Design ownership | Business partnership advice

I currently own my own design, marketing, and web design business in addition to my FT position as Marketing Director at a nonprofit. I have shops on both Creative Market and Etsy and have found quite a bit of success on my own. My brother is trying to recruit me to be a partner with him in his business based on my design and marketing experience. I have the money to invest to become a part owner but that’s not in my best interest at this time.

My question: They need my help tremendously but want me to create designs under their business that they would essentially want to own and profit from. I’m not willing to do this on a salary but would consider it if they do pay me but provide a % per sale to account for the ownership of the designs. To me, that seems completely logical considering the fact that they are in great need of my skills and the designs I can produce, however, a partner thinks that it should be a basic salary. I’m asking for professional advice from you all so I know how to best reply to the offer I will be getting tomorrow.

Help! :slight_smile: Thanks so much!

Are you asking for a percentage, or a salary plus percentage?

If the partner is arguing for ‘basic salary’, I would want to know what the salary offer is. The word basic makes it sound like the partner expects you to be more of a junior designer.

Speaking as someone who believes the design work belongs to the client (who else is gonna use it?) I can’t understand this concept of expecting royalties for graphic design.

You don’t say what kind of business this is that your brother runs, or what kind of services he needs.
I could understand royalties if you were, for instance, designing illustrations for t-shirts. But not for designing the packaging those t-shirts are wrapped in when sold.

Requiring royalties for illustration usage is an entirely different concept from the way graphic design is billed out. And even then, the rights are usually offered per a set number of units sold, not a per each. The business buying the art might pay up front for, let’s say, up to 10,000 impressions of an image for a set fee. It’s up to them to then sell the 10,000 pieces, while you still have the money they paid for the imagery. You are basically selling a stock image. This doesn’t apply to specifically created graphic design.

Like Mojo said, it sorta depends on what you are calling a “basic” salary. If that salary more than covers your hourly rate and maybe even comes with some benefits like unemployment insurance and health/dental, and if it is the basic graphic design job that designs the marketing collateral to bring in business, it may be worth your while. However, depending on what country you are in, any work created while employed by another becomes the property of the company you work for pretty much automatically, so be aware, if this is an illustration job where the art sells product on a piece basis. There are also contracts drawn up as Work For Hire where anything you produce is owned by the person who contracts you (which is how logo creations works.) Even if you work on a contract basis, the work you create is pretty much geared for one specific client’s needs, which is why I don’t understand the claims of “copyright” some designers think they are entitled to. You can’t copyright a design layout, you can’t claim copyright to any supplied images or body copy (if you took the images, you can charge a royalty fee, just like a stock company but put it in your contract, and if you write the copy, there is a fee involved there too, but where else are you gonna use that copy?) There isn’t a whole lot about a designed piece that would be copyrightable. Logos always become the property of those that commission them.

As a designer, your art is a commodity to be sold. Nothing more.
Charge accordingly.

Never make allowances for “family.” Always use your standard contract.
You are in business to earn a living. You might give someone the “friends and family discount” but don’t undersell yourself. Uncontracted dealings with families and friends can lead to some spectacular misunderstandings. It’s gotta be just another day at the office.

I’ve had many opportunities to work for royalties over the years. Turned every one down. Never regretted that once.

I’m with PrintDriver completely on this one. As far as i’m concerned, that just not how graphic design sales work. PD used the phrase “art as a commodity” and I couldn’t agree more.

It’s a made-to-order product sold at a either a predetermined price or at an hourly rate.

That aside, what business model could possibly allow commission to work. Especially if they’re in the market for branding. The artist makes a logo and proceeds to profit on business sales? It doesn’t quite make sense. Perhaps from the viewpoint of marketing/sales this could work, the revenue generated from your marketing campaign could yield you a commission of sorts. But your design work is to be billed per project.

I should have been more specific. He wants me to use original designs I’ve already created on my own and create original artwork and start and manage an Etsy, Amazon and eBay store for them. He has a 60K machine that can print on metal, canvas, fabric etc. The opportunities are endless really they just don’t have someone that can come in and maximize the potential of the machine. Since I currently run and operate my own business I’m having an issue giving away my designs for an hourly rate. This isn’t a typical graphic design position. I have a hard time giving away so much of myself to them when I can do it on my own but I want to help. I think it would be fair if there was some sort of a bonus or % per sale if I were to come in and help. I hope that makes more sense and thanks for the replies so far I appreciate it. I’m meeting with them later this afternoon so I was just seeking advice.

Your explanation changes things a bit.

What it now sounds like is that you’ve created artwork that will be printed and actually be the product that is sold. If that’s the case, then royalties would be an option.

There are also a lot of red flags in your posts. So proceed with caution.

Thank you. Yes, I would create the original artwork that would be printed with this machine and sold for their profit. They also want to own the rights to everything I create. A friend of mine also advised the same about the red flags you mention. He said it can get very complicated and thought it was best that I don’t get involved. They have been asking me for months to get involved because and I want to help but I also don’t want to leave room to be taken advantage of so I want to be prepared when I talk to them today. I really thank you all for your help with this.

Another red flag. That’s not a royalty situation, that’s work for hire.

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The biggest red flag here is this is family.
Proceed with extreme caution.

I did have a chuckle at $60K and prints on anything…
UV direct? Or Dye Sub?
Not that it matters much except for the size of your output.
I do a lot of work with the $200-350K versions of either of those types of machines.
They do have their limitations as to what “sticks” to what, especially when it comes to “metals”…
Another case of buyer beware. :stuck_out_tongue_winking_eye:

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You cant even get a low end digital ‘press’ (copier) for 60K these days.

I’ve seen the machine twice so I’m not exactly sure the proper name or even brand. He leases it from a company that uses it to custom print on top of coolers. I’ve only seen it print on canvas at this point but I’ve also seen items they’ve printed on metal. I am told it can print on most anything as long as it’s level.

They want to offer me 3% of each sale the original artwork I’m creating for them and own the rights. Considering I can create and have been creating items myself and can continue to do so on my own this doesn’t seem logical for me. Thanks for the feedback.

I think you would find The Graphic Artists Guild Handbook - Pricing and Ethical Guidelines to be very helpful. It goes into the pros and cons of situations like this, and the things you should look out for. Work for hire, licensing, royalties, contracts, trade customs, etc… There is a section on graphic design of mass produced items like textiles.

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This is very helpful thank you!!

Sounds like a UV inkjet.
It ain’t so much about sticking to the metal, the bigger question is, “how long will it stay stuck.”
Some things, the ink just slides right off immediately. Other things, everything from flaking to cracking over the course of 1-3 years. That’s why I said Buyer Beware. You might think it looks great, until your client calls 2 years down the road to say their work of art is in pieces on the floor…

If you go with that offer, demand a non-refundable advance against royalties.

And don’t give them ALL rights. Offer exclusive reproduction rights for a limited time, such as 3 years. At the end of that time those rights revert back to you and you can renegotiate a higher percentage with them if it turns out something is a monster seller.

And define ‘royalty’. Is it 3% of gross or net? If it’s net and they are counting expenses against your share you could end up with nothing. Hollywood accounting.

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I think your brother needs you more than you need them. You can write your own ticket but if you have your own gig why do you need them. You don’t. I think your emotions are getting the best of you because it’s your bro which is understandable.

Try to step back and sleep on it for a week to get a clearer picture.

If you don’t want to run your own business it’s a good thing because you don’t have the hassle finding sales and using your own cash flow.

You can also do tiers if you sell x amount the percent goes down.

Good luck.

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If you’re happy doing what you currently do … why change?

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Amazing and true reply thank you. He’s my twin so it’s tough. I am going to take this advice and think it over. I appreciate your time.

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