The best way to answer this question is from a cost-benefit analysis.

You have to be careful with this. You might get the answer wrong if you only consider the financial costs and benefits. There are some indirect costs and benefits that are important to consider, too.

With this in mind, I will try to demonstrate how every author can benefit from doing at least one reading or signing, but that most authors shouldn’t hold multiple events.

Costs include:

• Transportation: Gas and wear and tear on your car getting to and from the event, airline tickets, hotel stays, food expenses that you wouldn’t have otherwise incurred (if you’re out of town), etc. If it’s a local event, it should just be gas and mileage.
• Stocking titles: Ordering paperbacks or hardcovers (don’t forget to include shipping and handling from the publisher to you) to stock up for the event.
• Materials: You may be able to keep this free, but it could include a nice pen, a sign with your name on it, bookmarks to put in the books, business cards, jump drive (to load the files onto a computer supplied by the venue, for example), and anything else that you may need to buy in order to hold the event.
• Venue fees: I suggest trying to avoid this, if possible. If the local bookstore is charging a hefty fee, it may be a way of trying to discourage indie authors from doing this. (However, if you’re holding a conference and planning to sell tickets to the conference, for example, then paying a venue fee may be worthwhile.) If you’re having trouble finding a venue, what prevents you from doing a reading at a public park? Maybe a coffee shop would host it with the prospects of selling coffee to your audience. Where there is a will and some creativity, there is a way. For example, if you have a zombie book, setup a zombie race, then do a zombie reading at a campfire.
• Miscellaneous financial expenses. For example, you might want to get setup with PayPal to accept non-cash payments, in which case you must account for transaction fees. You might make a special trip to the bank to get plenty of change for cash payments, too (there is more gas and mileage, unless you plan ahead and get this during a routine trip to the bank).
• Time and effort: These are costs, too! Your time is worth money. It is possible to spend just a little time finding a possible venue, setting it up, promoting the event, attending the event, and getting there and back. If so, then there may not be much time and effort involved. But if you’re spending many hours on this, don’t forget to consider time and effort as part of the total cost.
• Money and effort that you put into promoting and populating your event. Running an advertisement costs money. If you’ve already built up a very large following in the location of your event, it should be easy to share the news and gather an audience. If you’re a new author or don’t yet have a very large following, it may be difficult to get an audience (it’s not impossible, though: First, you can get friends, family, acquaintances, and coworkers to help populate the event; you can also be creative, and put Zombie Race flyers, for example, all over town where your target audience is likely to see them). Either way, you can populate an event with little cost to you. In fact, advertising to generate a following probably won’t pay off.

Benefits include:

• Immediate direct sales of physical copies or e-books (come prepared to transfer a .mobi file right onto a Kindle, or a PDF right onto a laptop; and you can even find an electronic tool for signings). If you already counted your purchased author copies as a cost, then figure the total sale price as a benefit.
• Leftover author copies may not be a sunk cost. You might be able to reuse them at a future event, supply them to a bookstore, send them to the media as part of a press release package, or sell them in person. If so, the leftover copies do provide you some value.
• You may sell future copies from bookmarks, business cards, and other promotional materials that you passed out. Someone who didn’t buy a copy at your event may go home and buy a copy later.
• A very important factor is referrals that you generate during your signing, which may not have come otherwise. This is difficult to predict and still difficult to gauge months later. How much do you believe in your book? Is the material so good that it’s likely to generate referrals, and is the packaging so good that it’s likely to generate sales from those referrals. Another issue is that it can take many months for branding and referrals to pay off. Unfortunately, many referrals don’t pay instant dividends. But those future sales are important benefits. They count, too.
• Any promotion that you do to spread awareness of the event also helps with your overall marketing and branding efforts. It’s not easy to judge what effect this may have, if any, on your sales, but it has the potential to improve sales a little.
• Suppose you want to tour the country in your r.v., or suppose that you’d like to visit the Statue of Liberty with your family, for example. The trip itself may have many benefits. If so, you might be willing to invest in the trip simply from a vacation perspective. This could have a large benefit to you or your family, personally, which may offset the financial business cost to some degree. If you would take the trip anyway, but are thinking about holding the event while you’re there, then the costs and benefits of the trip may cancel one another out, more or less.
• There may be some tax benefits. You get to subtract your business expenses when you prepare your tax forms (see an accountant or attorney to be sure).
• Here is an important benefit that may make it worthwhile to hold the event once, even if otherwise the cost-benefit analysis would suggest not to do it: Think how your AuthorCentral page, fan page, blog, social media, and any other websites will look. First, you can put the event on your schedule, announcing that you’ll be holding the event. Afterward, you should post a picture of yourself at the event (showing a professional-looking, well-attended event in the background). You can even post a video on YouTube (and link to that from your blog and elsewhere). Will it improve your author image? If so, it may help with the image that you brand.
• The experience of holding the event itself has value, especially the first event. This counts, too.
• You get to interact with some of your readers and potential readers. This by itself provides some value to you. In addition, readers are more likely to buy your books when they meet you in person, interact with you, and enjoy the interaction. This also improves the prospects for sales, reviews, and referrals (of course, if the book doesn’t look professional or isn’t well-packaged, the event seems unprofessional, or you make a poor impression, then all of this will be negated; you have to judge all of these things, too, in order to properly weigh the costs and benefits).

Why should every author do (at least) one reading or signing?

See the last three points above. If the costs seem to outweigh the benefits financially, you should still strive to put together a low-cost event, populate the event as best you can, and aim for the benefits that these last three points have to offer. If you get a few sales and referrals, too, great; but focus on the last three points.

You can keep the costs down by finding a free local venue (like a picnic in the park), only holding one event, not spending money on advertisements or promotions, limiting the stock to just a few copies (or going e-book only), not spending too much time on setup, using only materials that you have handy, etc. If you want to, you can definitely keep it affordable. If you’re a new author or have very little local following, and if you have friends, family, acquaintances, or coworkers to support you, you can at least put a small group together. This still gives you the chance to announce the book on your blog and author page and to post photos of the event afterward (do your best to make it look professional in the photo – you signing a book with a couple of people in line is fine). If you get a few readers you don’t know to attend, you sell any copies, or get any referrals, that’s gravy.

Who should do multiple readings and signings, and who should only do one?

You shouldn’t invest much time and money on a reading or signing, and you shouldn’t hold multiple events unless and until you have a very large following in the area.

A new author should just hold one low-cost event and shouldn’t expect outside attendance (i.e. beyond what you can put together with people you know). Any other author who doesn’t have a significant following in the area should do the same.

Your blog following consists of people from around the world. Very few are likely to live in any given city (well, if you have friends, family, and acquaintances on your blog or if your followers gravitated toward you because of your common roots, these might be exceptions). You can’t look at your total number of followers either: How many people are likely to view one post? If about 10 people view a post, and these 10 people live all over the world, you can’t expect your blog following to generate an audience at your event.

If you’re only selling 10 copies per day at Amazon, most of the customers won’t even check out your author page, and if they do, most live all over the US. So you can’t expect random customers to populate your event.

If you have a fan page with thousands of fans signed up, that could be significant. If you’ve sold thousands of books, that may help you to generate an audience at your event. If you’re a celebrity of sorts, you may have a significant following on FaceBook and Twitter. In these cases, it could pay off to go on a tour, especially when you release a new book. But in these cases, you’re probably already a very well-established author.

If you have a strong local following, that’s significant, too. In this case, multiple events in your region may be worthwhile. This is one way that a new author can benefit from multiple events.

Chris McMullen, self-published author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers, Vol. 1 (formatting/publishing) and Vol. 2 (packaging/marketing)