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Contract for Royalties Resulting from Copy?

by Dexx
9 replies
Hey Gang,

I've heard multiple times about copywriters receiving an initial payment, and then a percentage of the profits generated from the copy they wrote -- for as long as it is used by a client to generate sales -- but I can't seem to find a recommended resource (or template) so base such an agreement off of...

Does anyone know where to a good royalty agreement for copywriting projects (I'm going to be doing a series of follow-up letters for a Chiropractor and want to build this in).

Has anyone ever had issues with royalty payments not being paid as they should?
#contract #copy #resulting #royalties
  • Profile picture of the author DanielleLynnCopy
    Originally Posted by Dexx View Post

    Hey Gang,

    I've heard multiple times about copywriters receiving an initial payment, and then a percentage of the profits generated from the copy they wrote -- for as long as it is used by a client to generate sales -- but I can't seem to find a recommended resource (or template) so base such an agreement off of...

    Does anyone know where to a good royalty agreement for copywriting projects (I'm going to be doing a series of follow-up letters for a Chiropractor and want to build this in).

    Has anyone ever had issues with royalty payments not being paid as they should?
    Hi Dexx,

    Be careful when doing a royalties arrangement with an individual. It's generally not recommended unless you're working with a company because it is very easy for individuals to 'forget' to make payments or not calculate them correctly. On the other hand, companies have departments dedicated to tracking, managing payments, and sending out royalty checks.

    That being said, if you want to go forward with it, create a standard contract, then outline the royalties as part of the payment area. Make sure you clearly state how much you will be paid (what % of the profits), when you will be paid (at the end of each month, each week, bi weekly), and I recommended adding a system for you to be able to view for yourself the sales (at each royalty payment due date, you sit down with your client and they show you the %.)

    Will the letters be emails or physical letters? The physical letters will be harder for you to track, you'll have to rely on their word.

    Again, just keep in mind that royalty contracts wont always hold when working with individuals, so proceed with caution.

    Best Wishes,
    Danielle
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  • Profile picture of the author Dexx
    Hi Danielle, thank you so much for the detailed response!

    So would you recommend that I just charge an appropriate fee that I would be satisfied with -- knowing that I won't receive any future payments no matter how much business they copy generates -- and with no "terms" as to how long they can use the copy for?

    Or would it make more sense to "license" the copy out for an annual licensing amount that allows them unlimited use of the campaign during that year?

    ~Dexx
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    • Profile picture of the author DanielleLynnCopy
      Originally Posted by Dexx View Post

      Hi Danielle, thank you so much for the detailed response!

      So would you recommend that I just charge an appropriate fee that I would be satisfied with -- knowing that I won't receive any future payments no matter how much business they copy generates -- and with no "terms" as to how long they can use the copy for?

      Or would it make more sense to "license" the copy out for an annual licensing amount that allows them unlimited use of the campaign during that year?

      ~Dexx
      No problem Dexx

      Yes - I would highly recommended just charging the full amount that you feel is fair, because with individuals (even well meaning one) it's too easy for royalty payments to fall through the cracks.

      If I had to choose, I'd charge the full amount and let the client keep the rights to it.

      From there, I'd offer a small optional monthly maintenance fee (to tweak, refresh the copy for improved performance.)

      If you go with "licensing," build it on the terms that when they renew it at the end of the year - you'll do a 'update/refresh' of the copy. That way it benefits both you and your client.

      Bottom line, when working with individuals and small businesses, because of the nature of small business, it's easier for both parties if you charge the full amount upfront.

      Glad to help
      Danielle
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      • Profile picture of the author Loren Woirhaye
        Unless you're dealing with a significant direct response company,
        whether or not your deal pays you as you've agreed is pretty
        much a matter of your client's sense of honor.

        No contract is gonna prevent a person who decides to screw
        you from doing it. You might ask for names of suppliers the
        client buys from. Call them and ask if the client pays on time.
        Straight dealings with suppliers is a good indicator not only
        of meeting agreements, but of some degree of positive command
        over the cash flowing into and out of the business.
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        • Profile picture of the author Dexx
          Originally Posted by Loren Woirhaye View Post

          No contract is gonna prevent a person who decides to screw
          you from doing it. You might ask for names of suppliers the
          client buys from. Call them and ask if the client pays on time.
          Straight dealings with suppliers is a good indicator not only
          of meeting agreements, but of some degree of positive command
          over the cash flowing into and out of the business.
          You know that's actually a great idea, even just as a general rule for accepting new clients, getting a "background check from references."

          Might try that! Thanks!

          ~Dexx
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  • Profile picture of the author David Raybould
    Dexx-

    Check out John Carlton's freelance
    copywriting course "The Freelance
    Course".

    There are very useful sample contracts
    in there.

    Also, the trick to charging royalties
    as well as an up front fee is to make
    sure you're happy enough to do the
    job for the initial payment alone.

    View the royalties as gravy.

    Don't let them become your bread
    and butter, unless you want to
    spend most of your life on the
    phone chasing people for checks.

    Good luck with it.

    -David Raybould
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    Killer Emails. Cash-spewing VSLs. Turbocharged Landing Pages.

    Whatever you need, my high converting copy puts more money in your pocket. PM for details. 10 years experience and 9 figure revenues.
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    • Profile picture of the author Dexx
      Originally Posted by David Raybould View Post

      Also, the trick to charging royalties
      as well as an up front fee is to make
      sure you're happy enough to do the
      job for the initial payment alone.

      View the royalties as gravy.

      Don't let them become your bread
      and butter, unless you want to
      spend most of your life on the
      phone chasing people for checks.
      Y'know, I have that business philosophy when it comes to doing marketing projects for clients, and didn't even think to apply that towards the royalties aspect.

      Thanks for refreshing my perspective!

      ~Dexx
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    • Profile picture of the author Bruce NewMedia
      Originally Posted by David Raybould View Post


      Also, the trick to charging royalties
      as well as an up front fee is to make
      sure you're happy enough to do the
      job for the initial payment alone.

      View the royalties as gravy.
      This is very good advice.

      Dexx, I've done upfront money with backend royalty deals.
      But, its always been with fairly long established clients - people I knew well.
      I trusted them to do the right thing, and they always have (knock on wood)
      I used a simple faxed letter outlining the deal arrangements. That was all.

      With a new or unknown history client, I'd be more careful. That's why getting
      customary fee upfront, and viewing any performance payments as a bonus is
      a good way to look at.
      _____
      Bruce
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  • Profile picture of the author John_S
    No contract is gonna prevent a person who decides to screw
    you from doing it.
    Sounds like a entrepreneurial opportunity for a savvy hosting/billing service specializing in JV ....oh look ... a new gimmick (gotta run.)
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