Numbers, numbers, numberswhich assumes a certain cover price, estimates revenues at different
levels of sales. (Remember sales?)
The P & L is used in determining how much to pay an author in
advance. Now mind you, the P & L says nothing about an author's
earnings. Royalties are just a cost the publisher incurs on the way
to profits. No, the P & L is really about the publisher's profit level,
where it begins (or ends) given a certain cover price and a particu-
lar level of sales. If you, the editor, believe that you can sell X num-
ber of copies... well, good buddy P & L tells you how much money
will be left over and that, in turn, gives you some idea of what you
can pay the author up front.
Still with me? Okay, so it would seem that profits are an impor-
tant measure of an author's value to a publisher, and are not uncon-
nected to sales. Good profits equal good author for the publisher,
right? Hold on! It is not that simple. These days, the numbers that
most measure an author's performance are found elsewhere.
Besides, as I indicated before, no one in book publishing really
knows what constitutes a profit anyway.
RETURNS
By the mid-eighties returns (copies not sold by bookstores and
returned to the publisher for credit) had become more important
than sales or profits as a measure of performance. Why? Because of
an unexpected series of developments. First, in the early eighties
sales per title, on average, dropped sharply. This may have been
because books grew more expensive, or perhaps because the num-
ber of them published each year rose, thus spreading a static num-
ber of unit sales over more available titles.
Whatever the reason, this spawned another curious situation:
the explosive growth of returns. (Well, hardcovers are returned to
the publisher; paperbacks have their covers stripped off and those are
returned.)
Now, you would think that higher returns would lead to lower
print runs. Not so. Instead, publishers in the eighties began to
pump out huge quantities per title, sometimes merely in the hope
of creating enough "presence" in the marketplace for a given title to
catch on automatically (which, at high numbers, they can).