I’m so excited about a great new column I’m kicking off today called “Ask Anything.” Former Art Buyers and current photography consultants Amanda Sosa Stone and Suzanne Sease have agreed to take anonymous questions from photographers and not only give their expert advice but put it out to a wide range of photographers, reps and art buyers to gather a variety of opinions. The goal with this column is to explore more of the commercial side of photography (not my area of expertise) and to solicit honest questions and answers through anonymity.
To submit a question you can email me or leave a comment in one of these posts.
The First Question comes from me:
One commercial photographer told me he was bringing in $250,000 in profits and another said he has several million in billings. So, what do successful commercial photographers make? I’ve always believed it was a lot. How has the economy effected the way people price? Are photographers starting to base their usage on their cost of doing business instead of the cost of the use?
Amanda and Suzanne: The responses have been amazing, from photographers with all levels of success to a very high level art producer. We really enjoyed the personal and honest insight we got as to how they bill and the thought process behind it. It reminds you that you are not alone in this negotiating process. Keep reading – we had 1 photographer bold enough to give the answer everyone has been waiting for.
Hot Emerging Photographer:
What is an average successful profit for a commercial photographer? My rep doesn’t price based on CODB, but on what the market bears. And it’s definitely going down from what it used to be (from the mouth of my rep). Times are changing, sadly enough it’s because the high earning commercial photographers with big overheads are struggling to stay alive and taking jobs for much lower fees in order to pay it. In turn, that makes the emerging photogs like us less competitive because we don’t have the experience and portfolio that they do. Then to think about hiring a staff, and having to pay for that. Now I understand why photographers get paid quite a bit. My rep basically bids on what the client’s budget is, we push the production as low as we can to do a good job then create the fee out of the gap. I think if everyone goes by CODB that will drive the market down even more because the smaller guys don’t have as high of a CODB. I vote to keep an industry standard of fees. Especially with this digital era.
Established Photographer 1:
250K in profits! I want to be him. In my best year, I grossed 225K and I was quite pleased. I can’t remember what I net’d but would have to guess around 1/3 of that.
I’m not sure I’m not a great one to compare as I keep it small, simple, and avoid big overhead. I’m happy with a couple of big jobs a year. I’d rather work fewer, better jobs than be cranking at 100% all the time (and burning out). It’s also difficult to compare me to most; I was away from business from 2005-2007 and have had a very challenging economy to grapple with upon my return so there’s no steady recent history for me to gather information with.
I have estimated jobs based on usage, and I haven’t won many of them :-(
Established Photographer 2:
I have always tried to avoid talking about this kind of stuff. Even though I bill well over a Million Dollars in gross billing annually. What you actually pay yourself is much, much less.
I am at the top of my game and probably make about what a halfway decent Attorney makes.
It is quite exaggerated what photographers make.
Keeping up with new equipment, software, insurance, salaries, and repair keep you from making any truly great money.
I assure you the owners of Advertising Agencies make much more money than us guys in the trenches.
Sure there are a few Super Star photographers but they even go broke. Take Annie Leibovitz for example.
Established Photographer 3:
Alas, I am south of 250K…. I think my rep told me once that most guys are around 20 – 25% of their gross, I was typically around that to maybe a bit more. I don’t know specifically what the numbers are, just in a general sense – as I remember that 08 taxable income was about the same as 07 but at less billings in 08.
I don’t do cost of business pricing per se, but can’t say I am a poster boy for usage fees either. I have found that it’s harder to get a premium for bigger usage on some projects (i.e. art buyers ask for a specific usage and then later want unlimited for a year or 2 for the same money or relatively modest increase in the fee). That’s big and small agencies, not across the board, but it’s not unusual. Maybe I am getting played, but it usually happens in competitive bids where they say the other guy will do this usage for this money, so to be competitive I need to come closer to that number – that kind of thing. I typically but not always cave into it, as my costs are relatively low now, I don’t have a staff or a rep, my equipment is paid for and my studio mortgage is relatively reasonable – less than what I was paying in rent a few years ago….. so in that sense my cost of business does figure into it, but I only consider it when pressed to meet another person’s price.
Established Photographer 4:
o.k. here is the poop in Vague terms.
Yes, many years the take home profit (the photographers net earnings after operations) is over 250K but that depends a lot on investments in equipment etc.
Last year for sure the usage is based on the size of the client and the size of the buy. For example a one year print license starts around $2,000 per shot. Big clients/ big media buy $5,000 per client. There are some exceptions for tiny clients and design firms.
Established Photographer 5:
Depending on what you shoot, it’s not necessary to bring in several million or even a million to generate 250k in profit (e.g. – Still life and product shooters don’t have the high production expenses compared to someone who shoots talent). In a good year, I can earn $200k personal salary on $800k in sales. (THIS AIN’T ONE OF THOSE YEARS….). I’m sure those billing 3 million can earn a profit of a million. What their personal salary comes to is another matter altogether.
It’s in our best interests to keep money in the corporation, as a corporation is taxed differently (lower) than an individual. Many buy company cars & new gear at the end of a good year to reduce taxes payable. There are creative accounting (and totally legal) ways to reduce one’s personal salary while maintaining a very nice lifestyle. The perks of running your own business.
Personally, I don’t believe in the CODB model. It’s far to limiting and does not represent what one’s competitors are charging. I don’t believe one’s fees should ever be based on one’s overhead. My overhead is my choice, and so is that of my competitors. But my fees need to be as high as possible while being as competitive as one can be. Low bids are generally not well received by art buyers.
Hi-end guys/gals don’t price themselves as commodities. They tend to price very high to maintain their perception as hi-end.
License model, combined with photographers fee (shown as one line item!!) is the way the top guys estimate.
An Established Photographer with Actual Salary Numbers:
We grossed in 2008, $218,000 in fees alone. In 2009, we grossed $253,000. In 2008, we paid $100,000 in salaries to assistant photographer and myself combined. In 2009, that figure was $125,000. That is most of the picture. There are other benefit issues, such as health insurance, meals and travel, that come out of the business and reduce the net of the company… If you look at our net between 15K-20K each year, after buying gear, bonuses and finding every write-off. We are also a C corp, which makes me a salaried employee.
A Very Established Art Buyer:
Believe it or not, top photographers do gross a million or more in fees. Of course, agent commissions come out of that, but it’s still a nice living. I don’t see top photographers any more willing to compromise on pricing than before the economic downturn. It still comes down to the project and what it’s worth to the photographer.
Usage pricing is all over the board and there seems to be no rhyme or reason to it. It’s simple survival: people are doing whatever it takes to survive. Sometimes the compensation is reasonable, but I’ve also heard horror stories of unreasonable compensation and even blatant disregard to copyright laws. Unfortunately, in those cases it comes down to who can hold out the longest with lawyer fees.
I wouldn’t say it’s the Wild West, but I certainly don’t see the solidarity in holding out on pricing that an “up” economy allows. There is definitely an air of desperation among many photographers, especially those just entering the market. I don’t know that it’s any different from any other business, though. It’s tough everywhere.
Stock imagery seems to be taking quite a bit of a hit this past year as well. Account reps are disappearing and even the Big Two (Corbis and Getty) are making drastic staffing cuts.
I hope the recovery heads our way soon!
Our 2 Cents:
From across the board – everyone has the same hope and desires – do good work and bill appropriately. Regardless of your status in this market – it all is interconnected. You have to know your worth creatively to bill appropriately. Of course – Joe Blow may gross $500k annually but his overhead could be $300k – which means he is not better off than the wedding photographer netting $250k with very little overhead other than equipment updates. So from a wide range of talents – you can still net 50k – 1MM in our BAD economy. But you have to do your part to get those jobs and keep those clients and ask for what you are worth – NOT WHAT IT COSTS TO PAY YOUR BILLS!
Call To Action:
If you are willing to share your actual annual earnings – what you grossed in fees and what you took home at the end of the day (net) – please email us your exact figure and how long you have been in business and the type of photography you do (editorial, commercial advertising, consumer, etc…). We will be thrilled to be able to share if with your peers – while keeping you anonymous! We respect everyone’s confidentiality. This information in the end is not for us – but for you the photographer!
My jobs tend to be fees inclusive of usage, and however high I can negotiate given the client.