run to get your work into polished condition than it is to have it made and then let it languish because it has been associated with “poor companions.”  Llumina's editors can make a real difference in the quality of your book.

Exclusive vs. Non-exclusive Rights

Another issue to contend with concerns the rights you are keeping and the rights you are assigning to the publisher.  If the publisher gets exclusive publishing rights, then no one else can publish your book.  A better choice for the writer is a publisher who is willing to take non-exclusive rights.  Non-exclusive rights means you can work with as many vendors as you want, and keep all the revenues you generate.  And as long as you retain subsidiary rights you can also benefit from movie and television rights, character merchandising, CD games, and other products derived from your work.

Contract Period

Most online publishers require authors to sign a contract that locks them in for a period of time ranging from one to five years or more.   Authors who want to maintain control over their material should make sure that there is a clause in the contract that allows them to terminate the agreement within a specified period of time. 

Investment

Self-publishing used to cost many thousands of dollars.  But with Print-on-Demand and eBook technology the only costs are setup costs.  These have to do with typesetting your book, creating cover art, setting up the POD and eBook files, getting your account set up, and other administrative details like assigning ISBNs and applying for Library of Congress numbers.   Setup costs for Print-on-Demand throughout the industry range from as low as $99 for a generic looking book with a plain cover to $2000.  Once you go to illustrated, full-color, perfect bound covers, however, all POD books are virtually indistinguishable from those that are traditionally printed.

Comparison Chart

(Source: Self Publishing in the New Millenium)  

**All comparison prices are based on assuming the following services:

ISBN and Library of Congress #s, Barcode/EAN, Formatting of book text, Original cover design, 5 or more images (on disk), Non-exclusive contract, Electronic (or digital) proofs, Distribution through Ingram and Baker &Taylor, Laminated cover, Perfect Binding, On site web page for your book

HOW TO READ THIS CHART:

Pay attention to anomalies. For instance, if the retail price is very high and the royalty is also very high, that may seem good, but is it?  If other books of the same type, size, and number of pages are selling for significantly less, then a high retail price is not competitive.  If the royalty seems higher than most, then ask yourself why. What retail price is the royalty based on? What is the distributor discount? A low distributor discount also means a low bookseller discount.  For instance, with a 35% distributor discount, the bookseller will probably only be able to make a 15% to 20% profit, while on books with a 55% discount the bookseller will get 35% to 40%.  Which book do you think the bookseller is more likely to buy?

Royalties

And what about royalties?  Be careful that you compare apples to apples.  Royalties can be based upon list price or they can be based on net price.  Some publishers play with these numbers, trying to make the royalties look substantial while still covering their costs and making money.  Usually, 10% of list price comes out to be more than 25% of “actual payments received less distribution, returns, and sales and use taxes.”  “Actual payments received” is list price minus discounts to the wholesaler (usual trade discount is 50 to 55%), printing cost, and other expenses.  

For example, let's say your book lists for $16.00.  A 10% of list royalty would be $1.60.  That may not sound like much, but let's look at how it works out the other way.  The net price or "actual receipts" from a sale made through a bookseller reflects a trade discount of 55%.  So right off the top, the price drops $8.80.  That leaves the publisher with $7.20 in actual receipts.  Let's forget about shipping and handling because the bookseller will pay it, and let's also forget about sales tax because this is a wholesale sale.  The publisher has $7.20 in hand on your $16.00 book, but still has to pay for the printing. On a $16.00 book that's about $4.  That leaves $3.20.  A 25% royalty on that $3.20 is $0.80.  Compare that to 10% of list at $1.60.

And how about when the sale is a direct sale from the publisher to the consumer?  A publisher offering 30% of list will pay you $4.80 on each $16 book sold.  Simple, straightforward.  What about the publisher offering 30% of "actual receipts?" On a $16.00 book, the author gets 30%, but it's not 30% of list; it's 30% of what's left over after the publisher takes out his expenses.

Other Considerations

There are other considerations besides these.  For instance, does the publisher offer editing and/or marketing services?  With millions of books on the Ingram database, the commitment of your publisher to making your book a success really matters.  And although it may be tempting to go with the biggest and most automated (Xlibris or iUniverse), be sure you check the fine print.  iUniverse, for instance, is partially owned by Barnes & Noble, but B&N does not stock books published by iUniverse on its shelves.  That tells you something, doesn't it?