I realized as I was getting ready to start writing the post giving tips on how to find an illustrator that I had not written anything about budget. Don’t cringe. Understanding your budget is a critical part of this process not only for finding an illustrator, but once you have that book in hand and are thinking about what you have to do next.
It is important at some point before you get to far down this path as an author to do your research on the business aspect of this career. I highly recommend talking with an accountant and/or a lawyer who knows the ins and outs of starting a business. Because really, you are starting a business if you are choosing to be an author. And, it can be, depending on where you live, more convoluted than you may think.
General starting a business items:
- Are you going to form an LLC, Corporation, or be a sole proprietor? What are the tax implications of each? Are forms required by the state to file as an LLC or corporation? What does it cost?
- Do you need a local, county, and/or a state business license? If you are using a fictitious name, do you need a fictitious name license?
- Are you in a state that you are required to pay sales tax on retail sales? Do you need to register for a sales permit? Are you required to pay sales tax quarterly, bi annually, or annually?
- Do you need a resale permit?
- Have you opened a business bank account?
- How are you going to do your financial book keeping/record keeping? Excel? QuickBooks? Or some other product?
- Do you have insurance; do you need insurance?
Then on top of all of that you need to start budgeting for the following:
- Website hosting and URL fees, email
- Phone service and internet service. If you are using your cell phone and your home internet, what percentage of the month should be associated with the business?
- Fax and copy (consider an all in one printer if you don’t have one), laptop, printer. Again if these are your home machines, what percentage of the cost should be associated with the business?
- Marketing materials such as business cards, bookmarks, flyers, etc.
- ISBN numbers (I will discuss ISBNs in a later post)
- Travel to bookstores, events
- Event fees
For producing your book (if you are an indie author)
- Book layout (unless you are doing it yourself)
- Paying for a professional editor
- File for copyrights to your book
- Book stock for sales, wholesale pricing, retail pricing, and royalty payments
- Book stock for promotions
- Advertising (Facebook, trade magazines, gift/craft/book shows)
And the biggest budget line of all needs to be your time! You need to figure out how much of your time you want to devote to this venture. As an indie author, and increasingly common as a traditional author, you need to spend your own time marketing your work.
Let me know if you have questions!