Are Reprint Rights A Good Idea For Your Online Business?
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Are reprint rights a good idea for your business?
The answer is, "Yes" and "No."
I wish there was a simple answer to this question, but there really isn't. Buying the reprint rights to a hot selling product could be the deal of a lifetime.
You could end up with a product that already has a hot market ready to buy without having to do any of the research, creation, or ad writing. It could be the perfect opportunity. Or it might not be.
This same 'perfect opportunity' might be sold by thousands of businesses already...It could be outdated...and it may never have sold well in the first place!
So, reprint rights may be right or wrong for your business depending on a number of factors.
I have experienced both the successful aspects of reprint rights, and have been able to avoid most of the pitfalls...but not all.
I have created many of my own products such as the "Instant Internet Cashflow System" series of ebooks and our newest video course "Internet Publishing."
Even though I have created my own products, we have still used reprint rights licenses in many ways to either expand or generate new profits.
I purchased reprint rights to several products when I first wanted to market online. The early success I experienced through selling these products led to the business I am in today.
Doing a quick run-down of the office shows that we currently have reprint licenses on 23 different products. One of these products has 19 videos and 2 manuals in it. Another one has 24 audio tapes, 2 videos, and a manual.
Other products consist of electronic books only. There are advantages and disadvantages to each format. The primary advantage of an electronic manual is that it is easy to setup and sell and requires no fulfillment or shipping costs which can be major hassles.
The primary disadvantage of electronic books which no expert seems to like to discuss is that most people don't like to read on their computer. They prefer to read a hard copy book, listen to an audio tape, or watch a video. Plus, it is much harder to show the uniqueness of an electronic book.
Both types of products (electronic and hard copy) have the unique advantages and disadvantages. I have been successful buying reprint rights on both!
So, I am speaking from a position of authority. Reprint Rights have been a part of my business from day one.
What Are Reprint Rights?
First, let's cover the different types of rights that are available out there on different products.
1. Affiliate Programs - Affiliate programs could be considered a form of rights, although a very basic one. Most of my readers understand exactly what an affiliate program is so I won't go into here. The advantage of affiliate programs is that they have little or no cost to get involved in.
The two major disadvantages are that you receive the smallest piece of the action from an affiliate program (10% to 50%) and that you will have thousands upon thousands of competitors. Always remember this, the cheaper and easier it is to start a business, the more competition you will have. Affiliate programs usually have no cost and no time involvement to sign up, so you can expect to have the most competition through them.
The advantage here is that the affiliate owner actually takes care of all the fulfillment, order processing, and everything else. So it is a great way to get started promoting products or to expand your product line. As I said above though, this could end up being a double edged sword. It is easy for you to sign up. It is also easy for ten thousand others to sign up.
2. Resale Rights - A resale rights are a little more involved. Usually when resale rights are involved, you pay an up-front fee and then you are given the right to buy the product at a discount. In some cases you buy the product wholesale and sell it retail.
In most cases though, you take retail orders for a product and then send the product owner a certain percentage to fulfill the order for you. This is often called dropshipping.
For example, you may want to sell a video set we have and offer to pay a resale fee of $500.00. Then, you take orders for it for the full $297.00 retail price. Every time an order comes in, you process the card and send us $125.00. We then duplicate, process, and ship out the order. You would never have to touch the product. That is dropshipping.
You make much more money this way than an affiliate program usually, but you do a little more work. You take the orders and process them yourself. Then, product fulfillment is handled by the owning company.
3. Reprint Rights - This takes the product selling to another level. With reprint rights, you actually take over the whole process yourself and don't have to pay anyone else. All of the money is yours to keep. When an order comes in for $297.00, you process, duplicate, and ship the order yourself. Then, you keep all of the money that is left over.
If it was an electronic manual you owned the rights to, then you would take the order and have digital delivery. All of the moneyleftover after processing fees would be yours to keep.
So the advantage to reprint rights is that you get to keep all the money. The disadvantage is that reprint rights usually have a premium price on them. For most products, you will pay 10 to 25 times the actual retail price of the product for reprint rights. Digital products usually are on the high end of the scale at 20 to 25 times the price, while audios and videos usually are closer to the 10 times value level.
So, a $29.95 ebook will usually cost $600 to $700 for rights while a $29.95 video will usually cost $300 to $400. The reason for the higher prices on the ebooks in most cases comes from the inherent dangers of reprint rights to the creator of the information.
As a product developer, it is much more dangerous to sell reprint rights to an ebook than to a video. Since a video is a hard product, there are costs associated to selling it (low costs of around $3.50 per video plus shipping). Since an ebook has no cost in delivery, a customer could buy reprint rights to it and give it away for free or almost nothing.
For example: Just recently I looked at the online detective ebook (which is actually more of resale rights not reprint rights) and saw a price of $4.95, $9.95, $19.95, and $29.95 after looking at several different sites. All of them were offering the same product, but at vastly different prices.
Someone could buy reprint rights to your $97.00 ebook and sell it for $9.95 from their site...destroying your business in the process (if you rely on only one product). If it is a hard product such as an audio set or video set, they will be much more unlikely to do this type of thing since there are costs involved in distribution.
For the reprint rights buyer, owning a successful product can be an awesome start to your business or an expansion to your business if you can afford the extra investment required.
4. Master Rights - This is the ultimate type of rights to purchase for your product. When you buy master rights, you also receive the ability to sell reprint rights to other businesses.
This added benefit comes at a premium price. You will usually have to pay 3 to 5 times as much for the master rights as you do for reprint rights.
For example: Let's take a $297 video set for an example. Resale rights may be $500 (which gives you the ability to have it dropshipped for $125). Reprint Rights may be $2995 so that you could sell the product itself and keep all of the money. Master Rights would probably cost $8,000 to $15,000 so you could sell reprint rights at $2,995 each in addition to selling it at retail.
Now, I hope that the above numbers didn't get you confused. They are just meant to be an example. All deals will be different based on the product and the creator's goals with it.
In most cases, you really shouldn't even be thinking of paying the premium price for master rights unless you know you have reprint rights buyers already lined up...or it will take quite a bit of cash flow from you for a while.
When Should You Buy Reprint Rights?
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