The Ins and Outs of Educational Distribution Part 2: How Are Distribution Fees and Expenses Handled?

POSTED ON May 28, 2018 / IN Documentary Toolkit


Steven C. Beer, Jake Levy and Neil J. Rosini

This Q&A was originally published in the Spring 2018 issue of Documentary magazine, a publication of the International Documentary Association, a nonprofit media arts organization based in Los Angeles.

The educational market is decentralized and relationship-oriented. The money and time invested for each sale can be considerable, since sales companies must attend annual academic conferences, markets and festivals to meet with buyers and pitch them on new titles. When they are not traveling, sales agents spend hours contacting buyers and sending emails to follow up with customized arrangements. Given the labor-intensive effort required for each transaction, most sales companies charge a substantial commission—often in the range of 50 to 70 percent of gross receipts (all monies actually received by the agent from the distribution license, sale or other exploitation of the documentary). Many, but not all, educational distributors will also charge producers for actual, out-of-pocket expenses such as DVD replication, digital encoding, and the creation of marketing, advertising and discussion guide materials. These costs are usually recouped “off the top” by the distributor prior to any distribution of payments to the producer.

To best manage these costs, producers are encouraged to negotiate the right to pre-approve each material expense in writing before it is incurred by the sales agent or distributor. In lieu of a right to pre-approve each item, which some distributors regard as burdensome, distributors will occasionally agree to a negotiated cap on expenses.

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