Valuation Fun…

Just Messing Around…

But my point is that copyright and trademark have value. Most writers don’t even realize what they are making money from is copyright, so to you folks, this will make even less sense. And at the same time, stories and books are inventory with value.

Copyright and Trademark are Intellectual Property.  You create copyright when you commit something to a form (with other rules), but for those of you who want plain talk, you finish a story, you created a copyright that is automatically protected.

If you publish it, it is also part of your inventory.

Property has value. Your home is a form of property. Your car another form of property. Property has value. IP is a form of property that has value, no matter your opinion on its value.

Valuation of that IP is often done for business sales (often trademark), licensing agreements (copyright, brands, and trademark), and estates (all forms).

Damn am I being simple here, but just live with it for now if you know more.

Valuation on any one piece of copyright is mostly done with two methods. Future income and market value, often combined. Inventory value is part of the market value.

Future income includes derivative works springing from it and the 70 years of life of the copyright past the author’s death, among other factors.

So a brand new short story by a new writer has some value. And inventory value. But say a novel by an author who has had works licensed from the property and good sales is worth a ton.

The more you write, the more your overall worth will climb, the more you earn from your writing in various forms, the more your worth will climb, the more trademarks you create from your work, the more your worth will climb. The more inventory you have, the more your worth will climb.

This is why many writer/singers who have been around for a time can license certain rights to their entire catalog of music for many millions.

Tonight, thanks to a friend, I was pointed out a nifty valuation of inventory.

It is in Shopify under the products tab. They basically take the sale price of each item times the number of items available and multiply them all together then add them up.

Nothing at all to do with copyright, but instead a pretty nifty inventory evaluation you can do with your own work. We have one store that has an inventory valuation of over 170 million. Another with an inventory valuation of over 130 million. There are reasons for those numbers not worth going into here.

So how does this work outside your Shopify store?

First figure out how many places on the planet your novel is available in electronic. If you are wide, that number will be around 500 or so, maybe more But use 500.

Now take 500 x $5.99 to get you the retail value of your book in all the combined stores. That number would be around $3,000. If you sold no copies of the book, the value would still be $3,000 for the books in the stores.

Now say you have 20 books, so that is now $60,000 in value sitting in the stores. Still no sales. Just value. And NOT COPYRIGHT VALUE… Just inventory value.

Next three years you add 50 short stories and another 20 books and your value of electronic inventory sitting in stores will be way past $200,000.

And remember, in the magic bakery, every time a reader gets one of your books, the inventory value does not go down.

But as you make more sales, THE COPYRIGHT value goes up.

Every time you license a copyright’s derivative work of any sort (movie, game, audio, translation and so on), the value of the COPYRIGHT on that work goes up, and pulls upward the value of others in your catalog.

So I know writers think their work has no value, while in reality is has both inventory value and long-term copyright value.

And wow can those numbers add up.