There are millions of books on Amazon.com and hundreds of thousands of authors who earn their living—theoretically—from this market-dominant company. The mechanics of how this works for an author may not be obvious to the general public. Here is an insider’s view.
Many people buy Amazon Prime paying $119 for free shipping, so Amazon is cash-positive from the get-go. How does Amazon ship for free? Answer: authors pay for the shipping. Here’s the math:
My book, “The Spark, the Flame, and the Torch”, has a cover price of $24.95. From time to time, Amazon arbitrarily decides to sell the book on their website for $14.00, making them look like a discount hero. Amazon—arbitrarily again—decides that they will discount the list price by 55%, so they pay me $6.30. The responsibility for shipping the book to Amazon is mine, so I pay $3 for an envelope, $13 for postage, and perhaps another $5 for creating an invoice, financing the accounts receivable and the cost of auto and gas getting to the post office. Gross income to me: $6.30; total cost to me of $21; so I lose $14.70 on every sale of a $24.95 book (and we sell hundreds of books each year!).
I have 22 books in print, an equal number of CDs and Videos, and similar losses occur on every item because of Amazon’s rapacious price-gouging and offloading of costs to authors and other vendors. To add insult to injury, if Amazon cannot locate a confirmation that I sent confirming that I have shipped the book within a window of 48 hours, they cancel the order altogether and don’t pay me anything, even though I’ve already shipped the book(s).
Last year Amazon increased—arbitrarily, again—the price of my $24.95 book to $50—for months. Since Amazon obscures the finding of phone numbers, emails or contact points for vendors who wish to reach them, I struggled to contact the company for 4 months during which time sales nosedived because hardly anyone purchased at these inflated prices. Eventually, I succeeded in getting an email response letting me know that “they were working on it”. However, no change occurred until—arbitrarily again, and after many months of lost sales—Amazon decided to restore the price to the correct one.
So, I have arbitrarily increased the price of my books on Amazon by $10 to help offset the losses. It’s an unsustainable business model, but I think it’s time for all authors to take a stand. Of course, Amazon has a lot of power—to lose the Amazon sales channel is painful for me, but I’d rather sell less books through a profitable channel than tons of books on which I lose money on every single sale. What do you think? If you are an author like me, what would you do? Is it time to start a movement? @boycottamazon
If you wish to support my work, all my books and other products and services are available here: www.secretan.com/estore.
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I sent an early draft of the post above in an email to Jeff Bezos, the founder and CEO of Amazon, and this is the reply I received the next day, in which they don’t address my concerns, but try to get me to publish through their own publishing house!!
My name is Albert Rosberg with Amazon Author Central – Executive Customer Relations, Jeff Bezos received your email and I’m reaching on his behalf. If you’re a Seller with Amazon please visit https://sellercentral.amazon.com/ for better assistance with your Seller Account. Also consider publishing your paperback books by using KDP, for more information visit KDP Jumpstart guide, check: https://kdp.amazon.com/en_US/help/topic/G202187740.
Best regards,
Albert Rosberg.
Executive Customer Relations
Amazon Author Central
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Thanks for sharing your experience, Lance. As a writer you are an insider, and you give account of what happens behind the “pretty shiny stage set” of Amazon. I am not surprised. Amazon has been in the headlines MANY times, especially during covid times, how badly they are treating their staff. To me they are vampires and slave drivers. I am amazed they get away with it under the existing laws and regulations. Yes, a movement. What choices can each one of us take that contributes to fairer share and exchange of services and products in communities and society at large? There are alternatives out there already. But it may be more costly and taking more effort on each person’s part who wants to see changes. Personally, my mind is forever more set on seeking out the MUCH-needed alternatives. But in your situation, Lance, I am sure it must be a difficult choice ensuring at the same time that the important messages of your books continue to get spread widely in the world. I wish you good luck and success.
You are so right Stephan. I am raising this, not just for me, but for the many thousands of authors who struggle with the big Amazon machine. At one point they suggested a solution would be for me to increase the price of my books. But this would just make my books uncompetitively priced and more expensive on Amazon than at other retail sources. And since they regularly, and arbitrarily, increase and decrease the price of my books compared to the sticker price, we could end up in the same place. I think we need the voices of writers everywhere to send a message to Amazon asking them to reset the relationship they have with authors. I hope others will sign on and therefore send a message to Amazon: “Play fair with your suppliers”.
Thanks for sharing, Lance. It seems to confirm that Amazon circles around their selfish agenda of profit and greed, rather than the high value of spreading knowledge and wisdom, and to respect and acknowledge the artists and writers like yourself through fair treatment. What you suggest for the community of authors to do is a good thing, but perhaps the only thing that will “hurt” amazon, and will make them listen, is, when the vast community of authors dumps amazon altogether and gets their books sold in alternative outlets. Do you think that is possible? Isn’t it easier today than ever before to self-publish online, for example? Everywhere the same seems to want to shape up – changing the world from the grassroots level up, not from the top down, because the latter doesn’t appear to work very well.
It’s very easy to self-publish, but distribution is another matter. Amazon has pricing secret deals with the big five publishers which shuts out independents – another contentious issue. A burgeoning organization called “small business rising” (www.smallbusinessrising.net) has been formed to try and bring attention to, and rectify, this unfair arrangement.
Lance,
I did not know this about Amazon and its financial relationship to authors. During this pandemic, I was made aware of Ben McNally’s bookstore move to Adelaide St. location, and have been supporting his totally uncomplicated ordering process: call him up, or send him an email as to what you want. Then, the books appear at my self-isolated door with a local bicycle delivery service. I’m hoping the authors get their fair share of profit using an independent seller. I stopped using Indigo and Amazon (but also use the library). I don’t think the average person knows this about Amazon. It’s terrible.
I trust you remain well and happy. Met you years ago in Toronto, when I was starting up my business in facilitation. You were very kind to include me in one of your client retreats at lake Louise. My best to you.