How do I Draft a Creative Agency Agreement’s Key Terms? 

If you decide to engage a creative agency, there are some key issues that you should be considering. These include the exclusivity of the relationship, the term of the relationship, how you will make payments and how the client will undertake the work. If you are a client, it is sensible to engage a lawyer to review the agreement you receive.  Or, if you are drafting the agreement, have your lawyer draft it to include specific terms to protect you and your business. Having these key terms in place will reduce issues later on and protect your business. 

Exclusivity

The agreement should clearly set out the relationship between you and your creative agency, as well as address the nature of the appointment and how it relates to exclusivity. If you are the creative agency, you may want to include a term that the client can only use you as their marketing and creative services provider. However, if you are the client, you would more likely make the relationship non-exclusive so that you can use other service providers if you would like to. Negotiating this term at the outset is prudent.

Term of the Agreement

Your creative agency agreement will set out the terms and will also include the option for renewal of the agreement. The agreement should have detailed and complete termination clause. It should set out the reasons as to why you can terminate the agreement, as well as a clear and amicable path to terminating the relationship with little difficulty.

Plan of work

Critically, you should have a clear and defined plan as to how both parties will behave in the relationship, how they will make decisions as well as timelines. You, as the client, will need to agree and approve the contract that should also detail,

• marketing strategy,
• creative concepts,
• schedules, and
• other events.

As the client, it is important that you set out how you can approve and deny the plan of work that the agency provides.

Payment

Depending on the agreement’s nature, you may have a monthly fee payable, a retainer or a fee payable on each project or piece of work delivered by the creative agency. Another consideration is the creative agency’s role in purchasing advertising or making other payments on your behalf. For these reasons, it is necessary that both parties understand the invoice process through clearly drafted terms.

Conclusion

It is important to draft terms and conditions that protect your business and define the relationship. For both parties to move forward, it is important that your agreement addresses exclusivity, terms and how you will make payments to ensure that you can amicably terminate if the need arises.

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