Wednesday, June 30, 2010

Creating a Logo 2: The Contract

I have found that many clients do not understand the limitations of what they are buying or haven't thought about all the copyright issues involved. It would be nice if everything could be done with a handshake but, unfortunately, misunderstandings happen in the course of doing business so it is good to have one's agreement written down. Although I do sometimes proceed without a contract, most of the time it is best to have one.

Below is a copy of one of my licensing contracts. (Licensing means I sell to a manufacturer the right to use my design on their product for a limited or unlimited time on a particular named product. They do not get to own the design. They are buying the use of it.) This is only slightly different from a contract for commissioned work like a logo.

Besides identifying the parties involved and the art product to be delivered, the important elements to be included in a contract are:
  • Who can use the image, where, and for how long? For example: this logo can be used only by the company for which it was created, except for marketing and advertising. If the company is sold, the use of the logo may be transferred to the new owners. Logo cannot be sold to a third party, with the above exception.... Usually, for a logo, I grant unlimited use of the image for an unlimited time period.
  • The image cannot be altered in any way except for sizing. If there are exceptions to this, then they must be described. Usually I allow for size changes but not color, proportions, or partitioning. (This is an important issue. One time I created a beautiful logo for a company in which the company name was part of the design. Two years later they decided to change their name and, instead of asking me to alter the logo, they simply altered it themselves in a very non-professional way, which changed for the worse the whole look of my logo. I don't want my name to be connected with something sub-standard like that so reminding them of the contract was necessary. )
  • A payment schedule. What is standard for me is payment in thirds (1. one third, non-refundable - to begin the project and do research. 2. One third upon completion and approval of sketches, and 3. The final third upon completion of the work.) I am somewhat flexible with payments. I've accepted monthly payments from some clients. In every case, however, a unique (non-licensed) product is never delivered until all payments are made.
A good source for information on licensing, contracts, agreements, etc. is a publication of the Graphic Artist Guild called Pricing and Ethical Guidelines.

Once an agreement is reached, and the initial payment to begin work is made, then I start to research my subject. (Next post.)

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