CONS FOR TRADITIONAL PUBLISHING: Some publishers use what’s called “basket accounting.” The author signs a contract and receives an advance. The only way you receive any royalties beyond that advance is to sell through it. In virtually every contract the publisher gets the right of first refusal on your next book in the same genre. If they decide to publish that next book, then before you receive the advance, they take a look at previous sales. For example, if you fell $500 short of selling out the advance on the previous book, they deduct that amount from the advance on the new one. (Rick adds: So, if your first book sells way short of expectations, then your second one might not bring you any additional money until or unless its sales are sufficient to make up for the first one. On top of that, you may well not be offered any additional contracts.)
CON FOR SELF-PUBLISHING: Although self-publishing no longer holds the stigma that it used to, the publishing houses still look at your sales record. If you self-publish and don’t sell at least a few thousand copies, you may not have a chance to get a contract with a traditional publisher, regardless of the quality of your work.
Even though Scott and I are strong advocates of self-publishing, we’ll be the first to say that that it’s not for everyone nor is it a runaway clear choice. This is why some authors have become “hybrid authors.” This means that they use both routes depending on the book.
Another con with traditional publishing is that authors of a series may well never to get to publish all the books in the series if the first ones don’t sell well. An author could end up with a stranded third book in a trilogy if the publisher doesn’t want it.
Depending on the contract, the author could well be prohibited from publishing it by any other route without the publisher’s permission under a “competing material” clause often found in traditional publishing contracts, and what is deemed competing material is solely at the publisher’s discretion.
I don’t know if this has changed in recent years, but in the past some authors had to fight for the right to publish other books in a series if the original publisher didn’t want them. All of this goes back to ensuring that your contract leaves you plenty of leeway if things don’t go as you expected.