Category: Pricing & Negotiating

By Jess Dudley, Wonderful Machine Producer

The creative director of a small West Coast graphic design firm recently contacted one of our photographers asking for a quote on a portrait for use in an annual report. The client was a large insurance company and they needed a picture of a financial planner who refers a lot of work their way.

The designer said the picture needed to be a tightly-cropped, environmental portrait at the subject’s office (about a 20 minute drive from the photographer’s studio). They wanted to see a variety of situations: “…the guy at his desk, at the computer, on the phone, looking at the camera, not looking, maybe outside.” The CD told me that the image would be used as a “supporting image within a sidebar in an annual report.” “Supporting image” was a little vague for me, so I asked to see a layout of the page to get a better idea of the size, placement and context of the picture. Looking at that, I saw that the picture would be relatively small, among other larger pictures, and that it was going to be used inside the brochure (rather than on the front or back cover). I also saw that it was a nicely designed brochure with other good photography comped in.

Looking back at a similar estimate I had worked on recently, I first set out to establish the fee. In this other project, the actual shoot was comparable, but the licensing was more extensive. It included Publicity Use and Collateral Use for a year. The subject in that case was also much more prominent within the company. In this case, they just needed one-time annual report use and the subject didn’t even work for the company that was producing the report. Also, looking back, the previous fee was probably a little fatter than I’d expect to get in the current economic climate. So I placed the fee for this one at 1000.00. The expenses are fairly straightforward. We wouldn’t need hair or makeup, props, wardrobe or backgrounds. That left us with the basic expense items: assistant, digital capture, strobe rental, file prep, miles and parking (since it was going to be less than 1/2-day, there wouldn’t be any meals to bill for).

Here’s the first estimate I sent over.

After confirming that they had received the estimate, there was no word from them for about a week. When the CD finally got back to me, he wanted us to shave 695.00 off the quote. “The client feels it’s a bit high for a simple head shot (half-day shoot). Would you be ok with $1200? Take a look at the comp again. I’m sure the photographer can do this without an assistant and rental equipment.” I took another look at the layout. The picture they showed in the comp was clearly strobe lit. I confirmed with the CD that he’d be happy with available light only. He said yes; so I called the photographer to discuss whether he’d be comfortable working without strobes or an assistant. It was a little awkward for the photographer because he only shows lit photos in his portfolio. So even though he was confident that he could do a good job without strobes or an assistant, the job was becoming less interesting to him. The photographer decided that he was comfortable working without an assistant and strobes as long as the client understood that the picture was going to have a different look from the comp.

With that resolved, we were still 180.00 over what the client wanted to spend. There really weren’t any other expenses we could do without, so the rest was going to have to come out of the fee. I couldn’t just arbitrarily reduce the fee just to meet the “budget.” (Probably the single most important rule of negotiating is that you can’t reduce what you’re getting without reducing what you’re giving. If you do, you’re just demonstrating to your client that you were trying to gouge them from the start.) But again, it raises the question for the photographer whether the job was worth doing. In my role as producer/estimator, I’m working for the photographer. So while it’s my job to lay out all the information and help him weigh his options, it’s ultimately his decision whether there’s enough money in a project to make it worth doing.

There are certainly a lot of reasons not to work too cheaply. The first is opportunity cost. If you commit to a low-budget project (that doesn’t have some other benefit), and another more interesting or lucrative assignment comes up, you’re going to miss out on it. Another is that clients tend to view your value partially based on what you charge. If you work cheap this time, they might not think to use you when they have a more lucrative job. A third reason is that a photographer only has so much time and energy. It can sometimes be better in the long run to rest or get caught up on your paperwork or marketing or working on your portfolio, rather than get bogged down in projects that you aren’t enthusiastic about or don’t pay enough.

It seemed clear that the client was not going to pay 1895.00 for the job, but I thought there was a good chance that they would be satisfied with the concession of taking out the assistant and strobes and agree to 1380.00. An alternative would be to pull out the web use, which was about proportional to the 180.00 we would need to get down to the 1200.00 the client was looking for. The photographer chose that option. The subject’s availability and the deadline gave the photographer the flexibility to move it around if something else came up. And it was about as simple as an assignment can get. So he decided to meet the client’s price rather than risking not getting the job over the remaining 180.00.

I sent off this revision along with my standard terms & conditions, which the agency approved.

by  Wonderful Machine CEO Bill Cramer

Here’s a project that began seven years ago and just wrapped up last month. Back in 2004, I got a call from an art director at a landscape architecture firm that was completing a $7 million renovation of a 70 acre piece of land, transforming it into a nature preserve for a non-profit. They had replaced alien plants with species indigenous to the area and they created beautiful bridges, paths and sculpture gardens. They needed photographs depicting plant specimens and landscapes for a guidebook. Oddly, they came to me. I say oddly because I shoot almost exclusively portraiture. I don’t even show still life pictures in my portfolio, let alone plants. But there was something about the personality of my photographs that the client thought would work well for the book. I liked her and the project. And in spite of, or maybe because of how different this project was, I decided that I wanted to do it.

When I met with the AD, she showed me several examples of plant and landscape photographs so I could see what she liked and didn’t like, which was very helpful. She explained that the project would need to take place over a period of a year or more, so we could illustrate what the plants and landscapes looked like in the spring, summer, fall and winter (including snow). The AD was initially a little vague about the actual shot list, but I knew I would need some specifics in order to do the quote. So together we figured out that the final book would need 8 landscape photos and 32 plant specimen photos. We agreed to show the plants close-up, on white background. (I found out that here was a house on the property that we could use as a studio.)

I went home and thought about how I would execute the project, and how I should structure the proposal based on that. I did some test pictures to get a sense of what kind of set-up I would need and how much time it would take to photograph each plant. I had shot lots of people on white background before, but never still life. I wanted the plants to be floating rather than lying on a white surface. So after some awkward and dangerous attempts on a ladder, I bought a bakers scaffold, some ¼” glass, and some plywood so I could build a window with a frame that I could stand on and easily shoot down on the plants – with white paper lit up on the floor below. (I’m sure the real still-life photographers out there will tell me there’s an easier way to do this.)

Even though they were only planning on using an average of 10 pictures from each of the 4 seasons, I figured we would probably want to shoot twice that number to cover ourselves. Then we’d have the luxury of choosing which plants and landscapes looked most interesting for each part of the year. I would plan to shoot landscapes early and late in the day, and the plant specimens in between.

Any time I put together a quote, I try to balance my need to control my costs with the client’s need to understand what they’re getting charged for and to control their costs. For this project, since I wasn’t completely sure about how long it was going to take me to get pictures that I was going to be happy with, and since I wanted to be able to experiment a bit, and since I knew that the project was likely to evolve over the course of a year, I wanted to build some flexibility into the schedule. Figuring that I could comfortably make 10 pictures/day, I budgeted about 2 shoot days for each season. That in mind, here’s the estimate I put together (PDF).

I decided that in addition to the four seasonal shoots, I wanted to build in an initial test phase so that we could be really clear about what the specimen pictures were going to look like (exactly what the white background would look like, what the light on the plant would look like and what the post-processing would look like – and get approval before we were shooting for real).

Even though I was planning on shooting as many pictures as I could, the fee I quoted entitled them to use 40 images in the guidebook. I viewed the actual licensing as somewhere between commercial and editorial. They just needed the pictures for the book itself. They didn’t have other plans beyond that. Even though the nature preserve was a non-profit, they had substantial financial backing. They weren’t hiring me because I was cheap. They were hiring me because they liked my pictures. Since the photographic expenses were all within my control, I decided to bundle them with my creative fee for each segment of the job, and then bill my actual cost for the hotel, travel and meals. I figured on 2 shoot days and a travel day for each of the four seasons (it was a four-hour drive each way), along with a license for 10 images, which I decided was worth 4000.00. Plus I’d need to cover photographic expenses of an assistant (750.00), equipment (500.00) web gallery (350.00) and file preps (10 @ 40.00 = 400.00). 4 shoots plus 1 test phase made 5 segments x 6000.00/segment = $30,000.00.

The client was comfortable with my price and only made a few small revisions to my terms (PDF), they wanted me to have any order changes made in writing, which was fine with me.

The project went remarkably smoothly that first year. I made my quota of pictures, and I only almost crashed through my makeshift window once. But then we hit some snags. We didn’t have any snow that first winter. So we had to wait a year for the next decent dusting. Then the AD fired the designer. Then the AD left the landscape architecture firm, and the client took over managing the project. Then the whole thing was on hold for a couple of years. When the project was revived in 2009, they needed a few more pictures to round things out after deciding to double the size of the book. After we went through a round of file processing and retouching it looked like it would finally be published. Then more radio silence. I would check their website every few months, then forgot about it myself for a while. Then finally, at the end of 2010, I checked their site and there was an announcement for the guidebook, so I bought a copy.

I had known for a while that they were planning to expand the book (and consequently, the licensing). But until it was actually published, there wasn’t anything concrete to bill for. When I got my copy, I had to reconcile the use of the additional pictures. Looking back on my 2004 estimate, I could have been more clear. There is an implicit license for 40 images, “This is a price quote for Bill Cramer to produce a series of 40 photographs…” But it really should have said, “This is a price quote for use of up to 40 images…” Also, I should have specified the cost for additional images.

This lack of clarity put me in the awkward position of justifying to my client’s client (now my direct client) the additional charges for use of the additional pictures. First, I had to make sense of it myself, so created a spreadsheet (PDF) detailing all the invoices I sent and what they covered. Then I composed an email (PDF) spelling out the charges for the additional usage. In an attempt to make up for my sloppy initial estimate, and to account for the fact that I had grouped the fee with photographic expenses in that estimate (leaving the actual licensing fee a little murky), I factored in a charitable discount to send the message that I wasn’t trying to rake them over the coals, but simply get fair compensation for the additional usage.

This task was made a bit easier due to the fact that the folks at the nature preserve went ahead and put several of my pictures on their website without my permission. If they would have otherwise put up a fuss, they were less likely to do so now. Anyway, they paid the invoice (PDF) and sent me a bunch more copies of the guidebook. And it actually looks pretty good, so I’m left wondering if I should start promoting myself as a nature photographer.

A question from one of my readers:

I am a photographer in Southern California and was approached buy a major record label out of New York asking for a quote to shoot their artists album. They are wanting multiple looks. Is there a good place where I can find a competitive rate so I don’t destroy the industry single handily with a low-ball rate? ha…

I emailed the question to an agent and here’s the response:

As we all know the record industry has been hard hit in more than one way in the last few years. Several of my artists shoot for record labels and although the work can be very creative the rates have not increased in a long time and they have actually gone down in a lot of cases.

When negotiating with the labels the first thing to ask is about usage. Most labels require you to sign a contract for all rights with a distinction of whether it is to include merchandising-for-sale rights or not. Merchandising-for-sale means posters, tee-shirts, calendars – any kind of merchandising that is sold (often at live shows) as opposed to being given away. Most labels will allow a photographer to retain the right to use the work in their portfolios, website and for promotion. The labels need to secure all rights for many reasons but mostly to protect themselves from pirated product.

The next element in determining the creative fees (after usage is determined) is the popularity of the band or recording artist. Larger acts will have a bigger overall budget which makes sense. If a label calls you to shoot a major act then they are going to be expecting a larger fee usually. The other factor is the level of the photographer. A younger or newer photographer will not be able to command the rates that more established photographers can.

I would say an average music fee (not including expenses) these days is anywhere from $5,000 to $15,000 depending on the rights needed and the artist’s stature and the photographers stature. The budget for expenses can vary wildly depending on many factors.

A junior band at a smaller label with newer photographer you might see the creative fee as low as a $1,000.

One trend I am experiencing is labels coming to us with an “all in” budget to include all of the expenses and fees. We get a call from a client and they say we have $30,000 “all in” to shoot this band, does your photographer want the job? This is usually with the understanding that if you bring the expenses in for less, without sacrificing the quality of the production, your fees can go up. This can be good in some cases, but in others you get the difficult challenge of managing the talents expectations for the shoot with not a lot of support from the label or help from management.

Here’s an example: The band wants to shoot at the Taj Mahal and you have to tell them that the label only has the budget to shoot at the local Motel 6. Or, the artist wants major fashion labels in the wardrobe pull, but the stylist can only have $2,000 “all in” with the overall budget being so low. Or, the artist wants a specific hair or makeup artist whose rate is very high. I will often agree to an “all in” budget if the hair, makeup and stylist is not included in our budget. Then we will try as best we can from the initial creative conversations with the recording artist to reference the budget in a sensitive way.

Also bear in mind that if you need to travel to do a job – which means airfares and hotels etc. as well as more days on your calendar the budgets do not often increase proportionally to cover that. So a budget of $25,000 “all in” is not so bad if you are shooting in your own home town with one recording artist. But that budget to shoot a band with five members in a smaller city in the middle of the country becomes not only more difficult in terms of production but is also immediately less profitable.

So when you get one of those offers you have to consider all the factors and perhaps the offer is to shoot a band that you love and you just say yes to be able to work with them and shoot it!

The other thing that is starting to happen more often is we are shooting these jobs for the artist or band management and not the label. In those cases it most often includes the option of merchandising-for-sale. The management then controls what goes to the label and to the merchandising companies – secure that they have all rights. They will often commission the art direction and design of the package or tour book and deliver a finished package to the record label or vendor.

The need for more control on the part of management and artist (from a marketing standpoint) is due to the changes in contracts between the labels and the recording artists. Also, a lot of major labels do not even have art departments anymore or if they do they are very small, and they often farm the design out to independent art directors and design firms as opposed to having a full time staff in their art department.

For a newer photographer the music industry is a great way to gain experience because you are required to shoot many set-ups on most sessions to cover not only the artwork for the CD packaging but also the needs of the publicity departments at the label. An average session consists of at least six and sometimes up to ten set ups in one day. So depending on the fee you are making it can be hard work for little pay but often a great experience as well as a creative challenge.

by Wonderful Machine producer Jess Dudley

We recently helped one of our food/people photographers quote on an ad shoot for an agency that specializes in reaching Hispanic audiences. The ad agency’s client was a major food brand, and the product they were promoting was a household name. The campaign was aimed at Hispanics and was to be used only in Spanish language media (primarily grocery store point-of-purchase). The agency needed pictures of a celebrity chef (standing, wearing chef jacket, looking at the camera), a recipe she makes using the product, and four still-life pictures of various products in their product line. All of the pictures would be shot on white background, at a studio near the agency and talent, in one shoot day. The usage was six images for “unlimited use in the U.S. for one year.”

When I build an estimate, I like to figure out the production costs first because it helps me really understand the scope of the project, which can influence the licensing/creative fee. One of the things that made this estimate interesting was that the agency asked us to use their estimating form (see below). That was nice because it gave us prompts for all the information they expected to see. And from their perspective, it makes it easy to compare quotes.

Production Crew. The photographer would have to fly in from another city for the shoot. She would plan to take her regular first assistant. She didn’t feel the need to add on a local assistant. My ideal is having one assistant who is familiar with the photographer traveling along, and one local assistant who is familiar with the local people and places who can help get us out of a jam when the unexpected arises. I put in for one assistant shoot day and two assistant travel days.

I find that hair/makeup, wardrobe, prop, and food stylists tend to be in the same general price range. But for this job, the food styling was the most critical component, so I budgeted more for that. The product itself isn’t very glamorous, so the recipe really needed to shine. In addition to looking through every food stylist website I could find, I spent a lot of time talking with local food photographers, folks at kitchen studios, and local magazines, to make sure I knew who the best food stylists were in that area. I planned on a day of prep for the food stylist to sort out the recipes and to buy the food, and a day on set for the food stylist and their assistant.

For this type of shoot (one subject, non-cosmetics shoot) one person can handle both hair and make-up. One stylist could handle the wardrobe (which would be provided) and propping with one prep day and one shoot day. Even though the wardrobe was to be provided, we still needed someone on set to steam the clothes and fuss with the fit. Chef uniforms are not the most flattering, so some time and attention would need to be spent pinning the uniform properly to give it a more fitted appearance.

I factored in three days for the production coordinator (me). It would mostly be pre-production to pull all the elements together and make the travel arrangements, and then just tying up loose ends after the shoot. The shoot was simple enough, and due to the photographer’s needs and the client’s budget concerns, I didn’t need to be there for the shoot.

Photographic Medium. We put in 300.00 for basic digital workflow. That’s less than we normally charge for a project like this, but it reflected the photographer’s comfort level. The retouching needs would mostly be file clean-up, smoothing wrinkles, smoothing skin, and fussing with the food a bit. I figured an hour for each image. The client requested a proof print of each of the final images because the final colors of the labels and product itself are so important.

Studio Rental. I had a couple places in our database, and got some more from some friends in the area. We found a great studio with a nice cyc wall close to the agency. As I’m checking on price and availability for all my support services, I generally put my favorites on hold. That way, I don’t have to scramble when the job comes through. When you put someone on hold, it’s like a tentative booking. If something else comes in for them on that date, they call you and ask you to confirm or release them from the hold. If you confirm and then cancel, you are obligated to pay them whatever cancellation fee you have negotiated. If you release them from the hold, or if the job doesn’t come through and you haven’t confirmed, there’s normally nothing to pay for.

We expected a cast and crew of about 10 people for a light breakfast and a normal lunch. I normally factor in about 40.00/head for that. If I have time, I’ll make some calls to confirm that with some caterers. If not, that amount is a safe bet to account for.

Equipment. The photographer was traveling with her own gear, for which she was charging a modest rental fee.

Location. Just needed a certificate of insurance for the rental studio.

Travel. We’d need round-trip transportation for the photographer and her first assistant. Estimating travel costs can be tricky. Airfares can vary wildly depending on when the travel is taking place and how much advance notice you have. Between the time you quote on a job and when you get it, fares can double—especially if the shoot dates change. Make sure you’re clear in advance about who is going to pay/get the difference when the fare goes up/down. In this case, we were charging our actual cost on the expenses and the client understood that it was subject to change. I normally figure on single occupancy hotel rooms. It wouldn’t be unusual to ask two assistants to share a room if the budget is tight, but it would have to be an extreme case to have the photographer share a room with the assistant. I chose to rent a car so we could run last minute errands. But I could have shaved off a few bucks by using a car service to and from the airport. Excess baggage is important to pay attention to these days. It’s a good idea to have your own scale to make sure your equipment cases don’t exceed 50 pounds. And unless you’re flying Southwest, you’ll have to pay close attention to the baggage charges, because they add up fast. In the past, I’ve been able to get discounts from airlines for photographic equipment (especially if the photographer had a valid press credential). But these days, with airlines trying to make money any way they can, it’s rare to get that kind of treatment.

Props, Wardrobe and Sets. The pictures required only simple plates for the food, no props for the chef and just white background for all the pictures including the product itself. But it’s better to have extra stuff that you don’t use than wish you had a wooden spoon or an oven mitt to put in the subject’s hand when the art director feels inspired. I talked to the prop stylists and the food stylists to get a better sense of what I should budget for plates, pans, place settings and the food. Depending on what else they’re responsible for, it would be reasonable to have the food stylist or the prop stylist handle the cooking-related props. It’s not unusual for food stylists to bring along a small selection of serving dishes which can fill in for whatever the prop stylist gets. Just be sure to be clear on who’s bringing what avoid any confusion on the shoot day. And of course, you can plan on the prop stylist being able to buy and return items that don’t get used.

Talent and Casting. The celebrity chef was the only talent and we didn’t have to pay her out of the photography budget.

Miscellaneous. The client requested delivery by DVD. More often we simply upload the files to our FTP and send the client a link. The “Shipping and Messengers” is actually a car service for the chef.

Photography Fee. Lastly, I nailed down the fee. The key points to consider were: national brand enlisted a mid-size agency and relatively unknown “celebrity chef” to promote a small segment of their business to the Spanish-speaking population of the U.S., using six images for one year (see “usage license required” on last estimate page). Some of these factors create upward pressure on the value and some push it down. The fact that only 17% of the US speaks Spanish as a first or second language seriously limits the audience of this campaign and drastically lowered the licensing fee. This brought the fee down from what would have otherwise been 10-12k to under 7k. Majors and minors refer to the prominence of the image in the ad. In this case, they expected to use the portrait and a couple of the other pictures big, and the rest much smaller.

(pdf)

Shakodo is a new website where photographers can share pricing information and from what I can tell it looks like it’s going to be an awesome tool for everyone. The features and design of the site are top notch but the real interesting part is going to be seeing real pricing information and debates over what should be charged.

From the press release:

Photography is one of those professions without any fixed prices; with almost everything being negotiated. Until recently, the photographic market was very isolated and the skill of price negotiation was one of the key success factors for professionals.

With the influx of talented amateurs a market-shift began to take place. With their lack of experience and knowledge about current market rates and not understanding client’s budgets and needs, these talented amateurs have settled for lower price offers. As a result, they have unintentionally undercut professionals while leaving money on the table because they are not aware of the true market value of their photos or services.

Let me know what you think.

By Jess Dudley, Wonderful Machine Producer

One of our still-life photographers was approached recently by a major brand to quote on a series of product photographs to promote a low-cost line of glassware that they sell through a big-box store. The client needed pictures showing several variations of each of the bowls, plates, and cups so that they’d have different options for use on packaging, point of purchase displays, and on their e-commerce site. They wanted everything shot on white background. Their in-house designers would process the raw files and handle the silhouetting and any retouching. The client would plan to bring a hard drive with them and simply take all the raw files with them at the conclusion of the shoot.

The creative challenge was to make simple bowls and cups look interesting on their own. The technical challenge was to light clear shiny objects and have them show up on a white background. After discussing the project with the photographer, she told me she could comfortably handle 3-4 items/day. So I would need to plan on a four-day shoot.

We’re normally inclined to quote creative fees by the picture rather than by the day. That tends to align the interests of the photographer with those of the client. If a photographer is charging by the day, her incentive is to run long and the client’s incentive is to finish early. If the photographer charges by the picture, everyone is going to be incentivized to work as efficiently as possible. There are exceptions to this rule, however. In cases where the client (or the client’s client) is in control of the shooting schedule (like on a corporate project where the photographer might be at the mercy of the subject’s or facilities’ availability at any given moment).

This project, however, is the type of shoot that a lot of clients have a need for, and that photographers customarily charge by the day for. Rather than upsetting that apple cart, I thought it best to go with the flow and quote the photography by the day. I’ve found that product photographers can command anywhere from 3000.00-5000.00/day for this type of work, with this licensing for a national brand. Whether I quote the high end or the low end is going to depend on how prominent the brand is, the complexity of the pictures, how prominent the photographer is, how busy he is, and the exact licensing. The number of shoot days and the regularity of the work is a factor as well. If a one-day shoot suddenly becomes a five-day shoot, I would probably discount the additional days.

Location of the photographer and the client can also factor in. If the client (even a big one) is in a smaller market and you’re competing with other photographers in that small market, you might not be able to charge as much as for a similar project taking place in a bigger market. In this case, the client and the photographer were in a big market, and I felt that all of the other factors together pointed to about the mid-point of the range, so I quoted 4000.00/day. The client specified the exact usage they needed, which I quoted on the estimate (below).

I chose to include a digital tech as well as a regular photo assistant for this project. For bigger sets, I would want to have at least two assistants, but for table-top, one was enough. I’m also finding that most assistants now have most of the skills of a digital tech, so the personnel (and the fees they charge) are starting to become interchangeable. (Of course, digital techs with extensive software and hardware knowledge, or those who bring their own computers or cameras, will always be able to charge a premium.)

Since there was so little pre-production necessary (just arranging the catering and the assistants), it wasn’t worth breaking that out as a separate line item. And while some shoots might require a pre-light day, this one was simple enough that I couldn’t justify breaking that out either.

Sometimes product photographers bundle the studio and equipment charges into their creative fees. Other times it makes sense to show separate line items. (Either way, it has very little to do with whether the photographer has “his own” space or “his own” gear. Some photographers naively charge clients based on the cost to them rather than the value that they’re bringing to their client. Equipment and studios are expensive whether you rent them by the day, by the month, or own them outright.) There are pluses and minuses to either approach. Bundling the charge might make your creative fee seem fat. Separating those expenses out might make it seem like you’re nickel-and-diming. Generally, I do whatever I think is customary for a given situation. Here, I chose to separate it out.

For catering, we’ll normally do a light breakfast (muffins, bagels, fruit salad, juice, water, coffee) and a casual lunch (sandwiches, salads, chips, cookies, brownies, water, soda, coffee). For productions with more than 10 people, or if you’re shooting more than a few days in a row, it starts to make sense to go a step further. We’ve sometimes gone as far as offering made-to-order omelets, pancakes and oatmeal for breakfast, lasagna and other hot options in addition to sandwiches for lunch, and snacks to keep people going through the afternoon. For people (clients especially) who spend a lot of time on shoots like this, it’s nice not getting stuck with an Italian hoagie every day.

Naturally, the client provided the product. But they also provided the stylist, which we were sure to note in the estimate. The shoot took place in the photographer’s own studio so travel and certificates of insurance were unnecessary.

The client liked the estimate and signed off on it, and the shoot went as expected. (Not all estimates go through as easily as this one did. I promise to get into negotiating next time!) One thing you might ask is, “what does the photographer charge if the shoot takes five days to complete, or if it only takes three?” Good question. Strictly speaking, we’ve quoted this as an estimate rather than a bid. With an estimate, the final cost will vary depending on actual conditions. With a bid, you’re saying that the cost is fixed for the result you’re delivering. However, in this case since everything about the shoot is going to be either predictable or within the photographer’s control, there would have to be very unusual circumstances to justify billing for additional shoot days. But at the same time, most clients would expect you to only charge them for the three days if that’s all it took. This “heads I win, tails you lose” effect is one more reason I prefer to bill by the picture rather than by the day.

If you have any questions, or if you need help estimating or producing one of your projects, you can reach Jess at jess@wonderfulmachine.com

By Jess Dudley, Wonderful Machine Producer

Corporations tend to use photography in two main ways: to illustrate their internal communications (like company newsletters whose audience is primarily employees) and in external communications (like annual reports, capabilities brochures, sales brochures and press kits whose audience is shareholders, clients, vendors or the general public). Before the advent of digital photography and desktop publishing, most big corporations had a steady need for professional photography and design for their internal communications. But advances in technology have made it easier for ordinary employees to do what they once hired professionals to do. And though the level of quality may not be the same, it is often considered good enough. That’s rarely the case for external communications which can often have a significant impact on the perception of the company, and ultimately their bottom line.

The following is an explanation of a simple portrait assignment for a Fortune 500 company, primarily for annual report use.

Our photographer first met the corporate communications director of the company when he was there on a magazine shoot. When the company replaced a member of their board of directors, they needed a new portrait to match the existing ones of the other board members. Our photographer was asked to bid on the job.

The client needed a waist-up portrait of one person on a white background. The picture had to match the others that they had shot previously using another photographer. They even had the background paper on hand. The client showed us examples of the other portraits they had done, which we were supposed to match. It’s sometimes awkward when a client asks a photographer to replicate another photographer’s work. Certainly, if there’s anything unique about the picture you’re copying, it would be a good idea to consider whether the client is asking you to infringe upon someone else’s copyright. In this case, the situation and the lighting were generic enough that there was no danger of that.

They needed the picture for a year, for a variety of non-advertising uses, including their annual report, related documents like their proxy statement, their website, and for press kits.

This client was sophisticated enough to understand how licensing factors into the estimate. Some smaller clients may not get why a photographer would want to know or care about how their pictures will be used. It’s very important for photographers to comprehend the licensing model of pricing well enough to explain it to clients in a way that makes sense and is not off-putting. When this conversation comes up for me, I explain that we need to grant a license in order for them to use the photographs. Sometimes I’ll explain further that a more narrow license tends to put downward pressure on the price and a broader licensing agreement adds upward pressure on the price. Once a client understands how licensing affects the cost, they tend to be more specific about their intended use. But it’s crucial for photographers to learn how to have these conversations.

Sometimes a client will know exactly how they want to use the photographs, and I can just put that language in the quote verbatim. However, in many cases, the client won’t be able to anticipate all the possible uses of the photographs, and they’ll want to license a range of uses. Though it makes it a little harder to nail down the value in those cases, it’s a perfectly reasonable thing for a client to ask.

I like to divide up the usage “universe” using simple terms that help the client get the flexibility they want without paying for usage they don’t need (or without unnecessarily driving up the price). For most commercial photography, usage can fit into the following categories: publicity, collateral and advertising. I define advertising as any time a client pays for placement to display a photograph. I call it collateral when a photograph is used in a publication that the client produces themselves. And publicity is when the client gives the pictures to an editorial publication (and is not paying for that use). Defining these types of usage makes it easy to grant a whole category of use for a specified time period, which provides a useful middle ground between one-time use and unlimited use. (See exact definitions below in the Terms & Conditions page.)

Fee

For this quote, the licensing was pretty clear. The client needed collateral and publicity use for one year. I tend to list the specific uses they ask for as well, to assure them that they’re included. By the way, you want to be careful not to think of “web” as a use, but rather a medium. After all, depending on the context of the use (and whose website it’s used on), it could be advertising, collateral or publicity. One way you can clarify this is to indicate the actual website that you’re granting use on.

My usual wording in the first line of an estimate indicates who the photographer is, what the picture entails, where the shoot is going to take place, how many shoot days are included and exactly what the licensing allows. Even in cases where I don’t have all the details, I’ll want to fill in my best guess of what they’re likely to be. When new information comes along, we can always update the estimate. But the estimate has to be as complete as possible. Since this is a simple job, I can describe the whole project within the estimate itself. More complex projects may require the photographer to summarize it in the estimate and then explain in more detail in a cover letter, how he’ll solve the problems presented by the shoot. Remember that the estimating process isn’t simply about presenting an appropriate price. It’s also your opportunity to convince the client that you’re interested in the project, you understand it, and you can handle it.

I’ve found that a typical annual report shoot day goes for between 1500.00 − 3500.00 depending on how sought-after the photographer is, how busy the photographer is, how big the corporation is, how difficult the pictures are, how long the days are. For this one, the photographer was a “medium”. The corporation was large. The degree of difficulty was very low. And the day was short. To me that pointed to the lower end of the scale, but I bumped it up to 2000.00 to factor in the broad usage requirements.

Even though the client was unlikely to license more than one picture, I generally like to specify the cost for additional images in the original quote to minimize awkward negotiations later. Normally my additional image fee is prorated from the shoot fee, but in this case since any additional image would be the same subject against the same white background in the same clothes, I felt a reduced fee of 1000.00/additional image was appropriate. Had the images been environmental portraits, wherein the photographer could have created two very different images, I probably would have prorated the addition images.

Expenses

The expenses on this shoot were pretty simple.

“One assistant” to help set up and stand in for the subject.

“Digital captures delivered by web gallery for editing.” For editorial and corporate projects, we typically charge for a web gallery, then we charge separately for each file prep and for retouching. That way, we can scale the cost to the needs of the client. It protects the client from paying for processing they don’t need. And it compensates the photographer for time spent processing images. You could lump the web gallery fee into the creative fee, but since it’s actual time spent outside of the actual shoot time, I think it’s important to recognize it in the estimate. With advertising jobs, instead of charging for the web gallery per se, I charge for a digital tech who would be doing that work. And instead of charging for file preps, I simply lump the basic file preparation in with the retouching. (After all, there is no advertising photograph that doesn’t get at least a small amount of retouching.) I didn’t quote retouching because I figured that the basic file clean-up that we include in the file prep charge would suffice. The Terms & Conditions says that if the client requests additional retouching that it’s 150.00/hour.

“Miles, parking, tolls.” I charge $.50/mile for car travel, plus actual parking and tolls. On short days like this, I generally don’t charge for meals (though I do pay for my assistant’s meals regardless.) I usually only put in for meals on corporate or editorial jobs when they’re full days, and usually not when we’re going to the client’s headquarters. I hate to give the impression that I’m nickel-and-diming them.

“Seamless paper and groomer to be provided by client.” Any time the client opts out of any normal item, I like to say that in the estimate. That way there’s no confusion later when the subject’s hair doesn’t look great. In this case, the subject was a woman. But the client assured me that she would arrive camera-ready. So no hair & make-up artist. (It doesn’t hurt to bring a comb, mirror, powder and sponges.) Even though the client said they had seamless paper, I brought an extra roll just in case.

There are times when I’ll add a line item for equipment, and other times when I won’t. I do for just about any advertising shoot, and for medium to large corporate shoots. But for the smaller corporate shoots, I tend to bundle it into the creative fee. I don’t have a rule of thumb for editorial clients. I consider it on a case-by-case basis.

They did not require a certificate of insurance to shoot in their offices, so we didn’t provide one.

Sales tax varies from state to state. In some states, if you’re billing the end user, they have to pay sales tax on photography unless they are exempt for some reason (like if they’re a publication or a non-profit). Also, if your client is going to be passing along your charges (like in the case of an ad agency or graphic design firm), they will also be exempt. Either way, I find it’s best on estimates to say, “plus applicable sales tax.” That way, I’m covered and it doesn’t artificially inflate the bottom line.

These Real World Estimating posts are written by the fine folks at Wonderful Machine. If you have any questions, or if you need help estimating or producing one of your projects, you can reach them at jess@wonderfulmachine.com

by Wonderful Machine producer Jess Dudley

I recently helped two different photographers quote on two very similar projects, so I thought it would be interesting to present them together (see estimates below).

Shoot A was a series of simple, tightly-cropped portraits on a plain background, with no props and minimal wardrobe needs, depicting “everyday” people. Shoot B entailed a series of pictures of people engaged in various athletic activities (like bowling and yoga) to show that the hospital could provide treatments to help people stay active.

The Similarities

• both projects entailed creating a series of similar (relatively simple) pictures with a number of different people
• the clients in both cases were regional hospitals
• the intended use for both was primarily local advertising
• both required just one shoot day
• both shoots would happen on a plain background in a studio

The Differences

• client A wanted to be able to (theoretically, at least) use the pictures anywhere in the world, while client B just needed local use
• shoot B needed a pre-light day and a digital tech
• shoot B required a lot of compositing and retouching after the shoot
• shoot B required a series of test pictures ahead of time to help nail down the concepts
• shoot B found professional models through traditional casting and model agencies, shoot A hired models from a “real people” casting company
• shoot A happened on the West Coast, shoot B on the East Coast

The Creative Fees

The overall scope of the two projects was very similar, but the fact that we ended up quoting exactly $18k for both creative fees was just a coincidence. Client A originally asked us to quote six tight portraits for “unlimited use, anywhere, forever.” Client B wanted four action shots (showing bowling, yoga, jogging and swinging a baseball bat) for “unlimited use, locally, forever.”

The “creative fee” covers the work required to make the pictures plus the licensing to use them (I normally bundle them into one number). Licensing is made up of the type of use (advertising, collateral, publicity), geography of use (local, regional, national, international) and the duration of use (one-time, one year, forever). Clients sometimes ask for broader licensing than they actually need, just for the convenience. The trick is to judge what’s reasonable to charge for the unused portion of the licensing. In this case, Client A is essentially asking for international use of the pictures. But since they’re a local hospital chain, they’re simply not going to have an occasion to use the pictures outside of the area they serve. Broader licensing is always worth more than narrower licensing, but it’s not worth nearly as much as if the client could actually take advantage of it. Both clients wanted to use the pictures forever. But as a practical matter, the pictures are going to have a lifespan of a couple of years. Both clients were asking for publicity, collateral and advertising use. The advertising part will have the most impact on the price. So I do my best to get my head around the likely use of the pictures, then assign a reasonable premium to account for the actual licensing.

I figured that in Project A, the first picture was worth $5k and each additional was worth about $2.5. I rounded it off to $18k. The broad use certainly adds upward pressure on that price, but the simplicity of the pictures adds downward pressure (there was very little pre- or post-production required, and the degree of difficulty and specialization of the actual shoot was pretty basic. So on balance, I was comfortable with the $18k.) The client said they would pay $18k, but asked us do eight pictures instead of six. Deciding how much to concede in any negotiation is difficult. A basic rule of negotiating is to never give something up without getting something in return. The weak economy is a factor generally, but a bigger factor is how busy the photographer is. In this case, the photographer wasn’t busy enough to risk losing the job over those extra two pictures. So we agreed.

Project B was only four images, but the pictures were more complex. The ads each needed to show a series of pictures to demonstrate range of joint motion with a recognizable sport or activity (like swinging a baseball bat). Initially, the client asked the photographer to do some test pictures to show what a range of motion would look like for a bunch of different activities. After a day of testing everything we could think of (for which we charged 1800.00), we settled on bowling, batting, yoga and jogging. We decided to depict each action with three pictures to illustrate the range of joint motion. So compared to Project A, the actual work to make the pictures happen was somewhat more involved, but the licensing requirements were a bit more modest. So I figured on 6000.00 for the first and 4000.00 for each of the other three, for a total of $18k.

Another influencing factor for licensing fees is whether the pictures are simply promoting one product among many, or whether they are promoting the entire company’s brand. There are times when promoting a small company’s entire brand is worth more than promoting a small part of a global company.

The Expenses

You’ll see variations between the two quotes for support services. They’re less about the regions where the shoots took place and more about the individual photographer’s idiosyncrasies. Photographer A likes to say, “Digital Capture Day”, the other says “Digital Tech Day”. The costs for the assistants, hair/make-up, wardrobe stylists varied just because of what those individual subcontractors charged. In both cases, the demands of the support staff were pretty modest. But certainly in situations where there’s more of an emphasis on the wardrobe or props or other element of the shoot, the photographer would be foolish to skimp. If you’re shooting a cosmetics ad, you’ll want to get your hands on the best make-up artist you can find, and you’ll have to be prepared to pay for it.

Photographer A worked out of his own small studio space, so quoted a modest 400.00 for it. Photographer B worked out of a more substantial rental studio, plus the client asked us to bundle the catering charge with the studio fee in order to “get it past accounting.”

Client B was comfortable working with the usual modeling and casting agencies to find the talent. Client A suggested we use an agency that offers “real people” at a much cheaper rate. So they were able to get models for about $630.00 each. Project B paid 2000.00 for each model, plus 1000.00 for the casting day. Just like any business decision where you’re trying to get the best value or return on investment (ROI), you have to decide when you can cut corners and when it’s not worth the savings. We often have the models bill the client directly. Some clients want to see those fees in the photography estimate, others are happy to leave it off.

Photographer A likes to quote a line item for a hard drive for archiving. Photographer B doesn’t bother.

In both cases, the equipment demands were pretty basic, so we chose to bundle the equipment charge into creative fee. However, it’s perfectly reasonable to break that out separately.

I normally don’t split hairs by quoting 6.5 hours of retouching. But we were so close to $30k that I decided to dial that number back just enough to keep us under that amount.

Photographer A chose to do his own production. Since there was a bit more to manage, Photographer B had me handling all the pre-production and I was on set the day of the shoot to make sure everything went smoothly.

Quoting wardrobe is always a crap shoot. A wardrobe stylist will generally pull a lot of options and return whatever doesn’t get trashed. But it’s a hard to predict.

In both of these cases, we were charging for production time and we were also getting a 50% advance payment on the entire quote. So we billed the client actual cost on the out-of-pocket expenses. I find that it’s customary to get expense money upfront on projects like this. But in cases where we don’t get an advance, I’ll normally mark up my expenses 15-20% to float that money.

Photographer A didn’t need a separate certificate of insurance because he was using his own space. Photographer B needed to provide one to the rental studio, so we charge 100.00 for that.

Photographer A charged a fairly typical 150.00/hour for his retoucher. Photographer B used his in-house retoucher, for which he charged 100.00/hour. Of course, just because you have someone on staff doesn’t mean you should charge more or less for it. Price is more a function of the value you bring to the client rather than the cost to you. In this case it was just another item that would allow that photographer to be a little more competitive on price.

If you have any questions or if you need help pricing and negotiating, or producing one of your projects, you can reach me at jess@wonderfulmachine.com.

By Wonderful Machine CEO Bill Cramer

Though we now work with nearly 500 photographers around the world, Wonderful Machine started out as a small cooperative of photographers in Philadelphia—sharing equipment, facilities, staff, supplies, insurance and know-how. Sharing those overhead costs is great, but it’s even better when we can develop client relationships that we couldn’t tackle individually. (Here’s another recent post about some other photographer cooperatives.)

One of those clients is a single department of a major university with a regular need for documentary photography. I started working for them nearly ten years ago, when their creative director saw my pictures in a couple of magazines and asked me to meet with her. At that time, their regular photographer charged 1800.00/day plus expenses for unlimited use of his pictures forever. But it was clear they weren’t happy with that photographer. I tactfully explained that I price my work based on usage, not just by time. And if they were willing to structure their licensing agreements that way, they could attract a higher caliber photographer (like me).

We agreed on a rate that covered her basic needs, which were local advertising, collateral (internal and external and including web), and publicity (press kits). To keep the fees within their budget, we limited the duration of use to one year. For anything beyond that (national advertising or subsequent use), we would negotiate an additional fee. We worked up a (non-exclusive) contract, which we tweaked periodically.

Then when I started collaborating with other photographers, I saw an opportunity to introduce them to that client as well. The university’s needs were growing. I was growing out of some of the assignments I was getting from them. So I had to figure out a way to incorporate our other photographers into our agreement.

It occurred to me that at the same time, we were in a position to create an exclusive relationship with the university in a way that could serve both parties better. The client could agree to give us all of their photographic assignment work, and in return we would agree to handle whatever they threw at us. The client would have the benefit of one point of contact (our studio manager) when they needed a photographer or a reproduction file. Our photographers would grow familiar with their people, places, and needs. And our photographers would have the benefit of a steady revenue stream. It’s a classic win-win that we’ve all been enjoying for several years now, and generates close to six figures in annual revenue.

You can see the actual contract and a typical invoice here:

And here’s an explanation of each paragraph:

<DEPARTMENT OF UNIVERSITY> WONDERFUL MACHINE INC.
2009-2011 MEMORANDUM OF UNDERSTANDING

Memorandum Of Understanding was what my client wanted to call our agreement. Clients will sometimes say “memorandum of understanding” instead of “contract” to avoid dealing with their own legal departments. It’s debatable whether this makes any legal difference. I’m confident that the clarity of the agreement is what protects will govern the relationship, rather than what we call it.

AGREEMENT – This agreement between Wonderful Machine Inc., (hereafter “Photographer” or “WMI”), and (hereafter “Client”) governs photographic assignments (“Photographs”), shot between August 26, 2009 and December 31, 2011, and constitutes the entire agreement between the parties concerning those assignments.

I like to give contracts expiration dates. Otherwise, whenever you make changes, you have to nullify the previous contract. It’s messy when you work with a client over a long period of time and it’s not clear which contract governs which project.

RATES – WMI will offer Photographers at the following rates:

A – 225.00/hour on site, plus 450.00 start-up fee, plus incidental expenses
B – 175.00/hour on site, plus 350.00 start-up fee, plus incidental expenses
C – 125.00/hour on site, plus 250.00 start-up fee, plus incidental expenses

In order to be able to handle all of their photographic requirements, we need to offer photographers at a range of skills and price points. Each of our photographers decides on his hourly rate. Then the client decides when they need their “A” team for a particular project.

In cases when I charge for my time, I’m usually billing by the day, not by the hour. However, the typical assignment for a university client like this is a couple of hours. Rather than agonizing over whether a project was a half-day or a full-day, I chose to structure it on an hourly basis. This is one of the concessions I made in exchange for a high volume of work.

The Start-up fee will cover normal pre-production arrangements, normal photographic equipment, digital files captured and delivered by web gallery for editing, and image archiving. There is no charge for the first two hours of round-trip travel time. After that, travel will be billed at half of the normal hourly rate. Incidental expenses may include mileage (at current IRS rate), parking, meals (on full-day shoots), tolls, assistants (as needed, 30.00/hour including travel and load/unload time), reproduction file preparation ($25.00 each), file upload ($25.00 for any number of files) and retouching (upon request 150.00/hour).

Charging by the hour only works when you have a suitable “start-up” fee to go along with it. That start-up fee covers the time it takes to do all the things that any assignment requires, no matter how short the actual shoot is.

Subject to availability, WMI will arrange for photographers in other parts of the U.S. and around the world, at the same contract rates listed above. In these cases, WMI will charge a 75.00/hour production fee to cover the staff time required to find and book the photographer, handle any post-production, image processing, captioning, archiving, and billing, over and above the actual photographer cost. WMI will provide a cost estimate in each case, and will alert the client if the anticipated production fee will exceed $250.00.

Occasionally, the client will need a photographer outside of our area. In cases where they can’t justify the travel costs, we arrange to have one of our other Wonderful Machine photographers handle it.

USAGE – The Client will have unlimited use of the Photographs in any medium and for any purpose, except for national advertising, (which will be negotiated separately), for a period of one year from shoot date, with an extension for images shot within that year and used in the annual report for that year. After that initial licensing period, the Client will pay one-half of the comparable Getty price for any further use of the Photographs. (The Getty price will be determined at the time of invoicing using the Getty Images price calculator, factoring in the size and prominence of the image, the type of media, duration of use, and quantity of publications produced.) The Client may print additional copies of any publication without any additional fee provided there are no significant changes to that publication. The Client may use any of the Photographs on their web site indefinitely without additional charge. Any publication the Client sends photos to for Publicity Use may use the Photographs without time limit, provided the Photographs had a current license when they were sent out.

The client uses pictures in lots of different ways, but mostly within a year from the original shoot. So we struck a compromise that allowed us to offer a modest rate for one year’s use, then bill additional use separately. We wanted to meet their needs without giving away the farm. Tying that additional charge to a stock industry standard eliminates the time and energy we’d otherwise have to spend negotiating. Half of the stock rate seemed like a fair discount given that they hired us to shoot the pictures in the first place.

EXCLUSIVITY – In exchange for these discounted rates and extended licensing, the Client agrees to assign all of their photographic work to Wonderful Machine Inc. If another department at wishes to use any Photographs created by WMI, that party will obtain permission from WMI and pay an additional fee to be agreed upon, except where that publication is specifically promoting , and the licensing period has not expired. Inter-departmental image usage under these terms must be accompanied by the statement, “Images used by permission of  <department of university>”. WMI will obtain permission from the Client before licensing any Photographs to any third party.

This paragraph says that they’re going to use us for all of their photography assignments and that the pictures we make for them will be for their exclusive use. (They do have the right to purchase stock photos from other vendors, which they frequently do.)

PAYMENT – Client shall make payment within 45 days of receipt of invoice.

30 days is more customary with us, but they asked for 45.

COPYRIGHT – Grant of any reproduction rights to the Client is conditioned upon receipt of payment in full as specified above. All rights not expressly granted shall be reserved by the Photographer.

This is a subtle but important point. Photographers lose a lot of leverage the moment they deliver pictures to a client. Here, it’s clearly stated that if the client uses the pictures and then chooses not to pay, they’re in violation of copyright, which gives the photographer a lot more leverage to collect. As a practical matter, it doesn’t mean that we expect to get paid before the client uses the pictures. It’s really just to protect ourselves from deadbeats.

CANCELLATIONS, POSTPONEMENTS, RESHOOTS – In the event of a cancellation or postponement of a shoot by the Client or subject, Client shall pay for the time and expenses incurred by the Photographer up to the time of the cancellation. If a shoot is canceled within 24 hours of the shoot, Client shall, in addition, also pay 100% of the fees of any subcontractors booked for the job.

As I’ve mentioned in previous posts, cancellation policies should be exercised with care (think about the last time you canceled your dentist appointment.)

INDEMNIFICATION – Client indemnifies and holds the Photographer harmless against any and all liabilities, claims, and expenses, including reasonable attorney’s fees, arising from Client’s use of the Photographer’s work.

I’ve never had a liability situation come up, but you never know. I think it’s reasonable for photographers ask for this protection in cases where they could be exposed to a law suit as a result of a client’s negligence. In the same way, it’s customary now for clients to ask this of photographers. I checked with our insurance company to make sure we were covered for it.

AUTHORSHIP CREDIT – The Client will provide a credit in the name of the Photographer whenever practical.

Often, it’s not practical for a non-editorial client to credit photographers. But in cases like a brochure where graphic designers and printers are often credited, it would be reasonable to credit a photographer as well.

TURN AROUND TIME – Normal schedule for web photo gallery or final file preparation is 48 hours. There will be a 50% surcharge for 24 hour service, and a 100% surcharge for same day service. Client will place all orders by email and also call to advise of any rush orders.

I charge 25.00 for a reproduction file prep for an editorial or institutional clients, which is relatively nominal. (I typically charge 50.00 to corporate clients and bundle the file prep charge into the retouching fee for advertising clients.) The rush charge keeps me sane and keeps clients from expecting everything immediately.

TEAR SHEETS – Client will provide Photographer with two entire copies of any publication his Photographs appear in.

Tear sheets are often good for my portfolio and they help me track usage.

If you have any questions about this contract or any others, please feel free to contact our lead producer Jess Dudley at jess@wonderfulmachine.com or 610.260.0200.

By Jess Dudley, Wonderful Machine Producer

Lately, I’ve noticed more and more corporations and ad agencies are requesting that photographers quote on producing “image libraries”. An image library is a pool of pictures that a client will commission, where they’ll license rights to use the photographs from a shoot in a variety of different ways, and they’ll often make them available over an intranet to different departments across their organization. The productions tend to be broad in their approach, loosely covering a variety of situations, sometimes in generic ways, rather than having a single specific objective. On rare occasion, library images will be used for ads, but most tend to be used for internal and external communications, and for publicity.

In the past, it was mostly institutional clients like schools, hospitals and other non-profits that liked to work this way. Those types of organizations tend to have a variety of different (often low-budget) publication and advertising needs that require a lot of pictures on a regular basis. But increasingly, where big companies once had photographers on staff to cover these types of projects, corporate downsizing has them now turning to freelancers.

One reason clients are willing to pay for broad (or unrestricted) licensing is because it’s often very difficult to maintain control over the use of the pictures when they’re available for use by so many people within their organization. So rather than risk a licensing infringement, they’ll negotiate unlimited use. Other times, clients expect to use such a high volume of photographs that they feel they can get a better deal by effectively negotiating a “bulk rate”. Still other times, a client will be willing to pay for the additional usage simply for the convenience of never having any limitations on their use of the pictures. In all of these cases, unlimited “library” use is worth significantly more than limited use.

But in a world where photographers traditionally price their product based on usage, what is “unlimited” use worth? There have always been photographers who intentionally or unknowingly ignore the subject of licensing, or otherwise simply give away unlimited use of their pictures without charging a premium for it. Those tend to be young photographers who don’t know any better, or established photographers who have found that it’s the only way they can compete, or they couldn’t be bothered with the extra work involved in understanding how image licensing works and explaining it to their clients.

However, in most of these cases, pricing photography “by the day” is a dysfunctional system, and not in the interests of the photographer or the client. There’s an inherent conflict when a photographer is compensated in inverse proportion to her productivity. The more photographs she produces, the less she is paid for each of them. Any photographer’s natural motivation will be to produce enough work to satisfy the expectations of the client, and no more. That is no way to run a business.

A much better fee structure is one that links the photographer’s compensation with the value to the client. My normal starting point for a medium-sized corporation and a middle-of-the-road photographer would be to quote a modest day rate (usually around 2400.00 plus expenses) which would include unlimited use, excluding advertising, of up to 8 images. Then I’d price additional images at 300.00 each (plus file prep). That way, the photographer is incentivized to be as productive as possible, and the client gets the benefit of committing to a low cost up front and then just paying additionally for any additional images that they pick. (Naturally, this pricing could be higher or lower depending on the nature of the pictures, the caliber of the photographer and the size of the client.)

Generally, I try to steer clients away from “unlimited use of all the pictures forever”, because it unnecessarily drives up the fee. There are many ways to satisfy the client’s need to use the pictures broadly. The photographer can license “unlimited” use in a limited way by restricting the time, geography, and/or realm of use, while leaving other parts unrestricted. Are the pictures really going to be useful after a few years? If not, why pay for forever? Do you really plan to use the pictures in Indonesia? Then why pay for international use? Do you really intend to put the pictures on billboards? If not, why pay for outdoor advertising use? When the photographer and client each understand what the other values most, they can come to an agreement that works best for both of them. (That’s known as a “win-win”.)

In addition to corporations, ad agencies seem to be increasingly interested in creating image libraries. We recently quoted on a project for a west coast ad agency who was working with a theme park client that needed a variety of pictures for use on their web site and in advertising. The agency asked us to quote a four day shoot, where the still photographer would work along-side a video crew, photographing families enjoying the various rides and attractions in the park. (See our related post on working with video crews here.)

In spite of my best efforts to persuade the client to agree to more specific licensing, they decided they really did want “unlimited use of all the images forever”. Determining an appropriate fee depends on a number of factors. Here are the questions I asked the art buyer (and the answers I got):

Who is the end client and how prominent is their advertising presence? (In this case, the theme park was a household name, but aside from the web, their advertising presence was not very prominent outside their region.) The larger and more prominent the company is, the more they stand to gain by using the photos. (In a normal licensing situation, the client has to share how they intend to use the pictures because it becomes part of the actual agreement. With any kind of unlimited use, the client has no obligation to tell you how they plan to use the pictures. And in fact, it’s in their interest to down-play their intended use. In these cases, it’s prudent for the photographer to overestimate, by a decent margin, the probable use by the client.

How many situations do you want to shoot in those four days and what level of production are you looking for? Would you rather cover more pictures with less production value (lighting, hair/make-up, props, wardrobe) or fewer situations with greater production value? (We’d like to cover variations of about a dozen different situations. We’re looking for a “real” look, so the pictures don’t need to be overly produced.)

Will the shoot days be consecutive? (Yes.) Just as you would discount your per image rate for multiple images, it makes sense to offer a lower rate for consecutive shoot days and a higher rate for non-consecutive because you can be more efficient with your own time on consecutive days, and you can typically get better rates from your subs as well.

Do you have a shot/situation list you can send me? (Not yet. We’re still working that out with the video crew. That list will be used as a starting point for the still photographer, and then we’ll work from there. We’d like to do a scouting trip with the photographer to determine which rides/attractions would offer good picture opportunities.)

How many final images do you expect to use? (It’s hard to say how many we’d actually use, but I’d like to see between 30-40 useable images per situation.)

Do you want us to deliver raw or processed files? (We’d like to have raw, color corrected images.) This can be a welcome change from the normal retouching and approval process. But the downside is that you are relinquishing control of the final image quality, and your ability to charge a fee to supervise that process as well. The down-side for the client is that they take on the responsibility of that processing, and they risk not getting the full impact of the photographer’s vision.

Thankfully, the art buyer was sensitive to the demands of working with a video crew and was very communicative regarding any overlapping production expenses. (For more on shooting along side a video crew, check out our previous blog post on the subject).

After considering all of the factors, we came to rest on the following:

(By the way, It’s very important for the photographer to convey the licensing to the end client rather than the ad agency. Otherwise, the agency would potentially be in a position to use the pictures for another client without further compensation to the photographer.)

A few notes about our production expenses:

In this case the “grip” was basically a 3rd assistant whose job was to be primarily rigging lights and managing underwater camera housings for the water attractions.

The groomer/wrangler is responsible for making sure the talent was where they needed to be for our shots and ensuring they were camera ready. You have to be careful when working alongside another production. They can handcuff your shoot should they dominate the talent’s time.

It’s unusual to charge for both digital capture and digital tech but due to the high volume of images generated on a shoot like this, the digital tech can’t keep up with the file management. So their job was to bring their workstation and display, transfer images intermittently when not needed on set and during breaks, and process a handful of images for review. This left a fair amount of basic workflow for the photographer after the shoot.

If you have any questions, or if you need help estimating or producing one of your projects, you can reach me at jess@wonderfulmachine.com

By Jess Dudley, Wonderful Machine Producer

A typical magazine assignment generates a modest fee, a couple of portfolio pictures, a little notoriety – and if you’re lucky, it can also provide an opportunity to make valuable connections with people who can give you work. Follow-up is key to capitalizing on those connections.

Though your subject or the contact person on the shoot might not be the ones who hire photographers for their organization, they probably know who does, and they will often have an influence on that process. When you’ve completed your shoot, find out from them who would be most appropriate for you to reach out to.

After a magazine has published the story, it’s normally okay to let the subject and their handlers see the outtakes from the shoot (certainly not before). Sending a print of your favorite picture from the shoot or a link to a web gallery is a great way build on the rapport that you developed during that assignment.

Explain that if they like them, they can license the images from you when the magazine’s embargo period is up. And that they can hire you for assignments as well. All things being equal, people are inclined to work with photographers they’ve met, like, and even better – ones they’ve seen in action. Don’t assume that a subject will know that you’re interested and available to work for them. Tell them so.

This strategy paid off for one of our photographers recently after he photographed a hotel executive for a business magazine. After the article came out, our photographer sent the subject and their corporate communications director a link to the pictures. They responded that they might want to use some of them in their press kits. We sent them a quote, then heard nothing for months. Eventually, they called to say that they needed pictures at a different location instead. So they asked us to work up a price for a new shoot.

Whenever I quote an assignment, I think (broadly speaking) in terms of time, materials, and licensing. I’ll want to understand what the final picture(s) need to look like, what we have to do to create them (factoring in all the production elements), and how the images will be used.

Here’s how the client described the pictures they needed:

Two different group portraits of eight people from their branding team, shot at one of their hotel properties

Here’s the licensing they needed:

Publicity and Internal Collateral Use forever

Here are the questions I had for them, and their answers:

Q. What are the locations that you’d like to consider using?
A. Both were local to the photographer.
(We’ll need one scouting day, paying attention to the time of day in anticipation of any outdoor pictures we might do.)

Q. Would you like to have professional hair/make-up?
A. Yes. (With eight subjects [more than half of them women], we’ll need two people doing hair and make-up. We’ll stagger the subjects’ arrival times somewhat to minimize the wait time for everyone.)

Q. Would you like to have a wardrobe stylist, and pull wardrobe?
A. No. The subjects would each bring two sets of clothes.
(Our regular hair/make-up stylists also have wardrobe styling experience. I’ll have them bring a steamer and they can tweak the wardrobe in a pinch.)

Q. Would you like us to arrange for catering?
A. No. The hotel will provide food and drinks for the cast and crew.

If this had been an advertising job, I wouldn’t have asked any of these questions. We would naturally plan on all of that stuff. But a publicity project like this is naturally going to be more modest in scale. Getting a sense of proportion from the client ahead of time will put our initial estimate pretty close to the mark. And when the client or subject is providing catering, wardrobe, or other production elements, it’s important to specify that in the estimate to avoid any confusion later.

I didn’t need to ask any more questions to decide on the other expense items. I knew it would be overkill to have a separate digital tech on site (in addition to me producing), so I decided to handle both myself. (Turns out we ended up moving around so much, and so quickly, that a digital tech was impractical anyway (and I’m a pretty good assistant when I need to be!) The client was happy to look at the LCD on the camera, using a loupe.) Photographing eight people in a big space would require a moderate amount of lighting equipment and two assistants. That was the extent of the production elements we needed to include in the quote.

In terms of licensing fees, Publicity Use and Internal Collateral Use have moderate value. Publicity Use is when a company gives away photos to publications to encourage them to produce stories about them. It’s impossible to predict how much mileage a company is going to get from those pictures, but it’s somewhat proportional to the size of the company.

Internal Collateral Use has a relatively small audience, generally limited to publications aimed at the company’s employees (usually in the form of a newsletter or intranet use.) So that value is also somewhat proportional to the size of the company.

Then there’s judging the value of “forever”. With some exceptions, publicity images showing staff people are going lose value at a pretty steady rate over the first few years, and be nearly worthless after five years. Clothes, haircuts and trends go out of style, and the subjects will age and change jobs. So licensing the photos forever in this case isn’t as valuable as when the picture is of something that won’t change as much over time. In this case the photographer was shooting group shots of trendy employees of a trendy hotel. So as a practical matter, the shelf life of the photos is just a few years.

I like to build estimates using a per image licensing model. It’s the best way to create a win-win for the client and the photographer. The client doesn’t have to commit to a ton of money for the pictures upfront, and the photographer is incentivized to be really productive.

I decided to quote the pictures at 1500.00 each plus expenses. Here’s how the estimate and terms & conditions looked:

The client signed off on the estimate.

After a quick scout of the two locations, the photographer determined that one of them clearly had more and better options to offer than the other. So that choice was easy. To make the shoot day more productive, the photographer went back to the chosen location and shot about a dozen quick test pictures and printed them out. The morning of the shoot, the photographer and client reviewed prints of the different situations and picked five to concentrate on.

The shoot went well. We ended up squeezing in six situations. The client loved having all the choices, along with the option to license more images in the future. And it was all due to some good-old-fashioned publicity of our own.

If you have any questions or if you need help estimating or producing one of your projects, you can reach me at jess@wonderfulmachine.com.

APE: When I worked at Outside Magazine we had a flat day rate for assignments but then had to create all these other rates to accommodate certain photographers or certain situations where the use was more extensive. It turned into a huge mess where we didn’t know what an assignment would cost and we would need to pull old invoices to see what we paid someone last time. When I went to Men’s Journal I redid the system and changed to a day rate against space structure which was much more elegant and logical. A fashion shoot that took one day but had 8 pages of images resulted in $3200 for the creative fees, which was more reflective of the level of talent we were pulling from and the overall amount of work that went into that one day of shooting. It’s good to see Wonderful Machine shedding some light on this concept in our monthly column, because it works well for both the magazine and the photographer. When shoots are “killed” some money can be saved and photographers have a guaranteed minimum but are paid based on the total usage.

By Ben Weldon, Wonderful Machine Producer

Many magazines have contracts with rates and terms that they offer to photographers (which are generally negotiable). Others don’t have their own contracts and instead work on a case-by-case basis with individual photographers. For those situations, it’s good for photographers to have a contract template on hand. We tend to structure our editorial fees based on a day rate against space. It’s an elegant solution to the problem of how to scale editorial fees, and it’s widely used by many national magazines, but some people find it hard to get their head around at first.

Pricing for editorial photography tends to be different from commercial photography for a couple of reasons. When a company decides to produce an ad or brochure, they already know what they need (in terms of photo display and usage) before the photographer is brought in. So it’s mostly a matter of the photographer coming up with a price and terms to fit those unique specifications. Magazines, on the other hand, need to work much more spontaneously. Editorial opportunities often come up on very short notice, and they also tend to morph from the time of the assignment to the time of publication. When an editor and art director send a writer and photographer out on a project, they never know what they’re going to come back with. And the play in the magazine is going to depend largely on how interesting and relevant that result turns out to be, compared to other stories that they’ve got cooking.

So photographers and magazines are best served by a contract that can be put in place for a couple years at a time (which allows for last-minute projects) and is scaleable (to account for variations in the amount of time required, expenses and the number and size of the pictures used). After all, it’s reasonable to charge less for a project that takes a day to complete vs. one that takes a month. It’s reasonable to charge less for a project that you can do alone in your back yard with a fill card than one that you have to take a crew of 7 and a dozen cases of rental equipment to Tunisia for. And it’s reasonable to charge less for a 1/4-page photo inside the magazine than a cover and 10 pages in the well.

The day rate vs. space structure takes all of these variables into account. The day rate is a minimum guarantee that compensates the photographer for his time on the project. It tends to be fairly modest, to accommodate small projects that won’t have a big presence in the magazine. The space rate comes into effect only when the magazine ends up using multiple or large pictures. The expenses are what they are. The structure nicely scales from small assignments that the publication can have done inexpensively, while incentivizing the photographer to produce a lot of great pictures. And it minimizes the need to renegotiate after the fact, when the final piece in the magazine is different than imagined.

Here is our standard day vs. space agreement (in Adobe PDF ):

And here’s an explanation of each paragraph:

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