# How to Calculate Potential Book Profits

Most writers have no idea how much money they can expect when their book is published. The formula, however, is fairly straightforward. To begin with, a writer generally receives an?advance. An advance is payment, in advance, based on the expected initial earnings of the book. It is a negotiable amount, but once the publisher pays this to the writer, the advance belongs to the writer whether or not the book ever sells a copy. Advances range from a few thousand dollars to over a million dollars for well-known celebrity writers. If you are an unknown writer, your advance should range from nothing to about twenty-thousand dollars in the United States. Some first time-writers negotiate more, but that is the usual range.

## Royalties

In order to make the writer more money than the advance, a book has to sell well. If it does, your payment as the author comes from?royalties, which you can calculate using the system below. A book that sells moderately well, but is not a bestseller, may or may not make the author a few extra thousand dollars. Royalties (ranging from 4% to 8% in most cases) are generally based on the cover price of the book, but that does not include books that are discounted or remaindered. So, for the sake of argument, say you sold 20,000 full-price copies of a paperback priced at \$7 (I know it would more likely be \$6.95 but I am going to use round numbers.) If your royalty percentage were a generous 8% you would make a total of \$11,200.