Deep Dark Financial Secrets of Publishing

This seems to be the day for mind-numbing financial data, designed to frighten and dismay writers. First, Jay Lake linked to a long article by Denise Little from the SFWA Bulletin (slightly less timely, I see, since it was originally from 2001) about how publishers calculate P&L statements. Then, Anna Genoese applied similar calculations to a dog of a book here.

Various writers are mailing and gnashing their teeth in the comments for the latter, too, which I suppose would be amusing if you enjoyed seeing other people suffer.

The elephant in the room, though -- the thing that's not accounted for in any P&L -- is that a publishing company is in business to publish books. Yes, it can be a crapshoot. Yes, quite often the profit on any particular book is small (if not nonexistent). But every company needs to sell a certain number of copies of their books a year just to keep the lights on, and that means we're all looking to publish something. It would be wonderful if a publishing house could publish one book a month that would steadily sell, oh, let's say fifty thousand copies a week for about four months, and then taper off at just the right speed to have a nearly perfect sell-through of a million copies. But that will never happen.

So companies buy books because they will cover a reasonable share of overhead for that month -- really, to be blunt, publishers buy books because they're the best books they can find at that moment. Every editor has to acquire enough books to justify his continued employment -- and to, at the same time, try to make sure few enough of those books are such utter dogs as to put that employment in jeopardy.

Really, all this is just another instance of what writers should already know: publishing is a precarious, low-budget entertainment business. Compared to nearly every other kind of entertainment, the money involved in book publishing is small. But it's small for the editors and publishers as well as for the authors, if that's any consolation.