I’ve read that literary fiction writers should consider submitting book-length manuscripts to contests and independent presses at the same time they are querying agents. This feels unorthodox to me, but given the tight market for literary fiction, maybe it’s warranted. What is your feeling on this?
I think that’s probably a wise and realistic approach for short story collections. The fact is, if you’re publishing stories in venues high profile enough to suggest that a collection might be a viable commercial prospect for a major publisher, you’re probably going to be hearing from agents already.
For novels, however, I’d save submissions to contests and independent presses for a second or third round. I don’t think you need to wait until you’ve queried every agent in the world, but make sure you’ve given yourself a chance with a few dozen or so people who seem like they’d be a good fit. You can then continue to submit to other agents while submitting to contests and independent presses.