Author royalties when traditionally published on Amazon
Let's say paperback retail = $10
Amazon takes 40% so $6 left over.
$3 to print = $3 remaining.
Does the author then get their royalty (presume 10%) off of this $3, or off of the $10 retail price? If royalty is paid off the retail price, does Amazon provide gross sales figures to the publisher, or does the publisher only know how much the Amazon check is each quarter in order to calculate author payment?
Thanks for any insight.
Critiquer for V39 Winner (Oh yeah, it's now a thing)
The first thing to remember is there are no rules, there's only your contract. Whatever both parties sign is what counts. If you foolishly signed a contract that said you pay them a dollar for every copy they sell, that's what would happen. (And while that's ridiculous, some contracts have slippery wording that is almost as bad. Beware of any payment based on the net. Publishers can deduct all sorts of vague expenses from the net.)
I won't presume to speak for all contracts, but I can discuss mine. The royalty for print books is paid on the list price. Even if a retailer offers the book on sale, I get the same royalty per book--unless it's "deep discount", meaning 50% off or more. Deep discount is generally a way to clear inventory off the shelves. It's a sign that the book's just not selling, and they want to get rid of it. I make $0 for a deep discount sale.
eBook sales are different: the royalty is based on the retail cost of the eBook. If it goes on sale, my royalty goes down.
As for the other question, Amazon or any other retailer reports copies sold.
Tools, Not Rules.
Martin L. Shoemaker
3rd Place Q1 V31
"Today I Am Paul", WSFA Small Press Award 2015, Nebula nomination 2015
Today I Am Carey from Baen
The Last Dance (#1 science fiction eBook on Amazon, October 2019) and The Last Campaign from 47North