After a very lovely conversation with my favorite agent, I’ve come to the conclusion that dealing with a smaller publishing house as opposed to the top 4 giants in some case can be more beneficial to a new writer. “HUH?” You ask? I too was skeptical until she broke it down.
Royalties, not advances, is where most first-time authors make their money. Giant publishing houses may give higher advances, but you have to sell through them before you can start earning royalties. And what if you don’t sell though that initial investment? Does that hurt your chances of selling a second book? Absolutely – you’ve now become a liability and they are less likely to pick up another book.
The standard royalty rate is anywhere between 8-12%. Contrary to what I expected, the smaller publishing houses frequently offer the higher rates. They also frequently give you a larger promotional budget which is important for a first-time author with no mass following yet.
So although we are all hoping . . . dreaming . . . praying to every known deity for a huge publishing contract, sometimes the smaller presses can work to our advantage. So when the time comes, don’t be afraid of smaller publishing house – the higher royalty rate and increased promotional budget may outshine the initial sparkle of a big advance!