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Ken Eppstein returns to explain how publishers price their comic in the latest edition of Indie Insights!


Ken Eppstein is the editor, writer and publisher of the independent comic Nix Comics Quarterly, a small press anthology.

OK class! Lets talk about putting together part of your business plan!  Today's lesson is setting the price of your self published comic book!  (Not into it? Blame James Moore from Two Headed Monster Comics.  He told me he liked when I talk business planning.  If he had told me that he wanted to hear about the Monkees, I would've wrote about Mike Nesmith's hat.)

There are of course as many different ways of valuing art as there are artists.  What I'm going to present to you is more or less a standard means of coming up with a price point based on production costs and, in the case of ongoing projects, overhead expenses.  There are other ways of doing it and they are all just as valid as the rest.  Heck, you could pull a number out of a hat and hope for the best, if you wanted to.  What matters in the end is that you're satisfied with the amount of money coming in as it compares to the amount of money going out.

Direct Costs:

If you're doing a one shot type deal, you'll need to figure out the direct cost of the book. In this case, your direct cost would be the total of everything that goes into the production of the print run for your book.  (And don't be silly.  At the very least keep this info in a spreadsheet or some kind of off the shelf accounting software.  Above all, keep your receipts!!!!) The cost of printing, paying artists, shipping the books, buying an ISBN for distribution; EVERYTHING that'd you'd like to have reimbursed to you when the book sells.

Divide this total by the number of books printed to give yourself the bare minimum you'll need to charge to break even on each book.   (So, if you print 500 books and spent a total of $834 dollars getting the job done, the break even point for each book is $834/500= $1.67 per book.)  

Mark up from your book from that amount, bearing in mind that most distributors want a discount of 60-70% off of cover price.  So whatever you charge for the book wholesale needs to equal or exceed that break even number.  (In our example, for instance, you'd want to set a cover price where you're getting at least $1.67 from the distributor as the wholesale rate.  So, if you set the cover price of the a nice even $5.57 you'd get to that magic number.  And probably confound anyone looking at the cover price.  Go for a nice round number somewhere beyond your break even point instead.  The goal is to make at least a little money, right?)

Indirect Costs & Overhead:

(Fair warning, this gets a little thick.)

If you're doing an ongoing series or several books under the aegis of a single press, things get a little hairier: You'll quickly notice while you're tallying up expenses you'll run into vexing expenses that don't tie neatly to a specific issue.  Say you're running a website to sell all of your books, for instance.  Which issue gets the cost of hosting?  Well... all of them.  You've just ran smack into the nearly invisible menace named overhead

I say nearly invisible, overhead leaves a tell tale shadow in the form of indirect costs.  Indirect costs are the things that you have to pay on a recurring basis for the overall good of the series/business.  Web hosting fees, advertising costs, table costs at fairs and cons, and vendor license fees are good examples.  How do you determine what's an indirect cost as opposed to a direct cost? A good rule of thumb is if an expense could arguably be applied to more more than one issue of your comic, its an indirect expense.  

Now that you know what an indirect cost is, its time to remove that cloak of invisibility from your Overhead.  Total up all of your direct costs like before, and then do the same with your indirect costs by making a total of all the other expenses you expect to incur for the year.   Be comprehensive in your speculation of both what your direct costs and indirect costs will be.  List out anything and everything you can think of. Then add at least 10% to that total because you're gonna miss something.  

Once you have these separate totals, add the direct and indirect costs together and divide that sum by the direct costs (only).   If you were looking for an equation, it'd be Overhead = (Indirect costs+Direct Costs)/Direct costs, dig?

So, going back to our example above, say that comic that costs $1.67 per book to make is a monthly series.   The total direct costs for the year would be $10,008.  ($834 for one single issue multiplied by 12 months.) Lets say that for the sake of our example that indirect costs of the book would total $2,000.  That would get us an overhead percentage of ($2,000+10,008)/$10,008 which equals roughly 1.20%

What do you do with the overhead number?  Well, its the number one indicator of how you need to be marking your book up.  That $1.67 per book isn't a good break even number anymore because it doesn't reflect the overhead costs.  However, if you multiply the overhead rate by the old break even number, you'll get a new minimum price point that accounts for those hidden expenses.  ($1.67*1.20% equals approximately $2.00 per book minimum that you should be charging.)

Is this method perfect?  Nope.  The most basic problem with this method is that it only provides a Break Even number based on selling 100% of your books.  That ain't gonna happen, so you're going to have speculate on how many you think you can sell and adjust your price accordingly.  Its a lot of research and math work to get you to the point that you can make an educated guess at what you should charge.  But hey, like I said, there are other ways to model your biz.  

Frankly, this model particularly appeals to me because it makes my business plan feel like an old Champions character sheet. Man, I loved working those old RPGs with point systems.  Spend points to raise my END score? No way man... If I use the same points to buy up my CON score I'll get the same effect plus extra ED, REC and STUN.  (If you understood that, you have the stuff to figure out overhead.  And you're a old nerd like me.)

The important thing is to pick a method and stick to it.  They all have perks and pitfalls.  (Want make yourself cry?  Assign what would seem to be a reasonable hourly pay rate for the work you've put into your comic and use that to figure what you should be charging per book.)

For more information about Ken and Nix Comics Quarterly:
http://www.nixcomics.com
http://www.facebook.com/nixcomics
http://www.twitter.com/nixcomics

Written or Contributed by: Ken Eppstein


http://173.199.169.70/index.php/columns/indie-insights/15369-indie-insights-on-setting-your-price.html/

[S.F. Jude Terror]

$6.00 for one book is pretty steep. How would you balance the need to not scare away consumers in this equation?

Also, I'd love to read an article about Mike Nesmith's hat.

[Ken Eppstein]

I'll be the first to admit that the $6 cover price on issue #2 was a bust. I got caught up in margins when I should have left well enough alone. #3 (Out next week!) will actually be back to the $5 everyone seemed fairly comfortable with.

I'll say this though... I don't feel that my price range is inappropriate and I'm not too-too scared of driving customers off. I'm content to let DC, Marvel and the other less-big big guys be the Budweisers and Millers of the comic industry. $3-4 bucks for a mass produced and generally inoffensive tasting product is their bag and they're good at it. I'm a microbrew... Locally sourced, made in small batches and somewhat of an acquired taste and my price gets scaled accordingly.

Also, I will continue my policy of offering a free B&W PDF version of the previous issue of Nix when the latest issue hits the stands. If free isn't cheap enough, then I have real problem and it ain't with my price model.

[MrGranger]

This is a good reason why ecomics are good option. I have never priced any of my books higher than $3.50, even if i lost money on it. I also wouldn't pay any more than $3.50 for a comic book single, sorry. Printing costs are only going to rise as less and less printed matter comes out, they've got to rise prices to cover their costs spread out over less customers. So it's only going to get worse.

Personally I wouldn't recommend anyone do any mass printing of indie books. Stick with the e-comics and graphic novels. Do small runs for shows if you want to, but keep it very small.

[Ken Eppstein]

I don't disagree with you that creating an on-line comic is a cheaper way to go. Nothing wrong with that if its your thing, although I think its worth saying that like you never paying more than $3.50 for a comic single, I personally would never pay anything for an E-comic. I just can't stand reading comics off a screen.

Those are all matters of taste and part of what I was saying about my comic being an acquired one.

I do think its far too early to tell if you're correct about printing costs. I can't help but think that the same thing was said about vinyl records when digital formats starting becoming more and more common. (First CD then MP3 and now streaming audio) Know what though? Vinyl production has been pretty consistently profitable and stayed relatively inexpensive for the past 20-30 years.

[Victorian Squid]

It's harder than ever these days to hit the line between a price that works for you, the publisher, and the price that works for drawing in potential new readers. I think the $6 was wide of that mark, and hopefully the $5 will sell your third issue more effectively.

First Comics, when they relaunch, will be distributing their line themselves directly to comics shops--this sounds like a relative of what you need to do, and in your case, I think someone's got to drive those things around and promote them. Weigh the cost of a trip as far West as you can manage with a dozen boxes of comics and order forms and whatever incentives you can think of to get some orders for future issues versus the potential long-term dividends. When you can, repeat and head South.

Unless you think you can get better promotion and distribution through a third party, I think at some point the show has to hit the road. I don't think mailing unsolicited copies to shops can ever be as effective as the man on the streets.

[superfictious]

Very interesting stuff. I love these Indie Insights.

[Ken Eppstein]

Unless you think you can get better promotion and distribution through a third party, I think at some point the show has to hit the road. I don't think mailing unsolicited copies to shops can ever be as effective as the man on the streets.

That's an excellent point. I don't want to be analogous to one of those garage bands that puts out a record, refuses to tour and then grouses that nobody buys it. You gotta get stuff out there!

Luckily, I travel a fair amount and plan to have a "wholesale kit" with me where-ever I go so I can solicit comic and record shops while I'm also being a tourist. (First stop: Portland, Oregon in October.)