There are two pricing models used by bookstores: Agency and Wholesale. The difference is in who sets the street price.
Most stores use the Agency model (e.g. Apple iBooks), whereby the street price is defined by the author/publisher. Royalties are fixed at 60% (i.e. 30% for the store + 10% for StreetLib) of this pre-VAT price.
Google Play, Amazon Kindle and Kobo Books all use the Wholesale model. This means that the author/publisher defines the list price (or suggested price), and will earn 40% royalties (or 42% on Google Play) of this price. However, the actual price at which the book is sold on the stores is chosen by the store itself.
Google Play often sets the price lower than the list price, and due to its pricing policy, Amazon will follow.
Agency/Wholesale Combo Box
In order to keep your revenues constant, we created the 'Agency/Wholesale combo box" in Publish. This can automatically adjust your list prices to ensure you always receive the equivalent of 60% royalties.
How it works
You first set your base/recommended price — in this case 2.99 EUR.
You then decide if you want this to be according to the Agency or Wholesale model:
- Agency — this will automatically adjust the wholesale prices (e.g. increase of 40% to 4.99 USD) so that your revenue remains at 60% of your base price. It is therefore as if they all used the agency model.
- Wholesale — the recommended price chosen will be used for all stores, regardless of whether they use the agency or wholesale model. You will therefore receive royalties of 40% (Amazon/Kobo) or 42% (Google) on stores that use the wholesale model. The only difference in price is for different currencies (e.g. 2.99 EUR is equal to 3.99 AUD).