Why is this?
THE UNDER CUTTING BASEMENT (A.K.A. “THE SWEATSHOP”)
The market has changed in recent years and there are now lots of new photographers around, many of whom are also reaching for a piece of the ever-shrinking corporate event photography pie. Sadly most of the new-comers to this business have little business sense or even understanding of how to price themselves, so they go in cheap. This increase in competition means that if I want to carry on working in this business I have to be competitive and reduce my rates too. Or improve my value offering. Or take out contracts on all the competitors who undercut prices. Well, there’s no Italian blood in me (omertà) so I’m really only left with one choice. It isn’t reducing my rates.
If I was to reduce my rates to compete with the under-cutters entering into the market all I would end up doing is heaping more pressure on myself. My rent doesn’t ever come down, nor do any of my other living expenses. I would have to work harder to make the same money I was making before. I’m old now. Working harder for the same things doesn’t really enter my thought space that much.
I understand that everyone has a different set of living costs and mine may not be the same as the new photographer who just graduated from college and still lives with his or her parents. But why should there be differences in the way we price ourselves? We are doing the same job and probably giving a similar output. The only things differentiating us should be our individual style and personality.
If you undercut your competitor’s prices to get a job the winner isn’t you, it’s the accountant working for your customer, because now they have leverage over you. They know that you’re a low-rent photographer and their exploitation engine kicks into high gear. Welcome to the world of the bargain basement photographer. If you’re undercutting on jobs because you can afford to charge less since you’re living in your parent’s basement paying hardly any rent, I hope you like that basement because you’re going to be spending a lot of time down there if your plan is to keep on doing cheap jobs for customers by undercutting the market. Those customers may keep you very busy, but you’ll never get any richer. You’ll just get worn out working for them. Trust me on this.
Once you set a price benchmark using basement living overheads, getting customers to move to a new benchmark outside of the basement (when your overheads inevitably increase) is going to require smooth talking from you on the intensity level of Spandau Ballet love songs to keep those customers. That is unless you have an X factor that they are prepared to pay more for. Not many photographers have an X factor, especially not in event coverage.
Around the time I made the transition to being a full time pro I had a conversation with a guy who used to be a moderator on the ODP forums (and he was also a member here), the late Mark Thomas who worked in Pretoria as a commercial photographer. Mark mentored quite a few of us on ODP and his advice on turning pro has stuck with me. He told me this story about how after being a pro for a few years and not really getting anywhere he decided one day to double his rates. He lost half of his regular customers immediately but he managed to keep the other half by promising them more attention to their individual needs and turnaround times. He didn’t shoot events (that I know of) as he was a commercial photographer, so his work was already at a certain level that those customers had come to appreciate and were prepared to pay more for. He also had the X factor in what he did. As a result of this decision he subsequently worked fewer hours, but made the same money he did before. This move however, improved the quality of new clients calling on him. He wasn’t being seen as a low rent photographer anymore and he also then had more time to explore other photographic interests, one of which was to start selling fine art prints and copyright of stock he’d taken to corporate customers. Back then I recall he sold a photograph he had taken to a company for a lot of money. He would never have had that opportunity if he’d been grinding away day after day for peanuts as a bargain basement photographer.
You have to think big picture if you want a long term career in photography. Trying to build up a business on a price offering is 100% dependent on volume and in these days of corporate cutbacks volume is fast becoming Unobtainium. Loyalty means nothing to customers who have made their purchase decisions on price. Don’t try and run your photography business like a supermarket, because there is always going to be somebody who will do it cheaper than you. You simply won’t last very long if your customers run out on you to go and use the next bargain basement photographer they find.
SETTING THE PRICE BENCHMARK
At a recent workshop I held for photographers looking to build their own WordPress websites we got onto the topic of price discussion amongst pros. How come so few of us publish our rates on our websites? We seem to have this totally unfounded paranoia about sharing what we charge with other photographers that doesn’t seem to exist in any other service industry. Plumbers and electricians are all pretty open about their rates and the medical profession have the Prescribed Minimum Benefits (PMB) system to work from (in a South African context). They all know what the benchmark for charging for their services is. Some go higher, some go lower.
If we professional photographers playing in the same markets set some PMB’s ourselves, we might make our lives a little easier. We will never get consensus on what that benchmark figure should be in an unregulated industry such as photography, but I reckon we should at least be looking to establish a minimum hourly rate for event photography, especially if we are to help new photographers avoid falling into the “bargain basement” trap and thus becoming a problem for the entire industry. Them being stuck in there hurts us all, so it would be better for us if they never went into the basement in the first place.
So, let me be forthcoming and reveal my personal pricing benchmark for event photography (please note that these are based on the South African market, photographers in other countries will have different benchmarks, but the principals used should apply to all markets).
When I quote on an event I first look at the timing and location of the event. I have developed a hourly pricing model (labour only) that is based on weekdays or weekends, daytime hours or evening hours. If it’s a weekday and the hours are between 7am and 5pm I charge R1000 ($65) for the first hour and then R600 ($40) for every subsequent hour, or part thereof. If the event is after 5pm the first hour is R1250 ($82) and additional hours are charged at R750 ($50) each. If it’s on a weekend my first hour is R1500 ($100) and additional hours are R900 ($60) each regardless of the time of day. Please note that this is purely for corporate events and only covers labour. If there are any extras like prints or disks those are billed for separately.
I choose to charge more for the first hour and less for extra hours because it makes it worthwhile for me to do short 1 hour jobs and it also gives my customer the impression that they are getting better value by having me around on an event for longer. However, I find that longer jobs are not as plentiful as they used to be, so if I am out for 3 hours on a job I am getting at least R2200 ($145), whereas if I was charging (say) R600 ($40) flat rate per hour I would only get R1800 ($120) for the same job. If a customer wants me for a half day or a full day they can easily work out the total costs using these rates. I don’t offer half and full day rates anymore.
For travelling costs if the event is outside of the Durban Metro area I charge R4.50 ($3) per kilometre from my starting point. I don’t charge for travel if the location of the event is within 30km. In light of recent fuel and insurance price increases I should probably re-look at that policy.
Sometimes I might get a project in another city that requires me to fly there. It doesn’t happen often but when it does I charge an S&T rate that covers my meals and any other costs arising (like parking at the airport, which can be quite expensive long term). I try not to gouge my clients and base this on reasonable expenses. Usually my client pays for the airfare and overnight accommodation if it’s needed, otherwise I’ll just add it to the quote.
I always ask for a 50% deposit on events, unless I have already got a long established relationship with the client. The balance of my invoice is due on delivery of the photos, not 30 days from delivery like how some customers (particularly certain ad agencies) like to pay. I make this very clear upfront for new customers. A new strategy I am adopting to avoid this “shoot now pay later” practise is to offer a 10% discount off my quote if payment is made in full upfront. You’ll be surprised at just how effective this has been! Solves a lot of admin and cash flow problems for me.
There are many photographers who are charging more than I do for corporate stuff and if they are getting their price then that’s great. My rates are based on Durban events. I’m sure photographers in Gauteng and the Western Cape are able to charge much more than I do. I’m happy with where I am price wise, provided the work keeps coming. I don’t expect to be busy every day, but at least when I am busy I don’t feel like I am being molested by some corporate accountant who’s only motivation for living is to bleed every supplier he can totally dry. I at least retain my soul when I am working on events and I enjoy them rather than spending my time feeling resentful towards the client who beat me down on price.
WHAT IS MARKET RELATED PRICING?
So what about those photographers charging less than me? How much less is considered reasonable to charge for events these days?
I reckon no photographer anywhere in South Africa should be working for less than R500 ($35) an hour for event coverage. If you’re going in under that price point you’re going to be in the low rent basement because these jobs don’t happen every day. You can’t rely on them for all your income, so you may as well make the most of them and charge a healthy hourly labour rate.
“But what if I’m not good enough to charge that much yet?” I hear you say. Oh dear. If you want to do photography for a living you have to be good enough before you get in the game. End of story. Roll credits here. There is no room for hacks in this business so please get “good enough” before you set up shop and print your business cards. Skilled work requires skilled workers and you need to have those skills in order to be able to charge for them. Horse. Cart. Order.
AND ON THAT BOMBSHELL…
If you’re already “good enough” but you truly have no idea on how the photography business works, yet you want to be a part of it, find yourself a good mentor who isn’t shy to share their experiences and business wisdom with you. There are many successful photographers around, some of whom offer internships, assistant jobs or workshops. Seek them out and tap their knowledgebase.
A good professional photographer will never be worried about you stealing business from them because they already know the value of their own ability and why their customers are happy to pay them for it. Don’t be afraid to ask and don’t be afraid to charge when you’re ready to call yourself a professional.
If you're a pro working in the events market outside of South Africa, please share your thoughts on billing in the comments. I'd love to hear them.