how to charge design fees

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Letter
How to charge
Design fees
Ajay
Vaibhav
Fees
Writing Letters
Estimating Fee
Invoicing

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What is Fees
• Selling your
– Talents
– Training
– Experience
• In the form of time in
– Thinking
– Meeting
– Drawing
– Traveling
– Research

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Design Fees
• No design fees ever be quoted until after briefing meeting and then
always in writing.
Golden rule
• Never quote fees off the cuff however hard you may be pressed to do
so.

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Writing Letters about
Fees
• Side of contract
• Imp. If work is abandoned before it finishes
• Virtually a Legal document
•Well constructed, Impressive to demonstrate
•Clear
•Logical
•Problem understanding

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Writing Letters about
Fees
• Introduction
• Summary of the brief
• Services provided
• Fees
• Special Clauses
• Additional fees

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Services provided
• Stage One
» Discussion with Specialists
» Agreed number of visits
» Primary design proposals
• Stage two
» Developments work; checking prototypes and
samples
• Stage three
» Finished working drawing
» Adaptation for size and range
» Advising during production & first batch

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Fees
• Stage One Rs.
• Stage four Rs.
• Stage three Rs.
• …
• Fee installment
• Expenses chargeable
• …

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Special Clauses
• Ownership and conveyance of copyright
• Breaking clauses and fee payable for abandoned work
• Permitted modifications
• Free specimen and design credits
• …

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Additional fees
• For extra visits
• For changes to brief
• For Traveling time
• …

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Estimating Fee
• The Secret of all successful estimation is to know the selling cost of
an hour of your own time.
• Chances of greatly underestimating your work on a job
• Try to counteract right from start by adding 25%, 50%, 75% or even
100% in job hours

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Estimating Fee
– (e.g.Typography assignment)
• E.g. Your rate is rs.100 per hour
• Drawing board : 4 hrs.
• Add Half of it: 4+2= 6
• Wrapping and mounting +0.5: 6.05
• Telephoning, letter writing (taking appointments) +0.75: 6.8
• Get to your client’s office +0.25: 7.05
• Meeting with client +0.5: 7.55
• Back + 0.25: 7.8
• ..
• ..
• Say 8.0
• 8 * 100 = 800 is the fee to be charged.

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Charging fees
• Lump sum or fixed
• Hourly- rate
• Percentage
• Royalties
• Consulting and retaining fees

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Lump sum or fixed
• Clear brief
• Preparing and submitting preliminary Design Proposals
» Product
» Graphic
» Engineering
» Furniture
» Textile
» Fashion

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Hourly- rate
• Design is a completely unknown quantity
• After First stage
• Easily Can be called a halt
» Checking prototypes
» House style or corporate identity program
» Range and color
» Supervising production
» …

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Percentage
• Are usually on a sliding scale
- as production costs increase, the percentage fees
come down
» Interior design
» Exhibitions
» Shops
» Shop fittings

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Royalties
• Things to be sold to general public
• Large quantities
» Furniture
» Fashion
» Textile
» Domestic equipments.

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Consulting and
retaining fees
• Fairly well – established designer
• Growing reputation
» Consultancy services only
» Separate fee for Design, Drawing board work …
• Mutual agreement for one or more years
• Retain exclusive service for particular design
• Not to work for any other client, until termination

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Invoicing
• Professional people always “render” their invoice……..
• When to invoice
– Is your design approved and had final clearance at the
stage
» Every month, when?
» Can you afford to wait ?

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Invoicing
•Work cost is 1,00,000
•Total Fees@15% 15000
• For stage one 1/5 of the fees Rs.3000
• For stage Two 1/3 of the fees Rs.5000 Total 8000
• For stage three 1/3 of the fees Rs.5000 Total 13,000
• For stage Four Balance Rs.2000 (final balance)

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Thank you