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10. Why do I need an Agent?
Agents open doors to toy companies, but a good agent should also help to bring a product concept into a marketable focus. As an Agent, we know what's hot, who's hot, what's been done and what has not. Your Agent should help to make you successful through product knowledge, industry knowledge and connections!
9. How much is a royalty?
Typically royalty is calculated on the wholesale selling price. An average royalty is 5%, but can range as high as 10% if it offers breakthrough technology, a strong previous sales track record, consumer recognition, etc. Royalties can even be less than 5% if the product's patents, etc. must be shared with another inventor or if the product is tied to a popular license.
8. Are there any hidden costs involved if you like my product?
There should never be hidden costs. A good Agent represents products without charge and makes their profit (as does the inventor) when and if the product is marketed and based on the sales success of that product.
7. Do I need a prototype or will this cocktail napkin suffice?
You need a prototype to show your concept to industry professionals (if you want them to take you and your concept seriously). Toy companies will not "imagine" that something will work-- they have a very WYSIWYG (what you see is what you get) mentality. A good Agent can weed out concepts in a cruder format as a time and cost savings to the inventor. The concepts that are deemed most marketable can then be created in prototype format.
6. Will my product be out for this Christmas?
Probably not unless you are producing the product yourself. The typically lead time in the industry is 18 months out and is growing even longer as more products demand greater engineering and development time.
5. Should I get a copyright or patent?
Maybe. This really depends on the product. Our first inclination is not to suggest that an inventor spend any unnecessary money . Our advise is to work with your Agent to determine if the concept is one best suited for protection and to help you determine what this cost would be before proceeding. We've seen inventors spend more money protecting their items than they will ever recover. We want you to make money. Upon licensing a product, most toy companies will expend their resources to patent and protect your item-- in your name, of course.
4. What is the difference between licensing and selling my product?
Licensing means that you are granting the rights to your product concept to another manufacturer / distributor for a "royalty" or percentage of the wholesale selling price (that's the price the toy company sells the item to the retailer). Inventors do not have much if any control over the product, look, name, outcome, etc., but also do not have any financial risk. Selling your product either means selling your company to another company (not very common unless you have a very strong product recognition) or that you are producing and directly selling your finished goods into retailers. Basically, you are the toy company and take on all the risk, but stand to profit many fold more than you would on a royalty basis.
3. What percentage do you get as an agent?
An Agents' range is typically between 25% and 50%- depending upon the amount of work, input and expense required by the Agent.
2. If I submit a product, do you guarantee to show it / sell it?
There's no guarantees in life, and certainly even less in the fickle toy industry. However, our team has a strong track record of picking winners.
1. How much money can I make?
It all depends on the product. The higher the wholesale-- the higher your royalty. The greater the sales and demand for your item-- the greater your royalty. This is why professional inventors are more selective about the product type and category they develop. Royalties can range from nothing (no sales) to millions of dollars (think Furby).
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