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Motion Design Business Practices
by Shel Perkins

IMPORTANT DIFFERENCES
On the flip side, there are important things that all motion designers do not have in common. Sometimes work is provided directly to the end client, while other times it’s done behind the scenes on a subcontract basis. Also, many motion designers are bringing with them general business practices and expectations from the entertainment industry, while others follow business practices from the design community. Let’s take a moment to look at each of these essential differences more closely.

SUBCONTRACTORS
If you’re doing motion design as a subcontractor, it means that you’re not selling your work directly to the end client. You’ve been brought in behind the scenes to help someone else (for example, a post-production company) with their project. In the entertainment world, the chain of relationships looks like this: The actual client is usually a film or television studio, or perhaps an independent production company. They own the project and will receive gross percentages of all revenue that it eventually generates. This client buys specific services from post-production companies such as VFX houses, usually on the basis of a fixed-fee contract. Many post-production companies then farm out portions of the project to independent contractors. These subcontractors are paid an hourly rate or a daily rate. Typically, subcontracted work goes to individuals, but it can also be done by small firms. In either case, holding the last position in this chain of relationships does not give the subcontractor much clout or bargaining power.

When subcontractors are self-employed individuals, it’s important for them to protect their legal status as independent contractors. In the US, there are many differences at both the federal and state levels between employees who are on the payroll and outside contractors who are not. To clarify the situation and prevent confusion, an independent contractor agreement should always be negotiated and signed. This document is usually provided by the company buying the services. It will specify the hourly rate or daily rate to be paid, and it will indicate that all services provided will be considered work for hire under us copyright law. The agreement will be accompanied by a statement of work (usually abbreviated as sow), which is an addendum with detailed specifications for the project at hand. (As a reference, a sample independent contractor agreement is included in my book Talent Is Not Enough: Business Secrets For Designers. Another sample can be found in the book Consultant and Independent Contractor Agreements by attorney Stephen Fishman.)

At the beginning of the relationship between a post-production company and a self-employed individual, it’s also a good idea to establish some ground rules for how the subcontractor’s time will be reserved. You should clarify the difference between tentative holds and confirmed bookings, as well as expectations regarding payment for on-call time and any penalties for cancellation of bookings (usually referred to as kill fees). An open forum for discussion of such issues has been set up at www.motiondesignpractices.org.

Beyond these questions related to scheduling, most self-employed individuals also need guidance on a wide range of general business issues, from marketing right through to billing and collecting. This is especially true for young designers who enter the field with very limited business experience. There are two useful resources for these young professionals. The first is a paperback available in most bookstores, the Graphic Artists Guild Handbook: Pricing & Ethical Guidelines. Second is the online information available from the AIGA Center for Practice Management. The CPM resources posted at www.aiga.org include many helpful business articles for independent contractors, such as “Freelancing for Design Firms and Agencies” and “Income Taxes for Freelancers.”

DIRECT TO CLIENT
The opposite of subcontracting is to sell your services directly to the end client. Sometimes this is done by individuals, but in the field of motion design it’s done more often by firms that are mid-sized or larger. In general, firms have a broader scale of operations, offer a more comprehensive set of services to clients, and have more clout when it comes to bargaining. When invited to bid on a project, a firm is often in a position to submit its own contract in the form of a fixed-fee proposal with attached terms and conditions.

These contract terms and conditions can vary quite a bit, based on the background of the firm submitting the proposal. Different industries have different standard practices. The legal expression for this is “usage of trade”—common business understandings and practices that are well established and regularly observed within a particular category of companies. They are usually written into the contract itself, but may be legally enforceable even if they are not. In the case of motion design, the contrasting sets of practices seen most often are those from the worlds of entertainment and design.
http://image.commarts.com/Images1/1/3/0/2/203106_54_0_MTA4ODU4ODM0LTE2MDAxMDUyMzM.jpgShel Perkins
Shel Perkins (contact@shelperkins.com) is a graphic designer, management consultant and educator. The revised and expanded second edition of his book Talent Is Not Enough: Business Secrets For Designers is published by New Riders.