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How to Start a Publishing Business

Updated on January 19, 2022

How to Start a Publishing Business

How to Start a Publishing Business

Whether you’re a writer or just an avid reader, publishing could offer you an opportunity to share writers’ inspiring creations with passionate readers. What could be more rewarding? Though tastes may have shifted away from physical books toward audio and ebooks, demand for good writing remains high and publishing is doing well.

Challenges exist, however, in starting a publishing business, as with any business. The key to success is to gain an understanding of the steps involved, the challenges you may face, and the potential rewards, as detailed in this step-by-step guide.

Let’s begin your entrepreneurial journey!

Fast Facts

Investment range

$4,150 - $18,300

Time to build

3 – 6 Months

Industry trend

Stable

Revenue potential

$60,000 - $600,000 p.a.

Profit potential

$9,000 - $90,000 p.a.

Commitment

Full-time

Step 1: Decide if the Business Is Right for You

Pros and cons words written on papers on a tree with arrow signs. Deciding or analyzing between pros and cons.

Pros and Cons

Starting a publishing business has pros and cons that you should consider carefully before determining if it’s right for you.

Pros

  • Rewarding – Boost writers and provide great books to readers
  • Creative Control – You choose which writers and works to publish
  • Profit Opportunity – Industry has sizable margins

Cons

  • Competition – Publishing is highly competitive, hard to stand out
  • Finding New Voices – Many author submissions to go through to find a gem

Industry trends

Market analyst IBISWorld values the US publishing market at $27 billion[1]https://www.ibisworld.com/united-states/market-research-reports/book-publishing-industry/ and global publishing at almost $110 billion,[2]https://www.ibisworld.com/global/market-size/global-book-publishing/#:~:text=The%20market%20size%2C%20measured%20by,is%20%24109.3bn%20in%202021. while German data firm Statista expects the ebook market to grow 17% to nearly $7 billion by 2025.[3] … Continue reading Print publishing has declined somewhat in recent years, but the educational and scholarly segment of the market is growing. Children’s books are the most popular genre in publishing as a whole.

How much does it cost to start a publishing business?

Startup costs for a publishing company range from $4,000 to $20,000 or more. The high-end range includes the first printing run of your first book. By focusing on digital publishing you can keep costs toward the lower end of the range.

Start-up CostsBallpark RangeAverage
Setting up a business name and corportation$150 - $200$175
Licenses and permits$200 - $300$250
Insurance$100 - $500$300
Business cards and brochures$200 - $300$250
Website setup$1,000 - $3,000$2,000
Initial marketing budget$1,000 - $5,000$3,000
Edit and design of first book$1,500 - $3,000$2,250
Print of first book$0 - $6,000$3,000
Total$4,150 - $18,300$11,225

How much can you earn from a publishing business?

The average profit margin in publishing is about 15% which reflects a mix of print and digital publishing.

As a solopreneur, you could work from home and sell 5,000 $12 books in a year, bringing in $60,000 in revenue and $9,000 in profit, assuming that 15% margin. As your brand gains recognition, sales might climb to 50,000 books a year, giving you a tidy profit of about $90,000.

When you know your full expenses, you can use the Step By Step profit margin calculator to determine your final price points.

What barriers to entry are there?

There are a few barriers to entry for a publishing company. Your biggest challenges will be:

  • Finding authors – Agents can help, but this requires a lot of reading
  • Marketing – Building a brand means spending on marketing

Step 2: Hone Your Idea

Now that you know what’s involved in starting a publishing business, it’s a good idea to hone your idea in preparation to enter a competitive market.

Why? Identify an opportunity

Look at what types of books are trending with readers by reviewing the bestseller lists. Are thrillers hot? Or maybe it’s romances and memoirs. Your challenge will then be to find strong submissions from authors in trending genres. As a new publisher, you’ll be looking for new authors who are just getting started.

What? Determine your products or services

You’ll have to determine two things: how to best help your authors and what books to offer customers. For authors, you may want to focus on editing, design, and marketing to stand out over another publisher.

Next, consider whether you’ll offer print books or digital, or a mix of both.

How much should you charge for books?

The average cost of a printed book is $14 to $18, while ebooks generally run $3 to $10. Generally, prices depend on the popularity of the author, so your new author’s books will probably be on the lower end of the range.

Who? Identify your target market

Determine your most likely audience. If you’re publishing in the young adult market with books that target young women, for example, you can probably find them on social media sites like Instagram and TikTok.

Where? Choose your business premises

In the early stages, you may want to operate your business from home to keep expenses low. But as your business grows, you’ll likely need to hire workers for various roles and many need to rent out an office. Find commercial space to rent in your area on Loopnet, Craigslist, Crexi, and Commercial Cafe.

When choosing a commercial space, you may want to follow these rules of thumb:

  • Central location accessible via public transport
  • Ventilated and spacious, with good natural light
  • Flexible lease that can be extended as your business grows
  • Ready-to-use space with no major renovations or repairs needed
Should You Start a Publishing Business

Step 3: Brainstorm a Business Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

  • Short, unique, and catchy names tend to stand out
  • Names that are easy to say and spell tend to do better
  • The name should be relevant to your product or service offerings
  • Ask around — family, friends, colleagues, social media — for suggestions
  • Including keywords, such as “publishing” or “books”, boosts SEO
  • Choose a name that allows for expansion: “Jim’s Bakery” over “Jim’s Cookies”
  • Avoid location-based names that might hinder future expansion
  • Use online tools like the Step by Step business name generator

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names at a web cataloging site such as NameChk. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these.

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. And if you’ve exhausted all your creative juices but still don’t have a business name, don’t stress! Instead, check out our business name generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Step 4: Create a Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

  • Executive Summary: Brief overview of the entire business plan; should be written after the plan is complete.
  • Business Overview: Overview of the company, vision, mission, ownership, and corporate goals.
  • Product and Services: Describe your publishing services in detail.
  • Market Analysis: Assess market trends such as variations in demand and prospects for growth, and do a SWOT analysis.
  • Competitive Analysis: Analyze main competitors, assessing their strengths and weaknesses, and create a list of the advantages of your services.
  • Sales and Marketing: Examine your companies’ unique selling propositions (USPs) and develop sales, marketing, and promotional strategies.
  • Management Team: Overview of management team, detailing their roles and professional background, along with a corporate hierarchy.
  • Operations Plan: Your company’s operational plan includes procurement, office location, key assets and equipment, and other logistical details.
  • Financial Plan: Three years of financial planning, including startup costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
  • Appendix: Include any additional financial or business-related documents.

If you’ve never created a business plan yourself before, it can be an intimidating task. Consider hiring an experienced business plan writer on Fiverr to create a professional business plan for you.

Step 5: Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business!

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states offer real advantages when it comes to publishing.

If you’re willing to move, you could really maximize your business!

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your publishing business will shape your taxes, personal liability, and business registration requirements, so choose wisely.

Here are the four main options:

  • Sole proprietorship – The most common structure for small businesses makes no legal distinction between company and owner: you get to keep all the profits, but you’re personally liable for all debts.
  • Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses.
  • Corporation – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly.
  • Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.

We recommend that most new business owners form an LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can quickly and cheaply form an LLC using ZenBusiness’s online LLC formation service (it can take as little as 5 minutes). They will check that your business name is available before filing, submit your Articles of Organization and be on hand to answer any questions you have about the company formation process.

Business structure comparison infographic

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN.

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist, and taxes can be filed online. It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.

Step 7: Fund your Business

Business loan application form with red pen

Securing financing is your next step and there are plenty of ways to raise capital:

  • Bank loans: This is the most common method, but getting approved requires a rock-solid business plan and strong credit history.
  • SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
  • Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
  • Venture capital: Offer potential investors an ownership stake in exchange for funds, keeping in mind that you would be sacrificing some control over your business.
  • Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund an entrepreneur’s vision.
  • Personal: Self-fund your business via your savings, the sale of property or other assets, and support from family and friends.

Step 8: Apply for Licenses/Permits

Starting a publishing business requires obtaining a number of licenses and permits from local, state, and federal governments.

Federal regulations, licenses, and permits associated with starting your business include doing business as, health license and permit from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. Also, each book you publish will need an ISBN number which you can get at Bowker.

You may also need state-level licenses and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. You could also check this SBA guide for your state’s requirements.

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties. If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

For peace of mind and to save time, we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state, and provide them to you to make sure you’re fully compliant.

Step 9: Open a Business Bank Account

Before you start making money you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your publishing business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account.

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

  • General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
  • Business Property: Provides coverage for your equipment and supplies.
  • Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
  • Worker’s compensation: Provides compensation to employees injured on the job.
  • Property: Covers your physical space, whether it is a cart, storefront, or office.
  • Commercial auto: Protection for your company-owned vehicle.
  • Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
  • Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of any of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business.

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism. They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google.

You can create your own website using services like WordPress, Webflow, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.

You can use industry specific software for publishers like Xpublisher or Quark to help you automate your design and publishing processes.

Marketing

Some of your business will come from the casual online visitor, but still you should invest in marketing! Getting the word out is especially important for new businesses, as it’ll boost customer and brand awareness.

Once your website is up and running, make sure you link to your social media accounts and vice versa. Social media is a particularly good way of promoting your business because you can create engaging posts that advertise your products:

  • Facebook: Great platform for paid advertising, allows you to target specific demographics, like men under age 50 in the Cleveland area.
  • Instagram: Same benefits as Facebook but with different target audiences.
  • Website: SEO will help your website appear closer to the top in relevant search results, a crucial element for increasing sales.

Accounting

  • Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero.
  • If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you’ll likely need workers to fill various roles. Potential positions for a publishing business would include:

  • Copy Editor – Proofreading, fact-checking, polishing manuscripts
  • Designer – Cover and illustration design
  • Editor – Review and shape manuscripts for publication
  • Production Manager – Oversees book production process
  • Marketing Lead – SEO optimization, social media strategy

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need.

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn or Facebook. You can also use free classified sites like Jobs and AngelList. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent.

Step 13: Start Making Money!

Focus on USPs

Unique selling propositions, or USPs, are the unique characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they’re able to quickly grasp how your publishing business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire.

Your USPs will target authors and readers. Some signature USPs for your publishing business could be:

  • The premier publisher for new authors
  • The best romances, thrillers and mystery novels
  • Top non-fiction publisher
USP venn diagram

Kickstart Marketing

Take advantage of your website, social media presence, and real-life activities to increase awareness of your offerings and build your brand. Some suggestions include:

  • Competitions and giveaways – Generate interest by offering prizes for customers who complete a certain action, such as a signed copy for the first 100 buyers.
  • Optimize calls to action – Experiment with text, color, size, and position of calls to action such as “Buy Now”. This can sharply increase purchases.
  • Signage – Put up eye-catching signage on your website
  • Flyering – Distribute flyers in your neighborhood and at industry events
  • In-Person Sales – Offer your books at local markets, trade shows

Build Affiliate Relationships

Affiliate marketing is advertising in which you compensate third parties (i.e. your affiliates) in order to generate traffic to your website. You can develop long-term relationships with these affiliates and generate traffic for each other on an ongoing basis. This is key for a publishing company, and not difficult to do. You could create an affiliate relationship with the world’s leading bookseller — just check out the Amazon Associates program. It’s easy and free.

Wrapping it up

Giving new authors real opportunity and seeing their work embraced by the reading public can be intensely rewarding. Yet publishing can also be a very profitable line of work. If you find just a few authors who become very successful, the sky is the limit. You can start small and grow your company into something huge – maybe the next Simon & Schuster!

You’re now ready to start publishing, and making good money from good writing.

Publishing Business FAQs

Is a publishing business profitable?

Yes, you can make a healthy profit from a publishing business if you’re successful. It will take some time and the right authors to get to a good profit level, but it’s an almost $110 billion industry globally so if you can capture even a small part of that, you’ll do just fine.

Are any special licenses needed for a publishing business?

There are no special licenses required for a publishing company on a federal level. You may need business licenses or permits through your state or local governments, so check with those offices for requirements.

How long does it take to start a publishing business?

It will take some time to find authors and get your first books to market. If you market yourself well, you could get started in three to six months.

If I start a publishing business, how do I find good authors?

You can market your new company with your website and through social media. There are thousands of aspiring authors out there who would be thrilled to find a new publisher interested in their work. You could also partner with a literary agency. They get thousands of book submissions and could send some your way.