Tips for Negotiating Your Producer Agreement
By Alyssa Minnec
If you don’t have a manager or a lawyer on your team, being able to effectively communicate with labels and artists is essential to the growth of your career as you start to get placements. Of course, working with a lawyer to look over your agreements will improve your chances of getting the best deal. However, if that’s not possible, there are a few important points to keep in mind. Let’s break it down, focusing on the advance, royalty, publishing, and credit.
The advance is, of course, the most alluring term. A recoupable advance (the most common type of advance) is paid back to the label or artist using the money generated from royalties. A fee, on the other hand, is a payment that does not need to be recouped or paid back.
There are a few benefits in locking in the highest advance possible. The higher the advance, the more money you receive upon the song’s release. If a song does well, you’ll recoup the advance fairly quickly, and you will continue to receive royalties on the “back-end.” If the song does not do well, you wont recoup your advance, but through the advance, you still received more money than you would’ve just through the royalties.
Here’s a few different strategies to consider while negotiating your advance:
· If a project doesn’t have too big of a budget, you can negotiate for a higher royalty and/or publishing split.
· If there aren’t many royalty points up for grabs, you can negotiate for half of the advance to be a non-recoupable fee.
· If the song is projected to do well, once it hits gold, you receive a bonus from the label/artist.
· If the budget is low, accept it for this project, on the condition that you will work with the artist on their next project for a higher advance.
· If the budget is low, accept it for this project and do a swap: send the artist some beats or have the artist send you something they’re working on now to collaborate on.
If a major label is involved with the project, the artist is generally only receiving around 15–20% of the royalties for the track themselves, depending on the deal they signed. If there is no label and the artist is independent, depending on the number of producers involved, there is going to be a higher royalty percentage up for grabs. Ask yourself: 1) Is there a label backing this project? 2) how many other producers are involved? When thinking about these two points, you can use the knowledge of the amount that you contributed to the project as leverage to negotiate the highest royalty you can. If you contributed the most out of the other producers involved, you should get the largest amount. If you are the only contributor, then it’s direct negotiation with the artist’s team.
All of this being said, make sure you are actually collecting your royalties. Most labels will have an online portal that you need to register for. It’s a tedious process, but straightforward if you follow the directions. Usually, it will require following up with the label a few times and potentially fixing some information on your end. Then, you will be able to have an online database that you can log in to and see where the royalties stand, how close your advance is to being recouped, etc. Unfortunately, it may take a few times following up with the label to create your royalty statement, but that’s a whole other article in itself.
Publishing can get confusing, so for the sake of sticking to the topic of this article, we’ll try to keep it to the most relevant information. Generally, in hip hop, the publishing is typically split equally, 50% to the producers, who compose the “music,” and 50% to the writer of the lyrics (typically, the artist).
If there are multiple producers involved that created different elements of the beat, the artist will generally receive 50%, and the remaining 50% will be split determined on the amount each producer contributed. Overall, if you contributed to the beat, you should definitely be receiving a publishing percentage.
Simply receiving credit for your contribution to a beat, track, or a project seems like a basic concept, but it can be a life changing one. Sometimes, an artist may be independent and not have much to offer for an advance, but can offer credit, royalties and a publishing split. Other times, there might be five plus producers on one track and those numbers are even lower. If anything, always make sure you receive credit. Of course, credit doesn’t pay the bills, but credit is the way to keep gaining more placements, get your name out there, develop that signature sound, and open more doors.
Picture this scenario: a popular artist hears a song that you worked on. They really like the beat- specifically the part that you contributed. The artist has their team reach out to the label to see if they can now work with you on an upcoming project. If your name wasn’t credited, you might miss out on that opportunity. Speaking of labels- if you are contractually credited on a track, but the credit doesn’t appear on digital streaming platforms, always make sure to get the credit updated. This can be achieved by reaching out to the people on the original email or social media thread you were a part of until it gets updated, having a lawyer help you with the project, or contacting the artist or label themselves.
If you’re negotiating your terms for an agreement and have any questions or would like to hire us to handle it for you, reach out to us anytime. We’re always here to help.
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