About two weeks ago Abby Glassenberg and I chatted about contracts and the fabric industry. In particular she was curious why some companies have a policy that they don’t sign written contracts. Every business has the right to set policies. And this extends to how they like to deal with contracts.
Yes, it’s true that the large or established companies have more leverage. And they sometimes use this to bully you into complying with their policy. Often they do this knowing that you will cave in because you know, that they know, that they can find someone else who will do it for their terms.
I also know that many female creative business owners, myself included, struggle with the imposter complex. The feeling like we are lucky to have what we have and don’t want to do anything to make people realize that we don’t have all the answers or aren’t perfect. And so we don’t try to rock the boat.
But that’s where setting boundaries for us and our businesses can come into play. Sometimes it’s easier to stick to a policy than stand up for us.
I’ve found what’s important when we set these policies is to craft the why behind them. So that we can provide context to our policy and they don’t feel arbitrary (both to ourselves and the other person).
For example, I have a company policy at the law firm that the full flat rate for our project is due before I’ll do a drop of work.
I’ve built things into my business to make it easier for my clients to pay. I accept credit cards so you don’t have to come up with the lump sum in cash. I also set my prices at the beginning of the year and they stay the same for the entire year. Which means you could talk to me in January and not begin work until October and the price will be the same. (And I usually know what the new rates will be by the early fall.) But I don’t do payment plans, I don’t take 50% up front, or let you pay me when I deliver the product.
When I get asked about the flexibility of my policy, I explain that this policy ties into my goals of providing my services in a way that builds a relationship between us. Because I’ll have to bug those that don’t timely pay and this will destroy any chance we had to build a long-term working relationship.
I also explain that I don’t want to punish those who pay on time. And that I’m sure that you would pay on time, but other people won’t. And the cost of collections then has to get wrapped up into my flat rate, resulting in an increase for those good people who timely pay.
Have I lost potential clients because of this policy? Yep. Some that I’m aware of and others that I’m not.
However, providing my services in a way that builds a long-term relationship is one of the most important goals of my business.
So I’ve set a company policy to reflect those goals. And I honor my clients and myself by sticking to it each day.
What the creative community fails to realize is that collectively the power is in your hands. Companies keep these kinds of policies only until the quality of what they are getting suffers. If they can’t find people of an appropriate caliber, then they will be forced to change their policy.
If those skilled enough to do this work adopt a company policy that requires written contracts, then they’d do it.
What’s your why that they might listen to? When negotiating these types of deals for my clients, I remind these companies that they have more on the line than my client. That a written contract protects them as much, if not more than my client.
A written contract protects them as much, if not more than you.
And if she’s not willing to put her little amount on the line, they must have a good business reason for not wanting to. And could they explain what that is? Usually, that gets them on board.
Are there designers out there the feel more freedom when working sans contract? Yes. I’ll save that Kiff Says rant for another day, but for those of you in that boat, the short answer is that you fail to realize:
- you are in a contract (it’s just an oral one and not a written one)
- that you enter into about 50 contracts a day, many of them written
And since that is your existing reality, how is a piece of paper going to change that?
Will setting a policy like this make you lose a job or project?
Probably Most definitely. But who wants to work with someone who fails to understand and respect the reasonable policies and boundaries you’ve established for your business? I don’t.
What do you think? Agree? Strongly disagree? Let me know.