If you’re a visual or graphic artist, such as a designer, photographer, fine artist, painter or even a sculptor, you have multiple avenues to make money. Some artists earn money by selling their original work. They can display their work in galleries and at craft shows and then sell each piece for a profit.
But when you fall into the trap of selling each piece of art only once, you are trading your time for money. Some artists can sell prints of their work, especially paintings and photography. But even then, you are paying for materials and the time it takes to print the copies.
To build a successful business as a fine artist, you may want to generate residual income. When you learn how to license your artwork, you can get paid an unlimited number of times for the same piece of art—with no extra effort required on your part!
Residual income from royalties when you license your artwork can help keep money in your pocket even when your own sales are slow. And if you decide to take a break from creating artwork, you can still have money coming in.
But how can you do it? What are the steps? And what are the pitfalls to watch out for?
What is licensing your artwork?
When you license your artwork, you are giving another entity—either an individual entrepreneur or a business owner—the right to reproduce your artwork for sale. You retain the copyright, and the person who licensed the art can only use it in the way you both agreed. You should have a contract outlining the terms of the licensing agreement.
What are royalties?
Royalties are residual income that artists and other creators earn by allowing people or businesses to reproduce their artwork. You may wish to negotiate 20% of all gross income earned from the sale of products bearing your art. That’s because the licensee is putting in the time and money to reproduce the art on different products, market the products and manage their distribution.
When you’re negotiating a licensing agreement, you want to be sure you’re being compensated fairly. Creating art in the first place is no easy feat. You want to be paid not just for your time but for your talent.
As the saying goes, “If I do a job in 30 minutes, it’s because it took me 10 years to learn how to do it in 30 minutes.” In any licensing arrangement, you want to be compensated for the years, not the minutes.
By the same token, when you’re negotiating, consider the profit potential of your artwork. How many items is your licensee likely to sell? You may accept a smaller percentage from a well-known, high-volume e-commerce store than from a mom-and-pop shop who is selling items at local craft fairs, because you’ll make more money in the long run.
[Read more: How to Start Selling Your Fine Art]
Licensing art vs. assigning a copyright
Alternatively, rather than allowing a business to use your artwork and earning money for each sale, you might agree to assign the copyright to the business. Then, that entity owns the copyright to your work. You can’t license it to anyone else or to sell products with that artwork on it yourself.
However, you might receive a larger lump sum payment for assigning the copyright. If you don’t foresee using or selling the artwork in the future, and you’re unsure about how well the design will sell for the company, you may accept a lump sum payment and assign the copyright.
If you want to retain the copyright but are unsure of the sales potential of the design, you might negotiate for a one-time license fee. You’ll get a lump sum payment and the licensee keeps all the profits from the sales. There are risks to this arrangement because the design might sell better than you expected and you lose out on residual income. It’s up to you to decide the scope of the licensing agreement and negotiate royalties, which are a percentage of the total sales that you would receive from the licensee.
Copyright your work
If you decide you want to begin earning royalties off your artwork, the first step is to make sure your art is copyrighted. Since filing a copyright can take time, you’ll want to do this before you begin reaching out to manufacturers who may want to license your work.
[Read more: What Happens if Someone Violates Your Copyright?]
Creating art in the first place is no easy feat. You want to be paid not just for your time but for your talent.
Create a portfolio
It’s best to group your artwork into collections of similarly themed pieces before you begin sharing it with manufacturers. You’ll want to create a style guide for each collection, which is a portfolio of the pieces you have available for licensing.
Market your artwork
Once you’ve created style guides for your artwork, you’re ready to begin making connections and marketing your work to manufacturers and agencies who may want to license your designs.
Many agencies license artwork and shop it around to larger clients, so if you can develop relationships with these agencies, they will come to you when they’re looking for designs.
You can use a combination of inbound marketing and “push” marketing—where you approach businesses with a proposal—to make sure you’ve covered all bases.
Inbound marketing can take time, but it can help create a stream of ongoing leads so you never run out of potential licensees. Fortunately, if you’re already selling your art on a website and through social media, a simple shift in messaging that your art is available for licensing can put you on manufacturers’ and agencies’ radar.
Reach out to potential licensees
When you’re just getting started licensing your artwork, you also want to be proactive. Look around—on the web and in stores—for companies that sell products using artwork similar to yours or that reaches your target demographic.
Businesses may wish to license your artwork to reproduce on:
- Poster prints, signs and wall art.
- T-shirts and other clothing.
- Posters.
- Cups.
- Pillows, blankets and other soft goods.
When you find companies you’re interested in working with, call and ask who you should speak with in regard to artwork licensing. It really is that simple. The receptionist may provide you with an email address or give you a name and extension to call. Sometimes, a quick search of the manufacturer’s website will reveal that they accept submissions from artists for licensing. If so, follow the instructions on the site to reach out to the company.
You can also reach out with an email and a link to your portfolio. This is called “cold emailing” and can be effective if you target the right agencies or manufacturers and send out enough letters.
[Read more: Everything You Need to Know About Intellectual Property]
Tackle revisions and build relationships
Keep in mind, some clients may request revisions of your work. Companies know what sells best to their market, so it’s wise to listen to the guidance of their art directors. By working together, you’ll be able to create pieces with greater profit potential.
If you develop a reputation for being easy to work with and delivering appealing designs that generate sales for the company, you can create a virtually endless stream of income by knowing how to license your artwork.
CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.
Follow us on Instagram for more expert tips & business owners’ stories.
CO—is committed to helping you start, run and grow your small business. Learn more about the benefits of small business membership in the U.S. Chamber of Commerce, here.
