Photographers How to set pricing
I was recently asked by a wedding photographer, how much you should charge for your time, your digital files and your products. This is huge guys! You really need to understand how to set pricing if you are going to run a PROFITABLE business.
I can’t tell you how many times I have helped people with the pricing just for them to run back to their old ways of doing things. Why? It’s super scary… thats why! I won’t lie. Usually if you were to calculate the numbers correctly, that number is most likely going to be higher than you are comfortable with. Most people won’t go that high and will compensate on something in between where they are now and that number. Sometimes people will even drop their price within a few months without giving the pricing the proper time to work. So to be better prepared for the numbers that are coming, let’s cover a few things.
Your Current Clients May Not Be Your Ideal Clients
One of the biggest things I see when photographers change their pricing is that they often say “My clients will never pay this amount. I have a hard time getting them to pay be $XX already”
You have to realize that when you change your pricing, your old clients will not be your new clients. Your new clients will value your work so much more that they will be willing to pay more for it. Your new clients will understand that this is a job and that there is more to photography than just taking the photo and delivering images on a usb drive. They will want to pay for art.
All that being said, you may have to look at other avenues to attract those clients. You can’t just sit back and wait or they will never know you exist. If you don’t want to do the footwork, you may as well give up now because thats what this job is. IT’S WORK – and a lot of it. But, if you get it right, it can be very rewarding too.
Artwork is Valuable
I get asked (so, so, so many times) how you can place a number on an image that didn’t really cost you that much to take. I know what they mean… With digital cameras, after the camera is paid for it doesn’t really cost you much to press that shutter button right?
WRONG! Everyone forgets about their time (to shoot, to edit, to prepare the files for delivery, to drive, etc) and their cost to produce that item such as website cost, overhead or office space, gas, paperwork for client packets, the cost of the prints, studio management software, continuing education, replacement gear, albums or canvas art, taxes, credit card or paypal/square fees… the list goes on and it defiantly costs you!!
Secondly, what most photographers don’t realize is that you are an artist. The client is paying you to take images of their most special day because they know that you will produce a better product than the regular Joe (or at least I hope you will). You are artfully capturing images of moments that they will never EVER see again. Moments that are gone in a blink of an eye. Think about this way and see if this helps you understand the importance and cost of what you do and how it relates into how to set pricing…
“Time is free, but it’s priceless. You can’t own it, but you can use it. You can’t keep it, but you can spend it. Once you’ve lost it you can never get it back.”
This is a famous quote by Harvey MacKay and it sums it up perfectly. Read the last line again and think in photography terms. “Once you’ve lost it you can never get it back”
What is this saying? To me, this is saying that it doesn’t matter what an item costs you to make because it’s value is tied to the emotional aspect of a fleeting moment. In this way you are selling memories, you are selling art and that is worth more than you can imagine.
How To Set Your Pricing
Now there is a different answer for everyone! I know that you probably just want an answer like “just charge $400/hr” so that you can go about your day but its not that simple. Every person has different factors that play a part in the cost so its really important that you actually do the steps to know what your numbers really are.
You will need to figure out three main things:
Your Cost to Run a Business
Your Cost to Shoot the Event
Your Cost of Living
The first one, cost to run a business, is going to be anything that it takes to run your business that is not related to a client. So things like your studio cost/utilities, website, bridal shows and marketing, sample albums and products, association fees, studio management software, etc.
The second one, Cost to shoot the Event, would be anything related to that specific event. So, things like second shooter fees, Client packets, Costs associated with meetings, gas, client related gift and things of that nature.
On the last one, Cost of living, this only applies to FULL TIME PHOTOGRAPHERS. If you are not full time, skip this. If you are a full time photographer then this would be things like rent, utilities, bills, food, gas… basically everything that you need to survive. Not all the fluffy extras but the living basics for a full year. If you have a spouse that makes a wage, then calculate what you need to add to their wage to make the bills.
Price Per Hour
Now that you have collected these numbers, we need to create an establishing price… or your price per hour. We will use this to base everything else on. This is not a number that you get by looking at other photographers and just charging the same. You don’t pull this number out of the air!! Come on people!! Most photographers are doing this wrong and if you copy them, you will be doomed to fail. This is not how to set pricing. Instead, we need to do the math.
How many weddings do you plan on doing next year? A good base is to see what you did this year and work off that. Its better to calculate low. Now add together your cost of living (if you are full time) with your cost to run a business. We are going to make this up for the time being. Let’s say that my cost of living as a full time photographer is $30,000 and my cost to run a business is $10,000. That is $40,000 total. Now I divide that with the number of weddings I want to do each year (lets go with 15) 40,000 / 15 = $2666. Now I add to that the cost to shoot the event ( $600) and we get $3266. This is what you need to make on each wedding just to cover your costs. Now, let’s say that you do an average of 8 hours per event. We would take $3266 and divide it by 8 giving us $408.25. This is the cost per hour that I need to break even. Crazy right?! Now, you should multiply that number times 3. Why? Well, 1/3 will be your cost (shown above), 1/3 will be your taxes, and 1/3 will be your profit. Now, because this number is crazy high and most people get scared, you can adjust down by (at the MOST) half. This won’t leave you any profit but hopefully you can sell items to make money. Now, use this number to make your packages.
I hope you found this helpful 🙂
So, what was your number per hour?? Share with us down below!