Ask Selina- New to Art Licensing, Help!

Hi XXXX,
Congratulations on the potential contract!
There are a couple of things the company could mean about pricing per image, so it’s a bit hard to give a sure answer.
Royalties can work in three ways-

• 1. Once off payment- a flat fee per artwork, for a certain duration. For example, $50 per artwork for three years, after three years the fee would be paid again to continue.
• 2. Percentage royalty- No upfront payment, and is normally a blanket amount for ALL artwork you offer them. Normally 5-15% for PHYSICAL products, but digital products can vary widely- up to 60%+ royalties is not unusual. So you would be paid a % for any sale on any artwork for the duration.
• 3. Royalty advance- the company pays you a bulk amount up front, for example, $500. But this is just an advance on what would be paid using option 2 above, and you will continue to receive royalties once the total they owe you goes over the initial advance amount.This is very rarely used, seen more in book publishing than art publishing.

I’m going to assume the company is talking about option 1 above, just based on their rather vague wording. Now, the price per image is really arbitrary and is completely up to you. But, of course, when quoting a price you would do well to consider the company you are dealing with and what they can afford. In some ways, option 1 is a little like option 3. You are making an estimate of what they would sell of your work and what you would receive if getting royalties, but getting an upfront payment rather than relying on the company to keep accurate records. That’s why option 1 is a good option for small business who don’t want the extra work of tracking sales for royalties and providing regular sales reports and payments to artists. You might also want to offer a discount depending on how many artworks they are licensing. This makes some sense because if they are licensing just one image of yours, you are likely to sell more of it, and if they license ten images the sales are likely to be spread more across the ten images.
When you get to see the contract, be sure to pay attention to the exclusivity and duration terms.
Three year duration seems to be standard on contracts I’ve seen. The exclusivity is also fairly standard, because companies will want to feel as though they are offering something special with your art, not something every other competitor of theirs can also offer. BUT on both terms you really need to read the details in the contract. For the duration, you need to know what your termination clauses are if you want out. For exclusivity, it can be exclusive per image, by region, or for you as an artist and your entire collection ever. When you get the contract to look over, check out my article on contracts here- https://selinafenech.com/2010/advanced-licensing-advice/ for more advice.
I hope that helps!
Selina