Offer from card company

[SFL]

A few days ago I was contacted by a card company (greetings card, postcard, calendars, note cards, etc) via my website and asked if I would be interested in supplying images for their products.   They say that theirs cards are stocked at Fenwicks, Waterstones, Oxfam, National Trust, etc and also that they have distribution in 4 other countries.  So far so good.  However they are offering me 6% royalties on the trade prices (what they sell the products at). 

 

I sold my images to card companies and sold my postcards directly to retailers before, but I don't have any experience with the royalty payment.  I am well aware that I am not going to make a fortune by taking on the offer. My immediate thought was that the images they are interested in are already made and are sitting in my computer, so why not.  However is 6% a reasonable offer? 

 

Can anyone with experience in this set up offer me any advice, please?

 

Thanks in advance.

 

Sung

[spacecadet]

Say that you would like to see some sales figures and talk about retail price. You might consider a licence fee as an advance on royalties.

[Pearl]

6% sounds rather low to me but I only have experience of selling direct.

 

Pearl

[Chuck Nacke]

In my opinion and from my own experience, 6% is not bad. When I have been contacted by

greeting card companies in the past they offered either a one-time fee for the license

of each image or a percentage for sales. They also wanted to restrict the usage of

the images that they licensed, but just in the card category. I always went for the

one-time fee

[SFL]

Say that you would like to see some sales figures and talk about retail price. You might consider a licence fee as an advance on royalties.

 

Yes, some food for thoughts...

 

6% sounds rather low to me but I only have experience of selling direct.

 

Pearl

 

Sounds a bit low, but on the other hand, they will have to produce, market and distribute.  I was wondering if there is any industry standard royalty rate.

 

 

 

In my opinion and from my own experience, 6% is not bad. When I have been contacted by

greeting card companies in the past they offered either a one-time fee for the license

of each image or a percentage for sales. They also wanted to restrict the usage of

the images that they licensed, but just in the card category. I always went for the

one-time fee

 

Certainly, it's something to consider and suggest.  

 

Sung

[Phil Robinson]

In my experience of retail (Waterstones, funnily enough) the markup on cards by the shop is huge. The shops probably get 60% of the retail price (unless things have changed a lot) leaving 40% for the supplier, who has to cover production, marketing and distribution costs. 

Book authors get around 10% - and it takes a bit longer to write a book.

[Chris E]

Card company's that offer royalty payments are few and far between these days. Most offer a one off fee and want restrictions for the industry.

 

In my experience 6% isn't too bad but if they come in at 6% then you could push for 8% and see what happens.

 

If it's a series of images I suggest you ask for an advance of 'x' against royalties for each image, not against the whole lot.

 

In any series some will fly and some will sink without trace, only the buyer decides that.

 

Retail price doesn't come into it, the royalty comes per unit price sold to distributors.

 

If you can get a % then I would go for it.

 

Regards

Chris E

[Chris E]

Sounds a bit low, but on the other hand, they will have to produce, market and distribute.  I was wondering if there is any industry standard royalty rate.

 

Sung

Not these days!

 

C

[David Kilpatrick]

6% of RRP sounds OK, I'd ask for 10 (or rather, try asking for 12) % of net sales instead - wouldn't accept 6% of net sales.

[SFL]

In my experience of retail (Waterstones, funnily enough) the markup on cards by the shop is huge. The shops probably get 60% of the retail price (unless things have changed a lot) leaving 40% for the supplier, who has to cover production, marketing and distribution costs.

Book authors get around 10% - and it takes a bit longer to write a book.

In my experience of retail (Waterstones, funnily enough) the markup on cards by the shop is huge. The shops probably get 60% of the retail price (unless things have changed a lot) leaving 40% for the supplier, who has to cover production, marketing and distribution costs.

Book authors get around 10% - and it takes a bit longer to write a book.

I know I was once in retail but they have a bigger overheads. But the writers don't have to get wet or get cold while they are writing, aren't they? :)

 

Sung

[SFL]

6% of RRP sounds OK, I'd ask for 10 (or rather, try asking for 12) % of net sales instead - wouldn't accept 6% of net sales.

Unfotunately, it's 6% of their selling price, ie trade price. That's why I thought it was a bit low but experinced photogs in this field think it is not too bad, so I suposse I will push a bit and will see what happens.

 

Sung

[SFL]

Double quote. Deleted.

[losdemas]

 

6% of RRP sounds OK, I'd ask for 10 (or rather, try asking for 12) % of net sales instead - wouldn't accept 6% of net sales.

Unfotunately, it's 6% of their selling price, ie trade price. That's why I thought it was a bit low but experinced photogs in this field think it is not too bad, so I suposse I will push a bit and will see what happens.

 

Sung

 

Push a lot and get a bit (it doesn't work the other way round!) Just be nice doing it . Good luck!

[SFL]

Card company's that offer royalty payments are few and far between these days. Most offer a one off fee and want restrictions for the industry.

 

In my experience 6% isn't too bad but if they come in at 6% then you could push for 8% and see what happens.

 

If it's a series of images I suggest you ask for an advance of 'x' against royalties for each image, not against the whole lot.

 

In any series some will fly and some will sink without trace, only the buyer decides that.

 

Retail price doesn't come into it, the royalty comes per unit price sold to distributors.

 

If you can get a % then I would go for it.

 

Regards

Chris E

Yes, you are right. I will definitely have a go.

 

Sung

[SFL]

 

 

6% of RRP sounds OK, I'd ask for 10 (or rather, try asking for 12) % of net sales instead - wouldn't accept 6% of net sales.

 

Unfotunately, it's 6% of their selling price, ie trade price. That's why I thought it was a bit low but experinced photogs in this field think it is not too bad, so I suposse I will push a bit and will see what happens.

Sung

 

Push a lot and get a bit (it doesn't work the other way round!) Just be nice doing it . Good luck!

You are absolutely correct. Thank you.

 

Sung

[PatrioticAlien]

The fact that you where contacted by them 1) makes me think they really like your work 2) you should be able to get at-least 10%. 

[SFL]

The fact that you where contacted by them 1) makes me think they really like your work 2) you should be able to get at-least 10%. 

Will try.

 

Sung

[isphoto]

The key question with royalties is not so much the % but more the minimum print runs! I'd rather 5% of 100k than 10% of 5k. On any royalty you should know the following, projected initial print run, will they reprint or is it a case of when it's gone it's gone, the stores in question sound good but are not real volume players in terms of cards. Also beware of licensing to a card co and giving them the rights to license/sell the design on line, you could get a% of a % if you get my drift. In many cases a flat fee is better than trying to monitor sales and track payments. Also bear in mind that wholesale prices of cards can be as low as 30-40p, also you need to know what will the rep be, better to have one at 1.99 or 2.99 than cards with an ESP of c99p.

 

 

Nothing wrong with 6%, but of what?