QUOTE (Wandering One @ May 7 2010, 05:47 PM)

I start this off with a comment: "YES, I'm pulling these numbers out of thin air and I am not a member of the industry!"
Just a little edification. These are some real numbers, though they're rounded off for simplicity. (I've been working on some independent game publishing that is in no way related to Shadowrun.) I've tried to keep out any commentary.
Printing a hardbound, 4-color book, of c. 200 pp, using a US printer, at a 3000 copy print run, costs ~$7 per copy. So, that's an upfront cash outlay of $21,000.
If a publisher uses any major gaming distributor, they'll pay the publisher around 40% of the cover price of the book. (So, a $40 book means the publisher actually gets paid $~16. The retailer pays ~$22, the other ~$6 goes to the distributor.)
So, that means the publisher nets ~$9 per copy.
If the full print run sells through, that means the publisher nets ~$27,000. With that money, the publisher needs to pay A) Creative Staff (~$10,000), B)Taxes (~$9,000).
That leaves $8,000 of net profit on an investment of $31,000. (Printing and Creative costs.)
This ignores warehousing costs, which may be substantial. It also ignores marketing expenses and any payments of non-creative staff. Finally, this assumes that the IP is original, not licensed.
Further, it's unlikely that the full print run will sell out in less than a year, if it sells through at all. If it takes longer then, every year come tax time, the publisher needs to pay taxes on the unsold books (they constitute an asset). The tax on these is significant enough that I honestly don't know why more RPG publishers don't pulp a high percentage of their warehoused books.
Yes, there are ways to cut costs. Some, like offshore printing, are more viable than others. Yes, a reprint is far more profitable to a publisher as the creative staff is already paid. Yes, this ignores any profits that can be made on ebook sales (~$200 - $300).