Crocodile Creek, MerryMakers, Inc., and Manhattan Toy Company design plush toys for children’s book publishers. When do publishers decide to introduce this type of product? What percentage of sales goes to the author and/or illustrator?Often, those makers approach the publisher, not the other way around. If a publisher does approach a toy company about a plush add-on, it's NOT when the book is newly out. It's when the book clearly has a significant fan base. Did you sell 50,000 copies last year? Great, have a doll. The plush market is not strong right now, nor has it been for the last several years, so getting a plush to go with your book is extremely unlikely.
Lots of authors have visions of sugar plums and merch subrights dancing in their heads when their book comes out. Whether it's a doll, or apparel, or whatever. Do yourself a favor and let go of those ideas. I've known a couple authors who spent the couple of years following a book publication doggedly trying to scare up interest in merch rights, and were bitterly disappointed. Because they did not have the huge fan base that would make merchadise manufacturers interested.
In terms of how much of that money the author gets, it says how much in your contract, in the subrights section. Some publishers don't separate merch rights and ancillary rights, but in case your contract does, ancillary is any non-book but still paper-based product. (Like stationery, or cardboard stacking blocks.) Merch is any non-book and non-paper based product. (Like a wading pool or pillow cases or hats or furniture.)
One of my illustrators was found to be in breach of contract over these subrights a few years back. If you take money from a wall-hanging manufacturer for the use of your illustrations-- illustrations for which you previously sold merch rights to your publisher-- I can tell you, our lawyers will be interested.
Read your contract and understand it. Please, people.