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Agreements Between Designers and Vendors
When making project-related purchases, designers need to protect themselves and their clients by going through a careful purchasing process and putting the terms in writing. Here are a few key points to consider for some common design-related expenses.
by Shel Perkins
April 10, 2006
When making project-related purchases, designers need to protect themselves and their clients by going through a careful purchasing process. In most instances, it's wise to put the details of the agreement with the vendor into writing. This article identifies some of the key issues involved and points you toward industry sources for additional information.
In general, a vendor is any outside entity that you buy products or services from. If you're buying services from a freelancer, you need to have a signed independent contractor agreement in place. The purpose is to describe the services being purchased and the method of compensation, but also to clarify ownership of intellectual property. To see sample agreements, pick up the paperback Working with Independent Contractors by attorney Stephen Fishman.
Intellectual property is also a key issue when you're negotiating with content providers such as photographers. The American Society of Media Photographers has two publications that explain standard practices in the field of photography: Working with an Assignment Photographer, and ASMP Professional Business Practices in Photography.
Most projects require miscellaneous supplies. These are usually purchased over-the-counter from retailers. In the U.S., general legal protection is in place for all such purchases. Every state except Louisiana has enacted Article 2 of the Uniform Commercial Code (UCC). This statute governs a range of commercial transactions, including the "sale of goods." "Goods" include all items that are both identifiable and moveable at the time of the sale. The UCC specifies that sales transactions carry an "implied warranty of merchantability or fitness for a particular purpose." This is a promise that the goods delivered will be free from defects and reasonably fit for the ordinary purpose for which such goods are usually sold. For details about this, contact the state government where you're located.
More important, graphic design projects often involve major purchases of custom services such as prepress work and printing. Information about standard trade practices is available from the Printing Industries of America and the Graphic Arts Technical Foundation. Their shared information site is http://www.gain.net.
When you're shopping for custom services such as printing, you need to prepare detailed specifications first so that you can seek competitive bids. Discuss the specifications with each firm and be open to suggestions—your vendors are a great source of expert advice. As you negotiate the price and schedule, be sure to spell out what the proofing and approval process will be. There must be no confusion about your quality standards and terms of acceptance for finished work.
If you haven't worked with a certain vendor before, they may require you or your client to fill out a credit application and pay an advance deposit on the work. If your design studio will be paying for the printing, then reselling it to your client, you many need to have a state sales tax account. For more information, see the AIGA publication titled Sales Tax.
The final step in the negotiation process is to lock in the details by issuing a purchase order. A sample P.O. can be found in the book Business and Legal Forms for Graphic Designers by attorney Tad Crawford and design manager Eva Doman Bruck.
Getting written agreements in place with your vendors will prevent confusion, particularly when you are buying expensive custom services. Detailed agreements will help you to avoid disputes and build positive vendor relationships.
Shel Perkins is a designer, educator and consultant to creative firms. His book 'Talent Is Not Enough: Business Secrets For Designers' is now available from New Riders/Peachpit Press. To contact Shel with questions and comments, please e-mail us at email@example.com.