When you become a freelance designer, or you decide to branch out and start your own design firm, it can be really difficult to know how to maneuver through the financial aspects that come with job. Yet, when you work in the business long enough, you’re bound to run across a client who doesn’t want to pay you. It happens to everyone. Either you’ll be told that they’re opting not to use the product you made for them, or that they’re “changing directions on the project” or their funding didn’t come through or that they’re going to handle it internally (this list will go on forever if I don’t stop myself).
What this all boils down to is you’ve done work and now your client doesn’t want to fork over the cash. And, in many ways, we’re to blame. Too often we’re going into these situations with a “Please, oh, please, can you pay me?” attitude. If you want to succeed in design, you’re going to have to learn how to figuratively say to your client, “Shut up and pay me.” Here’s how.
First, you have to unlearn some of the things that have been drilled into you since childhood. Namely, you have to talk about money. We’re taught from a young age that discussing money is impolite. We’re told not to ask how much someone paid for something and not to ask about someone’s salary. These things are rude, they tell us; it’s undignified, it’s gauche, it’s fill-in-the-blank. Which might make sense for maintaining interpersonal relationships, but, when it comes to collecting money from your clients, you have to forget this. After all, though you hopefully enjoy your work, you’re not doing it for fun. It’s your bread and butter. It’s serious. You always need to keep in mind that the service you offer is valuable and that you are a businessperson.
Just breaking into learning the nuts and bolts of business? Here are some resources you might find handy: Xero Accounting has created this handy invoicing guide for small businesses. Smashing Magazine wrote this guide to successful relationships with clients. And Freelance Switch has created this great guide to when you reach the breaking point of clients who just refuse to pay.
No businessperson would enter into an agreement without a clear contract, and you shouldn’t either. Never make an oral agreement with a client and then start working on the project for them. Remember, it’s not a matter of trust. You can trust your client all you want, but you still need to think like a businessman. Never accept a client’s word. If anything goes wrong, or they don’t want to pay you for your intellectual property at the end, you will have very little leverage. Instead, get it in writing. In his “confessions of a designer” Anthony Fonseca makes a strong point to ask lots of questions to ensure as much clarity as possible.
Before you give anything to your client, make certain that you have a contract that clearly draws out the expectations on both sides. Come to the table ready to draw up an agreement that is mutually beneficial for both you and your client. Keep in mind that oftentimes your clients will have lawyers on retainer and that these lawyers will always be looking out for the best interest of their client. Do not just sign the contract that they offer you. Find yourself an advocate as well. Though it might seem like paying for legal advice will take away from the money you make on a project, oftentimes good legal advice can be the difference between getting compensated for your work or not.
Not sure where to start? Here are five good resources to writing contracts.
Furthermore, if expectations change while you are completing the work you agreed upon, do not just roll over and start again. After all, your time is money and you’ve already invested a lot of it doing the project that was outlined from the start. Instead, you need to end the contract and renegotiate terms for the new work that your client wants. This is where having a “kill fee” stipulated in your contract will be beneficial. It means that if the terms of the contract change, or the client no longer wants your services, you’ll still get paid. Since oftentimes you’ll have had to turn other business away, a kill fee will also give you a safety net while you book more work.
If it’s at all possible, work at building relationships inside the company. If the worst happens, and you’re scrambling to get your payment from your client, having an advocate on the inside can make the difference in actually getting paid. When you are starting any new job, always know who will be in charge of handling paying you. Keep in contact with this person and really work at developing a good working relationship with him or her. When you are a real person to your clients, it will be a lot more difficult for them to rationalize away not paying you. Don’t play to their emotions or their sense of guilt, however. The goal is to simply humanize yourself in your client’s eyes.
Finally, never deliver your final product until you’ve received your full payment for the work you’ve done. Be very clear in your contract that any deliverables you give them cannot be used until you are paid. Your clients will not want to deal with a lawsuit, which misappropriation of intellectual property is a clear cause for, so make certain that your contract fully clarifies that your work is your work until they fully pay for it. Period.
Bottom line, your work is a business and when you’ve put in the long hours on a project, you deserve the compensation that’s owed you. With a little foresight, you can make certain that you’re always getting the financial compensation that you deserve. Now shut up, and pay me.
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