P.J. Kaiser's Blog, page 6

Indie Publishing: The Business of Indie Publishing (5 of 5)

 

This is the fifth of five posts in which I delve into detail on the presentations and discussion at the Indie Book Event 2011.  Here's a snapshot of all the blog posts related to the Indie Book Event:

 

 

My overview post: "Indie Publishing:  One Size Does Not Fit All"
Post 1: "Pros, Cons & Definition of Indie Publishing"
Post 2: "Editing and Indie Publishing"
Post 3: "Marketing in Indie Publishing (Part 1)"
Post 4: "Marketing in Indie Publishing (Part 2)"
Post 5: "The Business of Indie Publishing" {you are here}

We've covered a lot of territory in this series and this final post will wrap things up for us.  This post will discuss some key points from Pavarti Tyler's presentation about setting up and running your publishing business.

Pavarti is an accountant and indie publisher.  She is uniquely qualified to give us some perspective on important tax laws and accounting practices.  Most of this information will apply only to U.S. residents, although some of the principals may apply in other countries as well, depending on the tax laws.

If this sounds like a major snooze-fest, I'll let you in on a secret:  it is a bit dry, but so critical to understand if you're going to be an indie publisher.  I'll keep it as short as possible:

The first critical thing to understand when you set up a publishing business is IRC183, known as the "Hobby Loss Rule."    This law says that a business can't take a loss for more than 2 years out of 5.  If you take a loss for your first two years, then the worst you can do is break even after that, in other words, you are limited as to the deductions you take after the first two years of showing a loss.
You need to determine whether you are in business to make money or are you in business because it's fun.  If it's just for fun, you can't declare a loss, you can't file bankruptcy, etc.  If you are in it to make a profit, then you need to follow proper bookkeeping procedures, prepare financial reports, file tax forms, etc.
80% of small businesses will be audited.
In order to officially set up your business, you'll need to file the proper forms with your state to form an LLC and get an EIN number (like a social security number, but for businesses).
Once you set up your business, your business expenses are deductible.
Capital investment is necessary in your business and needs to be reflected in your business records.
You would set up a publishing business as an LLC (limited liability corporation) which separates you from a business.  A corporation, on the other hand, pays business taxes but an indie publisher doesn't need to do that.
If your revenue is more than $50,000 (or if you are mathematically-challenged), then consider hiring a tax accountant.
Whenever your business makes money, the profit is taxable income.  It needs to be declared.
15.7% is the self employment tax which is owed on all the profit.  But depending on the structure, that money can be paid into Medicare / Social Security.
Keep that 15.7% aside rather than reinvesting it into your next book or marketing, etc.
Research best practices for bookkeeping or hire an advisor who can help you.
You may need to obtain a business license – this will depend on your state or local requirements.
If you are not indie publishing, your publisher will issue you 1099's for what they've paid you and you simply report these amounts on your annual taxes.

Pavarti was also kind enough to share with me some more in-depth information on the Hobby Loss Rule, as follows:

You can read the details of the Internal Revenue Code.

Various code sections may come into play whenever there is an adjustment that may involve IRC §183, including but not limited to the following:

§ 183 – Provides, generally, that if an activity is not engaged in for profit, deductions are allowable in the following order and only to the following extent:

1. amounts allowable as deductions during the taxable year without regard to whether the activity was engaged in for profit are allowable in full (e.g. home mortgage interest, real estate taxes, etc.);

2. amounts that would otherwise be allowable if the activity were engaged in for profit and that would not result in an adjustment to the basis of the property if allowed are allowed only to the extent the gross income derived from the activity exceeds the deductions allowed or allowable in (1);

3. amounts that would otherwise be allowable if the activity were engaged in for profit that would result in an adjustment to the basis of the property if allowed are allowed only to the extent that gross income derived from the activity exceeds the deductions allowed or allowable in (1) and (2).

Greatest Misconception:  "Income from my hobby can't be taxable." The operative word here is "income." It's taxable.

Deduction Limitations: If your gross income from this endeavor has a profit for 3 or more of 5 consecutive taxable years then such activity shall be presumed to be for profit. In layman's terms: you can claim a loss for only 2 out of 5 consecutive years. After that any deductions can ONLY offset income. Exceptions exist to this rule but only a tax professional can tell you if you fit the criteria.

Proving you are a business and not a hobby: At a minimum, you should have a name for the business, some stationary, invoices, a separate bank account, separate books and records, a place in your home that is used only for this business activity and some records to show that you are spending some time working on this activity on a regular basis. A daily log or journal would be a substantial help in this regard. A formal business plan showing your projected income and expenses over a five or ten year period – with some profit at the end of the period – will be a huge advantage to you if you are questioned by the IRS. It would also help you to be able to show that you are actively studying and learning how to be financially successful in this activity. Attending seminars, subscribing to trade magazines or newsletters, buying (and reading) books about the business and consultation with various professionals will also help.

For additional questions or advice contact Kara

A big thank you to Pavarti for her presentation at the Indie Book Event and for providing this extra information for my post.

An excellent resource with additional information is "Creating a Business Plan for the Indie Writer" by Suzan Harden.  For more information and a coupon code, go here.

Any readers who have set up their own publishing businesses are welcome to weigh in on any of these points and add any tips.  Have you found this useful?  What questions would you have before embarking on setting up a publishing business?  Please share in the comments!

Inspired Links – Sept 20, 2011

In my "Inspired Links" feature, I provide links and brief descriptions of thought-provoking articles.  I hope you enjoy these little treasures

I'm in the midst of reading "Story Engineering" by Larry Brooks.  It's a fantastic book which I'll be reviewing when I've finished.  In the meantime, you should check out this interview of Larry by Victoria Mixon.
From "The Passive Voice" blog, the title of this post says it all:  "Indie Author Goes Traditional – A Cautionary Tale."
And another gem from "The Passive Voice" blog:  "Is There Anything That Can Take the Pain Out of E-Book Formatting?" This post talks about an interesting new tool that could do just that called "Jutoh."
If you're either a fan of or writer of e-books, then you'll enjoy perusing "E-Book Cover Design Awards – August 2011" over at Joel Friedlander's blog.  Even if you don't plan to design covers yourself, you'll want to be able to recognize good ones and there's a lot that can be learned from a good critique.
Natalie Markey – guesting over on Kristen Lamb's blog – shares some wisdom about writing moms (a subject near and dear to my heart) in "Writing, Burp Rags & Sesame Street – How Can We Balance It All?"
Debbie Ohi (aka Inky Girl) is on a quest – as I am – to find a better balance between online and offline time.  "Time Management and Social Media: Progress Update #1" is her first status update and contains some good tips based on what she's learned thus far (plus the post includes a cute cartoon).
The always-inspiring Jody Hedlund shares some wisdom in "One Thing We Can Do To Help Us Write Every Day."  Now that my daughter has started preschool I'm hoping to move towards my goal of writing every day.
And lastly, over at Tuesday Serial, last week we featured the second of two posts from Brand Gamblin about how podcasting can be of use for serial stories.  Many of the points, by the way, are very useful for writers of any length – flash fiction, serials and novels.  The second post is:  "Writing Like a Reader:  How Are Audio Serials Different?"

If you're wondering about my methodology for choosing links for inclusion in this post, rest assured there isn't one.  It's just a collection of things that I found interesting and I thought you might too.  Please let me know what you think!

 

Inspiration Minute – Library Love – Sept 19, 2011

In my Monday feature, "Inspiration Minute," I'd like to share with you something that has caught my attention or inspired me recently.  Be forewarned, it may take a bit more than a minute!  

On the heels of last week's "Little Free Libraries" post, I came across this lovely tale of "Library Love" … who knew I would be having a series on libraries? (!).  Anyway, in the wake of proposed library cuts, somebody has been leaving fantastic little gifts in Scotland's libraries.  The story is too fantastical to retell, you'll need to check out the story and images in the original article.  The linked post is updated as new treasures are discovered so be sure to check back.

I hope you've enjoyed this week's installment of Inspiration Minute!  Feel free to share it with your friends

Indie Publishing: Marketing (Part 2) (4 of 5)

This is the fourth of five posts in which I'll delve into detail on the presentations and discussion at the Indie Book Event 2011.  Before reading this post, you might want to read the following:

- My overview post "Indie Publishing:  One Size Does Not Fit All" in which I provide some high level observations from the conference.

- The first in this series of five posts, entitled "Indie Publishing: Pros, Cons & Definitions (1 of 5)."

- The second in this series of five posts, entitled "Indie Publishing: Editing (2 of 5)."

- The third in this series of five posts, entitled "Indie Publishing: Marketing (Part 1) (3 of 5)."

As mentioned in "Indie Publishing: Marketing (Part 1)," marketing was a very popular topic during the course of the day.  For each of the points below, I mention who the source was, including Carolyn McCray, Rachel Thompson and Amber Scott of the Indie Book Collective, Shae (who does contract administration and marketing for "The Writers Coffee Shop" (TWCS) Publishing House), Donna (head of marketing for "The Writers Coffee Shop" (TWCS) Publishing House) and Lori Hettler (from The Next Best Book Blog).

Rather than list points in chronological order as they were presented in the various session, I have culled some of the important points and arrange them by topics and broken this section down into two posts.  This, the second post, has some more tips on specific topics.

Pricing and seasonal promotion cycles:  

If you only have one book out, you need to aim for a 99-cent price.  If you don't have enough sales, you won't gain traction on the bestseller lists. (McCray)
When you have more than a particular level of sales each month – say, 500 – or if you have another book out, then you can raise the price. (McCray)
Don't spend a lot of money on promotion during months when sales are typically low such as June and July. (McCray)

Amazon:

Consider carefully the Amazon page for your book and make sure that you optimize the "above the fold" features such as cover art, number of reviews and "likes." (McCray)
Put an emphasis on the product description on Amazon and other sites.  Include reviews in the description with specifics, not just "I love this book," but you don't need to include the name of the reviewers. (McCray)
End the product description with a call to action and information about other books.  For example, check the Amazon page for "Fated." (McCray)
Add the "search inside" material on your Amazon page.  This enhances the discoverability by a huge margin. (McCray)
For more tips from McCray, check out her posts over at Digital Book World:  Part 1 and Part 2.  McCray also recently participated in a Digital Book World roundtable discussion.  Subscribe to their podcasts (either here or through iTunes) so you'll catch her episode when it's available (plus all the other fantastic DBW content).

Book content and design:  

It was repeated by many presenters and panelists that first and foremost, writers have to ensure the writing is the best possible quality.
When writing a book based on blog content, you need to appeal to both regular blog readers and new readers by ensuring there's a beginning, middle and an end and creating new material beyond what's available on your blog.  (Rachel)
Include as much information as possible in the backmatter of your books including specifics on your backlist.  If you don't have a backlist, then you can mention other people's books that are in a similar genre / similar stature.  This provides "sales resonance" or "sales lift." (McCray)
Remember that everything about the book enhances marketing including the cover, formatting and even the author photo. (Shae)

IBC events:  

Indie Book Collective offers monthly promotional events. (McCray)
The 99-cent collective also has a $2.99 and under category so your book can participate even if you price higher. (McCray)

Connecting with readers via book bloggers:

Working with book bloggers can be an important way of reaching out to readers.  Be sure to read and follow the bloggers' guidelines.  (Hettler)
A good place to connect with reviewers and set up blog tours is www.bookblogs.ning.com.  (Shae)
Also, you can connect with book bloggers who don't review your genre and see if they can refer you to other book bloggers. (Hettler)

Connecting with readers via Goodreads and other sites:  

Goodreads was cited as one of the best ways to reach out to readers who read books like the one you have written.  The best way is by joining groups that focus on your genres.  (Hettler)
Do your cover image early and you can get on Goodreads prior to release. (Hettler)
Besides Goodreads, authors need to be present in social media and on Library Thing and Shelfari. (Shae)

Blogging and Social Media:  

Maintain an active blog.  Blog at least once a week, but only if you have value to share. (Donna)
Amber has a secret reader group (not-so-secret) on Facebook.  She created some swag and kept it consistent with her brand and her image.  The secrecy increased its popularity dramatically.  (Amber)
Don't worry about whether Twitter will sell books.  Focus on the intangibles including reviews, name recognition, etc.  (Carolyn)
Use blogging and social media to build a newsletter list.  This has a very good return on investment in terms of actual sales.  Get readers excited and try to get them to review your books on Amazon (rather than Smashwords).  (Carolyn)

I'll leave it to the experts to conduct in-depth research as to which tactics are the most effective, but I thought I'd conduct an unscientific poll on my blog.  In my recent "Three for Thursday," I included a poll and asked, as a reader, "How did you hear about the book you're reading right now?"  I had 23 responses as follows:

"I found it while browsing in a bricks-and-mortar bookstore" 30% or 7/23
"I heard about it on social media from the author or a publicity event" 22% or 5/23
"I found it while browsing Amazon or BN or other online bookstore" 17% or 4/23
"A friend (in real life) recommended it to me" 13% or 3/23
"A friend (via social media) recommended it to me" 9% or 2/23
"I read a review in a newspaper / magazine" 4% or 1/23
"I read a review online" 4% or 1/23

The key message to me from this unscientific poll is that 1) bricks-and-mortar bookstores are not dead yet and 2) it's important to do marketing in a wide variety of ways.  Among some audiences, I'm sure that reading reviews is an important way of finding books.  As Carolyn McCray emphasized, authors need to pay attention to their presence in online bookstores and make sure that readers have enough enticing information to turn that click into a purchase.

Any other marketing tips you want to share?  Any comments on these methods from either a writer's or a reader's perspective?  Please share in the comments!

Inspired Links – Sept 13, 2011

In my "Inspired Links" feature, I provide links and brief descriptions of thought-provoking articles.  I hope you enjoy these little treasures

Alan Rinzler has a new post entitled "New Ways to Sell Short Stories" which covers some potential ways to publish and a bit of insight about the new market for short fiction in a digital world.
And, in case you haven't seen it, Nathan Bransford has a new post "Self Publishing and Literary Fiction" which challenges the prevailing idea that self publishing is primarily for genre fiction.
A mentor / mentee relationship has been critical to the success of many writers.  One of the key benefits of getting an MFA is building these relationships.  But what if you don't plan to pursue an MFA, for whatever reason?  "How to Build Your Own MFA Experience" from Bridget Asher provides some excellent tips.
Author Elizabeth S. Craig is providing a great service to the indie publishing community by creating a directory of service providers for self publishing.  You can find it by going to her blog and clicking "E-Book Services Directory" on the right-hand side.  Stop by her blog, while you're at it, for some fantastic writerly content.
Ever feel like you're getting advice from too many sources and too much of it is contradictory?  Then you'll appreciate this post by Katharine Grubb "Pushing the Mute Button on Writing Advice."
Self-Publishing Review has an interesting post that furthers the discussion about errors in e-books:  "E-Book Authors:  Errors and the Dreaded Stigma of Self Publishing."
The title of this new post from Jody Hedlund says it all:  "Three Ways to Tell If Your Writing is Crap."
Last week over at Tuesday Serial we featured a guest post by Brand Gamblin "What Podcasting Can Do For Your Web Serial" and this week we feature part 2 of this 2-part series.

If you're wondering about my methodology for choosing links for inclusion in this post, rest assured there isn't one.  It's just a collection of things that I found interesting and I thought you might too.  Please let me know what you think!

 

Inspiration Minute – Little Free Libraries – Sept 12, 2011

In my Monday feature, "Inspiration Minute," I'd like to share with you something that has caught my attention or inspired me recently.  Be forewarned, it may take a bit more than a minute!  

Courtesy of the Utne Reader, we have today's inspiration minute, which features "Little Free Libraries."  The idea is ingenious and the images are precious.  So, what would you like to find in a "Little Free Library?"  Books?  Or perhaps something else? {Thanks to Virginia DeBerry and Donna Grant for sharing this story on Twitter.}

I hope you've enjoyed this week's installment of Inspiration Minute!  Feel free to share it with your friends

Review: "Hamlet's Blackberry" by William Powers

I've been waiting for the perfect time to write a review of this book.  It's recently been released in paperback, so I figured that time must be now.  I've been so eager to review this book because it's had a profound impact on me and I hope to share some of it's goodness with you in this post.

To begin, William Powers did an interview on PBS Newshour in August, 2010 that really does an excellent job of capturing the high level essence of the book.  The video is just under eight minutes and is well worth the time.  I should also note that it was through this video that I first became aware of the book and it was none other than David Allen (the "Getting Things Done" guy) who shared the link on Facebook.  Moments later, I was purchasing the book for my Nook app.

Do you ever get the feeling that instead of managing your life, your life is managing you?  Between numerous social media platforms and a buzzing, whirring smartphone, overflowing RSS readers and emails, my connectedness had gotten out of control.  There's a certain appeal to being constantly connected.  You always feel "in the know" and you always feel needed.  But it comes at a high cost.  That nervous twitch that your eyelid has developed?  Yeah, that's part of the cost.  Not being able to focus on any task for more than two minutes without checking your email?  Yeah, that's another part of the cost.

After watching the video, you may feel as though you've already gotten the key message from the book, so why bother to read it.  Haven't you read an article about how being disconnected sometimes is a good thing?  Have you made an effort to do it?  Have you incorporated disconnected time into each week?  each day?  It's easy to say and difficult to do, right?  The lessons that Powers covers in this book are in-depth and powerful.  And they simply must be read to be fully appreciated and absorbed.

In particular, his approach of using historical figures as examples to drive his points home is quite effective.  He talks early in the book – and in many of his interviews – about the unplugged weekends his family has instituted.  If the solution was that easy and obvious, there would be no need for the book.  But it's much deeper than that. Powers uses the examples of Plato, Seneca, Gutenberg, Shakespeare, Franklin, Thoreau and McLuhan to teach us very specific and valuable lessons about how these figures approached the problem of being over-connected.  It's about learning how to set boundaries and how to incorporate new routines into your life.  It's about understanding our desire to be connected and the ramifications when it gets out of control.

So, if you're picking up on the idea that I highly recommend this book, then you're quite perceptive I have instituted some changes in my life after reading this book.  I'm not as rigid as Powers' family with their modem-free weekends, but I try to remain nearly completely disconnected on the weekends with only the occasional email check.  I also try to unplug for a couple hours or more each day.  I have turned off all alerts and notifications on my smartphone.  The downside is that I periodically need to check all of my emails and social networks in turn, but the big upside is that I am not getting constant interruptions.  I have also come to recognize the signs of slipping back into over-connectedness and I am more disciplined about forcing myself to step away from the computer and turn off the smartphone if necessary.

Some people don't really have an issue with finding a natural balance in their connected and disconnected lives.  I am not one of them.  I tend to crave information and being a stay-at-home mother can be isolating at times.  So, I definitely tend to be too plugged in, fearing I'll be missing something.  Although I have to work at it constantly, I am finally finding a nice balance in being able to reap the benefits of technology and connectedness while minimizing the downsides.  I hope that this fantastic book can help you do the same.

"Hamlet's Blackberry" is available in e-book, paperback and hardback formats from all major booksellers.

Indie Publishing: Marketing (Part 1) (3 of 5)

This is the third of five posts in which I'll delve into detail on the presentations and discussion at the Indie Book Event 2011.  Before reading this post, you might want to read the following:

- My overview post "Indie Publishing:  One Size Does Not Fit All" in which I provide some high level observations from the conference.

- The first in this series of five posts, entitled "Indie Publishing: Pros, Cons & Definitions (1 of 5)."

- The second in this series of five posts, entitled "Indie Publishing: Editing (2 of 5)."

The subject of marketing came up, without fail, in every presentation and panel discussion during the day.  Marketing was a particularly hot topic in the following agenda items:

Panel discussion on marketing and pricing tactics with Carolyn McCray, Rachel Thompson and Amber Scott of the Indie Book Collective.
Presentation by Shae (does contract administration and marketing for "The Writers Coffee Shop" (TWCS) Publishing House) about what happens after the contract is signed including editing, cover design, marketing, blog tours, press releases, radio spots, etc.
Presentation by Donna (head of marketing for "The Writers Coffee Shop" (TWCS) Publishing House) about "tastefully tooting your own horn."
Panel discussion with members of the Indie Book Collective that included discussions on branding and marketing, going from blog-to-book, Twitter and other social media, and some of the marketing events that the Indie Book Collective hosts.

Also, Lori Hettler (from The Next Best Book Blog), touched on marketing during her panel discussions.

Rather than list points in chronological order as they were presented in the various session, I have culled some of the important points and arrange them by topics and broken this section down into two posts.  The first will provide some general marketing tips and resources and the second gets into some specific topics like social media and Amazon.

General marketing tips:

Don't worry so much about a short-term launch period (such as the traditional six week launch), but focus more on building long-term traction for your book.  (McCray)
Press releases going to local newspapers and radio stations, as well as radio spots, can be effective especially in small areas where people like to support local authors.  (Shae)
Things to avoid include mass emailing, spamming via social media and doing nothing.  (Shae)
Use tools like a calendar system to plan ahead and keep yourself organized. (Shae)
Promo tools such as bookmarks, magnets, etc. can be effective IF it's done in conjunction with building a relationship with readers.  They can be a token to remember an interaction.  (Shae)
For press releases, www.pitchengine.com is a good site.  Also www.patch.com and newswire services. (Donna)
At in-person events, be sure to introduce yourself and have books on hand.  Take full advantage when somebody asks "what do you do?"  This is your opportunity to talk about your publishing company, your book, etc.  (Donna)
Many in-person events are not terrific for selling a lot, but they're still worthwhile since they get your name out there.  (Donna)
Libraries are perfect venues for events.  Don't seek out bookstores who aren't carrying your books.  (Donna)
Some printing resources include Vistaprint and www.orientalbooktraders.com.  (Donna)
Build a consistent brand for yourself.  Brainstorm a list of 20 or more words that represent your book, your voice and you as an author.  Then condense it to 5-7 words.  (Amber)
Branding is not your tagline.  It is the name or idea or impression that your readers attach to who you are.  (Amber)
Even a consistent color scheme can be employed in branding. (Amber)

 

If anybody wants to share additional tips or comment on those outlined above, please share in the comments!

Inspired Links – Sept 6, 2011

In my "Inspired Links" feature, I provide links and brief descriptions of thought-provoking articles.  I hope you enjoy these little treasures

This week's edition is very short, since I'm just coming off a vacation which included some wonderful unplugged time.

Terri Long's indie novel "In Leah's Wake," has been tearing up the social media airwaves.  In this series of two posts over at Novel Publicity (part 1, part 2), Emlyn Chand and Terri share her story including some tremendous marketing tips.

 

K.B. Owen has written a very interesting post called "Sex Appeal" that covers a number of topics including a discussion on whether and how to target a book to a specific gender or not.  She also has an interesting discussion of the differences in the reading habits between men and women.

 

Doug Lance, editor of eFiction, wrote a guest post for Tuesday Serial this past week entitled "Four Timeless Tips to Make Your Serial a Success" and the Tuesday Serial report for last week has 22 serial installments including 2 debuts and 4 conclusions.  And if you're looking for still more fiction, the lastest Friday Flash report has 52 stories for your reading enjoyment.

If you're wondering about my methodology for choosing links for inclusion in this post, rest assured there isn't one.  It's just a collection of things that I found interesting and I thought you might too.  Please let me know what you think!

 

Inspiration Minute – Where Children Sleep – Sept 5, 2011

In my Monday feature, "Inspiration Minute," I'd like to share with you something that has caught my attention or inspired me recently.  Be forewarned, it may take a bit more than a minute!  

In the two-week break between summer camp and school starting, we've managed to get completely off of our wonderful sleep schedule.  We're just returning from a trip to Ohio to visit Grandma and we now have twenty-four hours to fix our sleep schedule before beginning school on Tuesday.  Having my children back in their own bedrooms reminded me of a wonderful collection of photos in a new book by James Mollison entitled "Where Children Sleep."  This article from the New York Times discusses the book and has several of the fascinating photos from the book.  Whether or not you're writing about children, these photos provide an interesting perspective.

Please let me know if this is interesting or inspiring in the comments!  It will help me to hone in on the best items for future installments of "Inspiration Minute."