MakingLures

I had another thought. If you do go with a percentage of sales, be careful. As an example: You are a kind friend and offer him 10% of gross sales thinking this is only fair. Then say you sell this lure for 1.00 . Now you pay him 10 cents as his design fee, thinking he is only getting 10%. Now on the surface this is true. BUT when you figure your costs of production into the equasion you will be shocked at what percentage he is really getting. So say your lure sold for 1.00, minus the following costs (10 cents for his design fees comission,9 cents excise tax, 10 cents overhead costs such as utilities & insurance & advertising & printer toner/paper/software/postage stamps etc, 20 cents for the raw materials of the product, and 20 cents labor paid to your employee or you. Your net profit on each lure is 31 cents. His net profit is 10 cents and he did nothing to help manufacture it, nor incure any risks of production, carring costs of the components,tooling costs ,and/or promotion and advertising. So at a minimum he is getting 25% of the profit (your .31 plus his .10 = .41 profit between the 2 of you makes his .10 cents a 25% cut of the actual PROFIT of the lure. I always figure whether or not to proceed with a project only after I have figured out my end profit. If the net profit margins are too small I won't proceed with a new product or idea. Hope this helps you a little. You may already know all this stuff! Just my humble opinion.

I think offering a percentage would be a HUGE headache down the road. Just some of the potential risks I would worry about: 1. What if after the deal I discovered I was paying too large a percentage because of unforseen costs to me? What if I sold gobs of the baits and he wants more money? Lawyers must be 200-500 bucks an hour. 2. Is he going to believe me when I tell him how many I sold? Or will he want to see my books and the names of my customers? Do I really want to be exposed that kind of risk? (He might see my customers and figure on starting his own lure company) 3.What if he dies? I don't know what kind of person might inherite his design rights. They may be evil? They may make unrealistic demands on me to prove sales figures. 4. What if my business relation with him sours? I would rather pay a little more up front and know my fixed cost. If he wanted too much money just pass on the whole deal. Just my humble opionion.

One other thing you may want to check into is import duties. It has been awhile since I checked into importing a large amount of items from china, but if I remember correctly you needed an import agent to do the paperwork when the container arrives. There are also tarrifs or duties on all kinds of fishing items. Each item has its own tarriff code number and tarrif taxes.

Go to www.walleyesupply.com they sell unpainted ice jigs in bulk. Quite a few different styles.