Overview
Creative businesses that provide services, or are commissioned, often have to provide proposals. These can include a brief, a financial quote and terms and conditions.

Proposals are an important tool for the client when deciding whether to use you or a competitor, but they are also communication tools before and during the process of delivering services to your client. Both parties need to agree what will be provided, how long it will take and what the costs are.

Doing business without detailed quotes and terms and conditions often leads to miscommunication, which can result in increased stress and time-wasting on both sides, and loss of customers and money. This factsheet outlines the main issues that you should be aware of when starting a new project with a client.

Meeting the client
Before providing a quote, it is advisable to meet with the client to gain a detailed understanding of what they require. Ideally they should have produced a draft brief outlining the aims/objectives of the project, timings, background to the project and their organisation, budget and - if it is a commercial organisation - their intended target market.

Try and quantify as much as possible what needs to be delivered i.e. a website with 15 pages and 30 images, a tableware set with a cup and saucer, mug and soup cup. A clear description of the style of design also needs to be agreed, e.g. ‘illustrative aimed at five to seven year olds’ or ‘contemporary decorative with colourful floral motifs’. It is useful if clients can supply visual examples of ideas they like, to assist you in meeting their expectations.

Remember this is a two-way process and before providing a quote you need to be confident that you are absolutely clear on the brief and that you can meet the client’s expectations, in terms of product, time and money. This is the time to negotiate!

What are your goals?
To be successful and satisfied, creative people often need new projects to give them at least two of the following: creative fulfilment, money or profile. It is important to recognise which of these you will gain and that taking on the project will help you to achieve the overall aims of your business.

Providing clear quotes will help the communication enormously. You will be able to make sure that you understand the client perfectly, so that you don’t deliver the wrong thing and your client will understand your process and feel that you really listen to their needs and wants.

The design process is very intangible and even experienced professional clients need to know in advance what they are going to get, by when and how. If you provide clear design briefs and quotes you will be able to manage your client’s expectations better, build trust and rapport with your client and come across professionally.

Creating a quote
After agreeing the client brief you have to supply a financial quote. This should clearly outline what you intend to provide to the client, including:

• A detailed description of the work to be undertaken
• Timescales and milestones
• Fees plus details of what is included in the fee and how extra amendments or changes will be charged for
• Information on what will happen if an order is cancelled, either before or during the commissioning process

It is advisable to break this down further into three clear stages, giving a quote for each stage and an indication of time:

Concept Stage: This stage encompasses the work involved in finalising the design brief, creating one to three design concepts, and all client meetings. As much as possible try to quantify the intangible aspect of your work and what the client will get i.e. three design concepts in two colour ways, presented through mood boards and illustrations.

The end of this stage is often a client presentation, whereby one concept will be selected.

Development Stage: In this stage you develop the selected design from stage one in more detail. Again quantify what the client will get and explain the design process at the same time, i.e. the development of the selected branding concept of stage one, including a black and white and four-colour logo, headed paper, compliment slip, invoice, and a business card template.

This stage takes the longest and covers aspects such as making and approving of samples. This stage finishes when both parties are 100% agreed on the final design.

Implementation Stage: This is the final stage whereby production of designs takes place, and products are introduced to the market. The designer has a quality control task at this stage.

The finer details
Make sure that you cover your costs at all times, profit will be made only in the latter stages. And be careful with providing services for free.

You will need to predict in detail how much time you will spend on each stage and each individual aspect of the project, all the costs relating to it (including your overheads, production costs, packaging and posting etc), plus some contingency and profit margin too. It really helps if you have kept timesheets during previous projects, as they will help you predict future projects.

Provide clear details at the end of your quote relating to:

• How long the quote is valid for. This is to ensure that the prices and timescales you have included are still relevant. This tends to be a three to six month period and after this time clients will need to apply for a revised quote
• What costs or expenses are involved in your fee? Who pays for postage and packaging, travel, production materials, insurance etc? Note that clients do not like to get small invoices, so it is better to include these costs into the overall fee, but state clearly that that is the case
• Identifying the different stages of the process, their individual times and fees will help you to avoid that a client in a later stage will make changes (i.e. in colour or style) that should have been cleared up in an earlier stage. It will also help you to get paid for your design concepts, as it is presented as part of the overall project
• Invoicing after every stage will ensure you get paid quicker and avoid some of the pitfalls of discovering that your client is a non or late payer. Overall it will help your cash flow
• If stage two is long you might want to invoice in two or more stages. If so you need to state this in advance
• Make it clear what the end of each stage is (i.e. a meeting), so that that stage can be signed off and invoiced
• State that the fees are irrevocable once a stage has started. If a client decides during the process that they do not want to proceed than they still need to pay the amount for the full stage. Not going to the market with a product should never be an excuse to avoid paying you for your work
• By quantifying what the client is going to get from you will help manage their expectations , i.e. three client meetings, two design concepts. This will also help in case you need to provide more additional support than quoted for as you will be able to renegotiate an additional fee.

Terms and Conditions
In addition to the design brief and quote, your proposal should be accompanied by terms and conditions. Terms and conditions state your requirements to doing business. Very often these terms and conditions are printed on the back of an invoice, but it is better to provide them with the proposal to new clients. They can include the following aspects:

Payment

• Specify the timescale that invoices must be paid by. Usual terms tend to be 30 days from the invoice date
• How do you want to be paid? By cash, cheque or directly into your bank account?
• In case of international clients, state the currency that you want to be paid in and make it clear that all bank charges need to be paid by the client
• State whether the terms includes VAT
• It is also advisable to add in terms relating to late payment, either charging interest or a percentage fee after a certain time period. For more information about how to deal with late payers, see www.payontime.co.uk
• In the event that the client wants to make changes to the specification or scope of the project, or additional amendments, a revised quote should be agreed before work commences
• Include what will happen in the event of cancellation by either party. Notification should happen in writing within a limited time span
• Clarify under which country’s laws any disputes will be handled; even within the UK, Scottish law differs from English law

Ownership rights
State clearly who has ownership of the intellectual property rights and under what circumstances they might be transferred. It is advisable that you as the creator remain the copyright holder, which means that the client will need to state your name in case of publication of your work. For graphic and web design work this is often more complicated - but try to get your name printed on any literature that you design.

Client’s terms and conditions
Sometimes the client may have their own contract, ensure that you read them carefully and highlight any areas you are unhappy about for further negotiation. Companies often have standard contracts for all their suppliers and therefore some of the terms and conditions may not be relevant to your project.

In particular, major brands and department stores have got very stringent terms and conditions. Read them thoroughly and question any element that you do not understand. Never sign anything that you do not understand as this might lead to major legal problems and loss of income in the future.

Creating your own terms and conditions
You can do some useful research into terms and conditions by looking at the back of many of your supplier’s invoices, as very often they are stated there. It is advisable to seek professional assistance when drawing up your terms and conditions. Using a solicitor who specialises in the design sector is a good idea.

Contracts
If you make an offer and it is accepted, a contract has been made. Contracts can be both verbal and written. Quotes and design briefs become contracts when the client writes down ‘agreed’ with a date, their full name and a signature on them. Make sure that both you and your client have a copy with these details on them before starting any project. This will help to minimise any problems in the longer term. If your quote is accepted, you have now entered into a contract.

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