So you’ve written your book, you’ve formatted, and maybe you’ve even hit publish. When you’re choosing your pricing within KDP, you’ll learn that the way Amazon calculates self-publishing royalties varies. Today, we’ll guide you through what that means for you.
Amazon offers two different ebook royalty structures: a 70% royalty, available for those pricing their work at $2.99-$9.99, and a 35% option for those pricing above or below that price.
That price changes depending on the currency, but Amazon tells you how much you need to price your book at to achieve the 70% royalty rate.
If you print using Amazon-only distribution through KDP, your royalty rate will be 60%. If you use Amazon to produce your print book for all retailers, you’ll get a 40% royalty.
If you aren’t going to be publishing to Amazon exclusively, it’s best to use a different paperback distributor (such as IngramSpark) to produce your paperbacks for other retailers, so you don’t have to take the lower royalty rate.
Amazon works on a 60-day cycle, so 60 days from your first sale, you’ll start receiving your royalty payments.
If you choose to get paid in any way other than direct deposit, you may have to reach a certain payment threshold before you will be paid. For most, this is $100/£100 or the equivalent in your currency. If you’re not planning to get paid by direct deposit into your bank account, see the threshold here.
Not counting any costs you may have incurred in creating your book, the only other cost to consider is eBook delivery costs. If you’re on 35% royalties, you don’t need to worry about this, because the fee is waived. However, if you’re on 70% it costs around $0.15 per MB of data. These costs are minimal, so you likely won’t notice them when you get your royalty payments, but it is something to be aware of as Amazon does not do so obviously during the publishing process.
Obviously, there are also costs involved in printing physical copies, but you will see these for your book depending on your choice of formatting when you create your paperback file.
If your book is in KU, then you’ll likely receive “page reads” that you will also be paid for. This is a fluctuating amount, as the global fund for KU books changes each month. You’ll see an estimate of the amount for what you’re likely to receive within your kindle reports dashboard. Generally, this is around $0.004 and $0.005 per page read.
So, how do you calculate your royalties? Firstly, there are a few ways you can track your Amazon royalties, so you don’t need to calculate them by hand every time you want to check your sales. These are:
To calculate an estimate, simply multiply the price by the number of sales, and then multiply by the royalty percentage as a decimal. Here are two examples:
You’ve sold 1000 copies at $2.99, so you’ll receive 70% royalties.
So: 2.99 x 1000 = 2990
2990 x 0.7 = 2093
So, you’ll receive around $2,093 in royalties, minus file delivery fees.
If you sell 1000 copies at $0.99, you’ll receive 35% royalties with no file delivery fee.
So: 0.99 x 1000 = 990
990 x 0.35 = 346.50
So, you’ll receive $346.50 in royalties.
Obviously, you’ll need to make a strategic decision about your pricing structure, but if you can price your work at $2.99 or above, you’ll have to shift less units to make good money. If you price at $0.99, you’ll need to move more, but it may make sense for you to do so if you’re selling shorts, doing a reduced price for the first in series, or doing a promotion.
If you use the report dashboard or Book Report, you won’t need to do math to figure out what you can expect in your bank account!