It makes me sick that authors are confused when they sign up with a “self-publishing” (vanity*) company and then after they get into a contract, it’s almost too late for them to rescue their content, and even more difficult to sell that book to a traditional publisher when the book takes off.  It’s so easy to be confused about all the options in the publishing industry. Some publishers take your rights, are shady about royalties, etc. So here’s what you need to look for when reviewing a contract and company to print and distribute your books, and my reasons as to why I don’t think any vanity publisher, especially those touting themselves as “indie publishers,” is a good choice for non-fiction business writers.

This is a review of the fairest of all vanity publishing contracts I have seen in my career as an independent publishing consultant. I hope you find it informative and I hope it helps you make the right decision for you.

Red Flag #1

Many vanity publishers make it difficult to find their contracts. Three or more clicks to locate a contract on their website is too much. And if they plaster their phone number everywhere in big pretty graphics, enticing you to call them for a quick answer, you can bet you will start getting tons of sales messages and follow ups by highly paid professional salespeople in order to gain access to that contract. Not to mention when you call, one of those highly paid sales professionals will be answering the phone. They know exactly what to say to get you to sign up to their service, before you ever see a contract.

Red Flag #2

In the best vanity publisher’s contract I’ve ever reviewed, under the Pricing section, it reads, “We or our affiliate will be the seller of record for each physical product of your Title” which means you are NOT the seller of record, even if you supply your own ISBN. This also means they take your distribution rights, and if you sell your book to a traditional publisher, they will have to fight the vanity company for the distribution rights, which traditional publishers are usually not willing to do. By using a vanity publishing company, you essentially give up your rights to be traditionally published in the future. Many of these companies tout themselves as “independent publishing” solutions, but taking control of your distribution rights and slapping their name on your book is everything but independent.

To clarify further, in this contract example, because the vanity publisher is the “seller” of record and because they pay out in “royalties,” taking a chunk of the profits of every book sold for the “print cost,” they do in fact take the distribution rights as well. Do the royalty checks come from “Vanity Publishing Company” or a worldwide distributor, which vanity publishers are not? Checks considered “royalty” that are sent through a publishing company, not a distributor, means the author does not control their own distribution rights. The only way an author can control their distribution rights is to work directly with a distributor, no middle man taking a cut. Of course, this only matters if you care about giving the middle man $4-5 in profits per book sold, and if you want to open a back door to a future traditional contract.

One of my close friends is the head of editorial for a major traditional publishing house. She told me they will not touch a book published by any vanity publishing company due to the difficulty of getting that book out of distribution. Despite most vanity publishers that say you can cancel your contract at any time, do you really think they’ll let you go easily if your book is doing well and making them a lot of money? They will send you to a retention department first and their top sales people will try to convince you to stay. This is not wrong on their part, they are a business and any business should do the same thing. But it does mean it’s not as easy as one might think to cancel that contract in order to sell the book to a traditional publisher. As a matter of fact, I have several authors who have set up their own publishing companies using the training inside The Book Ninja Academy who are now under traditional contract, and each one of them was told the reason they were selected was because they independently published that book and had direct control over its distribution.

Red Flag #3

Further down in the Pricing section it says, “You will provide a List Price for each Title … which will be at or below (a) the price at which you list or offer that title via any other sales channel; and (b) the price at which you sell such title in physical form to customers through any distribution method.” Here’s the plain English: You don’t control your price. You set the initial price, but if you decide to raise the price of your books for a special event in the back of the room (say, to make it an even $20 instead of $18.95), this goes against your contract. “Any distribution method” includes you selling your own books. Also, the publisher has the right to sell your book wherever they want for however much they want, as stated earlier in this section, “You acknowledge that you have no input or control over the price at which your Titles are sold…”

Red Flag #4

I don’t care what the company calls itself – subsidy, independent, etc. Any company that states, “…we will pay you the applicable Content License Royalty” (under the Royalties section) using the word “royalty” that requires any payment upfront at all is a vanity publisher. The only publishers who can use the word “royalty” and not be considered vanity are traditional publishers which work primarily through agents and usually offer authors an advance. This means even with their “free” options, vanity publishers are not traditional or independent publishers.

Sure, you can raise the price of your book if you want to make more money in royalties (with most companies, you do control setting the initial retail price). But that means the publisher makes more money, as they should, since they often have a free setup option. Why is this bad? Because most of the time this prices the book out of consumer guidelines, which means no bookstore will have the author for a book signing. And some vanity publishers require you to sign up for a package that costs thousands of dollars, and pay several hundred dollars more each year if you want to accept returns. In order to see the inside of a bookstore, returns are mandatory.

Red Flag #5

The “rights” section in the reviewed contract states, “we will own all right, title and interest in and to the templates and other materials created, provided or used by us in our performance under this Agreement (including Source Files, Future-Proof Archive Files and Packaging Materials, including all Intellectual Property Rights therein.” This means if you ever want to take your book somewhere else, but you paid the vanity publisher to create the cover and interior layout, you are going to have to pay all over again to have those files re-created from scratch. This also means any revisions you made to the text in the course of proofing your book will be lost and you’ll have to remember exactly what changes you made. Some vanity publishers don’t even offer those original book design files to be purchased from them, which any professional book designer worth his salt will have a provision for in their contract.

Red Flag #6

Further down: “Additionally, you may not in any way use any XXX IP, including without limitation for the purpose of issuing any press release or other activity that may be considered promotional or marketing related.” This means you cannot advertise that your book is published with the vanity publisher in any promotional material or a press release. Now ask yourself this question: If the vanity publishing company is such a fair and honest company, and if they really wanted more customers, why would they have in their contract that you’re not allowed to say you’re published with them? After all, according to Section 4.2, they are the “seller of record.” Why do they want to keep quiet that you published with them? I think it’s because they’re trying to deceive people into thinking they are independently publishing, when in fact they are actually publishing via vanity.

Red Flag #7

Nowhere in this particular contract did they say the exact percentage in “royalties” you will be paid. They do link to their royalty schedule, but unless it is written in the actual contract you sign, they are free to change that royalty whenever they feel like it. This means you have no control over the amount you will be getting paid.

The problem with this is, unless the royalty amount is located in the actual contract you sign, in writing, you’re not guaranteed that amount in the future. I have had authors come to me over the years who are undergoing lawsuits with various vanity publishers because they weren’t getting paid for books that they had proof of that were sold (ie: they had hardcopy receipts from their customers). Why? Because the amount they were to be paid was not in writing. If it’s not in writing, any lawyer will tell you it won’t hold up in court. I want to help you avoid messy situations down the road, by not only knowing up front what you should be paid, but having it in writing so it guarantees you will be paid.

Too often we sign on the dotted line without reading the fine print. And most of the time when we do that, we regret it–big time. As I stated earlier, whether you should go with a vanity publishing company or not depends on your goals for your book. If you are happy with distribution being controlled by someone else, allowing your “royalty” payments to be changed whenever the heck they feel like it (depends on the contract), giving up your potential right to be traditionally published with that book in the future, and cutting out over 75% of the buying market by cutting off bookstore sales (the United States and are not the only places people buy books, and only 19%** buy print books from, then vanity publishing is a good option for you.***

But if you want to control your distribution, open your book up to worldwide sales and meet all the requirements to have a book signing in a real brick and mortar bookstore, true independent publishing, with you in total control of the entire process, is a good option for you.

*My definition of “vanity” is pay now, pay later. Pay up front for the production, keep giving the “publisher” a profit on every book sold. In true independent publishing, the author is responsible to pay their service providers. To compete traditionally, you must have professionals working on your books.

**Study conducted by Spencer Wang at Credit Suisse in 2009

***In my opinion, vanity publishing is a good option for poetry, memoir, fiction and any extremely niche book with a limited buying market.

Kristen Joy

Kristen Joy

Kristen Joy Laidig is the founder of The Book Ninja. She has authored over 40 books, started over 50 publishing companies, trained over 10,000 authors worldwide, has her black belt in karate, and eats way too much chocolate. She currently changes lives through her students… one published message at a time, manages her two retail stores Toy Box Gifts & Wonder® and Nerdvana Outpost in the heart of her newfound hometown, Chambersburg, PA, is in the start-up phase of at least three new businesses at any given time, and generally causes anyone reading this bio to be out of breath. On her “off” time (what’s that?) she brainstorms business ideas with her awesome husband, the great Public Domain Expert himself, Tony Laidig, and hangs out with her two ragdoll kitties. She’s even been known to sleep... occasionally.

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