This means YOU!
Talking to a fellow author yesterday, he asked if I know about (BrandName withheld for legal reasons) Shoes. I’m going to try to reproduce the conversation as closely as I can.
“BrandName? Of course I do,” I replied. “Everyone does.”
“That’s right, everyone does. But did you know that BrandName no longer makes their own shoes?”
“What do you mean?”
“There’s no BrandName factory making shoes. Everything is subcontracted. The owners don’t do anything except take in money.”
I laughed, but I was still curious. “How does that work?”
“Every year they pick one or two new designs. The designs are submitted by a design company. The approved designs are sent to a manufacturer, who makes the shoes. The shoes are packaged, and then promoted by an advertising agency. A distributor sends them to the stores. Ultimately the shoes probably costs about 6 or 7 dollars a pair. The shoes retail for anywhere from $70 to $100. That’s a profit of $63 to $93 per shoe.”
“Before costs?” I asked.
“No. That’s after costs. Do you know how many pairs of BrandName shoes are sold worldwide?”
“No, but I bet you do.”
He did. But I still looked it up for myself online. BrandName brought in 14.54 BILLION dollars in 2012 and again in 2013. Stats for 2014 aren’t in yet. This amount then is divided between the owners (I think there are only three of them) who don’t have to lift a finger unless they want to.
What’s the point of this story? A lot of businesses are following this model. No matter what they produce or what it says on the label, they’re just in business to make a maximum amount of money with as little effort as possible. And one of the markets they tap is YOU, the author.
Now wait a minute, you’re thinking. What’s wrong with making money?