How Book Royalties Actually Work: A Zambian Author’s Guide

A royalty percentage looks reassuring until you ask what it is a percentage of. An author hears “ten per cent” and imagines ten per cent of the price on the back cover. The contract may mean ten per cent of the money the publisher receives from a bookseller. Both calculations can be written honestly as “10% royalties”, but they produce different payments.

If you are weighing a publishing offer in Zambia, put the percentage beside its base, the sales it covers and the date on which you will receive an account. That small exercise tells you more than the headline number.

Start with one copy, not a thousand

Imagine a paperback with a cover price of K150. The figures below are examples for comparison, not a quotation of any publisher’s terms.

Under a royalty of 10% of the cover price, one eligible copy sold generates K15 for the author: K150 × 0.10.

Now imagine that a shop takes its agreed share and the publisher receives K90 for that copy. A royalty of 10% of the publisher’s receipts generates K9: K90 × 0.10.

A 20% royalty on those K90 receipts would generate K18. So a larger percentage may pay more or less than a smaller one, depending on the base. Ask for a sample calculation using the proposed book price and the channels in which the book is likely to sell. Do not compare two offers by their percentages alone.

“Net receipts” should be defined in the agreement. You need to know whether it means the amount actually received from the retailer after a trade discount, and which taxes, delivery charges or other deductions are excluded. A term such as “net profit” deserves even closer attention: if costs are deducted before your share is calculated, the agreement should say which costs, how they are measured and whether you can see the supporting account.

A book reaching a shop is not necessarily a book sold

Suppose 300 copies leave the printer and 100 go to a shop. The author cannot assume that 100 royalty bearing sales have happened. The shop might hold stock on consignment, buy it outright, return unsold copies, or pay only after its own customers have bought them. The agreement and the actual sales arrangement determine when a sale counts.

This is why a statement should distinguish copies printed, stock held, copies supplied to each channel, copies sold, returns and complimentary or review copies. A publisher may also sell directly at an event or through its website. Those sales may produce different receipts from shop sales. If the contract sets separate rates for direct sales, heavily discounted sales, ebook editions or other formats, the statement needs to show them separately.

Our guide to how book distribution works in Zambia explains why moving stock into a shop is only one part of getting a book to readers. For royalty purposes, the difference between a shipment and a sale matters just as much.

What an advance really does

An advance is money paid to an author ahead of future royalty earnings under the relevant contract. It is commonly recouped from those royalties before additional royalty payments fall due. It is not a bonus added to every later sale.

Take a hypothetical K2,000 advance and K10 earned per eligible copy. After 100 copies, royalties earned total K1,000. The author has already received K2,000, so the statement may show K1,000 of the advance still unrecouped and no further payment yet. At 200 copies, earned royalties reach K2,000. The advance is fully recouped. If another 50 eligible copies sell on the same terms, they earn a further K500 payable under the contract’s reporting and payment schedule.

That arithmetic assumes one rate and no returns or other adjustments. Real agreements may separate formats or titles, or apply different rules to recoupment. Ask whether an advance for one book can be recovered from earnings on another, what happens if a project ends early, and whether any circumstances require repayment. Read the actual wording before treating an advance as guaranteed extra income.

Many publishing arrangements do not include an advance. Its absence does not, by itself, tell you whether the deal is fair. Compare the whole proposal: editorial and production work, rights granted, distribution plan, author payments, and how sales are accounted for.

Paying to publish changes the question

If an author is paying for editing, design or printing, do not assume that “royalties” will work like those in a conventional publisher funded deal. You may own the printed stock and receive the proceeds of copies you sell, while paying a shop or distributor its share. Or the service provider may sell copies and owe you an agreed amount per sale. Some agreements combine an upfront author payment with a continuing share of sales.

Write down each flow of money. Who pays the printer? Who owns the finished stock? Who sets the price? Who receives a buyer’s payment? What amount goes to the author after a shop discount, payment fees or fulfilment costs? Can the author take copies to sell independently, and on what terms?

For example, an author might spend money to produce 200 books and then sell some directly for K150 each. The K150 received from a buyer is revenue, not profit. The author still has to account for production and selling costs. Calling that entire K150 a “royalty” would hide the investment already made. Our article on pricing a book in Zambia helps you work through the other side of this calculation.

Ask to see a statement you can understand

An agreement that promises a good percentage but offers no clear accounting leaves an author unable to check what has been earned. Before signing, ask what a typical royalty statement will show and how often it will be sent. Useful lines include opening stock, copies printed or reprinted, units sold by format and channel, returns, royalty base and rate, royalties earned, any advance balance, adjustments and the amount due.

Check when payment follows the statement, whether there is a minimum payout threshold, and how errors can be queried. If the publisher uses several retailers, ask whether their sales are reported together or separately. If a retailer pays late or returns stock, find out how that appears in a later period. The aim is not to demand a perfect forecast; it is to agree on a way to trace a sale from reader to author.

Consider an author who receives a statement saying “400 copies distributed, royalty due K3,600”. There is not enough information to verify it. Were 400 copies sold or merely delivered? What price or publisher receipt was used? Were returns recorded? One more column can turn a mysterious total into an account the author can check.

Different rights may need different calculations

A paperback, ebook, audiobook and translation are not necessarily sold or licensed in the same way. A publisher might sell an ebook directly, license audio rights to another business, or offer a special bulk sale to an organisation. The author’s share for each may be defined differently. Do not assume a print royalty clause automatically explains those other uses.

Ask which formats and territories the publisher is taking, who can approve a licence to a third party, how that licence income is shared, and what statement will show it. Rights that will not be actively used should be considered carefully. Our contract checklist for authors goes further into the rights and obligations behind the figures.

Five questions to take into the conversation

• Is the royalty calculated on cover price, publisher receipts, a fixed amount per copy, or another clearly defined base?
• When does a copy count as sold, and how are unsold stock, returns, damaged copies and free copies handled?
• Do direct, retail, bulk, digital and licensed sales earn at different rates?
• When will I receive a statement and payment, and can I check the sales figures behind them?
• If I am contributing money to publication, who owns the stock and what do I actually receive from each kind of sale?

You do not need to become an accountant to ask these questions. Ask the publisher to walk you through one copy sold in a shop and one sold directly. If the numbers cannot be explained in ordinary language before you sign, they will be harder to untangle after publication.

Which part of a royalty offer has been hardest for you to understand: the percentage, the deductions, or when a sale actually counts? Share the question you wish you had asked sooner.