I'm in the process of starting up an online t-shirt business, and I have some questions about how to deal with my designer. I checked http://www.t-shirtforums.com/tags/designer/ but I didn't see an example that was quite like mine.
I've known the designer for years through my regular job and when I approached him (initially to do the Web site, but as talks progressed, he was excited enough about the project to help me with the designs as well), he said that if he were to charge at a per-design basis, it would be very expensive. But, as I said, he was jazzed about the whole thing and had apparently for a while been thinking about how to get his designs on shirts, so this worked out well. He said he'd do the work for free and we could split the profits somehow later on. I said that sounded great to me but he could be getting 50% of zero for all we know! He was not dissuaded. He'll also be creating a logo and building the Web site.
Anyway, we're going to have "the talk" next week to iron out exactly how we're going to do this before we sell anything. Right now I've paid for the Web hosting and am in the process of buying a thermal printer and bags, etc. Also, depending on how we decide to form the business (sole proprietorship, corp., LLC, partnership, etc.), which we'll also decide next week, I'll be paying for that as well, along with any and all appropriate licenses we'll need to operate a business in our area. And of course taxes, plus I'll be doing all the shipping. Also, I don't know if this makes a difference, but all the designs are my ideas, most of which I'd done in Photoshop, but I'm no artist so I was happy that he agreed to work on them to make them better. We'll have to also discuss who owns what when we have our meeting.
Sorry to have turned this into a novella, but I am curious if anyone has any suggestions about what type of business formation would be recommended under these circumstances and how the designer would then actually be paid. Like, if I strike out as a sole proprietor, do I hire him as consultant? And then he would get profits up to the point at which he would have charged me had we done it at way at the beginning? (Like, say $10,000 or whatever.) If I incorporate and he decides he doesn't want to be a major part of the business (that's my guess as to what his take will be), do I hire him as an independent contractor? I'm so confused. I've read tons of info on the Web and some of my MBA friends have talked to me and lent me their grad school books, and I still am not sure what would work best. Like I said, if anyone's been in a similar situation I'd love to hear how they worked it out.
By the way, I've been reading this site for a few months and it has been invaluable in terms of planning and preparing. Thanks!
Smeep
Last edited by Rodney; August 3rd, 2007 at 02:18 PM.
Reason: fixed link
I would suggest hiring him to create the designs on a freelance basis.
Splitting up payments and commissions will get messy down the road. Also, if you two have a different direction on how the business should go, it will get complicated.
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Like I said, if anyone's been in a similar situation I'd love to hear how they worked it out.
Hi Smeep - This is not as confusing as it seems. You've heard of KISS - Keep It Simple Stupid -
That's very good advise. Do you want your own company, or do you want a partner? If you want your own company - you can get your pick of designers on Elance.com or on several other sites.
Just post what you want and you'll have at least 25 designers contact you. You'll get everything you want for the fraction of the cost of a partner.
Hi Smeep - This is not as confusing as it seems. You've heard of KISS - Keep It Simple Stupid -
That's very good advise. Do you want your own company, or do you want a partner? If you want your own company - you can get your pick of designers on Elance.com or on several other sites.
Just post what you want and you'll have at least 25 designers contact you. You'll get everything you want for the fraction of the cost of a partner.
LLC's are very popular now - Good Luck
Thanks for the advice. And actually, I met with my designer a few days ago to discuss the business side. Right now he's in creative mode, and he wasn't really interested in getting into the specifics of business. He's fine with being basically a vendor, and it would be totally my business. Which, to be honest, is what I preferred as well, because I think forming a partnership or having him as part of an LLC or corp. is a pretty big step, even though I've known him for a long time. It seemed like he felt the same way so I was glad we were on the same page there.
Anyway, we left things such that I'll be forming whatever business formation I decide, and then we'll divvy up the profits should they materialize. Remember, he's doing all this for free at this point (re-creating all my designs, as well as designing the Web site and the logo), because there's no way I could afford to pay him up front. I still want to draw up a contract of some sort (I found a bunch on the forums), but I'm stuck at the compensation part. If by some miracle this thing takes off and we're taking in a steady profit, then at some point he'll reach a number at which he would have been reasonably compensated for his work, but I'll still be running the business, incurring all operating costs, and doing all the shipping. So it seems like we have to stipulate some kind of cap or time limit in the contract. He didn't seem to want a royalty-type deal, and that does seem like a bit of a headache, so I'm kind of stuck at that point.
I'll bring it up to him again closer to launch so I don't bother him when he's working on creating the designs. I just want it to be fair for both of us. He's really, really talented so I'm very lucky that I know him and that he was willing to jump in on this.
I would really encourage you to hammer out all the details as soon as possible. It is in the best interest of both parties. Even if they are in "creative" mode, it doesn't matter, because the littlest misunderstanding can get blown out. Better now, then later when more is invested.
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Thanks TripleT! Also, yeah, prometheus, I agree I'd rather get it worked out ahead of time, just for peace of mind if nothing else. Then I can get back to the fun of planning the marketing and all that stuff. It's a concept I've been working on for a few years and I'm excited to see it come to fruition. It's a drag to deal with this crap, especially for a site that'll probably sell 10 shirts, but I know it has to be done. I just have to convince him of that ...
Suggestions For Working With A Designer? 
Re: Suggestions For Working With A Designer? 
Heavy Metal Art and more @ 
