If you want to publish your book, Amazon KDP (Kindle Direct Publishing) is a great self-publishing platform. This platform is not only accessible and flexible, but it can be a great way for writers to make money from their work.

Amazon KDP offers different royalty rates. How do you decide between them? Well, this guide will help you to make an informed decision regarding which royalty rate is right for you!

What Are Royalty Rates?

In publishing, royalty rates will be paid by the publisher to the author. The royalty rates are given so that a company has the right to publish the author’s work. These royalty rates differ depending on several factors. For instance, they tend to be much lower when using a traditional publisher than if you are self-publishing (see also ‘Self Publishing vs Traditional Publishing: Which One Should You Choose?‘).

Traditional publishers tend to offer approximately 10% royalties. You will struggle to find a rate that is above 20% when using a standard publishing house unless you are a well-known writer. Meanwhile, royalty rates for self-publishing can be as high as 70%.

Amazon KDP Royalties: 35% Vs 70% Royalty Rates

Now that you have a thorough understanding of royalty rates in the world of publishing, you can now begin to consider which of the Amazon KDP royalty rates is best for you. Here are the two different options:

35% Royalty Rates

The first option offers a 35% royalty rate. You may think that this royalty rate is inferior, as it means that the author receives less money for every sale than the 70% option.

However, the reason why this royalty is desirable is that it can be applied to books that are cheaper than $2.99. The 70% option is only available to books that cost at least $2.99. So if you want to sell your book for a cheaper price, the 35% royalty is a solid choice.

This makes it a great option if you are writing a shorter book, such as a poetry collection. Moreover, this cheaper price point makes it suitable for first-time writers and people who are writing about more niche subject areas.

You should bear in mind that when you select this option, you will receive 35% of the book’s price without VAT (value-added tax) per unit. As a result, the lower the VAT, the more money you can make per sale.

Also, the delivery cost will not be deducted from your royalties if you have chosen this course of action. In contrast, Amazon will charge a delivery fee for the 70% royalty scheme depending on how many megabytes a digital book features.

70% Royalty Rates

On the face of it, you will receive more money when opting for the 70% royalty rate. This is because you will receive double the amount of money per sale than you would for the 35% option.

But there are a few caveats to this royalty. Firstly, it is not available in certain locations, namely Mexico, India, Brazil, and Japan. If you want to have this royalty rate in these territories, you must sign up for Amazon KDP Select (see also ‘The Ultimate Guide To Trim Size, Bleed And Margins On Amazon KDP‘).

Moreover, this option is only available for books that cost more than $2.99. So if you want to release a cheaper book (see also ‘What Is The Best Time Of Year To Release A Book?‘), you have to select the 35% royalty rate.

Some writers will be anxious about selling their book at a price above $2.99, especially if it’s an ebook. This is because some customers may be reluctant to pay so much for a book. So if you have quite a small book, it may not be best to select this option, as you could discourage customers.

As mentioned, you must also pay for the delivery of your book when utilizing this royalty rate scheme. Reliant on the number of megabytes, writers will be charged for delivering their files to a customer. This can end up reducing your profit, particularly if you have written a lengthy book. Therefore, you may need to compensate by placing your book at a high price point.

How To Pick The Right Royalty Rate?

Choosing the right option for you can be tricky, as there are advantages and disadvantages to both of these royalty rates. You might assume that it’s simply best to opt for the 70% rate as it will allow you to earn more money per book sale.

But we recommend weighing up these options to find the one that works best for you. Here are some of the most important factors to think about.

The Price

When you use a traditional publisher, they will decide on the selling price of a book. To do this, they will likely take into consideration factors like the cost of printing. As a result, the writer won’t have to work this out for themselves. But when you use self-publishing, a writer must consider the price at which they are going to sell their work. 

As you can imagine, it can be difficult to make this choice. After all, this can impact how much money your book will make. Not to mention, a book that is too expensive may put customers off buying a book. On the flip side, it will be hard to make money on a book with a low price.

As stated previously, the 70% royalty rate is only available if your book is sold at more than $2.99. Not every book will be worth this price point. If your book has a limited audience, you will likely struggle to make money if you sell your book above $2.99. Therefore, you must carefully consider how much you believe your book to be worth.

Delivery Fees

Delivery fees will not be applied to books that are sold through the 35% rate. However, they are applied to the 70% rate. Given that this fee is dependent on the size of your book, you must calculate how much this will affect your profit.

The Kindle eBook Pricing Tab

Perhaps the best way of working out which rate is best for you is to use this pricing tab. This will allow you to calculate how much you can make depending on the royalty rate and size of your file.

Frequently Asked Questions

What Is The Average Royalty Rate For Authors?

For printed books, authors tend to receive a royalty between 10% and 15%. Of course, this can differ depending on a range of different factors, such as the publishing house and the book’s genre.

As you can see, self-publishing royalty rates tend to be much higher.

What Are The Advantages of Self-Publishing?

Though self-publishing can be quite stressful, there are lots of advantages to this publishing method, such as:

• The writer will have more control over their work.
• You can control the pricing of a book.
• Royalty rates tend to be superior, as evidenced by Amazon KDP.

Final Thoughts

Though Amazon KDP is a great service that makes it much easier for writers to get their works published, there are certain things that you must consider before using this platform. Perhaps one of the most important considerations is what royalty rate is ideal for you.

There are pros and cons to both the 35% and 70% royalty rates. Therefore, we recommend that you carefully consider these two options before making your decision. After all, by picking the right rate, you could make a significant profit!