When Dodd, Mead published my Secrets of a Freelance Writer in July 1988, I didn’t expect the company to go out of business four months later. (After all, it had been in business for 150 years.) People began complaining to me that they couldn’t get the book in bookstores, and bookstores couldn’t get it from the publisher. Finally, I received a letter from Dodd, Mead telling me it was having “losses and cash-flow deficits” and looking to sell its assets. In other words, it was going bust.
But even more shocking was the request that I buy back rights to my own book-for $2,500!
Naturally, I had assumed the rights reverted to me. After all, it was in my contract. But Dodd, Mead felt differently. How we eventually settled the deal-and how you can protect yourself when your book goes out of print (meaning, it is no longer available to the public) or your publisher goes out of business-is the subject of this article.
A book represents a great investment of time, effort and energy-an investment rarely covered by your advance alone. Unfortunately, most books go out of print too quickly to pay substantial royalties.
But having the book go out of print does not put an end to its value. The physical inventory-the remaining unsold books themselves-have value to the author, both as a product that can be marketed and sold on its own, and as a promotional tool (for consultants, doctors, psychologists, speakers, experts in various subjects, and others with professional practices in the fields their books cover).
Even more important are the rights to reprint and republish the work. Even if you never sell the book to a new publisher, you still want to be able to use the material-as chapters in other books, as articles, lectures, speeches, cassette programs, perhaps even in self-published material. If you don’t have full and clear ownership of these rights, your material may remain unread and unused forever.
BEFORE YOU SIGN ON THE DOTTED LINE
To make sure you retain the rights to your book after it goes out of print:
- Make sure the publisher copyrights the book in your name, and not in its own. Although copyrighting the book in the author’s name is standard practice, numerous smaller publishers (and a few larger ones) will make themselves the copyright holder-unless you insist otherwise.
- Include a contract clause that states that rights revert to you when the book goes out of print. In 1982,for example, I published a dictionary of computer words with a small press. When the press went out of business, I checked my contract and found that I had neglected to insist on a clause dealing with rights reversion (often called the “termination” clause in a standard publisher’s contract). Now the books are out of print, the former owner of the publishing house won’t return my phone calls, and my rights to reuse the material are probably lost forever.
- Make sure the contract defines “out of print” so both you and the publisher know when you can request reassignment of rights. One publisher’s contract says the book is out of print when “subsequent to one year from publication date, no earnings have been payable to the author during two consecutive accounting periods (12 months).” After that, the publisher must republish, resell or actively market the book within six months, or rights revert to the author.
Be careful of tricky clauses. Another publisher’s contract says that rights don’t revert to the author until the work is out of print “in all forms of media.” This means that if the book goes out of print, yet the publisher continues to sell a cassette version, a video-tape, or even a small pamphlet based on the book, I can’t offer the book itself to another publisher.
- Make sure the contract specifies what happens to the remaining inventory of books and the original camera-ready copy when the book goes out of print. In my contracts with Dodd, Mead, this clause reads: “The Author shall have the right to purchase from the Publisher all copies remaining at cost of manufacture, and the plates and engravings (if in existence) at one-half their cost to the Publisher, including composition.
Getting the copies is important if you intend to sell them, use them as promotional giveaways, or simply want them as mementos. Getting the plates is even more important,because a new publisher canreprint your book directly from the existing plates or films, saving enormous amounts of time and money. And this, frankly, is a selling point when marketing the book to a new publisher.
- Choose a reputable publisher with a good track record. This, I admit, can be difficult. For instance, in the early 1980s, I published six books with Banbury Books, a small, entrepreneurial publishing firm that was a successful pioneer in computer books. When the computer book market went soft, Banbury went out of business, and my six books went out of print.
I vowed to stick with major publishers. Then, after publishing two books with Dodd, Mead-a firm that had been in business since 1839-it folded in 1989, and twomore books were out of print.
Meanwhile, my friend Roger Parker has completed some successful and lucrative books for a small publisher I had never heard of -Ventana. Roger’s books continue to sell like gangbusters, and both he and Ventana are making a lot more money in publishing than I am right now.
Still, a large, established publisher like Random House or Simon & Schuster is probably less likely to disappear than a small press with only a couple of titles in its catalog.
WHEN THE BOOK IS PUBLISHED …
The best way to protect yourself from your book going out of print is to help the publisher sell it-so that there is a constant demand for it. Some suggestions:
- When filling out the author’s questionnaire, give the publisher complete information: on the book, its selling points, and any resources or media outlets for promotion. The staff at the publishing house gets its information from your completed author’s questionnaire, not the book itself (which they don’t have time to read). So don’t take. this document lightly.
If you’re detailed in your answers, the author’s questionnaire form won’t give you sufficient room for your replies. I type the questions and answers on my word processor, which gives me more room and allows me to insert entire sections of my book proposal into the appropriate sections of the questionnaire. This gives the publisher’s staff the same powerful material that sold my editor on the book in the first place.
- Volunteer to write promotional copy for the publisher. Write your own catalog blurb and press release, and give it to your editor and publicist. Usually they will be only too happy to use what you supply and have you do the work.
- Cooperate with the publicity and marketing departments. These days, the most common complaint among authors is that publishers don’t do enough to promote books. So when the publisher does get you a speaking engagement or book you on a talk radio show, don’t be difficult. And let everyone know you are eager and available to do more of the same. Getting publicity for an author makes the publicist look good, so she will work with you if you encourage it and if your book is promotable.
- Conduct your own marketing campaign. Politely find out what the publisher intends to do-and what it won’t do. Then, consider taking up some of the slack yourself. If you have written a book on management, for example, and have some contacts at major corporations, see if you can sell the book in volume as a training tool or premium. Give seminars or lectures at which the book can be sold to attendees. This won’t move large quantities, but it will help spread the word about your book.
- Keep at least a dozen copies on hand. If the book suddenly goes out of print, and you can’t buy the remainders, you’ll need these copies to send to prospective new publishers. And, once you find a new publisher, his production department will probably need two or three clean copies of the book to print from, assuming you can’t get the plates or films.
- Keep up with the publishing industry. Subscribe to Publishers Weekly and Writer’s Digest. If you read or hear rumors that your publisher is in financial trouble or is a target for acquisition, call your editor and buy at least a hundred copies of your book (at your author’s discount, of course). Once a publishing house’s money problems are bad enough to become public rumor, financial collapse-which can result in inaccessibility of their inventory-can happen faster than you think.
Another warning sign that your publisher is having financial difficulties is late royalty payments and statements.
WHEN YOUR BOOK GOES OUT OF PRINT . . .
Sooner or later, despite your best efforts, your book will go out of print. Either the publisher will notify you, or royalty statements will indicate that the book isn’t being sold any more. If you’ve protected yourself by including the contract clauses I suggested, you’re in good shape.
Not sure what your contracts say? Go to your files and check all contracts for your existing books. There’s a good chance your contracts contain these clauses. If you don’t have a clause reverting the rights of your out-of-print book to you, the going will be tougher, but not impossible. Some publishers-especially financially sound ones – will be reasonable and give you the rights. Others-usually small ones going out of business-may not respond to your request at all.
Here’s what to do:
- Send a letter to the publisher requesting that all rights revert to you. If your contract contains a reversion clause, say so.
- Consider buying the remaining inventory of books and the printing plates or films, but at a reasonable price. Include a sentence in your letter that indicates your interest without making you seem too eager. For example: “If you are interested in selling the remaining inventory and the plates, I may be a customer.”
If all is well, the publisher should respond by offering you the remaining inventory at a reasonable price (we’ll discuss pricing later). You should get the books, the films or plates (if available), and a letter stating that all rights have officially reverted to you.
WHEN THE PUBLISHER GOES OUT OF BUSINESS . . .
A far more serious problem arises when the book goes out of print because the publisher is going out of business. You might think that, because the book is out of print, tire rights automatically revert to you. But beware. “There appears to be a general misconception in the publishing industry that if a publisher fails to remit royalties or becomes the subject of either voluntary or involuntary court supervisedliquidation proceedings, authors’ contractual rights revert to the authors,” stated Dodd, Mead in a letter to me concerning my books. “We believe that the rights under the authors’ contracts do not [italics mine] revert to him. In fact, in such recent proceedings as the Stein and Day bankruptcy case, authors’ contracts were sold to the highest bidder. Therefore, you should not rely on any automatic right of reversion.”
Dodd, Mead sent me a notice offering to sell me the rights to my two books, Secrets of a Freelance Writer and The Copywriter’s Handbook, for $2,500 apiece-$5,000 total.
My immediate reaction was to get my attorney to threaten a lawsuit, which was a mistake. A company hounded by creditors isn’t afraid of one more complaint. My lawyer got out of it, and my agent took over. The final deal was that Dodd, Mead granted me all rights to both books in exchange for a payment of $2,000 ($1,000 per book) plus forgiveness of back royalties (which I never would have seen anyway). I could have gotten it cheaper- I believe that those Dodd, Mead authors who negotiated early, instead of fighting as I did, paid somewhere around $250 per book for rights.
Conclusion? If the publisher offers to sell you the rights, respond immediately with a much lower figure and begin negotiation. The authors who act first can get back the rights at the lowest price. Later, when the publisher realizes how badly it needs cash, it becomes more demanding and less open to negotiation.
Determine whether to accept the publisher’s final offer based on what the book means to you-personally, emotionally and financially-as well as its sales potential. With my children’s book, Ronald’s Dumb Computer, the book is financially unimportant to me and I never bothered to pursue the rights. But The Copywriter’s Handbook is an ongoing promotional tool for me and a major source of new consulting business, so getting back the rights was crucial-and well worth the $1,000 I paid.
My story has a happy ending. My editor at Dodd, Mead moved to another publishing house. She got in touch and expressed interest in republishing Secrets of a Freelance Writer and The Copywriter’s Handbook if I could get the rights back. My advance from the new publisher more than covered what I paid out to Dodd, Mead to recover the rights, and new editions of both books are now in bookstores.
BUYING THE INVENTORY
When Dodd, Mead offered to sell me the rights to my books, it also asked if I wanted to purchase the remaining inventory. While most book contracts offer the remainders to the author at manufacturing cost, Dodd, Mead wanted cost plus $1 per book. This was $3.16 per book for 629 hardcover copies of The Copywriter’s Handbook with a cover price of $17.95, and $3.91 per book for 406 paperback copies of Secrets of a Freelance Writer with a cover price of $9.95. This meant I’d write Dodd, Mead an additional check for $3,575.10 in exchange for 1,035 books with a retail value of $15,330.25-assuming I could sell them.
In my case, I wasn’t especially worried about being able to sell the books. I use The Copywriter’s Handbook as a premium, giving it to clients and prospects for my consulting and copywriting services. In addition, I receive several calls each week from people wanting to know where they can get a copy. As for Secrets of a Freelance Writer, I knew from running a test ad in Writer’s Digest that I could sell the book profitably as a mail-order item.
However, by the time I decided to buy the books, Dodd, Mead’s inventory was frozen for legal reasons. Eventually I bought the books at an even lower price from a remainder house (a distributor that buys and sells inventories of out-of-print books).
Make an offer and get the books shipped to you right away. Otherwise, you may never get them.
This assumes, of course, that you want the inventory. You may not. Storing hundreds or thousands of books presents problems in itself. The best place is the garage, attic, basement or spare bedroom, but you may not want to live with the clutter. The alternatives -warehouse or other storage facilities-are not inexpensive. I got a quotation from a “fulfillment house,” which would not only store the books but also handle incoming mail orders and ship books to customers for me. Storage alone for the 2,000 books was in the range of 550-$100 per month-which would quickly eat into my I profits. I keep my books in my basement.
Selling the inventory is a challenge. But, being a writer, you may be able to find creative and profitable ways to do it. Many authors sell their books by mail.
The selling method you use determines the maximum you can afford to pay for your out-of-print books. If you sell them at seminars, for example, where selling costs are low, you can pay up to 50% of the retail price and still make a handsome profit-because your only advertising cost is holding up a copy of the book from the podium.
But, if you want to sell the book through mail-order advertising, you need a higher profit margin to cover the cost of advertising (classified is best), mailing sales literature, and shipping books to customers. The most you can afford to pay is 25% of the retail price, and you really should be looking to pay 10-20% of retail or less.
For most trade paperbacks, this comes to $1-$3 per copy. When selling the books mail order, add $2 to the retail price for shipping and handling. This helps relieve some of the burden of your high selling costs.
KEEPING THE BOOK IN PRINT
Assuming you are successful at selling your books, the inventory will soon be gone. Then what?
If the rights belong to you, you have two choices. You can sell the book to another publisher. Or, you can publish it yourself.
The author who wants to self-publish his out-of-print book has a big advantage over other self-publishers: Namely, the book has already been designed and set into type-eliminating thousands of dollars in typesetting and composition costs.
Ideally, your printer should print from the publisher’s original plates or films. But in most instances the printer can produce an acceptable finished product using existing copies of the published book as his camera-ready artwork. For this, he will need two clean copies in good condition.
How many copies should you print? Most self-publishing experts I talked to recommended a first print run of 3,000 copies. Printing fewer copies drives up the cost per copy, while printing more could leave you with a warehouse full of books if it doesn’t sell.
For a 128-page trade paperback, trim size 5 1/2 x 8 1/2 inches, a book production house quoted me a price of $6,488.09 for 3,000 copies, or $2.16 per book. I could probably have gotten a lower price going directly to a printer and handling the production details myself. Be sure to go to a printer specializing in books.
Self-publishing offers you the advantage of control-control over jacket design, pricing, marketing and distribution. You might want to get into the book-selling business this way. I didn’t. And where would I store 3,000 books? So instead, I chose to resell the rights to the publisher where my Dodd, Mead editor now worked.
Will you be able to resell your book to another publisher? It may be difficult. Publishers are more interested in something new than something old. Unless your book was a big seller, most editors won’t get excited about it. But if you query publishers, you may find one looking to fill a slot in its catalog with a book just like yours. Or maybe an editor who praised the book in the past would be happy to acquire it now. If your original editor has moved to another publishing house, he or she would be your best bet for a resale.
What kind of advance can you expect? Probably 50% or less of the advance you would get for the book if it were new. On the other hand, it’s easy money; unless your book must be revised and updated, there’s almost no work involved for you.
If there’s one piece of advice to follow above all else, it’s act quickly. Those authors who take immediate action and persist until the deal is made suffer least and profit most when their books go out of print.
