The Brutal Truth of Author Earnings on Amazon

Imagine selling $100,000 worth of books on Amazon, only to take home a mere $35,000. WTF, right? This is the harsh reality many authors face when they rely solely on Amazon for their book sales. Let's break down the numbers and explore the Amazon Math Nobody Talks About.

The Amazon Math Nobody Talks About

When you sell a book on Amazon, you're charged a commission fee, which can range from 30% to 65% depending on the type of book and the royalty plan you're on. For simplicity, let's assume our author is on the 35% royalty plan. Here's the exact calculation:

• $100,000 (book sales) x 0.35 (royalty rate) = $35,000 (author earnings)
• $100,000 (book sales) x 0.65 (Amazon's cut) = $65,000 (Amazon's earnings)

But wait, there are hidden fees authors don't see coming. Amazon charges a $0.15 per book delivery fee for books priced between $2.99 and $9.99. Let's assume our author's book is priced at $4.99.

• 25,000 books sold (assuming $100,000 in sales) x $0.15 per book = $3,750 (delivery fee)
• $35,000 (author earnings) - $3,750 (delivery fee) = $31,250 (author's take-home pay)

Why 'Exposure' Doesn't Pay Rent

Many authors are told that being on Amazon is all about exposure. But exposure doesn't pay rent. Let's look at some real data on conversion rates. According to Amazon, the average conversion rate for books is around 2-3%. This means that for every 100 people who visit your book's page, only 2-3 will actually buy it.

• 10,000 visitors to your book's page x 2% conversion rate = 200 books sold
• 200 books sold x $4.99 per book = $998 in sales
• $998 in sales x 0.35 (royalty rate) = $348.30 (author earnings)

As you can see, exposure alone is not enough to make a living as an author.

The 85% Alternative

So, what's the alternative? Direct sales. When you sell your books directly to readers, you get to keep 85% of the revenue. Let's redo the calculation from earlier:

• $100,000 (book sales) x 0.85 (royalty rate) = $85,000 (author earnings)
• $85,000 (author earnings) - $0 (no delivery fee) = $85,000 (author's take-home pay)

That's a $50,000 difference in take-home pay. This is what we call The Author Tax - the difference between what you pay for convenience (Amazon's commission) and what you could be earning with ownership (direct sales).

Look, this is literally why we built AuthorKit - to help authors keep more of their hard-earned cash. With AuthorKit, you can sell your books directly to readers and keep up to 85% of the revenue.

The Compound Effect

But here's the thing: keeping 85% vs 35% is life-changing. Let's say you sell $100,000 worth of books per year for 5 years. With Amazon's 35% royalty rate, you'd earn:

• $35,000 per year x 5 years = $175,000

With direct sales and an 85% royalty rate, you'd earn:

• $85,000 per year x 5 years = $425,000

That's a $250,000 difference over 5 years. This is the compound effect of keeping more of your earnings.

Reframe: Amazon Isn't the Enemy. But Paying 65% Is.

So, what can you do? Take control of your earnings. Consider selling your books directly to readers. It's not as hard as you think, and the payoff is worth it.

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