: From short fiction to a novel I write short stories. However, the more I research, the more I find that people prefer novels over short stories (irrespective of the quality of the work).

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The "issue" with the stort story, such that it is, is that classically they would appear in magazines like The Saturday Evening Post (a lot of Vonnegut's works appeared there for the first time) or even Cosmopolitan or Playboy. Well, readership in magazines is down in general and many magazines or at least genres which used to feature such things no longer do. There are still short-fiction presses (Analog is still being made, right?) but the market has almost completely dried up, and this is a thing that happened 20 years ago. Perhaps the rise of e-literature will also cause a rise in short work - I really do think it fills a niche that is currently unfilled - but it's hard to say.
As for novels vs. short stories, I'm not sure it's so easy to just morph the smaller into the larger one by adding subplots and the like. I mean, don't get me wrong, this is essentially exactly what Orson Scott Card did with Ender's Game and Chuck Pahlianuk did with Fight Club, but it's not all that easy. Having written (but, in fairness, not published) both, I find the following to be the case:

It is a lot easier to keep a plot in your head over 20 pages compared to 300. My own experience was that I simply could not keep track of all the balls I was tossing in the air (writing as juggling!) when I was wrote longer works without the aid of an outline. I know that some people work without outlines (for instance the American Indian detective novelist Tony Hillerman) but it's also often the case that those folks a. have done it for so long that they've gotten pretty good at it, and/or b. they often spend an extra draft or two fixing the issues that popped up as the result of not outlining things.

Short fiction requires a ton more precision than longer fiction. To me, short fiction lies in a kind of open space between poetry and novel (or at least novella) length work. With poetry, every single syllable matters. You have to be mindful of rhythm at all times. You might spend hours perfecting a single stanza. Short fiction isn't quite as demanding but writers such have Hemingway have stated that they don't think that a story even begins to feel like something they really understand until the 9th or 10th revision.
Now, some novels do/did get rewritten that much but it's not so much of a requirement, I don't think. On top of that, there's likely to be more straight-up mechanical rewriting in a novel (tying up plot points, eliminating a description at point Y because you totally forgot you described it in detail 30 pages previously at point X, cleaning up passages to maintain consistent grammar) and I don't know, I don't feel like this is as hard work as the "getting it just right" stuff.

You can often get away with a quirky, interesting, or avant-garde style in a short story more than in a novel. The only novel I've read written in second person ("You walk to the door. The door opens with a click. Beyond the door there is a guy you know named Joe. He has a bandage on his arm; you wonder about it for a second but then remember him talking about going to the tattoo parlor down the street the last time you talked.")(that was also in present tense, so, um super-styley, I guess) is Jay McInerney's Bright Lights Big City. I won't like, it gets a bit annoying. On the other hand, Lorrie Moore's collection of short stories Self Help doesn't strike me as particularly jarring even though if anything it's even more unconventional (the stories are written kind of in "recipe form", as in the first bit of "How To Be A Writer", that goes something like "Try to be something else. Fail at it."). I think it has to do with the fact that I'm only diving into that world for 15 or 30 minutes at a time, whereas the McInerney work represents several hours of getting acclimated to this style.

I think (and this may be controversial) that there might be more fertile ground for exploration than short fiction. One of my biggest issues with short fiction is that modern literary short work in particular has a bad, bad habit of using the Epiphany Plot over and over again. Person X comes in with Belief X and the whole story is about how they suddenly realize that they really should believe Belief Y. Don't get me wrong, this is used beautifully in places (see: Flannery O'Connor) and to some extent that's what happens in all fiction, but when it's all that happens it gets a bit old after a while.
On the other hand, I think that if you have a cool milieu with a cool plot hook and you've populated that milieu with cool characters, that's almost too much cool stuff to cram into 4,000-5,000 words. Of course, sometimes you've got a simple idea which just doesn't make sense to explode into a short story (I for one adore Chekhov's story Sleepy but I couldn't imagine it stretched into 10,000 words, let alone 60,000) but the more balls you want to throw in the air (there's that metaphor again!), the better suited longer form fiction is going to be to give you the space to explore all of those... um... balls.

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I share your opinion. I also think readers prefer novels over shorties but not necessarily because of the price. In my case, I don't buy short stories because I always end with that -- it was too short -- felling.

Being a good or a bad shortie, I always end up with that feeling that I could had more. Those rare times I bought a short story, were because it was sold inside a book with a collection of short stories but, even so, I would rather have one of those shorties developed into a novel.

But, back to your question, the easiest and more interesting way to change a short into a novel is to use subplots.

The short story will have only the main plot line, most of the times, because of space. It's all a matter of having the unexploited parallel stories of your short appended to it.

If the short is about a police man that finds out a bomb in a post office and manage to disarm it, saving everybody inside, you could write a parallel plot about the recently fired mailman, who wrongly lost his job when he found out his boss was stealing money from the company, and decided to avenge himself by blowing everything up.

You could also write about the unrequited love the policeman had for the girl who work at the post office, and made him to go there a lot detecting something was not wrong... And even that the girl didn't returned the love because some mob guy blackmail her for some reason.

The main plot line is almost the same as the one in the shortie -- a police man that finds out a bomb in a post office and manage to disarm it, saving everybody inside -- but the subplots will change it into a novel and allow you to develop everything into a more complex web.

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