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2 In Legal/ Startup Life

Contracts… So Necessary

Why contracts are very important for your service based business

This segment of your relationship with your graphic designer is brought to you by the school of hard knocks and painful lessons learned. When I started my venture into designing for business owners I was naive and excited. Believing that people would honor their word if I honored mine, I did not have contracts, down payments, kill fees etc. Everything was working well with the first several clients but then I learned why you have to have a contract. One month in particular, I had three wonderful clients lined up that I had completed several hours of work for.

At the end of my process, they decided for various reasons that they did not want to continue with our business relationship. As a result, I was out multiple hours of my time and had no contract to fall back on in order to receive any compensation for that time. This is not meant to be a sob story, but more of a lesson to help you learn what not to do. Needless to say, I started doing contracts immediately after this experience.

When you are beginning to work with a designer — here are the key components of an e-sign contract:

1) Creative brief – The details of what you are looking for from a design point of view, what inspires you, and what you see your brand as. Colors, font preferences, down to the specifics of the things being designed.

2) Down payment – It is customary for a down payment to be required for design work to begin.

3) Total payment amount – Designers have different ways of charging. Some by the hour and some by the job. This should be specific and clear in the contract so you have no surprises.

4) Project deadlines – These are there for you and for your designer to make sure that you have a realistic time frame for the completion of your design work.

5) Copyright information – This will explain who owns the rights to the artwork originals.

6) Kill fee – A design contract is unique in that a service is being provided and that service 99% of the time results in a product that you, as the customer love. However, there is such a thing as client/designer chemistry — the better the chemistry between the two parties, the better the product. In some instances, there are circumstances where your creative vision and your designers creative vision just do not connect, and a kill fee will help protect you both if this moment arises. The kill fee could be the down payment amount or another amount specified in the contract. It seems counter-intuitive to pay for something when you don’t actually walk away with a product, but your designer may have invested several hours into your project and their time is valuable.

Here’s to many beautiful designer/client relationships!!! Goodbye for now.

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