Show Me The Money: What Do You Charge? Let’s See What It Costs

“Day rate is not an accurate measure of photography cost, as it does not include expenses. Day rate does not transfer usage or licensing rights, the real sale in commercial photography.”

“What do you charge?” There is something about that much anticipated, yet dreaded question that causes many photographers distress. There are probably a dozen psychological reasons for this feeling. Rather than take on those feelings, which is beyond my ken and that of this magazine, I’d like to look at specific actions and steps you can take to improve your behavior when it comes to pricing and asking for money.

It all begins when a prospective client or customer asks, “What do you charge?” Hold on. First, they are asking the wrong question. It’s too personal and too subjective to answer professionally and objectively. The real question should be: “What does the photography cost?” But we can’t change the behavior of our clients, only our own. So, try this technique: in response to their question about what you charge, say, “Let’s see what it costs!” The key here is changing from “you charge” to “it costs” and making it more objective.

They are also asking the wrong question if you hear, “What’s your day rate?” Day rate cannot answer the pricing question for several reasons. Day rate is not an accurate measure of photography cost, as it does not include expenses. Day rate does not transfer usage or licensing rights, the real sale in commercial photography. Day rate implies employment and you know the client does not want to employ you. (For the best reference for commercial pricing guidelines on usage and licensing, see Pricing Photography, 3rd Edition by Michal Heron and David MacTavish, Allworth Press. For wedding and portrait pricing guidelines, check with your national photography associations and photographer peer groups.)

To price out a job requires that you first get a complete and thorough description of the photography project. What does the client specifically need? What are the number of setups, the number of views, and then the number of variations? You can’t get too much information! For an example of a setup, think of the background, camera, lighting, props, and surfaces. Then look at the number of views: how many people or products (or both) are going to move in and out of each setup? Finally, look at possible variations: once the setup is fixed and the view is in place, how will the client want to vary the pose or the product placement? Be sure to find out how it will be used (for commercial clients) and if it will be for print or web use (for consumer clients), as this will dictate your expenses on digital capture, scanning, and delivery media.

Ask about delivery in a way that gets you usable information. This allows you to include any possible rush charges for a faster than normal delivery. Ask for objective information rather than just their opinion on the delivery due date. Don’t simply ask, “When do you want this job done?” It is much too subjective a question. Instead ask for more objective and measurable information such as, “When will the website be launched? When is the ad artwork due? How many people need to approve it beforehand? How long will that take?” By breaking the deadline into a series of benchmarks on a timeline, both you and your client will feel more in control and be more likely to meet the true deadline. Always help your client motivate others in the approval process by giving them a timeline. Be a partner with your client. It is the two of you against all the other forces that can delay a job.

Ask about usage. For commercial jobs you are selling rights to use the image and some clients can tell you exactly the rights they want to buy. But when your client isn’t familiar with copyright and usage pricing, try this question, “Who will see it and what will they do with it?” This question will determine whether your photography will be in a simple catalog or used in a national ad campaign.

Ask about the budget. “What are they planning to spend on the photography?” Though clients won’t always tell you, at least they will know that you are concerned. You’ll get the information in a later step so don’t worry if they won’t give you the answer at this point.

Ask how many people are bidding. “Who else is giving them a cost proposal?” This question will often tell you the answer to the budget question. Again, your client may not want to give you the information, but at least you’ll know whether the job is being put out for bids or if you are the only one.

Ask about payment. “How will this be paid?” Always work out all the details of deposits and payments at the beginning of a job. In consumer photography, wedding and portrait clients usually pay a substantial amount up front to secure the photographer. Payment for commercial photographers is often related to the type and to the size of the client. The larger the company, the further away your client is from the person writing checks. When a commercial client does not know how you should proceed on the issue, ask if you can talk with their accounts payable department. Your client will probably appreciate one less thing they have to do and the accounting department will be able to tell you what to do to get paid in a timely manner.

At this point, you may want to get some professional help with putting together your estimate. You can buy different computer software programs that will assist you with pricing and estimating photography such as fotoQuote (www.fotoquote.com) and Blinkbid (www.blinkbid.com).

Have A Plan B Before You Talk Price
Once you have determined the photography fees and expenses for the project, stop and consider what happens next. When you give a client—any client—a price for your services there are only really two responses: yes, that sounds good, or no, they don’t have that much money. When the response is positive, you can move ahead to a written proposal but when the response is negative, you need a “plan b.”

Why not just drop your price, why bother to negotiate? Because it is incredibly unprofessional to magically make money disappear, money from your profit. When you act unprofessionally it hurts the rest of us in the business. Finally, once you do this the client will never agree to your quoted price; you will always be asked to drop your price. So before you talk price, you need to be prepared to negotiate or walk away.

On any project, less money might be okay, but fairness and good business sense demands that you negotiate some considerations or changes to the detailed project description. I have been teaching and using a very simple negotiating concept—for the client to pay less the client will get less of some aspect of the project description or you will get more of something valuable to your business.

To create these considerations you must put two lists together in advance of any discussion of money. One is a list of the considerations the client can make to lower the price. For example, they can get less work, different variations, fewer views, less usage (if the project is a licensing one), fewer approval stages (if the project has a long timeline). Anything you can think of that will help the client pay less without damaging the images.

If you need to, go to your second list. These are the considerations where you can get more of something from the client to lower the price. For example, you can get more time, more printed samples, a link on their website to yours, barter for goods and services, better photo credits, or better payment terms. (Please check with your accountant for the income tax consequences to barter payment for your services.)

“When you give a client—any client—a price for your services there are only really two responses: yes, that sounds good, or no, they don’t have that much money. When the response is positive, you can move ahead to a written proposal but when the response is negative, you need a ‘plan b.’”

Now, You Can Talk About Money
So with your two lists of considerations ready, here is a good script for verbal presentation of your pricing estimate: “From what you described, it will cost $5000 for that amount of photography, how does that fit your budget?” Note the use of the word it making the photography less personal to you and then take note of the test-question part of the script, how does that fit. The less personal the negotiation is the better you can handle the situation. The test-question asks the client to think instead of the following closed question that you should never ask: “Does that fit your budget?”

When they respond positively, then you go forward with the written proposal. When they are negative about your price, then you go back to your two lists of considerations to negotiate. Before you put anything in writing, negotiate all the considerations and project’s description until you and your client agree it sounds good. If the client does present you with a budget for a specific project description—for consumer or commercial photography—then you can go straight to a written proposal. Often they will not, and you should prepare a script in advance so that you can handle any of those “how much do you charge” questions.

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COMMENTS
texas best's picture

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zacsifac's picture

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zacsifac's picture

Also 5000$ might seem a lot for somebody new in the field but others find this sum "manageable".

byronryder's picture

There are a lot of ways to improve the relationship with the clients, knowing how to answer to the questions they give is vital if you want to create a good impression. My son is a photographer and I am sure he would like to read these tips, it will give him a better understanding of the photography cost measures.

opaler's picture

I was never a good negotiator because I don't know how to handle money, I am better with people than I am with money. That's why I got Phoenix Accounting to keep all my records and also to negotiate my bigger contracts for me. That way I can stay true to my work and not have to worry about money.

crazymeme's picture

Thank you for providing this great and useful post! Being a good negotiator is a must in the business field even if you are making money online or running a local business.

sultan's picture

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brenden's picture

Digital photography is one of the booming business today, because now a days digital imaging is an easy as 123. Digital cameras are at reach of people such as smart phones, cameras and the in demand DSLR cameras that fascinates people in taking high quality pictures.
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zacsifac's picture

Speaking of which, I was thinking of buying a home and I have been kept some savings for a few years, but then I thought of investing them in a similar idea, and then with the profit I am really considering making an advanced payment and loan for a house. I know it`s risky, but reinvestment is safer for the future.

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crazymeme's picture

Thank you for this great and useful article. I've recently read a similar post on http://www.absolutewealth.com/ about the importance of asking the right price for your services. As a photographer, I have to give my clients a detailed list of costs for my services.

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aglaja's picture

I think that before setting the price for your work, especially because it is a vocational one, you should do some market research first, see what are the prices in your area and then arrange everything based on your experience in the domain like Ryan Deiss once said.

ereere's picture

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opaler's picture

Negotiation is an art and we have to use it in our daily life more often than we expect, not only when applying for Instant Credit Loans. When it comes to business for example,a program is always a good thing to start with but negotiation skills are vital if you want to keep your business running. It's a jungle out there and you have to maximize your profits and reduce costs.

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