Negotiating Advances and Book Deals: Current Agent Tactics

To maximize earnings, agents have to pay special attention to audio rights, plus consider how an author’s platform plays into an offer

You’ve probably heard the conventional wisdom among agents and authors that the bigger the advance, the more committed a traditional publisher will be to a book’s success. Thus: Get the biggest possible advance. While that strategy remains prevalent, some of the finer details of book deals have changed over the last 10 or 20 years.

In an informational webinar hosted last month by the Authors Guild, author Erin Lowry (known as the “Broke Millennial”) moderated a panel of two agents and a former editor to discuss what advances and royalties look like today and what authors need to know about negotiating deals with small and large publishers alike. Obviously, a lot of variables are at play, and the answer to many questions had to be framed as It will depend on the book. Still, the panel offered useful insights and helped set expectations for authors of all genres.

One big change to advances: they’re getting paid out in more installments. In the old days, an author could expect to be paid half on signing and half on acceptance of the manuscript. Agent Jonathan Lyons of Curtis Brown bluntly said, “That’s not the way it is anymore.” Publishers now try to spread out those advance payments, and each company has their own preferred model for doing so based on how big the advance is. The lower the advance, the more likely it could be paid out in two installments. For bigger advances, Lyons is not only seeing three installments, but four, five and even six installments. An author might get an installment on signing, another installment three to six months after signing, another on partial delivery, and so on. And it’s not just about a greater number of installments. Sometimes, Lyons said, publishers will not pay more than 50 percent of the total advance before acceptance to protect themselves, in addition to moving installments out to post-publication. He’s seen as far as 24 months out, which he finds problematic. Of course there’s room to negotiate these details, but nevertheless publishers are getting “creative” in coming up with different triggers for payment, he said. The agent’s job is to ensure the installments will be paid out in a timely manner even if the publisher does something unexpected, like delay the book’s publication.

While there’s no hard evidence to suggest the average author’s advance is significantly lower than before (in fact, Markus Dohle of Penguin Random House recently offered evidence to the contrary), panelists speculated on what might be affecting amounts, if they are in fact down. Amanda Shih, formerly an editor with Penguin Random House and Scholastic, said that publishers have rising costs tied to paper and printing, due to shortages up and down the supply chain. Publishers are affected by the rising costs of consumer goods like any other business. But there are other factors, too—like author platform.

All panelists agreed that the size of an author’s platform could drive an advance up or down, mostly for nonfiction authors. Lyons said there has been more and more emphasis on that over time. “Authors with really strong platform, with real conversion—they are getting paid more and more. The money is going to them.” The riskier projects or authors (again, primarily in the nonfiction category) aren’t getting signed at all or they’re getting smaller advances. Even when it comes to fiction, agent Dara Hyde of Hill Nadell said the publisher considers an author’s position in the market. It’s not just about being on social media and what your engagement is—although that’s part of it—but also whether you’re a good literary citizen and if you’re engaged in your community in a positive way. “Whatever that community is, that’s valuable to the publisher. You’re giving them a built-in sales base to at least start from,” she said.

Even if the advance isn’t significant, there are other ways to sweeten the deal. Hyde said there are many different types of bonuses that can be added to a contract. For example, there can be bonuses for earning out in the first year, hitting a bestseller list, or winning an award. Sometimes bonuses are tied to sales of a particular format or sales within a particular time frame. “I’m always looking for a bonus that is achievable,” Hyde said. And of course there are ways to limit the grant of rights to the publisher (retaining foreign rights or translations rights, for example), giving the agent and author another sales or revenue stream.

However, it is getting very difficult for authors to hold on to their audio rights or sell them separately from the print rights. Lyons said there are a couple major publishers who won’t accept a deal that doesn’t include audio rights. But agents can work around this issue, assuming there’s competition for the project, by doing the audio deal first or selling the audio rights concurrently with print rights. If that’s not possible, then he tries to make the publisher commit to publishing the audiobook themselves, rather than licensing them out, if they want those rights. “A license means a 50 percent decrease in the amount of royalties you’re going to receive because it’s a 50-50 share between the publisher and you for any sublicense,” he said. “So you’re making the publisher commit to publishing simultaneously with the print edition. … You have to give audio rights almost always now, but you do have more leverage to ask for more things as part of that.”

If your deal isn’t a very good one, it is possible to renegotiate it later—as long as the right opportunity presents itself. Lyons said the most common scenario is when a book does very well and you’re going back to negotiate a second deal. As part of that new deal, you can ask to renegotiate the royalties on the prior deal or even get a refresher advance. Hyde added that a publisher deciding to go out with a new edition offers an opportunity as well, but that you have to be careful. “There are times when the terms from 15 to 20 years ago may be more favorable,” she said. Also, “Is the best thing just getting a new edition, new attention, new marketing? Maybe that’s actually better than getting some money up front.”

Authors shouldn’t worry (much) if their advance doesn’t earn out. While some authors are worried about what might happen if a publisher overpays and their book performs poorly, Lyons thinks generally it’s better in the long run to get as much money as possible up front—especially since it ensures the publisher has skin in the game. Shih, speaking as an editor, said that in the short term, nothing terrible happens if you don’t earn out. Longer term, you could have a harder time selling to that same publisher again, depending on the sales record. But she said that doesn’t mean your book can’t sell somewhere else, which she’s seen happen. Hyde also offered reassurance that publishers and editors thoughtfully consider why a book might not have earned out. It’s not always the fault of the publisher or the author or the book itself—especially when something dramatic has affected the market, like the 2016 election or the pandemic. “They’re aware of why a book with really high expectations did not perform the way they thought it could,” she said.

Bottom line: The degree to which an agent or author can increase an advance really depends on the nature of the work and how sought after it is. Obviously, a competitive bidding situation allows you to ask for more. Regardless, it’s important to ask if the publisher can do better than the first offer they give you. “Not asking,” Lyons said, “is almost like a sign of lack of confidence in your book. You should value your work highly. There’s no harm in asking if you do it nicely.” Hyde agreed and said even if the advance can’t be increased, there are all kinds of sweeteners in book deals, like bonuses, better royalty rates, or more aggressive escalators in the royalties (where royalties increase quickly as certain sales numbers are met). Shih said, “My very first publisher that I ever worked for always said if you don’t ask, the answer is always no. So that is the advice I would give creators also. Just ask.”