Finding the right mix of clients and projects
Peer group pressure is rife among designers. Most designers think others are working on brilliant, ground-breaking projects while they’re up to their @rse doing grunt work. Truth is, you need a mix of projects and clients to build a successful, sustainable creative business.
So, what’s a perfect mix?
The perfect mix
Of course, there is no ‘perfect’ mix but we know from experience this breakdown builds a viable business:
- 30% transactional work. Fee for service tasks most likely to be costed on an hourly rate.
- 30% passion projects. This is work you love for a client sector you strongly support and feel the most empathy.
- 30% other. The ‘general’ work of a studio. It is most probably a mixture of targeted clients and client sectors, and referrals.
- 10% pro bono. Supporting endeavours and people who can’t afford your services.
Firstly, the emotional rationale: working on passion projects uses our mind and our talents for good and not evil. It’s emotionally fulfilling to support businesses with similar aims and objectives to our own. The key is to find the right mix of passion and profit.
Second is the economic rationale – it’s about being sustainable.
Operating expenses including salaries shouldn’t exceed 60% of your complete turnover.
Drilling down further, the aim is to keep salaries below 30% and operating expenses to 30%. That means, a base of 30% of stable transactional work will cover overheads, allowing more flexibility in the other categories. It builds a sustainable base to a business.
Maintaining a base of 30% of transactional work should cover operating expenses
A word of warning
To run a successful, sustainable creative business, passion projects still need to be profitable. Sad but true.
There is no sense in running an unprofitable studio. It’s not good for clients because everyone wants to work with successful suppliers. It’s not good for employees – if they wanted a treacherous existence, they’d run their own studio. And it’s not good for business owners to continually assess their viability. So regardless of your passion, you need to source commercially viable projects.
On the other hand, pro bono projects do not have to return any investment. They come with caveats — once committed treat a pro bono client as any other; define the scope right at the beginning and ensure there is clarity around the value of your input by estimating and invoicing even with a nil balance — but that said, pro bono projects are not expected to return a profit.
The grass is not always greener. Rest assured even the greats of design like Pentagram still have a core of transactional projects. Use these ‘bread and butter’ projects to hone your technical craft, and streamline processes and procedures. The more effectively and efficiently you work, the more time left for those projects you feel passionate about.
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These articles also talk about clients and projects:
- What clients want from designers
- How to deal with price-sensitive clients
- What constitutes a client’s job
About Carol Mackay
After 30+ years running a graphic design firm, I pivoted from client-focused projects to consult to the design industry. Now with the Design Business Council I use my experience, and research, as a design mentor and coach. I help designers build robust, sustainable businesses, and help businesses integrate, and profit from, design.
The core of the DBC is the building a design community – over 85% of designers work in businesses with less than 5 employees, many less than 3. That means designers don’t have the same support network of other professionals. The DBC’s solution is supplement paid gigs with research, mentoring breakfast meet-ups, informative UNseminars and practical workshops in Melbourne, Perth and Sydney.