These are the faces of three cats who were not on board with letting me make my bed.
It’s time for everyone’s favorite activity: paperwork!
No, I’m serious. Being a self-published author is a business, and it has to be maintained like one if you want to see where your money is going and how successful you really are from a monetary perspective. Even if you hire an accountant, you should always have your finger on the pulse of your business.
These are the things I personally recommend, and this comes not only from the perspective of an author but as someone who has managed small businesses:
Profit and Loss Sheet & Tax Worksheet
It’s easy to see sales come in or sell out of your books at a market and feel like you hit the jackpot, but did you really? Do you know how much went into the making of the books you just sold?
Your profit and loss worksheet is vital for tracking how much you actually spend versus how much you make on your books and how to plan accordingly when it comes to your marketing efforts and necessary purchases. You need to factor in every penny you spend, even if it’s just for one time purchases. This is also a good way to really figure out where you can cut costs and shop around, especially for marketing material and shipping material if you ship your books out yourself.
In addition, keeping this sheet will make it so much easier to do your taxes because all of your income and expenses are in one place, and they’re already broken down. The image to the right shows how I break mine down, but you can tweak it for your own expenses and revenue streams.
Transaction Tracking Software (I love QuickBooks Self-Employed)
Most banking apps have some kind of tracking and budgeting capability, but if you can do everything in one spot, that makes your life a lot easier. Software like QuickBooks tracks your business credit card and bank account so you can assign expense and revenue categories, maintain a budget, and track your spending. Plus you can share it with your accountant and export the data.
QuickBooks (and undoubtedly other software too) also lets you track mileage, which, if you do a lot of markets, cons, readings, and appearances, adds up too.
I will be the first to admit, I am the worst about this. I know what my sales are, but if you ask me to break it down, you’re more likely to get a vague, “Oh, I think it was this many books and some prints” rather than a concrete number. But there are a lot of advantages to tracking your inventory including knowing what your best sellers are so you can be better prepared for shows and markets, knowing what marketing strategies worked the best for you, and when you start to run low on any of your products.
Going into a sales season like Christmas or the beginning of summer or going to a show with less inventory than you thought you had is not ideal, and being able to track your inventory is key. I currently have a spreadsheet in Google docs I made, but you can shop around for inventory software. If you have a WooCommerce site, there are some good plugins you can use.
Your books aren’t going to sell themselves, no matter how good they are. And even if you decide that you want to look into trad publishing, most smaller publishers expect you to take on some of the marketing effort.
There are a lot of different organic marketing strategies out there, as I touched on in a previous post, but if you have the budget for it, paid marketing can be your friend. I typically pay $12-18 a month for Instagram sponsored posts that reach between 5000 and 6000 accounts, and it just takes two book sales to repay that cost (after I deduct the overhead for making the books).
This is where your marketing strategy and tracking sheet comes in. It’s exciting to see that your Amazon ad campaign generated sales, but how much did you spend to get there? How many people clicked on your ad and then bounced without converting into sales? That’s data that you can use to fine tune your ad campaigns, and if you’re on a very tight budget, you can use Amazon’s search term tool to find more specific terms people use to search for books like yours. Amazon and Google ads consoles let you export the data too, which is nice.
I know this might be a head scratcher, but hear me out. You’re a business. That means you need to operate like one, and at the end of the day, your business plan is a fluid document that details how you plan to operate, how much you plan to make, and where you see yourself in five, ten, or twenty years. If you decide to apply for a small business loan to heavily invest in reviews, ad campaigns, table fees at larger cons and shows, and production, this is how you do it. If you decide to get a business partner who wants to understand your process, you have something to show them.
Making my business plan was when everything started to come together for me. I had a clearer picture of my needs and the structure I wanted to put in place. I could see where I needed to get creative when it came to my marketing strategy and where I needed to tighten up on spending, and I saw a better way to get where I want to be in five years.
If you have a business or marketing background, you’re probably already familiar with these kinds of documents. If you have any strategies that help you keep track of your spending, budgeting, and business, share them in the comments!