Illustration Pricing Factors

Ever wonder why a pair of Levy’s 501 jeans sells for $64 dollars at Macy’s and $44.99 on Amazon.com, or why the same variety of Campbell’s soup sells regular price for $1.25 at one grocer and $1.45 at another? Of course you have, especially if you are a conscientious consumer. And there are understandable reasons why these price fluctuations occur. But did you ever consider how the same type of reasoning can be applied when it comes to pricing illustrations? Perhaps you have, and then again, perhaps not.

This is a true story. A number of years ago I was in a store that sold used CD’s. I noticed it was sort of a hangout for students from the local high school near by. I also noticed that none of the used CD’s had a price tag. While I was there, one of the students took a CD up to the man at the front counter who happened to be the owner. He asked the owner, “how much?” The CD was A Momentary Lapse of Reason by Pink Floyd. The owner said, “I’ve got to get five bucks for that”. The student put the CD back on its shelf. A few days later, on my way home from a client meeting, I stopped by the CD store. Since I had just come from a meeting with the Vice President of a large company, I was wearing a suit. I picked up the same CD, A Momentary Lapse of Reason, and went up to the owner to buy the CD. He looked at me, then paused and studied the suit I was wearing, and said “that‘ll be fifteen bucks”. Now I’m not going to tell you if I bought it or not, but I will tell you I was not taken off guard by the incident. Although a hard lesson, there may still be a lesson to be learned here.

© 2014 Don Arday.

Tangible Factors

There are many tangible factors that influence the price of an illustration such as how large it will appear, the number of copies that make up the edition it is a part of, how many times it will be used, and for how long, etc. These tangible factors certainly provide a beginning for estimating what to charge for an illustration.

The Graphic Artist’s Guild, Handbook of Pricing and 
Ethical Guidelines includes a comprehensive section of statistics and suggestions for what to charge for illustrations that have been commissioned under similar circumstances and for similar purposes. Consulting a resource such as the Handbook for suggestions is a great place to begin when pricing an assignment.

Intangible Factors

Although the data provided in the Handbook of Pricing and Ethical Guidelines is very useful, it is primarily based on tangible factors such as usage and market circumstances as they relate to the finished illustration, in other words, whether the illustration is national, regional, etc., whether it will be published singly or multiple times, whether it will be produced in a large quantity or a small one, etc.

Now what about intangible factors that may influence the price of an illustration such as those alluded to previously? Here are a few that should definitely influence the cost of an illustration in one manner or another.

Turn Around Time

Perhaps the easiest to determine reason to vary from a standard pricing model, turn around time can drastically effect the pricing of a job, and it is not only measurable but it is usually foreseeable. Here are some considerations that can affect cost.

• How fast is the turn around time for the assignment?

• Will it require an all-nighter or two to produce?

• Will it interfere or compromise other assignments that are in progress or have to occur simultaneously?

• Does the assignment have a set schedule or is it open-ended?

Scope of the Work

Not all jobs are created equal. Some may require more sketches than are factored into a typical pricing model, while others may require extensive research. Others may have a series of approval stages instead of the standard two.

• Will it require many sketches?

• Will the sketches have to be shown as comps or partially rendered illustrations for approval?

• Will more than one finish need to be provided for the final choice?

Conditions for the Work

Occasionally there are commissions that require an illustrator to work in a client’s facilities to integrate into a project workflow or to interact with a team of production people or to have their work supervised or directed.

• Will the work have to be produced in the client’s facilities?

• How many meetings will the assignment require?

• Will you be working under supervision?

• Will you work as part of a project team?

• Is there travel time or expense involved with the assignment?

Type of Client

Not all clients are alike. There are easy clients to work for and there are hard ones. There are those that will trust and respect your talent and expertise, and there are those that won’t and will try to “direct” your work and even your working method. You may even have your work subjected to decisions made by a committee.

• Will you be working for a visually educated client such as a graphic designer or an art director or for a non-visual client such as a company owner or product manager? 

• Will there be a committee of people or a single person involved in approval of the work?

• Is your client very “hands on” or mainly hands off?

Your Studio Overhead

Your cost of doing business should be factored into the cost of an illustration, which means you should know what that is. If you reside in New York City or Seattle the cost of living will be higher, which means the cost of an illustration will also have to be higher, and clients should understand that. For instance I can still buy a beer in a bar in Auburn for $3.50, but the same beer in New York City will cost me $9, and so it goes for a can of peas, toilet paper, and so forth.

• Do you have a modest overhead or a substantial one?

• Do you have a home-based studio or do you rent a separate space?

• Do you have an assistant or employees?

• Does your studio reside in a high cost of living area or a low one?

• Will you have to acquire special materials or equipment to complete the assignment?

Who You Are

Your level of experience and status as an illustrator has worth, and they do affect what you can, and should, charge for an illustration. This may be especially important if you have invested substantially in a marketing effort to reinforce or enhance your status in the field. This is the theory behind why a Jimmy Choo boot costs $1295 and an Ivanka Trump boot retails for $199. It is referred to as market forces.

• Are you just starting out or a highly experienced illustrator?

• How much are you spending on marketing and promotional efforts?

• Are you a specialist in the type of commission or subject area you will be commissioned for?

• Will you have to learn or apply new techniques for the commission?

• Are you overbooked and having to turn down work?

Conclusion

The fact of the matter is that all these intangible factors can’t be ignored when it comes to determining the price of an illustration. And of course, whether an assignment is worth pursuing or not. By combining tangible pricing factors that influence standardized pricing with the intangible factors that affect the actual assignment it will be possible to determine the best price for an illustration. Without a doubt, taking the considerations listed above when pricing a commission will be worth it.

Post Conclusion

If you are still wondering whether I bought A Momentary Lapse of Reason, the answer is yes, but I bought it for $8, which is what I offered to pay. I thought it was a fair price considering the size and location of the store; the condition of the CD; and demand for Pink Floyd material. In any business, whether you are buying or selling, it pays to know how to barter.

Work Made for Hire

Although the idea of “work for hire” has been around since the mid-nineteenth century, it was first adopted as a doctrine in the Copyright Act of 1909, and is officially titled “work made for hire”. Only two possible obligations can constitute work made for hire. First, if the work was produced for an employer while the creator was under employment. And second, if a written, signed, work made for hire contract, is agreed to by the commissioning party and the commissioned party, i.e., the client and illustrator for work specially ordered or commissioned, and the work meets one of nine possible conditions. Without a written signed agreement, the creator would retain the copyright ownership for work produced, for our purposes, the illustrator.

© 2012 Don Arday.

Employee Condition

Work made for hire is almost universally a condition of any exclusive, full-time employment arrangement. The employer retains all rights to copy and dispose of as they wish, any creative output produced by an employee. This would include all work from idea development, thumbnails, sketches, comps, to finished art.

Non-Employee Condition

The non-employee provision for work made for hire, egregiously and unfortunately, began to flourish in the 1970’s among companies that commission creative works for mass media. In 1976, to protect the rights of the creator, an amendment to the work made for hire doctrine was made to restrict the ability of companies to take advantage of a commission arrangement. The doctrine now states: All three of the following distinct conditions must exist in order for a work made for hire contract to be legal.

1) The work must be specially ordered or commissioned.

So, use of a prior work of art would immediately not qualify as work made for hire, nor would use of a derivative creation based on a prior work of art.

2) The work must meet one of the following nine definitions:

• A contribution to a collective work

• A part of a motion picture or other audiovisual work

• A translation

• A supplementary work (to another author’s work, such as a foreword, chart, or table)

• A compilation

• An instructional text

• A test

• Answer material for a test

• An atlas

Of the nine definitions, two in particular involve illustration more than any of the others, and they are “a contribution to a collective work” and “a supplementary work”. Almost all editorial work produced by an illustrator can be considered supplementary or contributing to a collective work. Magazine illustration is contributing to a collective work. And in most cases, book illustration is supplementing the work of an author. The definitions in both instances can be stretched to include just about any publication or broadcast illustration commission, such as those for advertisements, corporate brochures, web pages, etc. Nearly every commission could conceivably be a work made for hire, but only if agreed upon by the illustrator and the commissioning party.

A work made for hire agreement stating the terms of the arrangement must be in the form of a written contact signed by both involved parties.

Verbal word of mouth arrangements are not considered legally binding. Since a work for hire contract deals with the ownership and disposition of personal property, like purchasing or selling a car or a house, it must be in writing.

Consequences

It is vitally important to consider the following: If a work is "made for hire", the employer, not the illustrator or artist, is considered the legal author and owner of the copyright for the work. Many publishing houses and magazine conglomerates are adopting and enforcing “work made for hire” contracts. This may sound absurd, but bound by one of these “work made for hire” contracts, the original illustrator has no right to; control usage of the image; receive any payments or royalties generated by reuse or resale of the image; produce any derivative works based on the image; or use the image for any purpose without permission. Under a work made for hire contract an illustrator would even have to get permission from the contractor to use a copy of the illustration they produced in their own portfolio, web page, or in a gallery exhibition. For illustrators who work traditionally, producing a physical painting, drawing or sculpture, not only the image, but the object itself, becomes the property of the contractor.

Considerations

There are some types of illustration commissions where a work made for hire agreement may seem to be appropriate. Illustrated logos and trademarks are two examples where the client would need to have complete ownership of image copyright. Still, there are alternative types of agreements that may serve the illustrator better for this sort of work than a work made for hire contract. A "transfer of copyright" agreement may be preferable to work made for hire, and transfers can be exclusive or non-exclusive. In other words, limited by certain conditions made by the illustrator, or unlimited. More information is available at http://www.copyright.gov/circs/circ01.pdf.

Not all work made for hire contracts are alike, so it is very important to read the contract over very carefully. There is no such thing as a standard contract, even though the client may say that the contract is a standard one.

Factors that influence the appropriateness and legitimacy of a work made for hire contract center around how closely, in the course of producing the commissioned illustration, an illustrator conducted himself or herself similarly to a full employee.

The validity of a work made for hire contract is weakened by the following factors:

• If the illustrator worked in their own studio.

• If the illustrator used their own materials and bought supplies themselves.

• If the arrangement is short lived.

• If the illustrator determined their own working hours.

• If the illustrator was paid a flat fee and not by the hour.

• If the illustrator was not on the client’s payroll.

• If the client did not pay the illustrator’s taxes or social security.

There are also other individual factors that would indicate that a work made for hire agreement would be inappropriate, but the bottom line is whether the opportunity merits the sacrifice. There may be a work for hire offer that is extremely lucrative, or of such high profile, that through negotiation of certain conditions, it is worth relinquishing some ownership rights. And, the thought of having to challenge the arrangement in court may never become a reality.

Working With Contracts

There are two very important things to note, when presented with a contract. And they apply whether it is a work made for hire contract or any another type of contract. First, as was mentioned earlier, there is no standard for contracts. Second, an illustrator has the right to amend any contract they are presented with, and it can be as simple as crossing out any terms or conditions that are not agreeable, or editing the wording in the contract, or adding additional provisions to it.

Here’s one way to look at it. When a client presents a contract to an illustrator they wish to hire, think of it as an "offer" from the client. Whether it’s a work made for hire contract or not, it’s perfectly reasonable for the illustrator to present the client with a "counter offer" for their consideration by way of amending the original offer. A negotiation of terms can continue from that point. It is rare for a client to flat out refuse all changes the illustrator requested, but it does occur. When it does, increasing the cost of services may be in order. Be sure any contractual agreement made with a client for control of illustrations will be worth it.

For more information on contracts and agreements see theinformedillustrator.com posts, “Illustrators Agreements & Contracts 1: Components”, and “Illustrators Agreements & Contracts 2: Restrictions”.