Design Domination Podcast Episode #133: Why Graphic Designers Need Contracts

Music: https://www.bensound.com

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In this episode of Design Domination, I’m talking about why designers need contracts.

I can hear you groan already.

But stick around and hear me out. I am going to share some important points, including how using contracts helps you in ways you may not even have thought of. You don’t want to miss that.

When I refer to “contracts,” I am referring to an agreement, a statement of work, a proposal or an estimate—whatever you use to spell out your terms of work, pricing, scope of work and deliverables. Those items should all be included in your contracts.

Why Designers Avoid Using Contracts

A lot of graphic designers shy away from creating contracts and using them with clients because, well:

• You hope for the best and trust that the client won’t do anything to warrant you needing one.
• You haven’t had any issues in the past.
• You may not think of yourself as a business owner.
• You want to focus on work, not legal issues.
• You think contracts are intimidating.

Benefits to Using Contracts

You really have to put your creative self aside and put your business hat on to understand some key points and benefits to using contracts.

Get More Respect

Contracts get you more respect. Contracts say, “I’m a professional. Here is how I work.” They also say, “I’m in charge here.”

You get taken more seriously and won’t be seen as a fly-by-night freelancer who might ghost them in the middle of their project.

You’ve clearly put time and thought into your work and understand how to work with clients.

Weed Out Bad Clients

Another benefit to using contracts is that they weed out bad clients.

They could be clients who might be looking to take advantage of you. Maybe they are hoping you won’t use a contract that will put them legally on the hook to pay you.

They could also be clients who don’t take designers seriously. “Oh, a contract? Oh, I don’t have time to read that,” or “Oh, I didn’t realize this would be so formal.”

They could be clients who feel the need to be in control and tell you how to do your work and nitpick everything you do. “Make this blue, Cinderelly. Make the logo bigger, Cinderelly.”

They could be clients who are bullies who want to try to talk down your pricing or terms or into not using a contract at all, so they don’t have to be responsible for anything.

Using contracts is a good litmus test. Anyone who balks at signing one is probably not someone you want to work with. It’s best to find that out before you work with them.

Set Expectations and Build Trust

You cannot just hope for the best when you do a project for a client. Just because you’ve never had any issues doesn’t mean you shouldn’t use a contract.

It’s only a matter of time before there will be a misunderstanding—and that doesn’t happen only with bad clients. It happens with good clients too. And when it does, it can really make that good relationship go south.

That means you may be resentful toward them and not motivated to do your best work. They may not want to work with you again. They may not refer other clients to you in the future. After all, that’s the other part of doing the work—not just getting paid but getting repeat work from clients and getting referrals.

You can have good clients that you end up in a bad situation with because of a poor or no contract.

Every client has different experiences working with graphic designers. They may have no experience working with a designer.

What may be obvious to you will not be obvious to them. It’s kind of a label I once saw on deodorant: “Warning. Do not apply to the eyes.”

Maybe you do things a bit differently from other designers too, which is totally fine.

When you use a contract, you set expectations. This is so important.

It really sets the stage and says, “Here is what I am going to do for you, how many designs, how many revisions, when I will send the first proof, and here is what I will deliver to you (PDFs, JPEGs, etc.) and when and how much it will cost.”

The more details you provide, the better. It builds trust with the client and it makes you look more professional.

When clients don’t know what to expect, they start asking a lot of questions. They may question your invoice. They may question the deliverables later.

Is it OK for them to ask questions? Yes, of course. But when they ask these types of questions, it’s because you didn’t clarify expectations up front and now they are feeling lost, confused, and maybe even unsure why they hired you in the first place.

You never want that to happen. It puts a bad taste in their mouth, and that is hard to undo.

Clients will remember how they felt working with you, and you want that to be a good feeling.

When you set expectations, you also avoid a lot of misunderstandings and uncomfortable conversations.

I know designers really squirm and sweat over those kinds of conversations. I know that feeling. I’ve experienced it many times.

Set the Rules

Whether you’re a freelancer working on the side or working full time for yourself, you set the rules you want clients to play by. These establish your boundaries too.

You don’t have to include these in every single contract for the same client necessarily. What I do is have all new clients agree to terms that apply to working with me, and then for specific projects, I include the project details but reference the terms they agreed to on such and such date.

Payments

Include details about the first payment they need to make. How much will it be? When is it due? What payment methods do you accept?

What happens if they pay late? Are you going to stop work? Are you going to charge them interest? If so, how much? Your jurisdiction may dictate the timeframe and percentage you can charge, by the way.

All of these things should be specified in your contracts.

Hours

You can even include your hours and when they can expect to hear from you. You don’t want clients calling outside of your work hours and expecting an immediate reply.

You’re allowed to set your own work hours. Plus, they may get upset when you don’t reply right away.

Ways to Contact

You can include how to contact you with questions. If you only want them to email you, then provide that. If you don’t want them to text you, let them know that.

I would go crazy if I had clients texting me. I don’t even turn my cell phone on.

Feedback

Specify how you want to get feedback on proofs, like if you want them to mark up a PDF. If you don’t do this, I can almost guarantee you will get an email with a list of edits or a new Word document with no changes tracked.

I also include how I want them to provide copy and that it should have been proofread first.

Invite Questions

A lot of times when you send a contract to a client, they will start asking questions about the project or your terms. These may be things you haven’t addressed or they may be things you have addressed in your contract that they forgot to bring up.

Getting questions before you start working together is a good thing. You want to clear things up, especially if there are any deal breakers for either party or if there is something you might charge more for that they hadn’t mentioned, such as if they do want the native files.

What’s not OK is if a client asks you to justify your rate or your terms of work. Never feel that you have to explain them. A simple “That’s just my rate” or “This is my policy” should suffice.

No one goes around to doctors, accountants or landscapers and asks them to explain how they came up with their rate.

They may ask you to make exceptions to your contracts. That is up to you to decide what to negotiate on. I will not work with a new client without a signed contract and without 50% up front. I may negotiate the percentage a bit if it’s a large project.

Increase Profitability

Using a contract can actually increase your profitability, and I mean this in a few ways actually.

First, there may be costs associated with the project, such as stock images, printing, plugins, hosting, etc. Who will be responsible for the cost of them? Are you including any as part of the project?

You don’t want to provide an estimate only to have the client assume that these costs were included. What they thought they were paying for is now completely skewed.

So when you state what you are or are not including you ensure they understand which costs they will be accountable for.

The other aspect to profitability is that many graphic designers are people pleasers and hate confrontation.

I can attest that I used to be this way myself.

If that’s you, you may find it hard to speak up and tell the client when they’ve exceeded their allotted number of designs or revisions or, worse to charge them when they do.

You don’t want to be the “bad guy” and have to break the news to the client.

The contract becomes the mouthpiece that speaks for the non-confrontational designer.

So you’re no longer the “bad guy.” The contract is, right? Well, really it’s the good guy, because it can stand up for you when you won’t stand up for yourself.

What’s in the contract is nothing new and shocking, because the client’s already read it and agreed to the price, the cost for any additional revisions or the cost for native files.

It makes it easier to say “This is going to cost more” or “This wasn’t included in our original agreement.” You just have to refer them back to it.

Create Accountability

Contracts create accountability for you and the client.

You’re spelling out what you will do and by when. You can spell out what they need to do—not just in terms of payments but for the project itself.

For example, if they are providing images, you want them to understand they cannot just send you images they find in a Google images search. You don’t want to be liable if they infringe on someone else’s copyright.

You also want them to provide them in the proper formats and resolution.

If they are going to be sending you a copy, if they are late with it, is that going to then extend the deadline, or will it be on you to pick up their slack and still get the project done on time.

When there is an important deadline that aligns with the launch of a brand or the occurrence of an event, for example, it can cost the client money if they miss that deadline.

These are things that you can address in your contracts.

Avoid Scope Creep

Contracts can help you avoid scope creep.

You know when the client just keeps making endless revisions, and you wonder when you will get out of this hell?

You can include how many rounds of revisions or time for revisions are included. But also state how much additional ones are.

If the project gets to a point where the revisions go beyond that point, it will be so easy to say, “I’m happy to make these edits. I just wanted to let you know that these will be additional, as they weren’t included in the original agreement (or estimate).”

You’re blaming that “pesky contract,” but you’re even doing them a courtesy by letting them know, because they may have forgotten to check the contract.

Avoiding scope creep will help keep the project on time and avoid sticker shock when you send the client the final invoice.

Protect Yourself and Your Creative IP

Protect yourself in terms of payment

Does it guarantee you will be paid? No, not if you don’t require payment before starting work and before providing final files.

Contracts also protect your creative intellectual property, which is vital for graphic designers.

So many designers don’t understand this. It can be a confusing topic. But let me tell you…

You are not obligated to hand over source files (native files), unless it’s a work-for-hire situation, like you’re doing work for another designer, or a logo design, which they should get native files for. You can find out more about this in my chat with lawyer Matt Johnston.

Otherwise, you can charge for native files.

You are not obligated to allow clients to use your work as they see fit wherever they want. You get to spell out the rights about your work and how they can do that. Again, that’s if it’s not a work for hire.

You can negotiate some terms in situations where it makes sense to do so. Do what helps the client but charge accordingly if you are giving more away.

It’s Your Business

When you think about creating your terms for your contracts, I recommend having a lawyer review your contractual terms.

But also think about your past experiences working with clients—from the beginning of the process and through to the end of it.

I say this because I’ve added to my contracts additional terms with every bad client or bad situation that came up to prevent those situations from happening again, such as “revisions should be of decreasing complexity at each draft,” as a result of a client rewriting brochure text on round 3. No thanks.

Also know that it doesn’t matter what every other designer is doing or charging. If other designers would be happy to take on clients who treat them badly or happy to do all revisions free of charge or happy to give away their source files, it doesn’t mean you should too.

It is your business, and if you don’t like someone, you don’t have to take them on as a client. If you don’t want to work with them again, you don’t have to. If you don’t want to give away source files free of charge, you don’t have to.

Do what works for you and your business, and don’t apologize for it.

If you want to start off on the right foot with clients before you even get to the contract stage, be sure to download my free guide, 17 Questions You Must Ask During a Design Consultation.

This will help you get more respect, get taken more seriously, scope the project and even charge more.