One of the trickiest things as a sole proprietor is figuring out how to price your services.
You, yourself, make the decision on how much you are going to charge people – including your friends, acquaintances, and estranged family.
In a perfect world, we could provide our services for free to everyone in a joyous world of harmony – one where we don’t have to worry about putting food on the table or paying the bills.
Sigh…but yeah, gotta get PAID!
So here’s a quick-reference guideline I’ve found has worked best for me as far as discounts are concerned:
1. The Costco Approach – as a photographer, we work (mostly) on a per-gig basis. If someone’s willing to bring me on for a weekly event, or 20+ hours during a 1 week period, I’ll consider giving them a discount on my rate. By taking the extra time & effort out of securing other work for that week or those times (if it’s consistent), it can actually benefit you to offer them a discount for buying you in “bulk”. For example, last week’s 3 day bender of 40 or so hours – since they were willing to provide me with that much work within such a short time frame, I was willing to give them a discount on my hourly rate. 5-10% or so would be appropriate in my opinion.
2. The Buy-It-Now Approach – by saving myself the headache of tracking down payment weeks after an event, (or when it comes to nightlife promoters sometimes MONTHS) offering a slight discount on payment can help put your mind at ease. Immediate/prior payment is obviously preferred, but I tend not to offer this unless it’s a large booking that I can use to put towards investing in my business right off the bat.
3. The Spicoli – While I’ve never really used this myself, it can benefit some photographers that might have day jobs that prevent them from getting their edits out in a timely manner. If the client is willing to wait a little longer (at least 2-4 weeks longer), maybe consider offering a discount for their patience in letting you take your time in editing their precious moments.
4. Friends – while it’s our natural inclination to hook up all our friends, good words spread fast about great work, and once people know you’re the go-to guy for photography, everyone wants in! Unfortunately, it would be counterproductive to do so many ‘favors’ for friends & detrimental towards your business growth, but that’s an entirely different blog post on pricing strategy. Of course I’m not going to treat them like a complete stranger, so if we’ve had a little history, even if it was math class back in 7th grade, I’ll be kind and offer a 10% or so. (If I like them)
5. Girlfriends/Family – This one is pretty much a no-brainer. Anyone that’s willing to help you hide a body, you don’t charge – I feel like that’s an adequate rule of thumb. Try that one on for size…next time someone asks you for a free shoot, ask them if they’ll help you hide a body – you’ll have your answer when you see their response. Also – show me a man that tries to charge his girlfriend, and I’ll show you a man with an ex-girlfriend. Just don’t let her go around toting your services like she has the hookup – make sure to get that ish clear between you two.
6. Promotions – I can’t count the number of times I’ve seen photographers advertising, “20% off for the month of MAY! ACT NOW” or “50% my regular rate because it’s Tuesday!” You get the point. Have a reason behind your rhyme. Use holidays, end-of-year, or come up with some unique promotional ideas for payment to offer savings on your rate. Don’t do it just for the hell of it. And I mean, hey – I could jack my rates up to $50,000/wedding and offer them at 95% off my regular rate…it just sounds silly when it gets to a certain point. Hold your value.
7. Trade – Some photogs are cool with this, as they’re looking to cover their bases. As long as they get food, drinks, maybe a 2 night’s stay at a hotel – they feel like they have it “made in the shade with trade”. While I don’t prefer this method, it’s always a good option to consider if you don’t have the biggest budget, but can work with providing something else in return. From my experience, anything I’ve ever done with trade has been double the cash value I would normally charge.
WHAT ‘NOT’ TO DO
1. Groupon - or ANY of the such! Can’t stress how bad of an idea this is for photographers. While I love these sites & think they’re great for the buyer, it more often than not doesn’t give the business the kind of clientele they’re looking for. If you’ve got a team of photographers that works like a photography warehouse, maybe this would work for you, but I dread the idea of locking myself in to a certain rate for a long time and doing it after-the-fact of being paid. (And not that much, might I add. These sites usually take about 40% of profit or so) In addition, the kind of clientele this brings are penny-pinchers, critics, and STRANGERS. There’s no personal connection, and it makes it THAT much easier for them to write a bad review of you on yelp, google, etc. If you’re a photographer who’s just starting out, this could really suck. It may seem like a good idea to drum up new business and referrals, but be patient my friend – grow it organically. How do I know all this? A friend of mine is currently locked into a deal with one of those discount companies – and she spilled the beans on how it all works. Not gonna mention any names, but let’s say that “Nelly” can’t wait to be in the clear from these clients.
2. Book weddings/big events LONG in advance at your current rate – if you work hard, and focus continually on improving, your rate should improve with you. You invest your time into learning about lighting, posing, gear, and composition – that time & effort should be paid off. I know it might be a bit confusing in regards to what I had said in number 2 above, but it’s also similar to the note mentioned about Groupon. You don’t want to lock yourself into a rate too far in advance, as your prices will inevitably increase. If you book a wedding over a year out, I would tack on an additional 10% to safeguard against feeling like your being taken advantage of when the time comes.
3. Keep your current rate when you’re stocked with gigs – You know when you’re really busy with work? That means it’s time for a RAISE! It’s nice being your own boss, isn’t it? Keeping your rate might seem like a good idea because you don’t want to lose a potential long-term client, but in fact – it’s actually going to prevent you from getting to where you want to be. Raise your rate about $50 more per hour when you’re getting that feeling of being too busy for your own good.
Hope this post helps – will be posting the client side on facebook either today or tomorrow, so keep an eye out for that!