Average commission rates charged by literary agents

After all these posts, I realised the most frequently asked questions relating to literary agent commissions in the minds of new authors haven’t been directly tackled yet. What’s the average commission rate for literary agents? What is this commission applicable on? How do literary agents get their share (i.e. how do they get paid)? Does the commission percentage remain the same for everything that the author sells? Do these rates justify full-time literary agent jobs?

Well, I’m not too sure if we should get into that last question. But let’s try to get some answers for the others.

What are the average literary agent commission rates?

Typically your agent will charge around 15%. The slightly wider range for commissions is between 10%-20%. That’s the generally accepted commission percentage in the bigger, developed markets (read USA). If you consider India, I’d assume these general average commission rates should apply.

However, as the literary agency market isn’t as well-developed as in the U.S., it’s pretty much upon you negotiation skills and desperation levels (with the latter playing a bigger role).

What is this agent commission applicable on?

The simplest form of commission is that your literary agent gets a percentage of your book royalty based on the number of copies sold. If there’s potential to take the book and re-mix / re-package the content in various other formats (audio, video, magazine articles), then expect to shell out more commissions to your literary agents.

Even if you have no plans in the immediate future to explore these derivative works, it would still be a good idea to include the relevant clauses in the contract. If you are unsure of how things work in that new area, you could keep a ‘generic placeholder’ in there mentioning that anything that’s not been specifically agreed in the current contract will be considered as and when needed, and included as an addendum to the basic contract.

How do literary agents get paid?

If you are working with a literary agency that has sold your book, you should have 2 contracts in place – One with your literary agency and other with your publishing company.

The first one mentions the agency commission rate. The second one created by the publisher includes the overall royalty rate (i.e. the money that the publisher owes for every book sold) and how the royalty payout will be split between the author and the literary agent. In this arrangement, the publisher pays you and your agent directly.

There may be other arrangements as well based on what you prefer and how you negotiate the deal. For instance, your agency might collect the entire royalty from the publisher, keep their share and pass on the rest to you.

Is the commission percentage fixed or variable?

Generally it might be fixed, however in certain cases, the literary agency might ask for a higher commission. One example is when you want to get your book sold to an overseas publisher. Many agents have contacts with editors in the local publishing houses.

When it comes to selling your book abroad, they may have to work together with their business partners (i.e. other literary agencies) based in the target country. This means there’s now one additional team to split the royalty share. So if the literary agent commission percentage for domestic sales is 15%, the overseas sales rate might be 20%.

Do these rates justify full-time literary agent jobs?

I thought we weren’t going to tackle this, right? Curious, arent’ we!

Alright, let’s try to take a stab at this too. A literary agent has a tough job, though authors may feel otherwise. And the royalty rate of 15% for a new author who may not sell more than 1000-2000 copies means that the total income (i.e. salary) for the literary agent can be peanuts. Unless one of their new author churns out a best-seller.

But that’s not a common occurance. So rather than depend on a handful authors, literary agents spread the net wider. Unless your book is taken off the shelves, you are paying your agent for life. Over time, the little streams of commission income from each author can grow.

So yeah, if you’ve sown the right seeds in the formative years, you could make a tidy pile if you have the patience.