KDP royalties for most books are set to drop,
which means your earnings in just over a month's time are very likely
going to fall. So we're going to look at this in a bit more detail.
I'm going toshow you what impact this could have on your earnings and finally
I'll give you some suggestions on what you can do to possibly alleviate this.
So what's been happening? Well, this morning I awoke to this email.
And on logging into my KDP dashboard,
this message which basically says as from 20th of June this year,
printing costs are going to rise.
And they put this down to the higher cost of materials, suppliers and labor,
basically inflation. Now, I don't know about where you live,
but certainly where I live, inflation is running rife.
And so I can understand why they have to increase their printing costs
because of increased in these supplies. So this is going to happen on the
20th of June this year. As I said,
it's due to increased printing costs and this is going to affect all books.
Now,
some books may actually benefit from these change in printing costs and that is
those books with colored interiors.
The printing costs may actually fall but ever so slightly and this is going
to particularly affect larger books. Now,
KDP defines larger books as those with a width greater than 6.12 inches or
a height of greater than 9 inches.
So those that publish notebooks, journals,
that're the common size of six by nine inches.
This is going to have a smaller impact over those that are publishing the
larger books. For example, the 8.5 by 11 inch books.
And I'll show you in a moment how this will impact you. So first of all,
let's just have a recap on how royalties are calculated. Now we're going to take
the example of 120 page book with a black and white interior selling for
$6.99 on amazon.com.
That's the US version of Amazon.
Now this may vary in other countries due to things like taxes. For example,
in the UK you've got VAT, in Australia, we've got GST.
So royalties are calculated by the royalty rate multiplied by the list
price. And then from that subtracted the printing costs.
For this $6.99 book,
we've got a royalty rate of 60% and the printing cost for this would be
$2.29. Now if you want to find out how much your printing costs are,
when you log into your KDP dashboard,
go to the second page of your book where you upload the manuscript and the
cover. When you scroll down,
you'll see that Amazon gives you the printing costs here.
Now this is for an 80 page book,
but if we look at a six by nine inch book with 120 pages,
as I've just showed you,
printing costs are $2.29 and that was also the same for an 8.5
by 11 inch book with 120 pages. The printing costs were also the same,
$2.29. So for this type of book, it would give us royalties.
Of $1.90 and as I said,
that was whether you published a 6 by 9 inch book or an 8.5 by
11 inch book.
So the thing that's changed is the printing costs and these have risen
for most books, which is going to reduce the royalties.
So let's have a look at this example of what the royalty changes will mean.
So again,
we're looking at a black and white interior book selling for $6.99 on the
US Amazon.
So for a book of 6 by 9 inches with less than 108 pages,
the old printing costs used to be $2.15,
which meant royalties of $2.04. With the new changes,
that means printing costs will increase to $2.30,
giving royalties of $1.89.
Now for the more common scenario of a six by nine each book with 120 pages,
the printing costs have increased from $2.29 to
$2.44,
which means the royalties have gone down from $1.90 to
$1.75, which is a decrease of 8%,
still a significant decrease. Now this is where things get a bit nasty
and that is for those larger books.
So for an 8.5 by 11 inch book with less than 108 pages,
the printing costs have increased from $2.15 to
$2.84,
which means royalties have decreased from $2.04 to
$1.35 per book.
That's a 34% decrease. Now remember,
royalties are what you actually receive at the end of each month from Amazon.
Now let's look again at the more common scenario,
which this includes my two top selling books and actually
a lot of my books are actually in this format and those are books which have 120
pages or 8.5 by 11 inches.
The old royalties were $1.90,
but that has now gone down to $1.15,
which is a 39% decrease in royalties,
which I think you can agree are quite significant.
So what can we do about this? Well, here's some suggestions.
First thing is you could do nothing, which, you know, is absolutely reasonable,
particularly if most of your books are those 6 by 9 inch books.
The next thing you could do is increase the price of your books,
which I think is probably what I'm going to do with my
8.5 by 11 inch books. Now if you do have a lot of books,
KDPP are going to allow you to bulk change the prices of your
books, but it looks like they're only going to allow you to do this one time.
So you're going to get this option here where you click on yes,
you want to bulk update the prices of your books and then continue.
So I think wait till that date comes around and then decide on what you want to
do with the prices of your books and go forward with that. Your next option,
I don't like this, but would be.
To decrease the page numbers of your books so that you fall into these
categories where the decrease in royalties would be less.
But I don't like that because it gives a poor customer experience.
Just imagine for a moment a customer has bought one of your books in the past
and now they come back to buy that same book again,
which does happen with a lot of my books.
I published a lot of sports related log books and I get repeat
sales quite a lot with those books. So imagine they come back,
buy that same book,
but this time they find that there's less page numbers in there.
It's not very good. In fact, it reminds me of bars of chocolate, you know,
years ago I remember as a kid they used to be huge and nowadays for the same
price or actually higher prices, they're a lot smaller,
which isn't very pleasant. Another thing you could do is diversify
your income.
So you could take those interiors that you've already created and sell 'em as
things like principles on sites like Etsy.
You could sell your interiors as interactive or editable PDFs for
devices like the Kindle Scribe, also on Etsy.
Another thing you can do is publish your books on other platforms such
as Ingram Spark.
Now I know they recently reduced or may have got rid of their fees
completely. So that's a good option to consider.
And another option you've got is just to keep creating more books,
so increase your portfolio and hopefully increase your income that way.
In the help section on the KDP dashboard, you can find,
in more detail these proposed changes,
and I will leave a link to that down below in the description.
So I'm sorry to be the bearer of bad news, but you know,
unfortunately there's very little we can do about it.
It's always a problem when you are making money on other businesses platforms,
but you are in control of some things, for example,
those suggestions I made earlier,
which may help alleviate the reduction in income that we're possibly going to
see. Thank you very much for your time. I really do appreciate it.
Here are some links to some of my popular videos.
Don't forget to hit that subscribe button and until next time, goodbye.