When you make the big leap of faith and decide to turn your passion for photography into a business, one of the most difficult tasks is working out how much to charge for your services. Whatever it is, you should never make this mistake.
Whether you're selling prints, your time, your photography expertise, your post-production skills, or a combination of them all, trying to come up with a price that you think is fair for your customer and fair for your own needs is quite possibly the most stressful thing when you're first starting out. If you've made the big decision to go from hobbyist to semi (or full-time) professional, then it's most likely you have confidence in your work and the quality of the service and product you provide. But what's a fair price to charge?
There's no single answer that will perfectly encapsulate every person's scenario, but there's definitely one thing you shouldn't do. In this video, Derek Halpern explains one mistake that we've probably all made at some stage of our entrepreneurial journeys. What is it? Asking how much the client has in their budget. Why is this a no-go zone? Watch the video to learn more and then comment below with your thoughts and how you approach such a delicate issue. I hope this will be of great benefit to all everyone thinking about turning 2019 into some kind of business.
Coming at this from a slightly different angle, as a freelancer I now regularly ask potential clients what their budget is. In the past I've spent/ lost/ wasted time trying to pull relevant information from them to turn into a coherent and worthwhile brief (the more 'creative' the client, the worse this process is). I've then offered my quote only to be informed by the potential client of their budget which never marries up with my quote. So as a time saving device I now ask what the budget is, to then be able to offer a level of service and final result that is suitable.
Yes, my caveat is that I have 4 different pricing options already set. Obviously, as the price goes up so do the inclusions. So when I talk about budget I am up fromt with the different optionsavailable. That way, clients know what they’re getting for the amount they’re spending. Just an empty “what’s your budget?” doesn’t really help anyone IMO
The “what is your budget” structure came from when art buyers and creative directors would deal with representation for artists. So in those scenarios clear and transparent communication about budget and quality was necessary to cut the fat off the meat and get to the right fit for the project. The toy company I worked at would give the creative directior a budget for photography, he would then reach out to his contacts for a bid on said project and the reason why being upfront about price was a big deal was avoiding wasted time ect. Get directly to the point, this is how much we have to spend and this is the quality we are looking for.
In the creative world it is quite a bit different than let’s say an electrician, sure the electrician is licensed and has good reviews so his prices are largely going to be in a typical range for the “mostl likely” common job where he can estimate close to exactly the amount of time he will put in. In the creative world it can be nearly impossible to determine how long a job will take you exactly, most projects are one of a kind and take a wide variability of time and creative energy.
Sounds like the person he reached out to is a hack anyway, 400-600$ is not enough of a difference range nor overall price to gain or lose a job over.
Most reputable contractors, like electricans, already have a set price in mind. Price per square foot for new construction, and per foot of material (wire/pipe) on remodels. Add a set price of per hour of labor (per person and experience) with a markup for materials of roughly 150%(switches/boxes/plates/outlets/pipe etc). Then there is the added cost of an extended project due to unforseen circumstances.
But every region of the states has a cost of living expense that determines the set point for their charges. Example would be; NY,NY would be much higher than say rural Alabama.
Every contract should include an itemized list of cost and the time limit. That way both parties know "exactly" what it comes to cost wise.
That gave me a good chuckle.
I think it depends on what part of the industry you're working in and how well you know the client. If you already have a good relationship with the client and can talk candidly, asking what the budget of the shoot is before offering services can give you an idea of what you're able to offer.
However, in pretty much every other circumstance I think Derek's advice of offering packages and talking about how those packages could help the client in different ways is the best option.
Ideally I’d suggest trying to get a brief from a client, including details such as time, licence, final product... etc in order to be able to offer a quote.
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Why doesn't he just say I have $400 for a job doing X Y and Z for 8 hours?
Because he knows that the old adage of "he who mentions price first loses". The free lancer answered it wrong as he should've said what does the job entail not what is you budget.
OTOH If I get a call and say I'll charge $100, and the client says that is too much, my next question is what is your budget? If they say $25 then it probably won't work out if they say $80 then we can negotiate.
That’s pretty much exactly wht I do. I say “I have 4 different options at 4 different price levels. Here’s what you get for each.” Then I go through each and talk about what might be the most suitable deal.
Photographers tend not to be great negotiators. Just for that reason videos like this are worth wile. But to me step 1 in negotiation is finding the right tone. Can't say this video really does that.
There's a time and a place to ask the budget question.
If client is asking about your basic services that you offer regularly, you'd better have a standard rate in place. If not, you may come off as suspicious or just non-professional. If you truly don't know what to charge, research the client. Get an idea of their industry and clientele and charge accordingly.
However, if it's a complicated job or perhaps a new client you haven't worked with before, the "what's your budget" question can save both of you time.
Yes I think the best way (in my experience) is to have different price options and then be completely up front and honest about what each option offers. That way, the client can work out the most suitable options for their needs and budget
In my previous life I was a suit in a major NYC ad agency, and that was always the first question we were asked. But we tended to deal with mostly the same general universe of people and it was just to set up a starting platform. They knew we were required to do three competitive bids so they had an incentive to keep their price contained or make a good case for why spending a bit more with them was worth it.
Why not simply use a hybrid?
"My day rate is $X with a half-day minimum. How long it will take depends on the specifics of the project."
This is a good starting point. The only problem is that it throws up questions about what’s included in a “day rate” or “half-day rate”.....I find it easier to do it in packages where clients see what they’re actually gettingg for their money.
The best pricing and negotiations advice I've come across is on TheFutur YouTube channel. That guy can sell anything and can get around any roadblock in a negotiation. Highly recommend.
https://www.youtube.com/user/TheSkoolRocks
Add this to your "things NOT to do on You Tube" video: Stop yelling at the viewer. lol! - There's nothing wrong with asking a client what there budget is BUT I would never give them a price range. Remember the first rule of negotiating: The first person to name a number loses. Usually after asking the client what their budget is they'll give me a number. If I like it I'll obviously take it. If I don't I will offer a counter. If they know how to negotiate they will push me for a number first. I'll then estimate a number based on the project that is high but a number I would be more than happy with to do the job. If they waffle you can always go down. The second rule is DON'T YELL AT ANYONE even if you're trying to be cool.