Home
>
Writing
>
Retail Margin, Trade Discount, and What it Means for the Author

Retail Margin, Trade Discount, and What it Means for the Author

DEFINITIONS

Retail margin is basically the difference between your book's wholesale price and your book's retail price. For example, a book with a cover price of $10 and a wholesale price of $5 has a 50% retail margin.

Wholesale price is the cost of your book to a retailer. To use the same rudimentary example, a book with a cover price of $10 and a retail margin of 50% will be sold to a retailer for $5.

Retail price is the same as cover price or selling price. This is the cost of the book to the end consumer (the reader). The retail price is typically printed on the cover of the book and also "embedded" within the barcode on the back. For example, a book with a wholesale price of $5 and a retail margin of 50% will have a retail price of $10.

As you can see, retail margin, wholesale price, and retail price are interconnected. By having two figures, the third can be calculated.

The fourth definition to be aware of is the trade discount, which is the percentage off the retail price that a wholesaler or distributor pays for your book. Since the retail margin is a portion of the trade discount, the trade discount always exceeds the retail margin. Distributors typically expect between 50% - 70% in order to provide an acceptable margin to the retailer.

MAKING DISTRIBUTION WORK FOR YOU

It should come as no surprise that the amount of distribution your book enjoys rests largely upon its trade discount. Generally, the higher the discount, the greater the distribution.

Think about it - distributors want to make money, too. So do retailers.

While your book's trade discount is but a piece of your pie (albeit a big piece), it is the entire cake for distributors and retailers, who together must split the take. The greater the number, the greater incentive they have to distribute your book, sell your book, and market your book, etc.

The proper trade discount depends upon each author's intentions, and can vary from author to author just as readily as from book to book. Obviously, the higher the retail margin, the higher the cover price, so authors interested in maintaining the lowest cover price possible will often opt for a lower retail margin.

Conversely, those authors who long for the best distribution possible will elect a higher trade discount, even though their cover price will increase accordingly (or their profit will decrease accordingly). Non-fiction or niche-markets are less affected by higher retail prices and greater distribution is often advantageous in finding those markets.

Often, the author will have little to no say in what trade discount to offer for their books -- its whatever the distributor mandates.

Trade discounts can be as low as 20% to successfully get listed on Internet retailers like Amazon.com, who manage to make a profit with such low margins through EDI (electronic data interface) with distributors like Ingram and on-demand publishers like iUniverse and Outskirts Press.

By comparison, trade discounts can be as high as 75% - 80% when dealing with a niche wholesaler, or when attempting distribution for a book that does not have a proven market. In these cases, the distributor may be padding the coffers a bit in anticipation for a "harder sell" and perhaps, also, in preparation for offering an increased retail margin to close the deal.

INDUSTRY STANDARDS

Industry standards for retail margins are difficult to define because, ultimately, it comes down to negotiation between all parties involved. Publishers have the power to negotiate with distributors, who have the power to negotiate with retailers, who have the ability to negotiate with the reader, but the typical trade discount is around 55%, which allows for a typical retail margin of 40%.

Publishing-on-demand is removing some of the participants in this little dance, and as a result, the same piece of pie is being divided among fewer people, resulting in more money for the remaining players (especially the author).

Brent Sampson is the President & CEO of Outskirts Press Publishing at outskirtspress.com and author of Publishing Gems: Insider Information for the Self-Publishing Writer. Information at outskirtspress.com

cleaning service near Bannockburn ..

In The News:

Learn how to act against cybercriminals in 2026 with essential security steps like two-factor authentication, software updates and credit freezing.

Choose between OpenAI releasing Sora text-to-video model, the AI race heating up, or Waymo driverless cars launching in cities across the country

Learn how to set up Google Maps and Apple Maps on your phone to automatically remember where you parked. Step-by-step instructions for enabling location services and parking detection.

Phishing scammers use rnicrosoft.com domain to impersonate Microsoft by replacing "m" with "rn" in typosquatting attacks that steal login credentials.

OpenAI announces new teen safety rules for ChatGPT users under 18, blocking romantic roleplay and requiring extra caution on body image topics.

A 2025 data breach at fintech company 700Credit exposes personal information of more than 5.8 million people through compromised third-party integration partner.

Retailers lose $76.5 billion annually to return fraud as nearly 10% of U.S. retail returns involve fraudulent activity, with $850 billion in returns expected in 2025.

ShinyHunters claims responsibility for stealing 94GB of Pornhub user data affecting over 200 million records and demands Bitcoin ransom.

ChatGPT 2025 now connects to Apple Music, Canva, Expedia, TripAdvisor and OpenTable through built-in apps that help users create playlists, design graphics and more.

Apple releases emergency patches for two zero-day vulnerabilities actively exploited in attacks. iPhone and iPad users urged to update immediately.

DoorDash launches Zesty, an AI-powered social app that recommends restaurants through conversational search, now testing in San Francisco and New York.

Cybersecurity firm Infoblox reveals that over 90 percent of parked domains now redirect visitors to scams and malware, making simple typos extremely dangerous.

The Fox News AI Newsletter covers the latest artificial intelligence technology advancements, including the challenges and opportunities AI presents now and for the future.

GPT-5.2 is now live for all ChatGPT users with improved coding, writing and image interpretation, with Kurt Knutsson offering his review.

New iPhone replacement scam uses pressure tactics and fake carrier calls to steal devices from buyers. Criminals claim shipping errors and demand urgent returns.

Amazon Ring's new facial recognition feature sparks privacy controversy as Electronic Frontier Foundation critics argue the AI upgrade expands surveillance risks.

New Android banking trojan Sturnus steals credentials, reads encrypted messages and controls devices.

Denmark's 3D-printed student village proves automation builds 36 apartments faster than traditional methods. Skovsporet project shows housing future.

Discover Android's new Sound Notifications feature that alerts you to smoke alarms, doorbells, and baby cries even when wearing headphones.

New SantaStealer malware reportedly threatens holiday shoppers with password theft. This Christmas-themed info-stealer targets browsers and crypto wallets.

The Christmas season brings a surge in Netflix phishing scams targeting shoppers with fake emails. Stacey P received convincing scam but verified account first.

San Francisco Giants invite Jamie Grohsong to throw ceremonial first pitch at Oracle Park after he learned to play baseball with a bionic hand following an injury.

FBI warns cybercriminals are stealing family photos from social media to create fake proof of life images in virtual kidnapping scams targeting victims.

Instagram's new 'Your Algorithm' tool lets you control your Reels feed in real time. The app now gives you power to customize what videos you see.

Major Marquis fintech breach exposes 400,000-plus Americans' data through unpatched SonicWall vulnerability, with Texas hardest hit at 354,000 affected.

Retail Margin, Trade Discount, and What it Means for the Author

Writing