OK, so the title sounds a little melodramatic, but on some level, it's pretty damn close to the truth.
Whether you're a recent graduate, a veteran freelancer, or an out-of-office-hours illustrator doesn't matter – we all want to be paid a fair rate for what we do. You do. I do. It's a given. The only problem is, a lot of us are out there working, but without knowledge on what's fair, so when a client comes along and offers to pay you a fixed fee for a job, or sets a daily rate for the same thing, it's all too easy to smile, shake their hand and be their new best friend for a while.
If you're young and a recent graduate, it's pretty likely that you might still live at home and don't really have a good grasp of what it takes to pay bills and probably don't have too many regular outgoings that need to be met, so there's a temptation to accept any offer of work without negotiating so you can get a foot in the door, build a client list, gain credibility and whatever else you think might push you to the top. This is probably ok for a while and most of us did it at some point, but sooner or later you will become frustrated when you can't seem to raise your prices while your friends are out living it up, or worse, you'll believe that this is what all illustrators should be getting paid and accept it. After all, we're doing what we love right? Can we really expect to live comfortably too?
Well, yes. We can, and we should. It doesn't matter if it's fun, it's still a job like any other and we're providing a service that people can't do themselves, otherwise they wouldn't come to us in the first place. So treat yourself and your skills with some respect and charge accordingly. If you undercharge, you're sending out the message to the client that the price they're offering is acceptable, and as a result, they'll offer the same amount to the next guy, and so on until someone says no, by which point the client will quite possibly feel that the dissenter is just some guy looking to rip them off. If this happens to enough clients, then you can kiss any hope of making a good living goodbye, and you've just helped to lower the incomes of a lot your contemporaries. No one wins but the client, who banked a lot more money than they probably thought they would – because you didn't find out what your work was worth.
Resources like the AOI can help you educate yourself on the wonderful world of rights, usage costs, and licensing to help you get a fair pay for your efforts. Getting an agent can also be a Godsend, as it's their job to know the ins-and-outs of pricing, and while they take a percentage of the earnings they bring you, they generally more than pay for themselves as they'll negotiate better rates than you might have done yourself.
I'm not here to tell you the price of everything, as that would be a long and ridiculous exercise (and to be frank, I don't know the price of absolutely everything either), and organisations like the Association of Illustrators have excellent resources on pricing structures for various things, but it should be known that one size doesn't fit all when it comes to illustration.
Here's a rough stab at the main points to think about:
Licensing is important
When you design an image, you can charge for the time involved in creating it, but you can also charge for the various uses the client has in mind for it. This is important information to find out, as the more uses the client has, the more you need to adjust your quote. Things to ask include where the work will be used. One country? Two? Worldwide? How long will it be used for – do they want it for six months or forevermore? What will it be used for? Print, television, advertising? Every application carries a price. Think of it this way; if you create a character illustration for a customer and they pay you £1000, then go and use it on a poster, you'd probably be happy enough right? But what happens if that client then takes the same character and makes it their company mascot, selling plush toys, tshirts, posters and whatever else, and they make tens of thousands from it in the process? Still happy? Take the time to learn the value of licensing images and you'll gain your worth, or as near as dammit. Some clients will flat out refuse to pay for licensing, only bringing you in as 'work-for-hire', meaning they own anything you produce. If this scenario comes to you, you have to decide if you're comfortable with that, or whether you want to walk away.
Hourly? Daily? Fixed fee?
Personally, I don't have an hourly rate. Some clients have tried to give me one by dividing my eight-hour-day and coming up with one, but that doesn't mean I'll abide by it. Here's why: some clients think they know how long something should take. We've all had it; the client emails and tells you that the revision is easy and will only take you ten minutes. Will it? Maybe it will, but then again, maybe it won't, and you can be damn sure that if the client starts dictating how long something takes you in minutes, they won't want to pay for it by the hour. Also, what happens if you're a quick worker? Does that mean that your worth on the job is less than someone else's, simply because they take longer to do the same thing? For me, and at the risk of being melodramatic again, hourly rates are a confusing and soul destroying hell-hole we should all run screaming from.
Daily rates are better, but make sure you're realistic about what that rate is. I've known some people to go freelance and set a rate by dividing what they'd like to make in a year by 365. Firstly, you won't work every day. In fact, it's possible you won't charge out half those days, so bear that in mind when setting a rate. Not only do you have to account for time spent working, but you also have to account for time not spent working directly. Administration, hunting for more work, emails, promotion all take up time. Of course, this doesn't mean to say you can aim to work one day a week and charge a fortune for it. It's a tricky thing to balance and if you're asking clients to be fair by you, you need to be fair by the clients too. Ask friends what they charge – you'll be amazed at how candid some people are about it amongst friends. You'll soon start to see a pattern emerge, and that's generally a fair rate.
Fixed fee is also good, but you need to treat it carefully. Don't be pressured into accepting one too lightly. You need to figure out how many days you think it'll take to complete the project and see if this fits inline with your daily rate. If it does, fantastic, but be mindful to let the client know how many days they're paying for and that any additional work will incur further charges. This should all be in your contract of works, but that's another issue and a whole other article.
Exceptions
You'll find certain types of work don't leave a lot of room for negotiation. For example, editorial work is fairly flat-fee based, and while there can be a little wiggle room, most of the time you pretty much take what you're offered, as magazines have budgets they need to stick to based on their circulation and their own production budgets. Publishing budgets work in a similar fashion. In both cases however, it's often wise to check whether the rights for the work extend into use in other imprints or territories as you really should look to retain those rights in case you can sell on the artwork elsewhere later on down the line. Pitch fees are similar in that a client is paying you to help them try to win work, so there's not a lot of room for negotiation.
I do wonder if there's anything we can do longer term though. Maybe colleges and universities should be teaching more about the business side of the industry to their students so more are coming out better prepared for the financial side of things as it can often be more stress-inducing than the work itself. If you're a student, why not ask your lecturing staff if they'll seek out a working illustrator in your area to come in and discuss the realities of working life with your intake, maybe it will be an eye-opener, and maybe, long term it will mean graduates entering the industry and making better wages from the outset, helping to keep a good standard across the board for us all.