Intro to Art Licensing | Part 4
I hope you've been enjoying this series about art licensing! If you missed part 1, part 2 and part 3 - go read them before tuning in below!
Wahoo! I'm excited to talk about the most frequently asked question about art licensing - PRICING!
As I'm sure you've learned, every client has a different budget. Pricing is a sliding scale - how big the client is, how many people will see the project, how many places it will be used, how long the license or contract is for. There's no one size fits all for pricing, but I'm going to do my best to shed some light on how the licensing industry handles pricing.
Buyers can purchase a license a few different ways. They can purchase the work at a flat fee, a royalty/percentage of sales, a combination of a royalty and flat fee (sort of like a holding fee or advance), or they can purchase artwork outright - which means they are buying the ownership to the artwork in full.
With companies that work with licensing artists all the time - they'll have a standard rate (or range) that they pay artists. They should also have a contract for you to sign, with their terms on it, since they do this often. However, you should have also have a list of terms and red flags that you look for. Don't be afraid to negotiate, and ask for changes if you're not comfortable with the contract.
One interesting things about royalties is that you don't know how much income to expect before the piece is on the market. You can ask for some numbers from the client, but you won't know anything exact for a few months (sometimes longer). Production takes a long time, so if someone purchases Christmas art from you in January - you may not see those royalties until the following year once the product is on the market. I've been disappointed by royalties, and blown away - so it's a good idea to ask for some figures if you're concerned about payment.
It's also important to note that depending on your terms, you can license the same artwork more than once. You can license artwork A to both a greeting card company, and a fabric company - as long as the terms aren't exclusive. This helps you to build both consistent income, and a recognizable style.
I know - you're like BUT HOW MUCH MONEY?! As far as royalties goes - it depends on the scale of the company you're working with, and the product. 4% of a greeting card is a lot less than 4% of a yard of specialty fabric - even if they sell the same amount of units. If your artwork takes 9 hours to create one piece, a flat fee may not be the right path for you. Remember that you can generate revenue from the same piece if more than one company licenses it.
Remember to READ contracts, know how long each piece takes you to create so you can determine your worth and value. Create a portfolio that's strong, approachable and would work well on a variety of different products. Are you comfortable giving up the rights to your artwork, or signing exclusive contracts? Can you wait a year to see royalties, or are you more comfortable working on traditional freelance jobs? Remember, you're the boss, so find what works best for you!
My friend Katie and I launched a course all about this, Art Licensing for Letterers! We both had similar introductions into the licensing world, and are so excited to dive WAY deeper into these topics with you in class. We'll share real-world examples, a peek into our process, and REAL pricing scenarios.
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