“Anyone who doesn’t take truth seriously in small matters cannot be trusted in large ones, either.” Albert Einstein.
Licensing your artwork or photographs is a great way to earn money. In this article I’ll address two common issues with regards to licensing, based on an e-mail from Dennis Panzik, a successful artist that is finding more and more opportunities for licensing his art:
1.) What’s the best way to get a contract signed by a client who is out of state? Will a faxed signature on a contract hold up in court?
I’ll answer this question two ways: First: The legal answer. (Disclaimer: I am not an attorney. But I have paid a lot of money to attorneys!)
Second: My philosophical thoughts on why you shouldn’t worry about having to sue a client.
When I asked my attorney this question a few years ago, she said that if the contract states that faxed signatures are accepted, than the faxed copy will hold up in court. Also, make sure that every page of the contract is either signed or initialed if it has multiple pages.
HERE’S WHY I NEVER WORRY ABOUT HAVING TO SUE A CLIENT:
Before Drew Brophy starts the work for any project, we require receipt of the signed agreement and payment (an advance for royalty arrangements or 50% down for flat fees – balance due at completion).
I never go into a new relationship with a client worrying about having to sue later. Instead, I do my “vetting” up front to make sure that the clients are good people to do business with and that they are committed to the project.
There are several things you can do to screen clients:
A. Use a deal memo or proposal prior to starting the work to make sure that both parties agree to the important points in the deal (price, copyrights, usage, etc.)
B. Collect a non-refundable deposit (or advance of royalties) up front before beginning any work and before sending hi-res files;
C. Keep in constant communication with the client;
D. Contact other artists who may have worked with this client and ask for a reference;
E. Don’t move forward with someone you don’t trust. You can’t have a healthy business relationship if you have a bad feeling about someone.
If you have policies in place that protect you from the start, you won’t get “stiffed”.
FOOD FOR THOUGHT: Someone told me once that if you are having trouble with a deal in the beginning, than it will only get worse later and will end badly. This was good advice, and I now keep that in mind when starting a new business relationship.
AVOID THE BULL-HITTERS: (I don’t like to use foul language in public, so I’ve dropped the S!) We are often approached by fast-talkers who dream big but deliver little. One smooth-talker spent days creating impressive spreadsheets projecting how much money we’ll make off of a clothing line that they wanted to develop.
“Oh, it’ll be great! We can use Drew’s art to sell a clothing line to department stores. We’ll put a quarter of a million dollars into the marketing and development….” They claimed that we would make hundreds of thousands of dollars in royalty payments. But when I submitted a deal memo asking for a royalty advance, they couldn’t put their money where their mouth was. They wouldn’t pay an advance. We turned it down and saved ourselves a lot of work for nothing. If they were truly committed, paying a $5,000 advance would have been just another cost for doing business. After all, the advance is deducted from future royalties. Requiring an advance is one way we weed out the serious from the bull-hitters.
FIRE BAD CLIENTS TO MAKE ROOM FOR THE GOOD ONES: Sometimes Drew and I will “fire” a client. We prefer not to work with people who lack integrity and who don’t keep their promises, or people who are just too difficult. Life just shouldn’t be that hard. If you can’t get a client to pay, or if they consistently break promises, then it’s time to fire them. You’ll make ample room in your universe for new clients that you genuinely enjoy working with. I am proud to say that 95% of the people we work with now are wonderful and we have mutual respect and love for each other! (I have just one last problem-client to fire, and then I’ll be at 100%!) 2.)
2.) When you’re licensing art should you register with the copyright office immediately? It takes awhile for the copyright office to get it processed – does this mean you’re not protected until it the processing is done?
You should always file a copyright for artwork that you’ll be licensing or putting out into the world. The copyright office is slow, but your protection begins the date that they receive your application and payment.
The best reason to file copyrights is to not only protect you, but to protect your clients from other entities that may steal your images for their own products (and in doing so, they hurt your clients’ sales).
I wouldn’t worry so much about being ripped off from your client, if you are doing your vetting and due diligence.
WEED OUT THE SHYSTERS: Just recently, we had a company contact us to license Drew’s art for wallpapers. I did my usual poking around and contacted a few artists that had been licensing to the company. I was told by two very disappointed artists that the company has not paid them a dime! That was all I needed to hear – I stopped communication with the company and saved us the trouble of being stiffed.
MOST PEOPLE / COMPANIES ARE GREAT TO WORK WITH: My experience is that while there are some shysters out there that will steal your art from you, they are far and few between. Most of the companies that you work with will be straight up.
Just be sure to have solid procedures in place to protect yourself so you can focus more on the artwork without the worry of being taken for a ride.
These are great questions. Thanks, Dennis. I hope to see you at the next trade show!
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