Subsidy Publishing: Proceed With Caution

by Joel Friedlander on May 7, 2011 · 140 comments

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It happened again today. In fact—and I know you’ll doubt me but it’s absolutely true—it happened twice in one day.

Two different stories with the same sad end.

In the first one, the author had gone to Outskirts Press, a subsidy publisher. She had the first book in a series, and wanted to brand the covers with her own art as a way of tying them together.

After getting resistance about using her artwork, the author insisted. When the books arrived, the artwork had been cut up and put back togther with completely irrelevant images that had nothing to do with the book. The resulting book cover, as you might guess, is a disaster.

Another Story, Same Ending

In the second story, the author went with Balboa Press. Do you know it? This is part of the gradual co-opting of the independent publishing houses by pure naked greed in the form of an alliance with subsidy king Author Solutions. They see all the money authors are paying to publish, they see every day how desperate writers are to get a contract with a publishing house. They decide to cash in, and Author Solutions is only too happy to help.

Author Solutions owns the AuthorHouse, iUniverse, Trafford Publishing, Xlibris and Wordclay imprints. It calls itself “the world leader in indie book publishing” despite the fact there is nothing even vaguely “indie” about the company or the books it produces.

But major independent publishers, perhaps pressed by the economy, perhaps with one eye on the coming tide of e-books, have also joined forces with Author Solutions. First it was Thomas Nelson, the huge bible and religious publisher, with West Bow Press, an enterprise operated by Author Solutions.

By tying the subsidy business to legitimate publishing houses, a true monster was born. The one thing the subsidy businesses lacked was respectability, and with good reason. But now, with major independents falling into line to reap the profits of the many people coming into self-publishing, respectability is guaranteed.

This author bought into the dream at Balboa Press, the Author Solutions-run subsidy branch of Hay House, a respected independent publisher of self-help and spiritual books. But many other publishers have also set up these so-called “self-publishing” branches.

So if Hay House doesn’t want your book, you can pay to publish at Balboa.

What Business are Subsidy Publishers Really In?

Now there’s nothing intrinsically wrong with paying for publishing services. That’s how I make a living, along with a lot of other professionals. But there’s a bait and switch involved here. Writers are sold by manipulating the dream they have of becoming successful published authors. But the truth of subsidy publishing has nothing to do with selling books.

All the income of these companies comes from their own customers/authors.

Because of this one fact, you can see that bringing in new authors, selling author services like editing, marketing, design and typesetting, are important business activities. Since selling books is irrelevant to the company’s profits, it’s logical that as little money and effort will be expended on the books themselves as possible. That’s how you maximize your profits.

But if you look at the “packages” that these companies offer, you soon realize you will be spending thousands of dollars to get into print, and that’s before all the upsells kick in. And before you start buying your own books.

I won’t even go into the litany of abuses these publishers heap on their customers, the same authors they pretend to be such champions for. The PDF files I’ve received with watermarks on every page, making it impossible to use the file for reproduction. The refusal of the publishers to turn over reproduction artwork for book covers the authors have bought and paid for. The list goes on and on.

So anyway, the second author went to Balboa Press, since her book is on a subject close to what Hay House publishes. She paid for everything. But here’s the problem.

The greed, once it starts, begins to consume everything. Her book is a 6″ x 9″ paperback with 284 pages. The retail price Balboa has set—and the author has no choice in this—is $22.95. I told her outright she would never sell the book. Who will buy it?

But wait, it gets worse. The author ordered lots of books to sell herself and to use for promotion. How much did the books cost her? $11.50 each.

A quick calculation told me that the publisher was paying their print on demand supplier about $4.90 to manufacture the books. More than likely the printer is Lightning Source, and part of the sell to the unwary author is that they will get “national distribution,” a scam so pervasive it deserves its own article.

So the subsidy publisher, not content to take thousands of dollars to produce a substandard book with a price so high no one will ever buy it, has turned the author’s own purchases into a profit bonanza. You pay them to create the book at inflated prices, then you pay outrageous prices to buy your own book. They are taking a profit of over $6.00 off every book this poor author buys.

Isn’t There Another Way?

I know the subsidy business is huge and growing because publishing is not, in the end, a simple or easy thing to do. Many writers don’t want to take on the considerable chores of publishing their own book, and look for a “one stop shop” type of solution.

This is one of the simplest reasons to educate yourself before you commit to a particular publishing path. I’ve consulted with half a dozen writers in the last two weeks, and this power of a little education has been proven over and over again. With better information, people make better decisions. When the facts are plainly in front of them, most people know right away what to do, it’s not confusing at all.

There seems to be room in this business for a subsidy publisher that honored authors instead of ripping them off. One that was transparent about their services instead of relying on hype and pretty websites to seduce people. A subsidy house that committed itself to helping its authors succeed at the one basic task anyone in this business ought to be dedicated to—getting their books the widest possible readership.

Now that would be something. In the meantime keep studying, keep learning. Book publishing is an incredibly exciting and rich place to be right now, at the nexus of change. There are huge opportunities for the entrepreneurial author, and they will continue to multiply. But the authors with paperbacks that cost $23, are poorly edited and unattractive, those people will miss out.

Don’t let that happen to you.

Photo by blech.

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    { 133 comments… read them below or add one }

    Scott Allan September 12, 2014 at 6:36 am

    I was glad to read this article. Everything that is mentioned here about the vanity Publisher is true and then some. Here is my short story to add.

    Before Amazon became the worlds biggest book retailer and set up its dynamic platform for authors who wanted to self-publish, about five years ago, in my enthusiasm to get published fast, I signed up for a package with iuniverse [one of the companies mentioned in the article]. I paid almost $900. I knew something was strange when I didn’t even receive so much as a “Welcome letter” after paying so much money.

    when my book was near completion I was told to contact this company so they could “walk” me through the process. Man was I excited! My dream was about to come true. The phone was answered by a woman who was obviously eating lunch and munching away in my ear while spewing off writer quotes and then trying to sell me another publishing package before we even had time to discuss the book I was ready to publish. The warning signs were everywhere, and what made it worse was, this very bad “salesperson” wasn’t even trying to hide it. She then said I needed editing done on my book, which I admit, I did. Shen then quoted me a price right away based on the word count and it took her all of six seconds to plug a number into the calculator and come back ayr me with a quote for $7,000. That should cover everything, she said.

    I realized then and there I had taken the wrong path for this. I hung up the phone and was hounded for several months by this woman and her team. I gave up on the vanity publishers and never looked back. Now, three weeks ago I had a call out of the blue from a woman out of Singapore claiming to work for Trafford who wanted to take care of my “publishing needs”; she got my number off a pamphlet I downloaded more than seven years ago. These people are relentless I’l give them that. I told her to @@## off and that was that. I learned a lesson with hess so-called publishers and the stories of people being ripped off. For authors out there who “don’t know any better” such as I was, this is the pathway you definitely want to stay clear of.

    Thanks for posting this. I have been waiting years to tell my story and, in the past year I’ve published several books, made some money, and am having fun doing it…and it still cost me less than $900.00 even with the professional editing.

    Reply

    Donald MacLean July 31, 2014 at 7:55 pm

    Good advice, thanks Joel. I can’t actually find a contract, and therefore no information on what happens if you want to end it! (I read elsewhere someone saying they hadn’t got a contract.) What I do have is a welcome letter from a ‘Check-In Coordinator’ giving me a project number. What I’m going to do is write to them asking for a full refund, and be ready to see a legal eagle if need be! I’ll keep this blog posted. Thanks again.

    Reply

    Donald MacLean July 31, 2014 at 7:37 am

    Having paid for an expensive package with Balboa, I have now read up on Self-Publishing and POD printing. I’ve got some excellent advice on how to proceed, and need to begin the process of asking Balboa to refund at least part of my money. I have hunted on their site, but can find nothing about refunds, no conditions, percentages or any ‘fine print’. I’ve held off writing to them, hoping to be better informed when I do. Have you any advice please?

    Reply

    Joel Friedlander July 31, 2014 at 10:07 am

    I suggest you carefully read the contract you signed with them, it should have all the cancellation information in it, and you might want to also speak to an attorney if you feel you’ll need help extricating yourself from the contract.

    Reply

    Nancy Miller July 27, 2014 at 12:26 pm

    Thank you for taking time to write and share. The strength we receive from the support of others is amazing, and what we do is better for it

    Reply

    Jaye July 25, 2014 at 4:58 pm

    Great information on this blog. What can anyone tell me about Morgan James? I’ve sent in a manuscript and had an initial introductory call. Yes, I know it is sort of a pay to publish program. Has anyone worked with this company?

    Reply

    Michael N. Marcus August 1, 2014 at 2:39 am

    I am preparing a blog post on the company. My initial impression is that MJ is both egomaniacal (“reported as being the future of publishing”) and dishonest in the way it compares itself to other publishing methods.

    It wants to seem like a traditional publisher but its website looks very much like a site for a pay-to-publish company. The site is intended to attract authors, not readers. Random House and Simon & Schuster do not advertise to attract authors.

    MJ requires that “Authors provide a fully edited, proofread manuscript.” That’s not the way traditional publishers work.

    MJ offers authors “small advances” and requires its authors to purchase thousands of books. It reminds me of the dreaded PublishAmerica (now America Star Books).

    I urge you to stay away.

    Reply

    Mark Funkhouser July 22, 2014 at 5:08 am

    Has anyone had any experience with Telemachus Press?

    Reply

    Michael N. Marcus August 1, 2014 at 2:23 am

    I am preparing a blog post on the company. My initial impression is that Telemachus’s prices are extremely high with no apparent competitive advantage to justify the prices.

    They brag, “With Us You Get the Greatest Profit per Book,” and “Make more money.” Their prices are so high that it will be extremely difficult to make a profit unless your book is amazing and you are very lucky.

    Reply

    Stephen Downey April 24, 2014 at 6:12 am

    I have been doing quite a bit of blogging, as weld was working on several book projects. But since I have not written a manuscript I have yet to contact any for of publisher was yet. O I was quite surprised to receive an email from Westbow offering their services. I deleted the email so I am going on memory here, but it seems they have read some of my blogs, liked what they had read, MD wanted to both encourage me to write a book and to assist me in publishing it. Nelson Publishers was plastered all over the email with Westbow in small print. Naturally I thought I had been contacted by THE Nelson Publishers, a company I am quite familiar with.

    By the Grace of God I decided to Google Westbow tonight just to explore what they were all about, and I accidentally came to your website. I want to say thank you for the time you folks take to offer information, because it has answered my questions and saved me a lot of grief and money.

    Blessings to you all.

    Stephen Downey

    Reply

    Joel Friedlander April 24, 2014 at 10:40 am

    Glad to hear that your research paid off, Stephen, you’ll be happy in the end.

    Reply

    Barbara Morghon February 17, 2014 at 12:03 pm

    This site just saved me a bundle that I don’t have! I’m currently on social security disability, trying to find a way off benefits without causing myself to lose everything before I have it replaced by real income. I’ve been creating that I will be off all benefits by the end of 2014. The Universe is lining up with that creation by having me find pools of information that further my success, like this one, and prevent me from falling into traps like Author Solutions, et al.

    I am creating myself as a Medical Diets Transition Specialist – how to get into the lifestyle the doctor just prescribed – whether it be Gluten Free, Diabetes, or any other Medically Prescribed Diet. She suggested I take the database of knowledge I have locked in my brain and get it published. Up popped a boatload of “related ads” for multiple companies all promising me to publish my book. A quick Google search after a conversation with a rep from iUniverse and a cautionary text from my coach got me doing some research. That brought me here!

    What I need is a coach/mentor. Someone who will hold my feet to the fire for the timelines – part of gluten intolerance that has gone untreated for so long is brain fog, memory issues, depression, and anxiety, got ‘em all in spades. I want someone to read the book as I write it and get the editing done as we go, less overwhelming for me to have things done in chunks rather than all at once.

    Is there anyone out there who does this? By the way, it’s kind of a “out of the goodness of your heart – until I start making some money” type of deal.

    I’ve downloaded all of the free guides, I’m on the waiting list for the next one, and will purchase the PDFs when I have a spare $46.00. Though I have difficulty with retention at times, I’m a fast study and a very good student who happens to be extremely coachable!

    Reply

    Diana Maryon March 22, 2014 at 2:24 pm

    Barbara, I will have a go at assisting you (for nothing of course). I am a really rigorous copy-editor, and when I work for my Christian friends as a beta reader commonly find much more the matter with a text than the rest of the team combined. My own fictionalised autobiography is here:

    http://www.amazon.com/Love-How-Deep-Diana-Maryon/dp/1449721206

    to give you an idea of my standards.

    You will see that I paid Westbow for publication. Westbow is ASI pretending to be Christian and pretending to do something with one’s book. It was a matter of keeping a dog and barking yourself all through my experience. They were better than CreateSpace in that I have got hardback and several types of ebook out of them, in return for several hundred dollars plus a pile of work on my part.

    Write to me at diana dot maryon dot telus dot net . I apologise that I have only just seen your message.

    Reply

    Gary Ockunzzi January 26, 2014 at 2:36 pm

    Jay, I am a self published author, too. I completed my book in 1996 and after querying it around to the mainstream publishers and somehow getting on the target list of the subsidy/vanity press, I formed my own publishing company and self published and sold my book. While I don’t profess to have done that great (I sold about 18 shy of 1,000 books), nobody owned me. I don’t regret my decision to go in the direction that I went in; it’s a free world out there and there’s room for all of us. Gary.

    Reply

    Michael Ward January 9, 2014 at 12:11 pm

    I’ve self-published two books (l and 2 of a trilogy), with Dog Ear. I think it sold about 3 books, as my last “royalty” check was for $2.20. Enough for a cup of coffee. I have spent hours and hours researching a publishing house that will do some active promotion of my 3rd book, and only come up confused. I’m about ready to resort to armed robbery for a career. Dog Ear is now offering a “digital package” with various social media mentioned. I can’t get a real answer of what that would do to get some promotion from them.

    Reply

    Don Ford October 8, 2013 at 6:36 am

    Joel, You said: “Since selling books is irrelevant to the company’s profits…”

    It may lack the cake, but not the icing. I’m sure they are licking the icing off the big payout by the author as each book sells.
    Cheers. Don Greywolf Ford
    Writer’s Digest and I go back a long way. :-} D.

    Reply

    Sergio September 30, 2013 at 4:36 pm

    hello Joel

    I have to thank you for this site, it has really helped me.

    I am just starting and I have considered the self-publishing solution primarily because of the time it takes for traditional houses to respond. I don’t mind rejections but taking that long is counter-productive nowadays.

    However, all of the self-publishing companies that contacted me were pretty awful pushers. I dont understand their actual role either.

    For this reason I decided to be the actual self-publisher but I have no idea how to start. I was wondering if you could provide any advice about the process please.

    Thank you.
    Sergio

    Reply

    Michael N. Marcus October 1, 2013 at 3:38 am

    Sergio, if you want to become your own publisher, this book will help. http://www.amazon.com/dp/B00AVDWAA4/

    Reply

    DT Anon September 26, 2013 at 9:33 am

    I entered into a contract with a subsidy publisher. As a newbie, I didn’t know that they were a subsidy publisher because they call themselves a traditional publisher. Regardless, I have paid a portion of their up-front “publicity” fee but have since decided that I do not want to pursue this subsidy route after all.

    How can I get out of the contract? There is a termination clause in the contract but it focuses on production and post-production, distribution, promotion, etc. I’m in none of those stages, as I have not yet submitted my manuscript to the publisher to begin the production process.

    I sent them an email and they were sorry to hear my decision to terminate–I didn’t go into specifics, but they said they don’t issue refunds. Can they keep my money even thought a “transaction” has not taken place?

    Thanks for your help.

    Reply

    Joel Friedlander September 30, 2013 at 2:30 pm

    Sounds like you need the advice of an attorney, but I can say that many authors have gotten released from these contracts in the past, so don’t give up hope.

    Reply

    Jean Ann Geist August 6, 2013 at 8:01 am

    I completely self-published my first book hiring my own cover artist, book designer, editor, printer, etc. The only thing I couldn’t get without signing my life away was a way to get my book into libraries and on the wholesale market. With my second book, I chose Lightning Source as my printer and was accepted as a client. They have been fantastic to work with. They have readily answered my concerns and provided me with print copies of my book at a very reasonable price. As the official publication date for my book is September 1, I cannot yet judge how many sales their wholesale market will generate, but it will definitely be more than I had for my first book (which was zero)! And i didn’t have to jump through the Amazon Advantage hoops to get it on Amazon, saving me countless hours! I HIGHLY recommend Lightning Source, Inc.

    Reply

    JR May 15, 2013 at 3:59 pm

    Thank you for addressing Balboa Press. There is much more. If there are any authors that thought they were using Balbao Press, A Division of Hay House, only to find out they ended up with Author Solutions, Inc. et al, leading to egregious malfeasance and an experience that only Rod Serling could give credence to – you are not alone. Please find me.

    Reply

    Barbara April 8, 2013 at 9:07 am

    I too have entered the crazy world of self publishing, but for my children’s illustrated book…Another Balboa adventure…here’s my dilemma and I’d love support on this…once submitted, the “retail price” went from an estimated $12.95 to $15.99 … I can cut out a few pages (“this book belongs to”, shorten the activity page, bakcground story) and get back to $12.95…but…since amazon discounts everything anyway, should I go with the higher $15.99 so once they cut it down it’s $12.99 anyway???

    Reply

    JR May 16, 2013 at 6:08 am

    Barbara,
    How many pages is your book? Also, find out the COGS (Cost of Goods) Balbao ‘states’ that Ingram and Lightning Source are charging for your book for distribution and print of your book. It appears the COGS are inflated and Balboa/Author Solutions et al receive a back-end on the COGS, lowering your royalty, increasing theirs, without disclosure. Your worry is not Amazon. If you are going to offer Ebook, etc. in truth your royalty is 50% minus technology fees, taxes, etc that are not disclosed as to the amount. There is much more.

    Reply

    READ THIS March 29, 2013 at 10:05 pm

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    LTF March 12, 2013 at 11:06 am

    The other form of naked greed (great alliteration) are companies that charge for consultation over the phone for self-publishers. I have seen these companies advertise their services on social media sites. I have designed heavily illustrated books for self-publishers and new publishing ventures but never charged a cent for consultation or explaining the necessary workflow required for a good outcome. I only charge for the actual design and production work. Author beware of companies charging for consultations. Obviously, informative websites such as this are a much better way to learn about the publishing process.

    Reply

    Roz March 8, 2013 at 12:33 pm

    Hi Joel, I started with Trafford publishing years ago – when it was an honest little company in Victoria, B.C. I am a counselor and I wrote a book for kids dealing with grief (When Goodbye Seems Forever). I used all of my own photos for each topic of grief, and I did a mock book through Creative Memories (a computer photo-book program) which is awesome.
    Over the years… I know it has taken me a long time, but I am also a working mom of 3 teenagers, Trafford has done to me exactly what I read about in your article. Since I wouldn’t accept that the cheap paperback book they said I had to sell for $20.00, was all they could do for me, I have shelved my own book! I am now requesting it be removed from their company and will loose the thousands of dollars that I have spent with them on this. I am hoping at some point to have my book published properly and sold for what it is worth. However, is there any legal road I can take to get at least some of my money back for the dreadfully poor job, unfulfilled promises, and outlandish lies from Trafford?
    Sorry to be another sad story!
    Roz!

    Reply

    Joel Friedlander March 8, 2013 at 2:05 pm

    Roz, thanks for writing and I’m sorry to hear about your frustrating experience. I can’t honestly say what kind of case you would have, but I would encourage you to ask an intellectual property lawyer about it.

    And I hope you won’t let the book go idle either. With the tools we have available now as authors, it’s not that difficult to put your book into print, and it can be done at a very low cost.

    Reply

    Lonso March 6, 2013 at 2:12 pm

    By POD self-publishing you do all the work of a publisher and barely get what a writer gets on publishing contract in %, or a small fraction of that in actual money. This is how the business is designed and the only way it can be. The high POD production costs and high markups of these businesses eat up the publishing profit, author profit, and most importantly, distribution options. Check the % of profit on your book when things are equal to a print publishing with distribution. Everybody else gets their money. If the book is more than 128 pages or so, the POD production cost eats into author profits. Most of the times, it leaves no room for real distribution. Why would a writer want to do the publisher’s job for free or lose the life distribution gives to a book? Vanity?

    If you can really be a publisher by producing in offset print run and in automatic binders, you get a low cost which leaves room for making money by using real distribution.

    And please, please, don’t pay $5000 or whatever to get your book in POD publishing. It will probably cost less than $1,00 per unit in quantity if you do offset and series binding and this will give you room to move. Anyone recommending spending that kind of money on a pure POD project is into scamming you. At that kind of cost you can produce cheap books in great quantities, work directly with a distributor, put some money into advertising, and actually make money.

    And, btw, I’m not an author. I have more than 30 years of experience in printing, binding, distribution and order handling in two European countries. I do know though, that most of the self-publishing success stories were heavily manipulated or even manufactured to serve specific marketing goals. A few were even the result of scams on the part of the author, gaming the system when it was young by fake paid reviews and riding on the momentary publicity of specific self-publishing technologies. Some authors are happy and some major companies are happy selling their ebook devices. Oligopolies are formed, in the print and ebook business. The funny thing is that authors feel great. They are not aware of the consequences. I’m 75yo and retired, but things will change for the worse for your generation (20, 30, 50 it’s all the same to me, youth!), and authors will be those hurt the most. The days when the only option will be to get $0.01 from the online content distribution companies are not far. It is already forming in music and video, books are next. And content creators are ecstatic at the possibility of giving away their work “for rent”, while the large corporations are putting them on a cage.

    Reply

    Joel Friedlander March 6, 2013 at 2:31 pm

    Lonso, I’m sorry your experience in printing and publishing seems to have left you a bit pessimistic. Or perhaps you are not that familiar with the book publishing industry in the U.S. If a book is properly planned and produced, there’s no reason why it can’t be financially very successful through PoD, and in fact many authors are making a pretty good living doing exactly that.

    As far as paying for services, again this depends on the individual author, their specific book and the goals they have for it.

    And I know some of the very successful self-publishers, and they are not liars, scam artists or manipulators, just hard working authors who have learned to use the new tools of publishing to their advantage.

    Although there are scammers out there, and authors who manipulate their “numbers” and firms that overcharge for their services, tarring them all with the same brush is factually incorrect and misleading to others.

    Reply

    Mark Bickham January 27, 2013 at 9:58 am

    Dear Sir,
    I have written what I feel is a good book that will probably be well accepted by all who reads it. However, the only ones that calls me about publishing are people who want money, money, money, and promise me the world of publishing and distribution. Exliber had a so called publishing consultant call me from the Phillapines but I am from New Jersey where everyone tries to take your money so the last thing I would want to do is send my money or my book to the Phillapines. Publishing has me so confused for all I want is someone to look at my book and if they feel it is good enough, help me publish and we can make money together. The Yellow Brick Road doesn’t have to be paved with gold or pearls, and the people who would read my book wouldn’t have to be rich. It sure would be nice to make some money but honesty is the most expensive and hardest thing to find. Do you have any experience or knowledge about Green Company LLC publishing in East Orange New Jersey for if not anything else here is a company for me who isn’t a half a world away who I could possibly walk in and show my book. My cover, side binder, and back are all done and I’ve done my best to see this book be read by one and read by all but how is the question? Please Help.

    Reply

    Joel Friedlander March 6, 2013 at 2:26 pm

    Mark,

    “all I want is someone to look at my book and if they feel it is good enough, help me publish and we can make money together.”

    That’s the description of a traditional publisher, so maybe you should be looking for an agent to represent you.

    On the other hand, doing it yourself doesn’t have to be that difficult. I would avoid companies like Green Company, which seems mostly to be a printer. Instead, try CreateSpace.com. I recommend them.

    Reply

    Mary Hofmann January 13, 2013 at 10:19 am

    I don’t see any mention of PublishGreen which is a subsidiary of Mill Press, and they say you get 100% royalties…yes there are packages, differing according to your needs including editing for bigger package, some add-ons per word over 75,000 (is that a usual length for a novel?) etc but they promise lots re distribution (nook, kindle, etc etc). Hand-done formatting too. What do others think?

    Reply

    Amanda Taylor January 13, 2013 at 11:38 am

    I have been a customer of PublishGreen for two of my books, and I highly recommend them. They do great work, hand-done formatting via HTML code, and has some of the best distribution options. 75K is about the length of a standard novel and other ebook formatters or publishers usually cut off at that length and require a fee per additional X thousand words or images–that’s standard procedure if you hire someone. Yes they don’t take any royalties at all. They also have the option of creating a sales page where you can sell your book from your website where you don’t have retailer fees, and you can create promo codes if you want to offer your book for free or at a discount.

    They are definitely a good choice for people with children’s or coffee table books that may not be meatgrinder friendly.

    Reply

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