Type & Tell Pricing Guide:
SALES – SETTING THE PRICE FOR THE WORK
If you choose to purchase the T&T distribution service, you are fully in control of the pricing of your own Work. You decide the price of your Work in every national and international market territory you choose to make the Work available in.
However, by agreeing to the T&T Terms & conditions, you agree to the following conditions:
For your POD book, you do this by giving the book a Recommended Retail Price (“RRP”).
The RRP, sometimes called the list price, is the price at which you recommend that retailers should sell your book to consumers.
The price that retailers pay for your book is called the wholesale price, or the trade price. The wholesale price is calculated by deducting a fixed wholesale discount (and any applicable VAT) from your RRP.
The wholesale discount is determined by Type & Tell’s deal with its distribution partner in each market territory. The wholesale discount in the UK and European Union market territories is 40 %. The wholesale discount in the US, Canadian and Global Connect market territories is 50 %. The wholesale discount in the Australian market territory is 40 %.
Your author royalty is calculated by deducting the printing cost of your book from the wholesale price. It is in effect the remaining sum, or net profit, after all costs are deducted from your book’s RRP. Your author royalty at T&T is 100% of your net profits.
This makes the formula for calculating your author royalties the following:
[Author royalty] = [RRP less VAT less wholesale discount less printing cost]
Author royalty calculation example:
Should you give the book an RRP of GBP 15.00 in the UK market territory. The UK print book VAT is 0 %. The UK wholesale discount is 40 %, or GBP 6.00. And presuming your book is a British paperback with 200 black and white pages in cream, with a printing cost of GBP 2.97. Then:
Author royalty = 15.00 less 0.00 less 6.00 less 2.97 = £6.03
When deciding your prices, note that the wholesale price of your book cannot be lower than the printing cost of your book. This would mean that the author royalty of a POD sale would fall into the negatives, ie., you would be making a loss on the sales of each book.
Note, furthermore that retailers of your book are allowed to, and will, decide the actual consumer price, or retail price, of your book independently of the RRP you have set. This does not affect the author royalty you receive, as this is based on the RRP you have set.
Major distribution and retailer partners, such as Amazon and Apple, reserve the right to offer their customers the lowest comparable price for your book within their market territories. This means that while you are allowed to sell your book on your own through other channels not covered by the T&T distribution service, you are not allowed to sell it for a significantly lower price than the RRP you have set for your book in the T&T system.
In terms of pricing, the ebook market is different from the POD book market in three markedly different ways. First, there is no printing cost to consider. Second, ebooks generally have higher VAT rates across the globe – in the UK the ebook VAT rate is 20 % to print books’ 0%.
You decide the price of your ebook by giving it a general RRP for each of the market territories you choose to make the ebook available in. If you want the ebook to be sold through Apple, you must also give the book a separate "Apple price".
The general formula for calculating the author royalty of your ebook sales is the following:
[Author royalty] = [RRP less VAT less distributor + retailer cut]
Author royalty calculation example:
Should you give the book an RRP of GBP 10.00 in the UK market territory. The UK ebook VAT is 20%, or GBP 2.00. And presuming the book is sold via a distribution and retail channel that takes a total cut of 58.5%, or GBP 4.68. Then:
Author royalty = 10.00 less 2.00 less 4.68 = £3.32
Apple also requires that the Apple retail price of your ebook is never more than the RRP price of the same title as a print book. In fact, in most market territories, the Apple retail price should never be more than a set percentage of the print book RRP.
T&T provides its customers with a pricing guide where the Apple pricing conventions are laid out in detail. However, a useful general guideline for pricing your ebook via Apple is to never set the Apple retail price to more than 60 % of your print book RRP.
Updating the price of your book
You can always update the price of your book, even after its publication and after it has been sent out for distribution. However, there are certain technical limitations to the scheduling of price updates:
You may update the price of your POD book once a month, for it go live the following month. To have the price update live and sent through to retailers in the following month, you should set the new price by the 10th of the current month; so that price changes submitted by the 10th of January will be sent to retailers on the 1st of February.
If you set the new price later than the 10th of the current month, the price will not go live until the month following the next month.
Ebook price updates are quicker and more flexible. You may update the price of your ebook whenever you wish. The price changes will go through to retailers generally within one business week, although you should allow for up to two business weeks for this.