|© 2015 Don Arday.|
many types of payment arrangements an illustrator can make with a client, and a
number of reasons for choosing one type over another. Although an illustrator
has control over the type of payment method they require, some methods may be
dictated by the type of work or circumstances of the commission. Some
payment methods may be preferable over others. When establishing an
illustration business, it is very important to establish a consistent payment
system. A consistent system for payment will help in getting paid quicker, and
it will dissuade clients from attempting to negotiate some “special”
inconvenient payment arrangement.
of what method of payment an illustrator will employ, there are certain pieces
of information that should be predetermined by an illustrator to provide
information to a client to streamline the payment process.
It may seem
to be obvious that the payee will be the illustrator completing a commission,
but how is that illustrator to be identified for payment?
Name Of An Individual
be made to an individual, the illustrator by his/her name, such as “Payment
should be made to Don Arday”.
Name Of A
Company or Pseudonym
also be made to a company, or an individual in a “doing business as” a company
or a pseudonym by addressing the payment to the name of the company or entity.
For instance, “Payment should be made to Arday Illustration”, or “Payment
should be made to DonArtDay”. If a pseudonym or company name is used, “doing
business as” forms will have to be submitted and endorsed by financial
institutions in order to transact bank payments. In any case this information should be
provided on an invoice.
the payer with a job index code, the payer will easily be able to track
estimates and invoices. This is particularly critical when several projects
have been commissioned to an illustrator all at once.
A payer can
be an individual, a company, or an organization. A payer can be the client for
whom the work was done or an entity representing that client. For example,
an illustrator is hired by an advertising agency to produce an illustration for
one of their clients. In this instance, the illustrator will most likely be
paid by the advertising agency, however it is also possible that they may be paid
directly by the agency’s client.
Orders & Job Identification Numbers
supply P.O. or Job ID numbers for each project commissioned. If not supplied,
they can be requested. These numbers or codes, when included in an invoice,
will greatly speed up the payment process. When a payer issues a P.O. number it
essentially means that the payment has been set aside in an account and is
already approved for payout. In addition to their own P.O. or Job ID number,
payers will reference the illustrators Job Index code. Especially when they
have issued a single P.O. for a group of projects.
illustrators utilize more than one form of payment depending on the type of
work to be produced, the length of engagement, the preferences of the client,
and their familiarity with the client.
comes from a payer to an illustrator in the form of a personal check or company
check is considered a direct payment. These payments are usually mailed to an
illustrator, thus the phrase “it’s in the mail”. It may also be possible for
checks to be picked up in person. An electronic transfer from a client’s bank
account into an illustrator’s bank account is another form of direct payment.
more and more popular, third party system payments are an effective way to
receive payment for work, especially with international commissions. PayPal is
a popular example of this kind of payment system. Money is paid directly to an
illustrator’s PayPal account. It is then made available for the illustrator to
withdraw the funds. Bank check’s and USPS money orders are other forms of third
Lump Sum Upon
A lump sum
payment is a single payment paid to an illustrator, usually at the completion
of a commission. This kind of payment can be risky when dealing with an
individual or a start up company. It is less of a risk with repeat clients and
Lump Sum Up
certain job circumstances where an up front lump sum payment may be necessary
or most appropriate. One example being a commission for a speculative business
or project, another being when a substantial amount of material outlay is
required on the part of an illustrator to begin a commission.
Lump Sum By
illustrators bill a lump sum payment for every presentation stage of an
assignment. A typical example is to require one payment for concept sketches
when they are presented and another additional payment for finished
illustration when it is delivered and the commission is completed. If there are
other presentations such as color comps, models, etc., additional interim payments
may be required.
of compensation is a non-monetary, in-kind trade of goods for services. Clients
will sometimes offer to trade products they manufacture or sell, tickets to
performances, sports events, etc. They may also offer to trade a service they
can provide for one provided by an illustrator. It is also possible to negotiate an arrangement that involves a partial in-kind trade in combination with a monetary
similar to a lump sum that is split to to be billed with each presentation, an installment
payment is more of a division of the total cost of a commission into a set of
equally timed, equal value payments. For example, for a illustration commission
costing $5000, an illustrator may require 5 payments of $1000 over a five week
period. Installment payments usually involve a single commission.
A royalty arrangement might be considered as a sole payment method or as an add on. Royalties are only a lucrative form of payment when the publication or product the illustration appears on will be sold in high volume. Royalties are usually a small percentage of sales or in some cases profit from sales. As royalty arrangements are dependent on sales predictions, to some extent they are a form of gambling.
client is going to commission an illustrator on a long-term basis, for an
ongoing variety of work, or for an extended series of commissions, an
illustrator may prefer to set up payment by retainer. A retainer is a regularly
occurring payment that is not based on a specific commission. A retainer is
advantageous for clients who wish to be able to receive priority consideration
from an illustrator. In essence, an illustrator is retained for work as needed and is always available.
can work two ways. The simplest and most forward is non-inclusive retainer fee that is
paid to an illustrator above and beyond any fees that may be charges for commissions completed.
complicated form of retainer involves keeping track of the amount of retainer
payment and applying it as a credit to the cost of any work commissioned. Under
this form of arrangement additional fees are combined with a retainer to serve
as payment in full.