Understanding Your Book Contract
By Mary Kole
Mary Kole is a former literary agent, freelance editor, writing teacher, author of Writing Irresistible Kidlit, and IP developer for major publishers, with over a decade in the publishing industry.
If you’ve just received a book deal from a publishing house, congratulations! What a major milestone in your writing career! However, proceed with caution, as understanding your book contract is essential to the cycle of your book. A book contract is a legal agreement between an author and a publisher, which outlines the terms and conditions of the publishing process, subrights, foreign rights, and many other components. Such contracts are often intricate and difficult to navigate without professional help. I am a former literary agent, and have created this article to help writers understand exactly what they are signing up for and what they should know before signing a book contract.
Understanding the Elements of a Book Contract
A book contract typically contains several essential elements that a writer should understand before signing on the dotted line. These elements include:
The Grant of Rights: A grant of rights gives the publisher the right to publish and distribute the writer's work in specific formats and territories.
Royalties: Royalties are the fees an author receives from book sales, which are usually calculated as a percentage of the book's retail price. There can be factors such as sales escalators and retailer discounts to consider here.
Delivery Date: The delivery date is the date by which the author must submit the manuscript to the publisher.
Advance: The advance is the upfront fees paid by the publisher to the author, and once this amount is earned out with book sales payments repaid to the publisher, the author will start earning royalties.
Option Clause: An option clause gives the publisher the right of first refusal on the author's next book, but can be negotiated in several ways.
There are several key deal points that writers should understand when it comes to book rights. These include:
Territorial Rights: Territorial rights refer to the areas in which the publisher is authorized to sell the book.
Language Rights: Language rights specify the language in which the book can be translated.
E-book Rights: E-book rights refer to the digital distribution rights of the book. A lot of publishers will not offer a book contract without a grant of e-book or digital rights included.
Audiobook Rights: Audio book rights refer to the audio rights of the book. A lot of publishers will not offer a book contract without a grant of audiobook rights included.
Film Rights: The rights to option a book for the film production process, which is too intricate to explain in any detail here.
Standard Royalty Rates in a Book Contract
Standard royalty rates vary depending on several factors such as the genre, format, and sales volume of the book. However, as a general rule of thumb, authors can expect to receive between 8% to 15% of the book's net revenue, though this can vary widely and shift as the project hits various sales escalators. This is a deal point that’s generally very open to negotiation.
Tips for Negotiating a Book Contract
If a writer finds themselves in a position to negotiate a book contract, there are several tips to keep in mind. First, it's important to be knowledgeable about the publishing industry and to understand the current state of the book market. Additionally, writers should be clear about what they want from the publishing process and communicate this to the publisher. Finally, writers should never be afraid to walk away if they feel the contract is unfair, or there are things in the document that the publisher will not budge on. Many writers don’t advocate for themselves because they are afraid to lose the book deal, but a bad book deal is worse than no book deal.
It can be very advantageous to bring a publishing lawyer on board to review your book contract and go back to the publisher on your behalf. If you’re not currently working with a literary agent, you may be able to get one to negotiate for you, unless you’ve already accepted the deal terms. The Author’s Guild will also review a book contract for little or no fee. Getting a second set of eyes on any legal document at this stage will save you a headache later on.
Understanding book contracts is crucial for writers, and hopefully, this article has helped shed some light on the subject. Whether it's understanding the elements of a book contract, key deal points, standard royalty rates, or negotiating tips, being informed about the publishing process is key to a successful writing career. Remember, it's never a bad idea to seek the help of a literary agent or publishing lawyer to navigate the often-complex world of book contracts. Congratulations, and I hope you make some intentional decisions at this very exciting time.
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