The Lure of The 5FAL: Why You Should Protect Your Business From It

— January 30, 2017

The past decade has seen a boom in technological advances, within the creative community. From affordable pricing on once-unobtainable hardware, to graphics/editing software that handle techniques once reserved for rubylith cutting veterans, the line between creative professional and amateur filter jockey becomes blurrier and blurrier. So much so, a viable business model has sprung up, taking advantage of the “one-touch retouch” fledgling creative that is looking to get a foot in the door, by setting fire to the entire building.


“What is this business model?” you might be asking. It’s called lowballing, and it’s priming our industry for a serious disaster.


low·ball


ˈlōˌbôl/ – verb


gerund or present participle: lowballing


NORTH AMERICAN informal
offer a deceptively or unrealistically low estimate, bid, etc. to.


While this applies to many fields that are related, Ill be speaking from the viewpoint of a Graphic Designer.


Crowdsourcing and “$ 5 for a logo” (I’ll call them 5FAL) companies are absolute death for the creative industry. These types of companies rely on utilizing a group of designers to create work for a client, often at a dirt-cheap price, or providing a marketplace that sells designs and/or creative services for a vastly undervalued rate. It provides a means for businesses to access a multitude of designers and artistic styles. However, it lowers the overall perceived value of the work we do.


Offering creative assets or services for five bucks is an insult to every graphic designer, calligrapher, typographer, writer, artist or creative that has invested the time & effort into honing their craft and making a decent living within their field. I, myself, have 20 years of real-world experience. Making us herd together like cattle and compete for your consideration gives off the perception that we’re contestants in a contests (and is often marketed as such): http://bit.ly/2jrcDmc


Now, to be fair:


Are we guilty of price gouging? Sure. Since it is tough to quantify when work begins/ends and what qualifies as work related activity, some creatives have taken advantage and charged for everything. Listened to a 30-second voicemail about a project? Half-hour of billing. It’s sad, and just as destructive, as crowdsourcing and 5fals.


Did we, inadvertently, start this trend? Possibly, as a means for new designers to drum up new business and counteract the aforementioned gougers.


Are we, equally, at fault for subscribing and participating in these business models? Absolutely.


Is reducing the average wage of entire industries the answer?


Absolutely not, yet, that is exactly what these companies do.


How? Let’s take a look:



  • Client wants a logo. Signs up for one of these 5fal companies and seeks a designer to create a logo for $ 5
  • This particular designer’s normal rate is $ 55 per hour, but is having a hard time drumming up business, so takes the job. 2 hours of work was put in to create a vanilla logo, using templated graphics and a safe (read: quick) layout.
  • Client likes the initial draft, but requests tweaks. Designer agrees, putting in another hour of work. Resubmits.
  • Client approves. File is packaged and delivered to 5fal, while money is transferred to designer (after 5fal takes its cut. Let’s assume it’s $ 1).

So, here’s how it breaks down:


Designer billing hours: 3 @ $ 55 per hour


Designer accepted: 3 hours @ $ 5 flat ($ 4 after 5fal fee)


Potential income, never realized: $ 160


Add to that, the possibility of client retention. While the designer may have acquired a new client outside of 5fal, they have to now justify a 1000% increase in rate for new projects.


Outcome:


lowballed designer. potentially skeptical business owner. high chance of losing return business.


So, what have we learned?


As the owner of a small business that looks to help small businesses thrive, I understand the value of staying within budget and getting the most bang for your buck. However, please understand that you WILL get what you pay for. INVEST IN YOUR DREAM, BUSINESS OWNERS. Be honest with your budget and don’t be afraid to let your creatives know what you can afford. You may not get all of them, but you will get more than you think. Just like you, we’re thinking of budgets as well. We want to make excellent work. We want to see you succeed. Your success, as a business, yields positive marketing opportunities for us, as the creative department that branded you. Don’t be afraid of spending on quality. If you think a professional design is expensive, wait until you have to pay for your amateur one: http://read.bi/2jLyYMf


Eager creatives, respect your craft and all of the pioneers that have paved the way. Don’t contribute to the notion that artists are unimportant or dispensable. You will make it! Just strive to be better and learn the business of being a designer (it IS a business, afterall). Why do you think lawyers and doctors are expensive? Because they are tasked with the heavy burden of handling matters that affect lives. You do the same with every business that turns to you, seeking a means to be successful, in a world that is primed to see them fail. Understand that!


As for 5Fals and crowdsource companies, I’ll consider supporting the models ONLY if their owners choose to do the same. Find the best IT professional that can maintain your servers, for five bucks. Get excellent legal representation, to protect you from lawsuits, from a stable of lawyers in another country. Find and subscribe to a quality health plan for you, your loved ones and your valued employees, for….you get the idea.

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