Sales Agents and Upfront Fees

Hi there,

In trying to procure a sales agent for a film I'm producing, I emailed all the relevant companies I could find with little success (the half a dozen who did respond said that it is too niche for them).

However, one company is interested (they actually contacted me first) but they charge upfront fees as standard practice. They are clearly a legitimate agency and apparently have a high success rate, but everything I have read during research points to upfront fees being a red flag.

At this point I will either have to go with this company or start contacting distributors myself.

Should upfront fees always be viewed with suspicion or can be a legitimate way of going about things (and better than approaching distributors unsolicited)?

Any thoughts are greatly appreciated.

Many thanks...
 
Upfront fees should always be viewed with suspicion. But they can be
a legitimate way of going about things with a company that is legitimate
and has a high success rate.

Since you are at the point where you will either have to go with this
company or start contacting distributors yourself only you know if doing
the work yourself is better than paying someone to do the work. I can
only say that for me I don't want to work as a sales agent even for my
own movies. But if you're comfortable getting out there and selling then
you will save money. Or will you?
 
Should upfront fees always be viewed with suspicion (and better than approaching distributors unsolicited)?

I've been taught that it is a red flag, but not necessarily a deal breaker. Do your research on them. Find out if you're a good match.

the half a dozen who did respond said that it is too niche for them

This would raise a bigger red flag for me. I suspect it's time for you to sit down and do some soul searching. Depending on when you approached them, sales agents are always on the lookout for good material to sell. If they don't think they can sell your film, most will pass. If those sales agents are all passing, perhaps your film needs more work to become market ready. If your film isn't working for those sales agents, paying someone to sell your film isn't going to necessarily going to put you in a better position.

or can be a legitimate way of going about things

Put it this way. They're in business. They want to turn a profit. If they don't believe they will be able to sell your film, the only way to make money from you is to charge you a fee up front. They make a profit regardless of the outcome for you and your film.

if you're comfortable getting out there and selling then
you will save money. Or will you?

Very well put.... that last part.
 
You've kind of answered your own question. How does this one agency expect to turn a profit, when all the others see little/no commercial potential in your film? It is possible, though unlikely, that this one agent knows something none of the others do. On the other hand, the upfront fee is certainly a red flag because it guarantees the agent an income regardless of whether the film has any real commercial potential.

At this point I will either have to go with this company or start contacting distributors myself.

Bare in mind that agents' professional survival depends on their knowledge of distributors and what products they want. If no agent is interested in your film (except one whose income is not dependent on securing distribution), that's a very good indication that the distributors themselves won't be interested. This is not to say that sales agents always judge correctly but their refusal and your relative lack of knowledge and contacts (compared to a professional agent) massively reduces your chances of success.

If this film is a passion project, purely a learning experience or some combination of the two, then my advice is to continue as you are: Carry on making your film while investigating this agent more thoroughly, maybe try and contact some of their happy (and unhappy) clients and then either go with them or start approaching distributors directly. Otherwise, halt the film's production and consider changing it's story/content/subject, to make it more attractive to agents/distributors or, consider producing a different film entirely.

G
 
Thanks very much for the responses...

Since you are at the point where you will either have to go with this
company or start contacting distributors yourself only you know if doing
the work yourself is better than paying someone to do the work.

I was initially most concerned about distributors not accepting unsolicited submissions, or sales agents having more cachet and ability for leverage. I can imagine that international sales would take a great deal of time and research but am not aware if trying to procure US sales alone would be that great of a commitment? The offer I have is from a US agency who says that outside of their own sales they can help to acquire a foreign sales agent (though I have already contacted as many of these as I can find so am not very hopeful).

Sweetie said:
I suspect it's time for you to sit down and do some soul searching. Depending on when you approached them, sales agents are always on the lookout for good material to sell. If they don't think they can sell your film, most will pass. If those sales agents are all passing, perhaps your film needs more work to become market ready. If your film isn't working for those sales agents, paying someone to sell your film isn't going to necessarily going to put you in a better position.

In regard to timing reaching out to sales agents, unfortunately I waited until after the premiere (which was at a respectable but not big-5 or so festival). I understand that the optimal time might be when a rough cut is ready and before being picture-locked so am not sure how much of a negative effect this had.

The film itself is finished so there is not much that can be done in terms of the content. I surmise that the central problem is the narrow audience for the subject matter as the reviews/feedback have been very positive.
 
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Whoever you get to distribute, make sure you get an experienced entertainment attorney to check over the contract. Make sure you get reports monthly, have a cap on expenses, performance criteria or the film goes back to you, and try and give rights for as short a period as reasonably possible.
 
I was initially most concerned about distributors not accepting unsolicited submissions, or sales agents having more cachet and ability for leverage.
Very true. Which is why a sales agent can be helpful.
I can imagine that international sales would take a great deal of time and research but am not aware if trying to procure US sales alone would be that great of a commitment?
Both are a a great commitment and will take a great deal of time.

So you need to answer the hard question for yourself. Is it
worth it to you to pay a sales agent to try to procure US and
international sales? Or is it better for you to save that money
and try to procure US and international sales yourself. There
isn't an easy solution to that question.
 
Hi there,

In trying to procure a sales agent for a film I'm producing, I emailed all the relevant companies I could find with little success (the half a dozen who did respond said that it is too niche for them).

However, one company is interested (they actually contacted me first) but they charge upfront fees as standard practice. They are clearly a legitimate agency and apparently have a high success rate, but everything I have read during research points to upfront fees being a red flag.

At this point I will either have to go with this company or start contacting distributors myself.

Should upfront fees always be viewed with suspicion or can be a legitimate way of going about things (and better than approaching distributors unsolicited)?

Any thoughts are greatly appreciated.

Many thanks...
I have heard stories about producers reps / sales agents who will take on ANY film. They pretend to go through a "review process", then of course they "accept" it, then they ask for $800 or whatever. Think about it. This is a GREAT way for someone who is out of work to make money! These guys will even accept films that haven't even been shot or without having even seen the film.

The other thing to think about is the fact that indie films are not getting theatrical releases. You go straight to DVD. Anyone can get non-traditional distribution on their own. So what is the point of having a sales agent?
 
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I was initially most concerned about distributors not accepting unsolicited submissions, or sales agents having more cachet and ability for leverage.

For them it's an ongoing relationship. Sales agents need to sell their product. Distributors need product. Experienced sales agents understand (for the most part) the value of each of the films in their slate. The independent filmmaker rarely understands the value. It often causes a lot of wasted time. This time is what the distributors lack. This is just one of the reasons.

I can imagine that international sales would take a great deal of time and research but am not aware if trying to procure US sales alone would be that great of a commitment?

The percentage fees you're paying pays for the time they've already invested in contacts, knowledge, experience and so on. The sales process doesn't often take that long. It's "who to best pitch to" that is important.

Just like distributors, there are sales agents that their focus is on particular genre, types, budget range etc.

I understand that the optimal time might be when a rough cut is ready and before being picture-locked so am not sure how much of a negative effect this had.

It really depends on the film, who your producer is, their experience etc... when the best time is to contact sales agents. The opinion that I hold (if you can get a good sales agent to help at this time) is during the development stage. BEFORE you finalize your package.

This is the point where your film has the most potential.

After you've finished shooting your film, it's too late for them to give you suggestions to whom will help garner distribution or steer you towards decisions that will increase your chances/price.

The film itself is finished so there is not much that can be done in terms of the content. I surmise that the central problem is the narrow audience for the subject matter as the reviews/feedback have been very positive.

Since the film is made, I assume there are no named talent attached. Your best bet is winning at high end festivals. Alternatively, garner lots of press attention for your film. The last option is getting a lot of local sales yourself and work towards getting an agent for TV rights, assuming you can get a lot of sales.

The other thing to think about is the fact that indie films are not getting theatrical releases

There are examples of independents getting theatrical releases. It's true it's rare. It does happen. Some are doing well.

So what is the point of having a sales agent?

In this case, probably very little.

To maximize the money you can get from sales.

So they find a distributor who will put up the cash to market the film instead of having to pony up the marketing money themselves.

There are many other reasons.
 
I have heard stories about producers reps / sales agents who will take on ANY film. They pretend to go through a "review process", then of course they "accept" it, then they ask for $800 or whatever. Think about it. This is a GREAT way for someone who is out of work to make money! These guys will even accept films that haven't even been shot or without having even seen the film.

The other thing to think about is the fact that indie films are not getting theatrical releases. You go straight to DVD. Anyone can get non-traditional distribution on their own. So what is the point of having a sales agent?

Thanks for the info...

In this instance the upfront fee is actually much more than that ($5,000) and the finishing/ongoing costs of the film have already left me in a pretty bad place financially.

A wide theatrical release was never going to happen (and I've had a number of indie theaters reach out for one-off screenings) but still, if the sales agent manages to get deals for DVD, Digital and possibly Ancillary and TV (by opening doors to distributors or by selling more units than self-distribution would allow) might it be worth it?

One problem is that I'm finding it difficult to gauge what kind of advances/returns I will get if the agent does make a sale. They tell me it's completely random and unforeseeable so they can't provide estimates, but I'm wondering what a deal for say DVD and Digital rights might realistically come to for a small, low-profile indie documentary and ultimately if it's worth taking such a gamble on upfront fees?

FYI the project has one high profile star but I think the main marketing problem is the obscurity of the subject.
 
if the sales agent manages to get deals for DVD, Digital and possibly Ancillary and TV (by opening doors to distributors or by selling more units than self-distribution would allow) might it be worth it?

That depends on what deals they get.

One problem is that I'm finding it difficult to gauge what kind of advances/returns I will get if the agent does make a sale. They tell me it's completely random and unforeseeable so they can't provide estimates, but I'm wondering what a deal for say DVD and Digital rights might realistically come to for a small, low-profile indie documentary and ultimately if it's worth taking such a gamble on upfront fees?

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Just in case you didn't understand the picture.... this is a BIG RED FLAG!

Part of a Sales Agents job is to create sales estimates. To put it into perspective, it's almost like an actor saying they cannot supply you with a showreel/credits list. If a task that is part of their job description is impossible for them to do, are they the right person? Would you really want to give them money up front?

I personally know very little about the documentary market, even less so with niche documentaries. I have a Documentary Broadcast sales projections document broken down by regions (no I cannot share the document). It's a little old (a year, maybe 2 - so take that into consideration). The list has low end documentaries at $180k and high end at $515k. With it being a niche, you'll have to work out where you fit in, where may be 1/3 of the low end for all I know... or it could be too small to consider or it may not have enough value to be able to sell.

Sales estimates need to be done with your specific film in mind. If you want sales estimates, pay an experienced sales agent (since you cannot find one to work with you already) to do up those sales estimates. Then you'll have more information to make your decision.
 
One problem is that I'm finding it difficult to gauge what kind of advances/returns I will get if the agent does make a sale. They tell me it's completely random and unforeseeable so they can't provide estimates, but I'm wondering what a deal for say DVD and Digital rights might realistically come to for a small, low-profile indie documentary and ultimately if it's worth taking such a gamble on upfront fees?
I don't see a red flag. The entire business is completely random and unforeseeable.
I suspect the money offered upfront by any distributor for a small, low-profile indie
documentary is quite low. Perhaps even non existent. Perhaps getting no money
upfront is the way you'll have to go with this niche project. At least it will be seen.

I suspect the reason why you have had little success with other companies is because
they can't gauge the earning potential of your documentary. Which is why I don't
see a red flag when the company in question can't.

Clearly Sweetie and Blade think going with them is a bad idea. And it might be for
all the reasons they have mentioned. But you know that at the very least they have
some connections and your research shows they have had some success and are
legit.
 
Clearly Sweetie and Blade think going with them is a bad idea.

I don't know them. I cannot really tell. All I can go by is what has been said here, which is also unverified. I talked with one sales agent who was considering switching models to people having to pay to submit the film for consideration due to the sheer numbers of submissions he gets. An up front fee is a red flag, but as I (believe I did) said before, it isn't necessarily a deal breaker.

Everyone wants to get paid. The thing about a sales agent, I believe that they should get paid when sales happen, so their goals align with yours. It will mean that they will pass on projects that they believe have little to no chance of success. It's also how I think it should be.

Also, I was talking about projections. Those are estimates. There is no telling what the market will do, and even if the person is accurate.
 
It will mean that they will pass on projects that they believe have little to no chance of success. It's also how I think it should be.

In theory I agree with you, in practice, it's a little more complicated. The initial implication was that we were talking about a feature and theatrical distribution. We're apparently now talking about a doco and looking at international distribution channels, including potentially TV, digital and/or DVD. While it's good that the OP is looking at international sales, as international sales often presents a more realistic chance of returns (for the indie filmmaker), it's more complicated because sales agents tend not to do everything. Most specialise in their own territory/region and then usually have one, several or a network of other agents to whom they sub-contract the international sales and those international agents may further sub-contract. Some agents may have a particular relationship with another territory, which can allow them in effect to bypass some of the layers of sub-contracted agents.

It's possible that this one agent thinks this doco may have some commercial potential because they have a foreign agent/s who've had some success with similar content. Without investing time (and therefore money) it might be impossible for this agent to come up with any realistic projections beyond their opinion that this doco may have enough commercial potential to make it worth their while. In other words, that the doco is maybe better than the average lo/no budget indie doco but is still a margin call as to it's commercial potential. They therefore need to cover their risk by requiring an up-front fee. On the other hand, it may have nothing to do with their risk or the doco's chances of success because they could be looking at the $5k as the sole income and make minimum efforts to actually sell it. The difficulty is that there are relatively few absolutely legitimate or illegitimate agents. By this I mean, agents which have never intentionally (or unintentionally) ripped-off a client or agents which always rip-off all their clients.

A question for the OP; have you made your doco to be internationally distributable for TV? IE. Have you made all the required deliverables? If not, then you've largely eliminated international TV sales and limited yourself to mainly digital and/or DVD distribution, in which case "international" is a relatively moot point.

I agree with both Sweetie and Directorik! :)
Everything described so far could be cause for a big red flag but it could also all be entirely legitimate. Researching them in more detail, talking with them and speaking with some of their previous clients may give a better impression but there's probably no way to be sure.

G
 
A question for the OP; have you made your doco to be internationally distributable for TV? IE. Have you made all the required deliverables? If not, then you've largely eliminated international TV sales and limited yourself to mainly digital and/or DVD distribution, in which case "international" is a relatively moot point.

Although my knowledge of TV deliverables is cursory, I was under the impression that generally all that is required are rights clearances (although I had heard that this might not even be necessary) an HD Quicktime file of the film itself and potentially Errors and Omissions insurance in some cases?

Everything described so far could be cause for a big red flag but it could also all be entirely legitimate. Researching them in more detail, talking with them and speaking with some of their previous clients may give a better impression but there's probably no way to be sure.

I've had some references back, all of which were good, but a few wish they hadn't paid the fees, even with sales.

It appears that the inability to provide projections could be valid so I guess it's just up to me whether I want to take the gamble or not. On the one hand this might be the only chance to get non-DIY distribution (a referee said they had tried to get distribution for a year on their own without avail until signing) and I would hope with that the possibility for greater exposure and maybe financial returns, at least in relation to the time I would have to spend going it alone. Conversely it could also be a huge waste of funds (I am already in debt and would have to try to borrow the money at present).

The quandary is made worse by the company's suggestion that I sign ASAP (they weren't pushy about this, just said that if we wait until after the holidays it will push things forward by months). Additionally, there are still some rights that haven't been cleared yet so I am slightly concerned about the company's haste in me signing, as I've read that distributors might need everything to be cleared before it reaches them?

At this point I am wondering if it might it be worth my while to see which US festival I will premiere at (I have been rejected by some, others pending) and wait to see if any interest accrues as a result of it, or is it best to move forward with the decision quickly to avoid drawing out the gap between the world premiere and a potential sale? I suppose one of the majors benefits of an agent being onboard ASAP would mean that they could get buyers in the room, provided I get accepted into a prominent festival (though as stated I premiered at a non top-5, so it does not bode all that well for the international premiere, unless a top-5 isn't essential)?
 
Although my knowledge of TV deliverables is cursory, I was under the impression that generally all that is required are rights clearances (although I had heard that this might not even be necessary) an HD Quicktime file of the film itself and potentially Errors and Omissions insurance in some cases?

While different broadcasters have different deliverables requirements, there are some basic requirements applicable to virtually all broadcasters and other requirements applicable to most. HDTV is defined in Europe by the EBU (European Broadcast Union) and in North America and some other regions by the ATSC (Advanced Television Systems Committee). If making a film/doco aimed (at least in part) at the HDTV broadcast market, it's obviously a fundamental failure on the part of the Producer not to know what HDTV is and/or not produce a HDTV compliant film! From what you've said, it would appear that you've simply shot a doco using a high resolution video format, rather than made an actual HDTV doco. Regardless of HDTV or SDTV though, broadcasters/distributors will require all rights clearances and an M&E mix is also a standard requirement.

On the one hand this might be the only chance to get non-DIY distribution ...

As I just mentioned, that will largely depend on whether or not you've actually made a "non-DIY distribution" film! If you haven't, then that dramatically reduces to whom an agent can sell and therefore dramatically reduces the potential benefit of paying for one up front. However, it still doesn't necessarily eliminate the potential benefit. Although very low paying, there are countries/regions which have very liberal/lax TV specs (which, with enough licensees, can add up to a modest/reasonable return) and the lines between DIY only and non-DIY distribution are rather blurred as far as some digital distributors are concerned. It's possible an agent could get your film "in the room" with some of these types of buyers, where you on your own might stand much less of a chance.

I suppose one of the majors benefits of an agent being onboard ASAP would mean that they could get buyers in the room, provided I get accepted into a prominent festival (though as stated I premiered at a non top-5, so it does not bode all that well for the international premiere, unless a top-5 isn't essential)?

As you've already premièred your film, that probably excludes you from most/all the most major festivals. "Buyers" tend not to frequent the less major festivals, so having an agent attempt to get them "in the room" at a less prominent fest could be useful. Why don't you ask them if that's what they intend to attempt?

G
 
If making a film/doco aimed (at least in part) at the HDTV broadcast market, it's obviously a fundamental failure on the part of the Producer not to know what HDTV is and/or not produce a HDTV compliant film! From what you've said, it would appear that you've simply shot a doco using a high resolution video format, rather than made an actual HDTV doco. Regardless of HDTV or SDTV though, broadcasters/distributors will require all rights clearances and an M&E mix is also a standard requirement.

I read the BBC broadcast specs during pre-production and it seemed very basic and suprise-free. We shot 4K RED. I can have an M&E mix made up very easily if it is required.

As I just mentioned, that will largely depend on whether or not you've actually made a "non-DIY distribution" film!

Is this related to SD material again?
 
The agent should have discussed deliverables and potential costs. They could vary a lot depending on agent and distribution. Some don't bother with E & O insurance, because their contract is worded so that you will be the only one sued.
 
I read the BBC broadcast specs during pre-production and it seemed very basic and suprise-free. We shot 4K RED. I can have an M&E mix made up very easily if it is required.

I can't really speak to the required broadcast specs on the visual side, as my username obviously implies my knowledge is geared towards the audio specs. If the 4K RED is a BBC/EBU approved camera, you're OK on that particular detail. On the audio side for HDTV they will require: A 5.1 mix, compliant with EBU R128 loudness specs (but with a max peak of -3dBTP for the BBC) and an M&E mix (specifically, a DM&E mix as it's a doco). To meet other broadcasters requirements, a full compliment of 5.1 stems (dipped and un-dipped) should be created as well as an LtRt stereo fold-down of the above mixes. It's not rocket science to produce all the above audio deliverables to BBC (or equivalent) QC standards but neither would I call it "very basic".

Is this related to SD material again?

SD or HD. On the audio deliverables/specs side for SD, all the above but just in stereo (LtRt or LoRo) rather than in 5.1 and with max peals of -9dBFS. Tech specs, physical deliverables and QC concerns aside though, there's the content itself and how the information in your doco is presented to the viewer. The BBC content guidelines are designed to avoid complaints/infringements in regard to equality, language, incitement to hatred/violence, etc. It's a good idea to meet these guidelines even if the BBC is not a target broadcaster, because the BBC has relatively strict guidelines and complying with them will probably mean compliance with most other broadcasters' requirements (domestic and foreign). Excepting of course those countries/territories who may be subject to government (or commercial) censorship of certain subject areas (or presentation style), of which there can be many, including BTW, even the US under certain circumstances!

G
 
A sales company/aggregator suggested that since my film has not had a theatrical release, the best thing is for me to just go through avenues like Vimeo, as I can drive buyers to it and that it would not be very visible on itunes etc due to the lack of a theatrical release and substantial promotion.

I am now confused about going ahead with upfront fees for a sales in order to hope to get distribution, as I am wondering if getting on itunes is even worth it (I understand it costs a fair deal just to go through an aggregator so was factor in that into the deal of paying a sales agent for up front fees) and if anyone even buys DVDs any more? As stated a theatrical release seems unlikely so I was hoping that distribution would result in substantially greater online and DVD sales but now am not sure if that will really be the case and if it is worth the expense.
 
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