If you've sold ten copies of a book, and the price is $2.99, and you earn a 70% royalty, you should have exactly $20.93 in royalties, right? That's what 10 x 2.99 x 0.7 equals.
It's often a little more complicated than that, which can be confusing.
So why don't royalties always match up with sales?
The first thing to note is that Book Report doesn't do a calculation like the one above - we get both the sales numbers and the royalty numbers separate from Amazon. What you see in the reports is just what Amazon has told us.
Here are the most common causes of out-of-sync royalties:
- Royalties lagging behind sales. KDP doesn't always add a sale and the royalties from that sale at the same time. Often they're hours apart. This looks like a sale that added no earnings, but should be resolve by the time the data is a day or two old.
- A book was returned. The sales number in Book Report is total units sold, not units sold minus returns. A returned book will show up as a negative royalty amount, but the sales count won't decrease.
- Exchange rates. Book Report combines sales and royalties from all marketplaces into our returns. A book that sells for $2.99 on Amazon.com might sell for £2.32 on Amazon.co.uk, and as exchange rates change over time, those sales might be worth fairly different royalties.
- Other complications. There are a few other things that go into the royalty calculations that Amazon does that can make things look weird, like VAT in the European Union and Delivery fees. These are reflected in the numbers that Book Report displays.
Book Report displays the data from Amazon with all the complexities baked in. This makes it more accurate than the simple calculation we started with, but also plenty more confusing.