1. Break the design process down in to stages. E.g, research, ideas generation, development work, production, etc.
2. Don’t charge the same for every stage of the processes. Different stages require different amounts of work, and therefore need to have different prices. Vary your costs.
3. Subcontracting. You have to build into your starting quote any other artists, photographers, etc, you might need to use for their project. You will be paying the photographer, as well as taking a cut for introducing the photographer to the company. Add 10% to what ever the photographer is going to charge you. This is called a ‘finders fee’ or ‘management fee’. It is your job to manage the work done by the photographer, and this has as much value as any other part of the process.
4. Paperwork. Normally, you would not start work until you have an agreement on the price of a job. Check the small print on documents like printers agreement.
5. Copyright. Photographers own the copyright of their work, unless they sign their work over to you. If you want to use an image again, you have to pay the photographer for each use. With stock-photography, you normally pay for a single use, unless there is a multiple use clause in their Ts&Cs.
6. Getting paid! If you are going to do work for someone, get a contract out of them first! Even if it’s a small job for a friend-of-a-friend. Have it in writing that they have agreed to hire you for a certain brief, pricing, etc. Never do all the work without stage payments. Put into the Ts&Cs that you will be billing them for each stage separately so that the client pays for the work done. Prices might need to be adjusted, depending on the amount of work a client wants doing. Do the work, sign the section off, and bill them!
7. if they don’t want to pay: Don’t hand over the art work. Simple.
8. Money up front. Unless you need funds for materials, this isn’t a ‘done’ thing.
9. How are you going to make up a quote? What is your hourly rate? How much do you want to earn? Consider your desired annual salary. If you want an annual salary of 20 grand a year, how many days a week do you want to work? Yo might be working for 20 grand, but you don’t take it all home. After tax and national insurance, you loose about a third of your monthly earnings. How many weeks of holiday would you want? Is that a sensible amount to earn?
10. Freelance? Work out your rent and rates: what does it cost you to rent your flat or office? Heat, light, and power: You can offset a certain % of your utility bills to your business. Telephone: similar to utilities, a certain % can be offset by your hourly rate. Maintenance: What if your window gets smashed? Consumables: e.g. toilet paper, coffee, printer cartridges. Insurance: e.g. professional indemnity insurance for major printing cock-ups, like a spelling mistake on page 1 (if it’s page 53, don’t mention it). Make the client do a final check of a document before sending it to print, then it’s their responsibility for finding mistakes and they have to fit the bill. Accountancy and Legal fees: You will probably need someone to look after your accounts. If you join the Design Business Association, they have a package that has legal and accounting things included. Also, the Federation of Craft and Commerce. Equipment: Do you need a new piece of software or hardware? Advertising: Are you going to have a website or business cards? Contingency: emergency costs.
11. If your expenditure exceeds your income… You are buggered. Negotiate for a more realistic wage in order for you to live.
12. Hourly rate. By budgeting, you can work out how much you need before you are earning a profit. You know what you need to charge in order to live. Think about how long it takes to produce a piece of work and how much work is needed for a project. Aim high. If you’d be happy with £200, say £500 and see what happens. Every client is probably going to try and barter for a lower price, you just have to aim harder at what you want. Always factor your time in!