The Title P&L for Predicting Profitability

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October 2013
by Dave Marx
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Will this book make money? We all wish we could get a clear answer to that question when we’re trying to decide whether to publish a particular book. There are so many variables; how many copies can be sold, cover price, manufacturing and production costs, marketing budget . . . Of course, there’s never a rock-solid answer, but a single-title profit-and-loss spreadsheet can help you decide whether and how to proceed.

The common industry term for this is a Title P&L. It’s similar to, but not the same as, an accountant’s P&L (profit and loss) statement for a business. An accountant’s P&L reports results; a Title P&L is a budgeting tool. Because it’s a budgeting tool, the more you know about potential revenues and costs, the more accurate its projections can be.

The result of an analysis of this sort is a figure for gross profit, not a figure for net. Overhead expenses, which are rarely measured in this kind of analysis, still bear on the company’s overall profitability (and in the case of a start-up, on its viability)….IBPA Members – Click here to view the full article (login required).

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