Reserves against returns

Since publishers usually calculate royalty statements within six months after publication, sometimes returns will lag behind the statements. Since an author is paid based on net copies sold, this creates a conundrum since publishers don’t really know what the “net” will be for quite some time after a book is published. In order to account for this publishers hold a “reserve against returns” for the first couple of royalty statements after a book’s publication, which means they hold back a certain amount of money in anticipation of returns. The reserve should be a reasonable amount (talk to your agent) and they should not hold a reserve forever. (see also “returns,” “net copies,” and “royalty statements”)

Related Entries

Leave a Reply

Your email address will not be published. Required fields are marked *