Finding the Best Toy & Game Broker/Agent

Back in January (wow, has three months passed by already since then?), you may recall that I had the unique fortune to interview Ed Akerman, the man who launched the best-selling and legendary card game, "UNO." Well, I decided to finally take his advice to heart by researching and contacting a number of top toy and game brokers online. Personally, I prefer to have a broker in the United States for the convenience of having someone closer to home and considering the time and costs of shipping my prototype. Plus, I do not know how to investigate the legitimacy of businesses in other countries, whereas here in the U.S., you at least have the option to look them up on the Better Business Bureau website.


You may decide to establish your own approach to evaluating the best broker for your own needs, but I took the extra time to read everything each broker presented on their website: i.e...


- How long have they been in business and/or what kind of experience in the industry do they have?
- What kind of products/clients have they represented?
- What services do they provide?
- How much do they charge?
- What percentage of your royalties do they receive?
- Do they have a standard non-disclosure agreement? (In order to protect you from anyone that might try to take your concept without permission.)
- Does the overall website look professional?


Afterward, I jotted down questions that may not have been answered: i.e...


- Where do you represent your client's games? (Only in the United States, Europe, or around the world?)
- Do you require an exclusive contract? (This means you are not able to have any other brokers shopping around the same invention at the same time.)
- If so, how long is the contract? (Some require as little as six months to one year, while others may require 1-2 years. It may depend on how many toy companies a broker may solicit or other factors. Generally, it is common to wait at least a year or more to see if any company is interested in licensing your game or toy. Otherwise, you may need to go back to the drawing board and make some revisions, start all over again, or try to self-produce it on your own.)
- Do you present games at Toy Fairs or do you go directly to the toy and game companies? (Some brokers may make the claim that Toy Fairs are for amateurs because the major toy companies are usually only interested in doing business with buyers, not acquiring new products. Your experience may be different.)
- What percentage of games/toys submitted to you for consideration do you represent? (A good broker will only represent a small percentage because they are only looking for those toys/games with a high potential for success.)


You might also want to ask about licensing a different version of your game: i.e. on cell phones, D.V.D., internet, and video games. However, bear in mind that, unless you are a talented computer programmer and animator, or a major toy company wants to do it for you, hiring someone (or a team of people) to make an electronic version of your game can cost several thousand dollars (sometimes over $100,000). Not to mention, there is no guarantee that a game company will want to license your game. However, if you are still motivated to give electronic gaming a shot after considering these factors, then by all means, go for it! You may have some talent that will blow everyone's mind away. When you become successful, hopefully you will remember that I was one of the few that encouraged you all the way! ;)


Bearing all of this in mind, I found a broker that I was comfortable with, who was professional, experienced, patient and willing to explain the aspects of the industry that I did not understand. (Trust me, not everyone was so pleasant.) This particular broker has 26 years of experience, has an impressive client list, and currently has an "A+" rating on the Better Business Bureau website.


You might be asking, how much money can an inventor make? Well, this may not always be the case, but it would appear that if a toy company is interested in licensing your toy or game, you may receive around 5%-8% of the WHOLESALE price, not the mark-up prices you see in stores. On top of that, if you used a talented broker to negotiate your contract with that toy company, your broker may receive around 20%-40% of your royalties. Some brokers ask for more, depending on where you go.


So, lets do a little math. If your game costs $5.00 to make per piece and you receive 5%-8% for every game sold, then you might receive $0.25 - $0.40 per game. If you used a broker and they receive 40% of your royalties, then you might only receive $0.15 - $0.24 per game sold. This means, if your game sells 100,000 copies, then you might only receive $15,000 - $24,000. (Not terribly impressive, I know.) However, if in the unique event your game is a huge hit and sells 1,000,000 copies, then add another zero and that comes out to $150,000 - $240,000 in royalties. It may not seem very much considering that you invented the product and may have put your heart, soul, money, and time into this project. However, if you do not have an understanding of business, marketing, distribution, or the financial capital to launch your product yourself, then this may be an ideal option.


I hope this information was helpful. Mahalo for reading my blog.

Best of luck,
~Luis
www.GlobalQuestGame.com