- Black Belt
- Posts: 1210
- Joined: Mon Oct 30, 2006 2:53 pm
- Location: USA
Unfortunately, I don't have an answer you would like. I have not used a Toy Broker/Agent to get my toys licensed. I contacted several when I first got started in the toy industry and after talking with them and understanding how much out of pocket money I was looking at decided I was not going to use them.
Here is a standard overview of what I encountered. And I know prices, royalties and everything else is different for every Agent/broker and deal.
Most wanted $125 to $300 per idea to review your concepts. I had 27 toy concepts so I was looking at $3,375 on the low side to get them reviewed.
Then, once they were reviewed the Agent/broker would want to have a presentation made for those items they picked from the 27. lets say they picked 5 to move forward. A proper formatted presentation to fit the target company was around $700 each, so 5 times $700 = $3,500. Now if the agent/broker decided I really needed a prototype made the price could be $1,100 and up. So, using the 5 times $1,100 = $5,500.
Now lets say that is all the expense I have in order to be ready for the items to be shown to Wham-O. My grand total is $12,375 for the 5 items.
Now, lets say the Agent gets them in front of Wham-O and they say, nice, but not interested. The agent/broker says well lets try these other companies and you are back to square one, but hopefully no additional charges.
Now, if Wham-O says yes to one of the items negotiations begin. Wham-O used to pay a $5,000 advance, not sure if they still do due to the economy.
You and the Agent/broker split the advance either 60/40, 50/50. As I said this is in general terms some brokers ask for less, others more.
The same terms apply to whatever royalty agreement the Agent/broker gets for you.
Understand this scenario is based on the Agent/broker reviewing your 27 concepts and picking 5 out of the 27 to move forward. What if the Agent/broker looked at all 27 and did not find any they thought they could represent? You now have to go out and find another Agent/broker and get them to review your 27 concepts all over again. Since this is a new Agent/broker you are again paying a fee per item for the review of all 27.
You tell him which 5 of these items have already been shown to Wham-O and turned down, so they know not to pick those items for that company.
So, on the low side you are looking at another $3,375. This reviewer may have the same contacts as the previous reviewer or lets say he has contacts in different companies the other Agent/broker did not have and he likes 8 out of the 27 ideas. You hopefully can use the presentation and prototypes from the first Agent/broker to approach their contacts and the process begins again.
Before approaching any Agent/broker ask about their successes and ask if they deal with the companies you are hoping to target. Some agents/brokers specialize in certain areas,like plush toys or action figures. Don't assume a agent/broker covers the entire industry.
Mattel and others may not look at items unless they are presented by certain agents/brokers. At one time Mattel sent me a list of agents/brokers they preferred you use. I don’t know if that is still the case.
Having dealt with companies in other markets that I licensed my items to I contacted the companies in the toy industry I wanted to target myself.
I found that I did not need a lot of the things I was told were needed to get our foot in the door. I licensed two toys to one company and licensed another to Wham-O. I am still pitching toys to these companies and have a couple on review. So, I am at the hurry up and wait phase right now.