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Retail markup and the 5%

If I sell a game through a store and the retailer marks up the price, and it happens that they make $3,001.00 on my product but I only get $3,000.00, do I still owe royalties for $3,001.00 even though I only made $3,000.00 personally? And does this count weather or not the retailer jacks up the price or if its because the price difference is the fee for the marketplace.

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asked Feb 10 '17 at 12:16 AM in Legal & Licensing

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Salamanderrake
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Royalties are based on the amount that the end user pays for your game, not the amount that you receive. So in your example, the royalties that you owe would be due on the $3,001 amount that the game is sold for, not the $3,000 amount that you receive.

Do remember that you do not pay royalties on the first $3,000 per quarter for each Product. Using your example again, if the gross revenues on your Product are $3,001 in a calendar quarter, you would pay a royalty of ($3,001 - $3,000)*5% = $0.05 for that quarter.

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answered Feb 10 '17 at 02:34 AM

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DudleyStephens ♦♦ STAFF
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avatar image Salamanderrake Feb 10 '17 at 03:00 AM

Thank you for better explaining it to me.

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