Jonathan was recently contacted by a very large, multi-national company to quote on some illustrations for packaging for a global brand. He was asked to send in an estimate for:
- A per piece rate for an illustration to be used as packaging. There would be 4 in total.
- Usage rights for 1 year in North America.
Once he’d got over the initial excitement, he started to panic! Having had no prior experience pricing work for packaging, yet alone for such a large company, he had *no* idea how to figure this out.
While Jonathan was mid-panic, I got in touch with a contact of mine - let’s call him James - who had previously worked for a similar company. I thought he would have some useful insights and he didn’t disappoint…
This is the advice we got back from James, a former marketing manager for a large multi-national brand…
- Design work should be in the singles of thousands – come up with some principles that arrive you at a figure of maybe $3-5k for the initial conceptual work and then an additional $5-10k for the whole four routes finalization, if chosen.
- Usage rights should be in the $10k+ range to be credible
- You should negotiate having you references as the illustrator somewhere (maybe not on pack, but in PR release, website etc.) – and possibly then drop the prices of the rights a little, if they are willing to do this
The caveat being that these figures were based on packaging for a higher-end type of product. But the advice didn’t stop there.
James also contacted a colleague currently working in a similar field for a global brand who sent these figures…
- Design: 4 routes at $10-20,000, depending upon rework required.
- Finalization of chosen one (high res, finished files) at $6-10,000.
- Rights for North America only for 1 year – we usually buy rights outright so this will depend how well-known a creative is.
- We usually budget in the region of $200 per hour for creative, so that works on the assumption that it takes 1-2 weeks for the 4 design routes and 1 week to complete the final designs.
And the final piece of advice came from a small design agency who work with the big corporates on a regular basis….
- Conceptual rough illustrations: 4 hours @ $200 per hour = $800
- Refined illustrations of chosen concept: 8 hours @ $200 per hour = $1,600
- Colouring: 4 hours @ $200 per hour = $800
- Usage rights NA @ 20% = $640 per year
- Bottom line is $200 hourly charge and 20% usage rights per year per region included in the hourly rates
Interesting stuff, hey?! That’s quite the range of figures.
However triangulating all the varying ranges is simpler if you take the fact that all parties appear to budget using a $200 per hour rate.
Taking that rate, we sent in the following estimate which we calculated based on:
- Initial design & concepts to create sketches ~ around 10 hours @ $200 = $2,000 per illustration
- Creation of final illustration ~ around 15 hours @ $200 = $3,000 per illustration
- Usage rights @ 50% per region, per year = $2,500 per illustration
The total project estimate coming in at $20,000 for 4 pieces and $10,000 for the usage rights for 1 year for all 4 pieces. As you can imagine, that was quite a stretch for Jonathan to submit a quote like that!
Unfortunately he didn’t end up getting the project because they went with another style but the estimate was spot on. The experience has been priceless and the information we gleaned was too good to keep to ourselves, so hopefully this is useful to you too.