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5 Things to Consider Before Signing an Exclusive Art Licensing Agreement

5 Things to Consider Before Signing an Exclusive Art Licensing Agreement

Tara Reed | ArtLicensingBlog.com

Recently an artist asked me the following question about art licensing contracts: “Would you ever sign an exclusive with a company (not for an image but as an artist) and if so, under what circumstances?”

I often preface my answers with two very important points – first, that my answers are my opinion and second, every person needs to weigh their own situation when making any of these decisions.

Being an artist and not an engineer comes with it’s pros and cons. In engineering there are usually ‘right’ and ‘wrong’ ways to do things. Math and much of science can be pretty cut and dry. (If you remember math classes you will recall that!) But art and business are more fluid… the con to that is that I can’t say, “This is the answer. Absolutely. All the time.” There is always the “it depends” factor.

So, here is my answer: Yes.

I have a few contracts that are exclusive with a company for a particular industry. Here is why and here is how I made the decisions. Certain companies will ask you for an exclusive for their industry.

Here are a few things to ask and consider when deciding if you want to agree to it or not.

1. Make sure you ask why they want the exclusive.

They will have their reasons but you want to make sure you know them, understand them and agree with them. Certain industries are very competitive (ok, all of them are but some more ‘name’ driven than others) and the players in those industries want to have some benefit for helping build your brand and get your products in the market place. It won’t work for their business strategy to have you do art prints with them then do more with another company.

2. Understand what they are willing to give for locking you in for an entire industry.

If you are going to commit to one company for an industry, what’s in it for you? Will they guarantee a certain amount of sales per year (hard to come by at the moment), guarantee that they will bring out a certain number of products, promote you and your brand in specific ways… you want something in return for cutting off other opportunities for a few years.

3. Have an “out clause” in the contract if they don’t do anything with your art.

The worst case would be you sign and exclusive, they file you away and don’t do anything with your art. You sit there, growing cob-webs, unable to work with anyone else but not really getting anything going with your exclusive company either. So try to put something in the contract that says if they don’t sell, produce, have available for sale (or something to that effect) by a certain date, you have the option to terminate the contract early. Or, if the royalties are under and certain $ amount in a certain time period, you again have the option to terminate.

4. Do your research on the company.

It is one thing to license one design or collection with a company to see how it goes. It’s like going on a blind date – you see what happens. But it is quite another to tie your wagon to a company for 2-3 years. If you don’t do your research and make sure they are a good company and believe they will do well with your art, that’s like heading to the alter without ever meeting the bride or groom… something we Americans just don’t do! Do your research – talk to artists that work with the company already. Do they pay their royalties on time? Are they good to work with? etc.

5. Finally, listen to your gut.

Making decisions like this are stressful – you are closing one door in the hopes that the exclusive relationship is mutually beneficial. In the end, you can’t know 100% so trust your gut. If you think the reward potential outweighs the risks, go for it!

All this said, one of my worst contracts ever was an exclusive and some of my best are exclusives. That is where I have built the best working relationships – where it is a true partnership and I don’t feel like I’m starting over to compete for every last deal. Being able to really get to know your client and what they need makes this job more fun and fulfilling. And it can make your income more stable which is never a bad thing either!


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