The End of the Advance?

Strangely enough, I had not one but two important conversations about book advances yesterday.  First, I was talking with my agent, Sorche Fairbank, who relayed some good news: The first book proposal we worked on recently attracted a good publisher and that publisher had offered us a book deal.  (A book deal!)  But then came the not-so-good part.  The advance was a lot smaller than we first hoped.  
      In exchange for the low advance, we’re trying to get some other concessions that will make the deal work.  (I will keep you posted.)

Now – later that afternoon, I had the pleasure of sitting down with agent Sharlene Martin, who was in the building here talking with some people.  She brough up advances again – saying that they’re slowly going away or getting smaller.  This is happening for two reasons, she said.  
      First, 90 percent of books don’t earn out their advances; and second, we’re in a recession and places are looking for ways to cut costs. 

All this said, there are two strategies to lowering book advances.  There is the strategy that you just pay authors less and keep your publishing house afloat.  And then there is the strategy that you pass less on the front end in exchange for a much better deal on the back end.  For example, instead of earning a standard $1 royalty per book, maybe you earn $4.25?  The publisher pays no money upfront, and the publisher and author are tied to the book’s success together in an integral way.

Hmmm … I wonder how this all will play out.  Thoughts?

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10 thoughts on “The End of the Advance?

  1. Sue

    I would like to think that the larger publishers would be willing to compensate the usual and customary expenses an agent and author may have parted with to get the book to a publisher’s doorstep.
    The publisher at the point of acceptance has not lost any funds…why not compensate that to their team players??
    However, I do see the point in opting to net only from royalties…but there should be a precise timeline for when the first check is cut.
    I would opt for "going green" and ask for e-deposit! Okay, truth be made known, I’m actually hinting at avoiding lost checks in the mail…."I’ll check with my bookkeeper"…etc etc.
    Susanna Ashford

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  3. Ane Mulligan

    I have some reservations. We’re all aware of how little marketing the publishers do for newer authors. With little or no financial investment, I can’t see them doing anything at all. That said, the larger royalties is good, financially. It’s a new economy and we have to bend.

    That’s my two cents.

    Ane Mulligan
    Aone Officer
    ACFW

  4. Jeff

    Seems like if lower advances became an industry standard, then that might even the playing field somewhat for small presses that don’t have the capital to offer significant advances.

    Larger royalties on the back-end also place a strong incentive for authors to take up an even larger part of the marketing. Of course, authors are then captive to possibly delayed accounting procedures of the publishing houses in processing payments. (One never knows the efficiency of large conglomerates.)

    Most authors have day jobs, but what about agents? How do they function without their cut from the advance and relying on royalties dribbling in?

  5. Kathy Temean

    A few weeks ago this conversation came up at the New Jersey SCBWI Workshop. Agent Edward Necarsulmer of McIntosh and Otis was asked this question. He said that due to the economy he felt advances will shrink, but he also said that wasn’t neccessarily a bad thing. If a writer takes a high advance and the book does not earn out the advance, it could wreck a good writer’s career.

    Kathy Temean
    New Jersey SCBWI Regional Advisor
    http://kathytemean.wordpress.com (Writing and Illustrating Blog)

  6. Dave Guilford

    Chuck,

    I can’t really speak for the industry because I just got my first book deal a couple weeks ago (unagented). There was no advance, but they’re paying me a 30% royalty, which I thought was pretty strong.

    They actually offered an advance, but it was very low and was more along the lines of a write-for-hire contract that paid zero royalties. Taking the 30 points was a no brainer.

    Dave

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