One thing that is different from what you’re describing is the extras made. Based on the pre-orders, the project founder should order extra. How much extra is hard to say, but if the project’s goal is $8,000 to make 200 copies of books at a $40 pledge level… then the cost to the founder should be more like $20/book. The extra pays for the founder’s time. And that $20/book price should include the art cost.
If the project gets just over $8000 so it just barely meets its goal, the founder can roughly double his order and still not risk any extra money. But he is risking the profit from those 200 copies hoping to make more profit on 400 copies. These extras he can then sell later on-line or at cons if so inclined. And of course he can put the pdfs for sale and do a print-on-demand setup as well.
Further, the print cost likely will go down. Say that $40 has a $15 cost to print at 200 copies. (The other $5—how we got to a $20 estimate—went toward the art.) But at 400 or 500 copies it may go down to $10 per book. Plus, the art cost can be cut down per book because it now is spread across double (or more) the number of books.
So to sum up, a Kickstarter project should have more than just a handful of extra copies after it is completed.
– Joe 2011-08-09 15:02 UTC
For that matter, if I were to do a kickstarter project I would probably plan it to exceed the pledged amounts – I’d be happy to risk profit (but not base cost).
If I figure it would be 20$/copy for 200 copies, and I went with 40$/copy as a pledge (plus ancillary pledge values for PDFs, etc.) then 100 pledges (4000$) would cover my expenses. After that I’m into profit, and if I’m left with a couple boxes of extras to sell at cons or even give away, I’m only out the time and effort I’d put in anyway.
Mind you, I’m not trying to make a living at this, so I’m okay with that kind of return.
IOW, I agree with Joe – for the core product you can probably reasonably expect a fair number to be produced on top of the pledged number. Not the extras; if I only get 10 people wanting the signed and numbered and embossed-with-gold-leaf version I might get an extra handful (for special purposes, gifts, whatever) but I might not.
– Keith Davies 2011-08-09 16:25 UTC
Thank you both for the extra info! I’m still trying to wrap my head around this paradigm shift from pre-orders to pledging.
Another element I’m trying to place is the importance of the funding goals and the various extras you can order. These seem to have multiple effects: increase turnover as you sell more, customer loyalty as they get something perceived to be exclusive and rare, a possibility to attract attention as people will talk a lot about available options even though few will buy them, a possibility to claim dedication as people will see to what lengths you will go for your project (if the price is right).
– AlexSchroeder 2011-08-09 21:34 UTC