How to Start a Children's Book Business

Start a children's book business by following these 10 steps:

1. Plan your Children's Book Business
2. Form your Children's Book Business into a Legal Entity
3. Register your Children's Book Business for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Children's Book Business
6. Get the Necessary Permits & Licenses for your Children's Book Business
7. Get Children's Book Business Insurance
8. Define your Children's Book Business Brand
9. Create your Children's Book Business Website
10. Set up your Business Phone System

We have put together this simple guide to starting your children's book business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Children's Book Business Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a children's book business?

The costs involved with publishing a children’s book are significant yet manageable. According to Lee Johnson, business owners on a budget can go from a story to having 3,000 copies of a finished book for $5,400. Hiring a more skilled illustrator or incorporating more edits may bring that total up to $8,000 or $10,000.

Ron Pramschufer of Self Publishing, Inc. breaks down the costs a little more:

• Illustrations often cost $2,200 for a 24-page book and $2,700 for a 3-page book
• Text editing costs between $500 and $1,000
• Text and artwork editing costs between $3,000 and $4,000
• Designing the layout costs between $1,000 and $1,500
• Printing 3,000 copies with offset printing costs $1.43 per copy ($4,290 total)

Of these, illustration costs can vary the most. Some illustrators may charge anywhere from $5,000 to $10,000, or even more. Higher-priced illustrators may include layout designing in their services.

Any of these steps that business owners can do themselves greatly reduces the total cost of publishing a children’s book. For this reason, many business owners do their own illustrations and layout design. They may also rely on school teachers or librarians, who are familiar with curriculum requirements and grade reading levels, for assistance with certain steps.

Business owners should only do these steps if they’re truly capable of producing professional quality work. Sacrificing the quality of a book’s text, illustrations or layout will greatly hinder sales in the future.

Additionally, business owners should avoid using digital printing. This printing method may be fine for test runs, but offset printing should be used when a book is printed to be sold. At volume, offset printing costs a fraction of what digital printing does.

What are the ongoing expenses for a children's book business?

After a book is published, the ongoing expenses associated with the title include any marketing costs and storage costs. Of course, businesses must also fund the publication of additional titles.

Who is the target market?

Counterintuitively, kids are not the target market for children’s books. Instead, it’s parents, schools, and libraries -- as they’re who actually purchase books. Children’s author Kate Klise says that schools and libraries are especially profitable customers as they purchase in bulk.

How does a children's book business make money?

A children’s book business makes money by selling copies of books. Books may be sold individually at retail prices or in bulk at wholesale prices.

How much can you charge customers?

The School Library Journal reports that children’s books usually retail for between $6.49 and $17.85 per copy. Hardcovers command the highest prices, with mass-market paperbacks getting the lowest prices. Trade paperbacks are in the middle.

How much profit can a children's book business make?

With a successful title, a children's book business can bring in six-figure revenues. For example, Augie and the Green Knight raised $384,410 on Kickstarter before publication.

How can you make your business more profitable?

Business owners have multiple ways to earn additional revenue. Selling ebooks is becoming increasingly common. Alternatively, business owners can speak at schools and businesses, and offer teaching workshops to other aspiring business owners.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your children's book business is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a children's book business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

Most people who start a children’s book business have either already written or plan to write their own children’s book(s). Some business owners first try to publish their stories through traditional publishers, and others go directly into self-publishing.

What happens during a typical day at a children's book business?

Publishing a children’s book involves several distinct phases:

1. Writing the story
2. Creating illustrations to accompany the story
3. Designing the book’s layout
4. Printing the book
5. Marketing and selling the printed book

Printing is usually outsourced to a company that has specialized equipment for printing runs of books. The other steps may be done by the business owner or outsourced to professionals. (Writing is almost always done by the business owner at first.)

What are some skills and experiences that will help you build a successful children's book business?

Most business owners that get into children’s publishing already know how to write books for kids. Those that don’t have writing experience can learn by taking classes at a local community college or online. Institute for Writers and Gotham Writers both offer online courses. There are also universities that offer M.F.A. programs in children's writing.

In addition to knowing how to write, business owners also need to know how to produce and sell children’s books. The best resource for this information is the Society of Children’s Book Writers and Illustrators, which has online resources, local chapters and annual events available to associate members. (Self-published and aspiring children’s authors can sign up as associate members.)

Two other resources that discuss the business side of children’s publishing are a book titled The Business of Writing for Children and a class called The Craft & Business of Writing Children’s Picture Books.

What is the growth potential for a children's book business?

A children’s book business may be a small operation that has just a few titles, or it can grow into a major publishing house that has many works in print. Oliver the Clownfish is an example of a small business that has three titles. Scholastic, Inc. is one of the largest children’s-specific publishing houses. The company puts out more than 750 new titles annually.

Not sure if a children's book business is right for you? Try our free Business Idea Generator and find your perfect idea.