Tuesday, October 30, 2007

Term of the Week: Auction

An auction is a process which allows multiple publishers to bid on your work. Auctions can vary in shape and type, depending on the number of editors interested, the type of book, and the agent involved.

Before an auction occurs, an agent will get in touch with editors and explain the rules. They will set a date in which offers from publishers must be received and what terms must be included.

An auction is typically classified as either rolling or best bid. In a rolling auction, after all initial offers are received the lowest bidder is giving an opportunity to improve on the highest offer currently on the table. The next lowest editor can then try to beat this, and so on, until every editor who made an intitial bid has had an opportunity to re-bid. Those who don't are dropped, and a new round begins, starting again with the editor with the lowest offer on the table. This process can continue without limit until editors give their top bid, or an agent can establish beforehand a closing date to ensure that the auction doesn't get drawn out indefinitely. A best bid option is simpler - the editor must convey to the agent their best bid immediately, without knowing what other editors are bidding.


As I mentioned in a previous post, some publishers might try to pre-empt an auction by conveying an offer for a limited period. If the author and agent reject this pre-empt, this can sometimes be adapted as a floor offer - i.e. the minimum offer that a bid has to be for in an auction. By making a floor offer a publisher then gets the right to top the last bid made by ten percent if such auction occurs.


Your agent should establish clear rules for the auction, guided by what they believe to be the best strategy for a successful sale. No matter what, these rules should state that the author reserves the right to accept an offer on the basis of a publisher's comprehensive proposal rather than based on the highest dollar offer, since the most money isn't always the best deal.

10 comments:

Robin S. said...

HiJonathan,

What a wonderful position to be in.

What does the publisher's comprehensive proposal include?
Is this inclusive of things such as publicity expenditures?

Thanks.

Jonathan Lyons said...

This could mean a number of terms, all of which the agent should set forth in advance of the auction. Basic terms typically include: advance payment split, type of first publication (hardcover or original trade paperback), royalties for hardcover, paperback, and mass market, territories and languages granted, publication date, permissions budget, subrights splits, publicity plans (if any), editorial vision, etc.

Kaleb Nation said...

Love the definition of the day! My agent wrote a wonderful book on a lot of these terms called How To Be Your Own Literary Agent (Richard Curtis). The title is slightly misleading but it's definitely an insider's guide! I think he goes into every detail of the business.

Robin S. said...

I'm sure the book is nice, but I like the blog version better- because I can ask questions, and, as I'm asking them to both an agent and an attorney - I figure that's as good as it gets --
a 'two-for-one special', with almost instant gratification thrown in, in the form of answers.

Thanks again for that.

Hathery said...

Wow, I had no clue that such a thing existed!

Josephine Damian said...

I like the point you make about big money isn't always the best deal. Great job listing the other details in the contract that matter as well.

Christine said...

So how does a book get the option to go to auction in the first place?

Jonathan Lyons said...

Christine - Not sure I understand what you're asking...

Christine said...

Sorry, that was a bit vague. Do all books go to auction or is it just when there is interest from multiple editors?

Jonathan Lyons said...

Most books don't go to auction. You typically must have multiple publishers interested in order for one to occur, though sometimes an auction will be held after multiple editors have expressed interest and you will only receive one bid, or even on some occasions no no publisher conveys a bid (basically, all the editors back out).

I should point out too that some agents prefer not to conduct an auction even if there are multiple interested parties.