Contracts

I’m always surprised to hear of designers that do not sign a contract with their clients at the beginning of a job, or are working on a project without having a contract in place. I think that it sends the wrong message out there to clients about one’s professionalism and if you don’t set your rules upfront, you’re setting yourself up for problems.

Bringing up the contract is the perfect time to put in place what your expectations of the client are and what they can expect from you in return, which prevents you from having problems further down the road.

In my office we charge a retainer, which is returned at the end of a job after all the bills have been paid – this retainer is usually around 10% of the total expected budget. We stipulate what our commissions are, how we do our billing, the progress and process that the job takes from beginning to end. If you don’t lay all this down in a clear concise way, you do not have a leg to stand on if there are any problems. Especially if it’s taken to mediation or to court.

You need to be professional to be treated as a professional, and that has nothing to do with the size of your budget, the personality of your client or the size of your firm. It has to do with how seriously you take yourself and what you do in your career.

Sean Low is my business adviser and he recently launched a blog called The Business of Being Creative where he offers advice to owners of small businesses that operate in the creative sphere. Go ahead, read his posts and follow him on Twitter – I think that it’s advantageous for us all to get some sound business advice from time to time!

And if you are working without contracts – my recommendation to you is to change that. Fast.

This entry was posted on July 9, 2009, 9:04 am and is filed under Random. You can follow any responses to this entry through RSS 2.0. You can leave a response, or trackback from your own site.

#1 by Faih Sheridan on July 9, 2009 - 10:28 am

Thanks for addressing the contract issue. I like the topics you are writing about, starting with Frustration.
I will definitely follow Sean and sign up for his blog too.

Best, Faith

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#2 by The Antiques Diva on July 9, 2009 - 10:59 am

I just wanted to write a quick note to THANK YOU for addressing these topics. As an “up & comer” reading how my “idols of design” conduct business really helps me as I get started! While reading comments on your Frustrations post recently I actually got out a pen & paper and started hand writing notes. Now, I’m off to go Follow Sean Low!
Thanks,
Toma Haines

#3 by The Designer Insider on July 9, 2009 - 11:12 am

This is so true. I learned a few lessons the hard way! Thanks for always inspiring me and keeping me and my business on the right track!

#4 by judith on July 9, 2009 - 11:36 am

I try and keep my contract to a simple one page overview of how we bill and what I’ve agreed to accomplish for the project. Over recent years that single page tends to have expanded a bit .. . primarily as issues have arisen and the need to be more specific also expands. I’ll look forward to seeing Seans’ suggestions – thanks for the link!
Judith

#5 by Linda Merrill on July 9, 2009 - 12:15 pm

Excellent points! I used to do a contract, then got away from it as more and more clients were people I knew or friends of friends. But, I do need to get back to doing it for everyone.

#6 by Ivy Lane on July 9, 2009 - 8:34 pm

I am surprised and AMAZED that designers would not use contracts…being a Realtor, the contract is the end all! It spells EVERYTHING out in the process/transaction… I deal with mostly referrals and repeat business.. If I was a designer working referrals, friends family..I would insist on a contract (tactfully of course)..as if something were to go awry, you can always go back to the terms of the contract to save yourself from losing a friend…and eating into your commissions etc…

#7 by Peggy Hall on July 9, 2009 - 8:42 pm

What kinds of things does one include in their contract? I’m just getting back into graphic design, and I used to require payment up front – what’s everyone else’s policy on that? I also ended up including a “There’s two revision stages included in the quote price of the job” to keep from nit picking at things forever and ever.

#8 by petra voegtle on July 11, 2009 - 12:59 pm

As an artist I could not agree more. I am glad that someone like you with so much experience is bringing this up. Greetings from Munich, Petra

#9 by Brillante on July 12, 2009 - 7:56 pm

Thanks for the information about the new blog. I believe we should all be as professional as possible and follow some common procedures, a contract being a must. I am still struggling to have the perfect one (if it does exist), any suggestions?

#10 by Brillante on July 13, 2009 - 9:01 pm

Forgot to mention Veranda with your stunning collection of photography displayed in such a unique way, not to mention everything else in your place! You have reached absolute perfection as a designer and as a photographer.

#11 by Iván Meade on July 14, 2009 - 1:36 am

Best advice ever!

Not just for getting paid an alienate future problems but also to protect your original designs.

I just had an intellectual property infringement – Because I had a contract with the client and in the contract said that I owned the copyrights of all my work I was able to work things out.

I am now going to check his blog

#12 by Amanda Reid on July 14, 2009 - 6:02 pm

Thanks for this post! Great advice, especially for a designer who has recently established their own business (like myself). I will definitely check out his blog and keep reading yours : )

#13 by Sonya on July 14, 2009 - 6:23 pm

I like to use ASID contract documents, you don’t have to be a member to purchase them. (they have order forms on line) There are several different forms, depending upon your needs, types of projects etc.

#14 by Lauren Liess on July 23, 2009 - 8:40 am

Great points- I need this reminder as I sometimes get lax… I am newer and it always seems such an awkward part of the process for me but it really shouldn’t be. Thanks!!

Just found your blog & am loving it!!
Best,
Lauren @ Pure Style Home

#15 by Hoechstetter Interiors on July 24, 2009 - 6:42 am

I am a big fan of contracts, and the more specific the better. Yes, clients may be less intimidated by short letters of agreement, but there’s no way to fully spell out all of both parties’ rights and responsibilities in enough detail to really be useful in one or two pages.

#16 by AbbeyK on August 26, 2009 - 9:46 pm

It is a business we are in. We are professionals so a letter of agreement or a contract are the first step!

I use a letter of agreement. It’s based on one I found in a book for interior designers. (I forget the book– contracts for interior designers?)

I had a lawyer review it when I first created this document and as I have gone along, paragraphs get added and revised. We all have to protect our financial interests as well as laying out the terms, financially and set expectations.

PS My sister who is a litigator just last weekend asked me if I have language that protects me from paying their legal fees should a law suit arise (god forbid! knock on wood!!!). Anyone have language like that in their contract?

I am going to check out the blog– thanks!