I recently came across this article by editor Rob Bignell, an esteemed editor and owner of Inventing Reality Editing Service. And I thought I might offer another perspective.
First off, let me say that I have an incredible respect for Rob Bignell. He has a proven history of high-quality editorial work. More to the point, it’s clear that Rob is making the point that having a structured budget is just as effective for the casual self-published author insofar as tax purposes go. As Rob mentions, “Even if not seeking a loan, such a plan can be useful in guiding your strategy to grow a business.” This is so incredibly true. A business plan can help you keep a budget on track and give a big-picture view of the future.
And then, Rob argues that you don’t need one:
Generally, creating a business plan is unnecessary for self-published writers, even then they establish their own “publishing company” that owns the ISBN to their books. Such businesses generally are a self-proprietorship, and any royalties coming to the author is considered personal income.
Here’s the thing: writers who are really serious about writing and publishing, even self-publishing, need a plan to succeed. It also needs a budget, true, but even a self-proprietorship needs a plan to stay afloat if it’s ever going to succeed in the long run. I’ve never met a writer who was happy with “just one”. We all (with few exceptions) want to chase that dream of writing for a living, forever. That can’t come true without one of two things: a load of money or a business plan.
It’s an uncomfortable truth that authors with money are more likely to succeed. Book covers cost money. Editors cost money. ISBNs cost money. Whether you’re buying 10k copies of your book to get on the NYT bestseller list or spending hundreds of thousands of dollars on personal advertising, the person with the largest wallet has the advantage. For a writer who has a full-time job and writes on the side, every penny matters. That is why a business plan is so important.
Too often, I see writers who take their book sales as “side hustle” income and don’t reinvest that money back into their own books. When I ask why, the answer is inevitably: “well, what am I going to spend it on?” That’s where a plan comes in. Knowing where your money is going, and what it is going to do for you, is going to maximize your success.
Most of the profits of The Wizards on Walnut Street went toward making No Place successful, and in turn that’s going to go toward the next book, and the next one. But I can only do that effectively if I have a plan. So yes, self-published writers need a business plan. Maybe not a big one, or a complicated one. Maybe they’ll never use the business plan to get a business loan and maybe it won’t significantly change their tax filings or their net profits. But if a self-published author wants to play in the big leagues, they need a plan or they will drown in the slush pile.