Why Books Suck As Products

Like I said in yesterday’s post, there are lots of reasons to write a book. Getting rich off of royalties is not one of them. To say it’s a long shot is a huge understatement.

If you’re writing the next great American novel and you are courting the likes of Random House then this advice doesn’t apply to you.

But if you’re an entrepreneur in the business of creating products and selling them for passive income, listen up.

Don’t write a book to make money off royalties.

1. Writing the book is hard work
2. Getting it self published can be a pain in the ass
3. The margins stink

So why write a book? Here’s a few reasons.

For one thing, nothing is better for demonstrating your knowledge and authority in your chosen marketplace.

Here’s a quick example.
You decide to seek legal advice on setting up a family trust, and rewriting your will. All else being equal, would you choose the attorney that has published a book or two on the subject and has them listed right on Amazon.com with glowing reviews, or the one without the book(s)?

No brainer, right?

Here’s another great reason: Some professionals operate under difficult marketing conditions where it’s unethical or illegal to collect certain kinds of testimonials. So the professional either collects no testimonials, or they’re so bland that they have no impact.

Think of a chiropractor. Even if several of her patients will put their hand on the Bible and swear that she cured them of aches and pains that no other physician could remedy, she can’t put that in print.

Or what about a financial advisor? Even if one of his clients would gladly tell his story of three consecutive years of double digit returns in down markets, the testimonial can’t be used.

But… testimonials about a book are fair game. And more often than not, peers will gladly review and provide testimonials for a well written book.

Book Publishing Vendor: Lightning Source

From what I’ve read, it seems that Lulu.com and many other book publishing companies actually use Lightning Source and simply resell and repackage the service.

So why not go straight to Lighting Source? You can… but they’re much more difficult to get established with than Lulu.com or others. You need to have a set of ISBN numbers in hand. These can be pricey. You’ll also want to order these far in advance of signing up with Lightning Source so you aren’t even tempted to pay $125 to get “rush” delivery of your numbers.

Here’s some interesting information James shared about Lightning Source’s pricing and Amazon’s fees:

It turns out there is a 90 cent base fee per book and then 1.5 cents per page. For my book, that works out to $6.27.

Amazon (and probably most book retailers) takes a 55% cut, so if I charged $25, the wholesale price would be $11.25. I would get the difference between $11.25 and $6.27 which is $4.98. OK. We’re still not gonna get rich on books, but at least I can charge a more reasonable $25 instead of $35 just to break even which would be the LuLu deal.

His pricing info on Lightning Source was reverse engineered, so it’s an estimate. But the bottom line is that a lot of folks get paid before any money reaches your hands.

If you’re not careful, it sounds like you could actually be in a negative cash flow situation if you book is long and you price it too low. This still could be a good deal for you if the book is a powerful loss leader for your products and services, but you should know your numbers going in, long before you write page one.