Some of you may know me, others may not. I have over 10 years experience working on user interface, skins and theme designs professionally. I've negotiated and contracted over 60 projects with Microsoft, 10+ with The Walt Disney Company, Intel, ATI, NVIDIA, Target, AT&T, Motorola... the list goes on and on. I was even approached by Microsoft Press a few years back to author a book on skinning. So i have a lot of experience.
I don't mind sharing some of the information I've learned with young artists. You should know what you're getting into, how to protect yourself and how to price out a project. These are methods that work well for me. These are merely some things I've learned as I went. Before you read my advice, you assume all responsibility and risk for the use of any information in this forum post. I accept no liability or responsibility to any person as a consequence of any reliance upon the information contained here in this post. With that said, let's get started..
Protecting Yourself
Do NOT start a project without first signing an agreement. Most commerical art projects these days tend to be "work for hire" agreements. You can read more about work for hire here: http://en.wikipedia.org/wiki/Work_for_hire
Working without a contract is like working without a net. You can find development agreement templates on the web. You can also invest in having an attorney create a template for you. If you're serious about getting into commercial art, then its a business expense that is worth investing in. So hire an attorney or find a good, solid template. Once you have a solid contractual template you can use it for all your projects in the future.
Good business is also about having good instincts and the ability to read people. If your gut tells you something is wrong with the potential project or if you feel uneasy about the person who is coming to you to hire you, you may serve yourself best by walking away from the project. If you get that "red flag" feeling where something is not quite right, trust your instincts. I've turned down projects when i didn't like the person who was approaching us. I've also turned down projects when i didn't trust the person. It happens. Trust your instincts.
Display rights - Make sure you get some sort of display rights when the project goes live to the public. Your portfolio is the key to your success as an artist. Fight for the right to show you work in your own portfolio. It's tricky with us because we hire artists and we're an art studio. So our artists have the potential to be our future competitors. Funny how things work out. However, we still give the rights to display their work for us but we maintain control over how its shown. You won't get that issue when non-art companies come to you as much.
Non-competes - Never sign a non-compete. If i had a dollar for every time some media company wanted me to sign a non-compete i could retire. Unless its a million dollar job, forget it. While the company wanting to hire you may seem like a great thing, another company 2 months down the road can approach you with a project that pays double. Don't limit yourself. Most companies won't ask for it but if they do, most will back down if you stand up to them.
Pricing Out a Project
So someone contacts you for a job, but you don't know what to charge. It's one of the most confusing things to do when you first start out. Here's how i do it. We have an hourly rate, but we don't bill hourly. We look at the potential client's project scope and estimate how long we think the project will take from conception to creation. Factor in time for multiple marker comps and client changes. Then we multiply our hourly rate by the time estimate to come out with a flat rate. You just have to decide what your hourly rate is. What's your time worth to you? Will the company who will be using your artwork benefit financially from your work? These are all things to consider when pricing out a project.
The only time we charge extra after we signed contracts is if there is "scope creep" (meaning the client adds more work to the project after you all ready signed the agreement) or if the client signs off on something and then backtracks. With "scope creep" we make the client sign an extension agreement which is governed by the rules of the initial agreement but adds in the new work the client is requestiong and what your cost is for the new work.
Once in awhile you'll get the client who doesn't know what they want. You'll spend 2 weeks on something, they say they love it and you spend 2 weeks more finishing it up and all of a sudden they want to change things. Get the client to sign off on milestones. This way if they sign off on something and then if try to go back and change it where it will cost you more of your time, you get paid for that new time spent redoing what they all ready said they liked. Keep in mind, if that's not stated in your agreement then you're out of luck. This is why contracts protect you.
Using Exhibits to your advantage - At the end of the contract you'll see something called an Exhibit. Exhibit A. Exhibit B. Whatever. If the client sends us 12 wireframes for a design we'll be creating graphics for, i paste every single wireframe into the contract. Why? Because if a 13th wireframe "magically" appears after we've started, they're getting hit with more charges. That's scope creep.
Also be willing to negotiate your price. Nothing should be written in stone. One other thing, be wary of trading good prices now for "future" projects. I can't tell you how many companies try to pull that. And if they want to trade advertising on their site for a lower payment, see what kind of traffic they get from a site like Alexa. If they are ranked 5,000,000 then think twice.
Payments
We charged a non-refundable retainer of 50% before we start the project. I will not have our artists start something without it. I don't care who it is. Projects have been known to be dropped in the middle by upper management. So at least you'll have half the money to fall back on. Another policy we use is to not turn the source files over to the client without getting the rest of the 50%. We will give them half the work as we go since they did pay for it, but not the other half. Once you give up your source files and work, you lose all control. Never give up your control. You'll also find you'll get paid faster this way.
So I'll probably add to this or edit it as i think of new things. I have a ton of work to do and it's not getting done as i type this. I hope this helps some of you and if you have any questions feel free to ask them.
You've heard this before, but business is war. You need to be tough to make it in business. Don't be afraid to stand up for yourself when negotiating. If something bothers you then say so. And always be willing to walk away from a deal.
Jeff
CEO, The Skins Factory, Inc.