Prints license request - need advice, please

Hello everyone,

I've just been contacted by a prints on canvas distributor based in the LA area, they print their products in China and distribute them to the US retail market. They affirm they work with many art and home furniture retail networks in the US and they're asking me to license about 6-12 of my photographs. They require exclusive rights for one year but only for prints on canvas, while, as I understand, I would retain rights for any other use of the images. They also state that I can reserve the right to cancel the license agreement at any time (???) Payment is a royalty fee, 4% of the gross sale revenues and payed quarterly.

Their website - http://www.malovanidesign.com - has just an average look, but the catalog of works is huge and they sell some very good artist, such as Adam Stone and Kat Sawyer (both painter).

I am a bit confused by the terms of the request. How does it sound to you? Is 4% a fair proposal in your opinion? Would you charge them with any up front cost in this particular case, where the required exclusivity is not so restrictive? Have you ever been contacted by the same distributor?

Thanks in advance for advicing me in this,
Paolo

The exclusivity sounds reasonable. After all, what are the chances that you'll license the same images for canvas in the given year?
I don't know about the royalties though. Sounds kind of low, but I guess it depends on what the potential sales of these things are. If they sell a lot, then it could be a good deal. You could ask for more, after all, they contacted you.
If you can live with the royalty percentage, why not give it a try for a year?

I have a similar deal with another company...i gave them exclusive rights for four years for for that sort of use and I see back 5%...you have zero cost up front and the distribution/sales potential is huge, so it has worked for me...just make sure you read the contract and that you are indeed are only licensing the rights...Nate

Thank you Rod, Nathan, for your kind answers.
I do think I will give it a try.

Cheers,
Paolo

5% is low - typically royalty deal like this are at 8-12%, in the U.S. anyway. I work with a U.S. firm that pays 12%.

5% is low - typically royalty deal like this are at 8-12%, in the U.S. anyway. I work with a U.S. firm that pays 12%.

Ah, that's quite interesting. I figured out I would negotiate the royalty percentage, but didn't think of such a difference between what I've been offered with, Nathan's fee and yours, Ron. i will certainly keep in mind this info when I call them back.

Nathan, Ron, may I ask you how you keep track of the sales you make with your distributors?

Thanks for the great info you shared,
Paolo

You know, you largely have to trust them. Before signing, I did ask if they could provide the names of other photographers who are represented by them. You have to do your homework upfront, because you really have no way of knowing if they are accurately reporting sales.

Yes Ron, you're right. To be honest, they actually told me they would have provided me with the contact data of some of the photographer they already represent, before I asked...

I will give it a try starting with a few photographs, and I will see how things will go on.
Thanks all for the precious, very helpful support,

Paolo