Prices...what to charge

[DVX100Shooter]

I get asked all the time what do I charge for this, what do I charge for that? I have some rates that I am still playing around with on paper. I have heard that some people charge a straight out flat fee for their services and others charge by the hour.

Can anyone give me an example of why one is better than the other?

I guess if a project requires a lot of shooting or editing time, I should charge by the hour?

I guess it could also depend on personal preference too. I just need to have some sort of rate plan in place for when I get my business up and running.

[Barry_Green]

Depends on the services you're offering. If you're just shooting, handing over the tape and walking away, then that's usually done at a flat rate, usually somewhere between $350 and $600/day depending on how good you are. Add equipment to that, so a guy with a camera usually goes for around $500 to $800. Depends on the camera too, of course.

But if you're talking about doing a full project, all editing, all post, all putting up with changes and requests, then there's two schools of thought on that too: either charge by the hour (which people seem to charge between $50 and $125) or tell 'em a flat rate (a HIGH flat rate) and forget all the billing and hourly and fighting and arguing that goes with it.

The other way to look at it is to forget all this stuff about "what do you charge", and turn it around on them and ask "what is your budget for this project"? In negotiations, one of the cliche's is "the first person to mention a number loses." I usually don't bother with trying to "charge" unless it's for an established company that knows exactly what they want and they just want a "day rate". Other than that type of client, I go in asking for what they have budgeted, and if they don't have any clue, I try to give 'em three potential price ranges that they could choose from, telling them what would be different in each (such as, "well, we could give you a basic commercial for $3500, but for $8,000 we could add this and that and the other thing, and if you really want to make an impression, for $35,000 we could do this, we could have this celebrity appear in it, we could do that, blah blah.") Almost always they choose the middle price range. So then I proceed based on the idea that we're going to do an $8,000 commercial, so I budget in what they can get for $8,000 (because with video, people rarely know what's possible, and they don't know what to expect to get, so you have to educate them every time).

Well, anyway, that's the way I've been doing it, and it seems to work. But I never, ever go over budget, never ever hit them with a "surprise", and I make sure they sign a contract that says if they change anything at all in the script or the production or anything, they agree to fill out a "change order" and pay for the changes in advance. So far nobody has. So I'm able to deliver on-time on-budget. Other people make a *lot* of money charging hourly rates... if that's your style, it's a perfectly accepted way to do things and people do understand it... I just don't like the idea, I like to give them a "will not exceed" number so everyone's happy, and then I like to deliver more than they expect, sooner than they expect it.

[DVX100Shooter]

Thanks Barry your comments shed some light on my concerns!

[grinner]

I charge one hourly rate.
Doesn't matter what we are doin... editing, animating, compositing, dubbing, or talking. It's 195 per hour. This not only keeps the day simple but it makes billing MUCH quicker and easier. I don't have time (or the desire) to go through and pick out two hours for this and 8 for that. How ever many we worked... that's how much it costs.
That said, I do some tv shows unsupervised for clients out of town and I do those at a flat rate. I had to do this to get the bid. I just multiplied my hourly rate by how many hours it otta take to get this figure. This is even more simple than hourly but can only be done effectivly when you know the projects well... and when bidding on new projects that can be tricky. All in all, it lands at my hourly rate (or I wouldn't keep doin em).
I'm a one man band and none of my time away from my family is worth less than other times.
I see no need to charge one rate for one thing and another for something else. They are paying for me and my gear.

[B._Summers]

Thanks dood's

that cheet is tight, what if you shoot as well as light, and take care of sound

(One busy Mafawka) But same prices for Grinner no matter what right?
Then what Barry quoted, plus the other services?

Barry, how many other people do you work with on typical 8k shoot?

You guys RAWK!

[IncMedia]

I bring a few extra (non-paid) people with me and have them wear the company shirt. Makes the team look thick. lol. But I use 5 trained people for my jobs. We never have any problems.

[Barry_Green]

Barry, how many other people do you work with on typical 8k shoot?
I didn't see this post before, sorry for responding so late.

On an $8,000 commercial, where the money goes depends on what format we're shooting on, if we're having to pay a host, etc. *I'd approach an $8k commercial with the idea that I want to keep at least 25% as corporate profit, and then get paid for the job I'm doing as well as paying the people on the shoot, plus props or film stock or whatever.

If it's a DVX shoot, it might break down as a 1-day shoot:

$500 for the host/onscreen talent plus agent's fee
$800 for a good D.P.
$150 for the camera
$450 for a sound person & gear
$1100 for a gaffer & grip/lighting truck
$650 for stage rental
$500 for misc props, art director, set dresser, whatever etc.
$250 for food and whatnot
$800 for writer/director
$750 for a day of post work
$50 * for tape stock and dubbing to BetaSP for delivery
-----
$6000 total expenses
$2000 corporate profit/markup

Depending on the spot, you may have the client him/herself as the on-camera "talent", but you may have to spend that $500 on someone to do graphics for you or something else. *Or you shoot on film, so camera rental and film stock are higher (for 16mm, I usually budget in $300 for 400' of stock plus processing and transfer, but bill the client $1000 for it). *Some shoots need a makeup person, some need sets designed, some need other specific needs so you have to balance it all out. *Some need specific gear (like underwater housings for the camera maybe, or a jib arm, or whatever it takes). *So you add here, cut there, but whatever you do, keep your profit margin intact or there's no reason to do the spot.

Of that overall budget, if you're the right guy for the job, you could be the writer/director and the guy who does post, so you could plan on pocketing the fee for the writer/director, the fee for post production, and the fee for camera rental, as well as corporate profit on the job, so you could walk away with about $3,750 for a couple days' work (well, plus all the time you put in for overhead, hunting down business, managing the client, billing, taxes, accounting, legal, making and distributing demo reels and other forms of marketing, meet 'n' greets, luncheons, mixers, appointments, preproduction meetings, writing contracts, and on and on and on... all that stuff that you as a small business owner have to do.)

[DVX100Shooter]

sounds like I/we need to hire an accountant to take care of all that! LOL! I just wanna shoot and edit and produce! Very Good points though Barry. Thanks for the breakdown. One more question Barry, is $750 a day for post to much if you need to spend at least a week editing? I just edited a project a few weeks where I spent 9 hours straight editing which included designing the DVD too! Now I didn't charge nothing because this project was a birthday present for someone but for projects like a Music Video that might require extra editing time do you still charge a figure like that or do you bring it down and negotiate some sort of compromise? It took me about a 2 week span just to put together my 2004 Demo Reel! 1 week for graphics and 1 week for editing it all together. Also what constitutes as a full day is it 8 hours or 10 hours I have heard both?

[Barry_Green]

I was talking about a commercial needing only one day of post. A music video or something like that may take much longer. Post rates depend on how good you are and how much you bring to it; rates of $100/hr are not uncommon.