What is a contract? A contract provides a definition of the project or assignment, limitations of the work (if applicable), terms of payment and/or credit for the designer, and protection of both sides in case of a dispute.
Why is there a need for a contract? There are times when clients don't understand what a Kill Fee represents or when they should meet with the designer if that is applicable. For the designer, they might expect a check immediately upon delivery while the client might believe he or she can pay 30-60 days after receiving the product.
How is a contract drawn up? The designer and the client will sit down and discuss the terms of the contract. They will set when and how the designer will be paid, if the designer will be allowed to use the work in their portfolio and web site, what the designer is responsible for, etc. Once the contract is complete a copy will be sent to the client to sign, it will then be returned to the designer to sign. A copy of the contract will be returned to the client to hold on to.