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Do FCPX freelance editors charge for your "Edit Suite"

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Mike Jeffs
Do FCPX freelance editors charge for your "Edit Suite"
on Jul 1, 2015 at 10:33:49 pm

This is a sincere honest question. Those of you FCPX freelance editors, or even those who work for post houses on FCPX, Heck even Adobe guys, do you charge for the equipment you edit on along with your standard day rate?

Not to long ago it was incredible common to have a day rate for the Editor and a separate rate for the Edit suite. All my "research" (read googling) it seems like that isn't the case anymore. Is it just factored into your Editor day rate? if so what percentage.


Where I am at we charge between $450-$550 a day for editor and up to $120 hr for the edit facilities. Is this normal? outrageous? Thoughts?

Mike Jeffs
Production Services Manager
KPBS San Diego


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Neil Goodman
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 1, 2015 at 11:15:54 pm

the day rate seems a little low, while the equipment seems a little high.


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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 1, 2015 at 11:30:56 pm

[Mike Jeffs] "Where I am at we charge between $450-$550 a day for editor and up to $120 hr for the edit facilities. Is this normal? outrageous? Thoughts?"

How does it compare to what other places are charging in San Diego that do similar work as yours? Geography and 'genre' play a massive role for what's considered 'normal'.


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 1, 2015 at 11:45:01 pm

I change for both - my day rate and a rate for my edit kit. When I'm working on my home-based system, it's easier to get the rate, although often it ends up being a package deal. It's harder to get a fair rate when I'm on-site using my laptop system. Clients seem to think that should be tossed in for free. So, while I usually get a fee for it, the rate is often lower than it used to be. Usually I get a day rate for me and then some sort of flat kit fee for the use of my gear.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Mike Jeffs
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 1, 2015 at 11:55:37 pm

[Oliver Peters] "Usually I get a day rate for me and then some sort of flat kit fee for the use of my gear."

Oliver is your flat kit fee per project one time charge no matter the amount of days of edit or is it per day? Even if its less then your home base set up



[Oliver Peters] "when I'm on-site using my laptop system. Clients seem to think that should be tossed in for free"

This gets my thought process when it comes to FCPX. Do clients think "hey thats a cheap software that runs on a regular mac laptop I shouldn't possible have to pay for you to use it." And maybe it is unfair of me to single out FCPX editors, all the major NLEs are relatively in expensive and run on relatively economical machines.

Mike Jeffs
Production Services Manager
KPBS San Diego


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 12:30:03 am

[Mike Jeffs] "Oliver is your flat kit fee per project one time charge no matter the amount of days of edit or is it per day?"

The flat kit fee only applies to on-site gigs. I attempt to get a day-rate, but often I have to settle for a flat fee for the whole gig.

[Mike Jeffs] "Do clients think "hey thats a cheap software that runs on a regular mac laptop I shouldn't possible have to pay for you to use it." And maybe it is unfair of me to single out FCPX editors, all the major NLEs are relatively in expensive and run on relatively economical machines."

I don't think it's specific to FCP X. I think it's a general trend. I've had similar conversations whether it's Resolve, X, PProCC or Avid MC. Not so much because of the software, but rather the hardware. As in, "it's a laptop, so it can't cost that much."

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 1:41:55 am

[Oliver Peters] "I don't think it's specific to FCP X. I think it's a general trend. I've had similar conversations whether it's Resolve, X, PProCC or Avid MC. Not so much because of the software, but rather the hardware. As in, "it's a laptop, so it can't cost that much.""

Correct me if you think I'm wrong, but I feel like this shift started occurring maybe 10yrs ago or so as FCP was coming up in the ranks. If someone spent $80,000 on an Avid setup it was pretty easy to sell the cost of doing business to a client. "Hey, the gear to do what you want is really expensive so that's why I charge what I charge." Even though the gear couldn't do anything w/o a good editor, it was easier to sell the value of the 'exotic' gear required vs the value of experience.

When FCP helped usher in 'desktop editing' then the act of explaining your rate based on the exotic gear and/or overhead started to backfire because clients were like, "If FCP costs way less than what Avid does then shouldn't your rate come down a whole lot too?" I still think clients are in the learning process of divorcing the value of the person doing the job from the amount of money the tools to do the job cost when it comes to rates. I doubt many of these people would hire someone to build them a fence and ask 'Hey, would the cost be lower if you used Craftsman tools instead of DeWalt?" yet when it comes to video projects that can be very much be the mindset.


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 1:46:58 am

[Andrew Kimery] "but I feel like this shift started occurring maybe 10yrs ago or so as FCP was coming up in the ranks."

I think that was mainly a factor for facilities. It really started with Avid before even FCP as equipment shifted from linear bays to Avids. Then to FCP on commodity gear. I think it's just a continuation of the same trend.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 2:07:21 am

[Oliver Peters] " It really started with Avid before even FCP as equipment shifted from linear bays to Avids."

Exactly. Avid used to be the cheap disruptor. "You Avid guys are charging so little, we're all going to go out of business."

Then in the mid-90s, guys like me with their "cheap" $30,000 Media 100 cards and "cheap" $10,000 Betacams with "cheap" $12,000 lenses. "Your cheap $1500 day rates killing this industry!"

Lather, rinse, repeat. I had to take a second mortgage to buy my "cheap" system, but at least I had a house. I have no idea how some of you kids are pulling this off...

...but indeed, this process has been underway since the very beginning of nonlinear editing. I think self-cannibalization is built into the DNA of this business more than most others.

In any case, the old guys in this forum like me were driving prices into the ground while some of you were toddlers. Yet another part of the economy that boomers torched before millenials arrived. You're welcome. LOL


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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 2:16:55 am

[Tim Wilson] "Yet another part of the economy that boomers torched before millenials arrived. You're welcome. LOL"

But, all you left us was a barren field, Mr. Wilson...

Yes, but it's YOUR barren field.

;)


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Gary Huff
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 5:05:26 am

[Tim Wilson] "I have no idea how some of you kids are pulling this off..."

Usually with an apartment shared with two others.


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Eric Santiago
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 2:26:57 pm

[Tim Wilson] "Yet another part of the economy that boomers torched before millenials arrived. You're welcome. LOL"

You kids get off my lawn!!!


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Bret Williams
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 6:20:31 am

In complete seriousness, the doubling of the cost of my family health insurance recently costs more than my gear and software. My health insurance went up $4,800 this year. I don't spend near that on video gear per year!


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Mike Jeffs
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 1, 2015 at 11:48:21 pm

[Andrew Kimery] "How does it compare to what other places are charging in San Diego"

That is what I am getting at. Looking around I can't really find others still charging for their Edit equipment. All I hear about or see (Google) is day rates, and they are all over the place. I have to assume they are building it into their day rates which leaded to my question of FCPX editors what percentage to they build into it? Or do they not?

Mike Jeffs
Production Services Manager
KPBS San Diego


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Dave Jenkins
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 2:15:55 am

I'm in Santa Barbara, CA and I charge hourly. But I'm a production company so when you walk in the door to my office there is no separation between gear and me. I refuse to do day rate jobs or flat rate jobs. I loose jobs to Craigslist but they aren't jobs I want.

Dajen Productions, Santa Barbara, CA
Mac Pro 3.5MHz 6-Core Late 2013
FCP X


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 2:58:29 am

This is pretty easy to figure out.

A day rate is what someone will pay you. If they won't pay that much, you negotiate. It is of course dependent on job, location, and market.

I find, depending on the job, it's best to charge post hourly as this draws a (sometimes arbitrary) line in the sand for clients. After that many hours, or thereabouts, the job is either complete, needs to wrap up, or we need to start taking about overages. Most people, in general, can quantify the value of this, even if they don't understand how buying productions services works. Sometimes, clients don't understand how much work goes in to certain jobs, and the hourly figures help them to understand when a limit has been reached. As far as gear, as Oliver says, it's mostly about location. If they are coming in to your studio all the time, your hourly change should reflect your time, your gear, and your expenses (food/electric/rent/consumables/etc).

When you're on site at a gig and you bring your gear, you should charge a fee, even if it's a laptop. Remeber, it's not only the laptop, but it's all of the software/plugins, and the expertise to know how to get the job done if something goes wrong, hard drives, peripherals, and insurance. All of that costs you something, so therefore it's also worth something. If a client doesn't understand the value, then they should try and rent a system from a third party. Of course, they'll balk, so you may want to simply raise your hourly rate to make sure your costs are covered.

And then, of course, clients want package deals. They have a certain amount of dollars for an agreed amount of work on a job. At that point, you have to decide if it's worth it. At the end of the job, will you be happy with that amount?

In your example, if you combine your equipment and editor rates, you'll get an hourly rate. Assuming a 10 hour day:

$120/hr and $450/day = $165/hr

A rate of $550/day gives you $175 an hour.

There is no easy answer, and depending on the types of jobs you do (or people you're looking for) they are all different and require different numbers. It's a jungle out there.

It is true the cost of ownership is lower than ever, but that doesn't mean it's worth $0.


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Bret Williams
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:18:21 am

Seems a bit on the high side to me. But like has been said every genre and locale is different. But at that hourly rate for an NLE suite, seems like you could buy a new suite every week. When the computer is 3k, the raid is 3k, the monitor is about 3k, and software is negligible cost at all. Rent is your biggest cost.

In the 90s, when an edit suite cost closer to $50,000-100,000, our facility was getting $150hr Max and I was on staff so that included the editor. The big facilities were getting $300-400hr but they had digibeta instead of betasp.

In my market, Atlanta, I've seen freelance rates rise while the cost of the suite drop.

I don't know what gear you have but if it's so awesome that the gear is 120/hr, it seems like you should have editors that are getting higher rates in the $75/hr range instead of the $50/hr range. For example if you're running a resolve full priced color correction console suite I'd expect the specialist running that to earn over $100/hr.

Currently, my suite is in the basement of my house so it's a write-off. I sorta work it into the rate. I used to charge a lesser rate for working at someone else's facility, but I found that put me in competition with myself. So I just have one rate now. Heck, nowadays I feel I should charge more to sit in traffic and have to deal with someone else's equipment.


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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:39:06 am

[Bret Williams] "Heck, nowadays I feel I should charge more to sit in traffic and have to deal with someone else's equipment."

You jest but I know some people that do that if they have to drive from one end of LA to the other to get to the gig. Granted, they don't straight up voice it that way but they will quote a bit lower rate if the gig is conveniently located and ask for a bit higher rate if it is a pain to get to.


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Bob Zelin
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 12:57:28 pm

this was such a great thread. You can see the "future" in this thread -
"all my employees have iPhone 8's that can shoot in 4K - Apple is putting all this beautiful footage on TV and the web, shot with iPhones - why the HECK do we need to hire YOU, when we can just get our staff to shoot it. And my secretary makes great looking videos with iMovie, and we post it on iCloud (or our YouTube Channel or Vimeo) - and our clients love it. So WHY should we pay you even 1 penny ? ".

Just wait - that day is coming. We are in the printing business, and unless you are a hi end printer, you are out of business. There is always a hi end market - and the only way to survive is going after that piece of the business. Remember, not that long ago, a corporate "happy face" convention video was a van load of equipment. Today it's a guy with his laptop and his Canon camera. And he is worried that the parking rate at the convention hotel is going to cut into his "profit" too much.

Bob Zelin

Bob Zelin
Rescue 1, Inc.
bobzelin@icloud.com


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 1:13:56 pm

[Bob Zelin] "Just wait - that day is coming"

Take a look at the website fiverr.com and peruse the section on video services. Yikes!

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Steve Connor
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 1:34:02 pm

[Oliver Peters] "[Bob Zelin] "Just wait - that day is coming"

Take a look at the website fiverr.com and peruse the section on video services. Yikes!
"


Plenty of businesses out there self shooting, using "internal resources" to make films, or getting low cost production Companies in.

I've been watching my clients do this for a while now. Almost without exception the finished videos achieve little or no engagement online, very important that you point this out to clients!


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:25:59 pm

[Oliver Peters] "Take a look at the website fiverr.com and peruse the section on video services. Yikes!
"


Please note the NLE being used in the $5 service:




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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:30:54 pm

[Jeremy Garchow] "Please note the NLE being used in the $5 service:"

1. Obviously you wouldn't want to show FCP X if you are trying to sell a professional service. ;)

2. If this guy only charges $5 and can still afford Adobe CC I think the complaints about price are officially dead. lol


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:37:51 pm

[Andrew Kimery] "If this guy only charges $5 and"

Actually, I think that's the structure of this service. If you look at the options, that's clearly a starting price and a lot of folks have caveats about being contacted first to discuss requirements.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:43:08 pm

[Oliver Peters] "Actually, I think that's the structure of this service. If you look at the options, that's clearly a starting price and a lot of folks have caveats about being contacted first to discuss requirements."

Just can't let me have my joke, can you Oliver... ;)


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 5:36:25 pm

[Andrew Kimery] "Just can't let me have my joke, can you Oliver... ;)"

Oops. Sorry, although I wasn't responding about the NLE reference.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 5:01:42 pm

[Andrew Kimery] "[Jeremy Garchow] "Please note the NLE being used in the $5 service:"

1. Obviously you wouldn't want to show FCP X if you are trying to sell a professional service. ;)

2. If this guy only charges $5 and can still afford Adobe CC I think the complaints about price are officially dead. lol"


3. Regarding 1. Touché, but I saw the opportunity. I took it. :-D I am sure if I really wanted to ruin my day, I could all kinds of services starting at $5 using all kinds of software.

4.







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David Mathis
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 4:37:22 pm

Imagine your clients seeing this and say, "Hey, they can do this for a low, flat fee, so you can do the same!" ;-)

Yeah, right, that is unless hell itself freezes over.

The magnetic timeline, it's magnetic-o-matic!



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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 1:11:43 pm

A few things to factor in...

If you're talking about a location gig, in many cases the prodcuers have the option of renting gear and often do. So when I bid these jobs, my rate is always stated as an amount for me WITHOUT gear. Then they have the option of supplying a system or having me supply it. It's often the case that the gear may already be covered and there's no need for me to supply it. Therefore, by including the cost of the gear, you are saving producers money that they would have otherwise spent anyway. In that sense, the editor on-site is the same as a DP/videographer, DIT, audio recordist, etc.

When you are talking about a suite, whether in an actual facility or your home office, there are plenty of other factors to consider beyond the workstation. Storage, other software, proper audio & video monitoring, access to fast internet, paid review & approval services, etc. Although the system could be a decent laptop, it could also be a trash can Mac Pro with a Promise array, large monitors, pro i/o, etc. Then that's not a $3K investment, but rather a $15K-$25K investment. So why should you give that away for free? And remember, even a laptop (when talking about a 15" Retina MBP) with fast storage, some monitoring and all the software you want is more than $3K, as well.

Finally, in the suite set-up, you are also assuming the responsibility to maintain a working and efficient system and some level of archiving of project data and possibly media, too. These are all costs that need to be factored in.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 12:42:24 am

[Oliver Peters] "When you are talking about a suite, whether in an actual facility or your home office, there are plenty of other factors to consider beyond the workstation."

I think the word "suite" itself has been diluted to the point where it's meaningless. We could be talking about a couple of rooms with amenities for client supervision, or we could be talking about someone running their laptop on a kitchen table, or anything in between.

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
@keenlive [twitter]   |   RenderBreak [blog]   |   Profile [LinkedIn]


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 1:39:34 pm

[Mike Jeffs] "Not to long ago it was incredible common to have a day rate for the Editor and a separate rate for the Edit suite. All my "research" (read googling) it seems like that isn't the case anymore. Is it just factored into your Editor day rate? if so what percentage."

With hourly or daily billing, we charge separately for labor and equipment. With project fee billing, we factor in both labor and equipment costs.


[Mike Jeffs] "Where I am at we charge between $450-$550 a day for editor and up to $120 hr for the edit facilities."

What's included in "edit facilities" for $120/hr?

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
@keenlive [twitter]   |   RenderBreak [blog]   |   Profile [LinkedIn]


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Mark Suszko
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 6:48:30 pm

I'm mostly in agreement with Garchow.

My take is, why even tell a client you have two rates for with/without gear? Fold the prorated costs of your gear into the computations of your day rate, which you should have done from the beginning.

You come at one price, period. None of this 'a la carte' BS. All that does is give away control of how you do your work, giving that control away to someone who may not know anything about it.

If they then book you to work in their room, with their gear, you're making a little bit more, OK, but you need not tell them that. Think of it as the "commuting charge". The main thing they are paying for is what's between your ears, and that doesn't change when the gear does. If you feel bad about the extra profit margin, you can find a reason to "discount" some back to the client, perhaps by under-reporting the hours on the job.

But consider: in someone else's room, their gear, their wiring setups, etc., you may be slightly less efficient, just because it's not all set up the way you're used to, or they may have some different components than you have at home, and you may need to adapt a little.

I think it all works out the same, in the end, so naming two rates, with/without, is a wash, and only opens a crack in the negotiations for the client to try and talk you down.

If the difference in rates between gear/no gear is the sticking point, I put it to you, that's probably just the convenient excuse they are giving. You're REALLY being hired for your skills, craft, knowledge, not primarily because you own some hardware.

The hardware is a bonus, an "added value", if you will. It isn't really the focus. Hiring your TALENT is the real focus.


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 7:48:46 pm

[Mark Suszko] "You come at one price, period. None of this 'a la carte' BS. All that does is give away control of how you do your work, giving that control away to someone who may not know anything about it."

Except that's unrealistic on a location gig. If your normal day-rate for a 10-hour day is $500, then with edit system and you, that should be $750-$850. If you charge $750 regardless, then you won't get the gig. The reality is that in most of the country, clients expect (and budget) to pay about $500-$600/10-hour day for an on-site editor and often ASSUME this includes gear.

The reason the discussion must be had is in order to define what the client's expectation of gear capabilities are and whether or not what you are supplying meets the needs. For example, are they going to hand you KiPro drives (FW800 only) and assume you can just plug them into your Thunderbolt MBP? That's when it's nice to know that up front, so that you supply the proper adapters. Or does the client expect you to come with external speakers so that their gaggle of clients are able to review your cut when you are set up in a hotel room?

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Mark Suszko
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 8:09:29 pm

Oliver, either they are supplying/renting their own gear from someplace, in which case they already have that cost figured out, and they're only hiring someone to work it, or they are expecting the editor to also supply, in effect RENT THEM, the gear needed, add that to the editing charge and and bill one daily fee. How is a rental charge any different in the long run from depreciating your own gear costs?

You're telling me a 100-to-300 dollar difference in the day rate between an editor with gear/no gear is going to be make or break for getting the gig, and I would respond that that amount of difference is barely the budget for a craft services table for one day, and this production therefore is probably not fully funded enough to make it to the martini shot, so I'm better off looking for another gig... is how I see it.

If you only ever take the rate they demand, how do you ever get more than they want to give? Than what you're really worth? It's a race to the bottom, and that's unsustainable.


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 8:18:01 pm

[Mark Suszko] "or they are expecting the editor to also supply, in effect RENT THEM, the gear needed, add that to the editing charge and and bill one daily fee. "

That means, you still need to negotiate with 2 prices in mind - labor only or labor + gear. Whether that's a single day rate or not doesn't really matter.

[Mark Suszko] "You're telling me a 100-to-300 dollar difference in the day rate between an editor with gear/no gear is going to be make or break for getting the gig"

Yes, it absolutely is and I've run into this repeatedly with many clients.

[Mark Suszko] "and I would respond that that amount of difference is barely the budget for a craft services table for one day"

Now you are applying the logic that few clients ever do. It's about line items, not totals, for many.

[Mark Suszko] "and this production therefore is probably not fully funded enough to make it to the martini shot, so I'm better off looking for another gig... is how I see it"

I'm afraid that few folks have that luxury any more.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 12:39:49 am

[Mark Suszko] "You're telling me a 100-to-300 dollar difference in the day rate between an editor with gear/no gear is going to be make or break for getting the gig, and I would respond that that amount of difference is barely the budget for a craft services table for one day, and this production therefore is probably not fully funded enough to make it to the martini shot, so I'm better off looking for another gig... is how I see it. "

It's not an issue of what this costs relative to catering. A $100-$300 difference in the editor's day rate of $500 is a 20-60% difference on that line item. Budgets are managed one line item at a time.


[Mark Suszko] "My take is, why even tell a client you have two rates for with/without gear? Fold the prorated costs of your gear into the computations of your day rate, which you should have done from the beginning. You come at one price, period. None of this 'a la carte' BS. All that does is give away control of how you do your work, giving that control away to someone who may not know anything about it."

If you're quoting labor and gear, you're almost certainly working for an agency or production company. This is their business, and seeing the prices broken out this way is very often an expectation.

We really like working on project fees, where we'll charge a fixed fee for a fixed scope, and we're finding that some clients are happy to pass the risk of cost overage onto us for the safety of a known number in their budget. Others completely prefer to keep their accounting in the system they know, which is hours/days of separate labor and gear, carrying the risk themselves if work takes longer than expected. If we want to work for them, we have to price within their system.

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
@keenlive [twitter]   |   RenderBreak [blog]   |   Profile [LinkedIn]


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 2:04:50 am

[Walter Soyka] "We really like working on project fees,"

You actually like it, or you have to like it? :)

The fixed price and fixed scope is often esoteric, especially in designed pieces.

We often have to deal with fixed prices, but it often happens where the job very quickly starts to expand out of the scope without knowing that they are asking that they are going out of scope. You ask for more, they say they don't have it, and you're stuck either fighting to give them less of what they want, or trying to get more money to cover the extra costs involved.

An hourly number, first of all, provides a level playing field. Prices start from a similar place every time and people can grasp the concept of what they are paying for. In production, this is often associated with more people, more talent, longer shoots, more equipment to get the results that are needed, any props/scenic/production design, etc. With post and design, people sometimes can't see all the effort, so an estimated hourly/daily amount is an agreement, and as soon as they start asking for more, that agreement needs to be renegotiated. With fixed pricing, I find this is more difficult. You can end up working way over what the original scope entailed, and no one suffers except you.

I'd love to hear how you handle this differently or how you guide clients in to giving them what they are paying for on a fixed budget, even though they ask for much more.


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 2:23:40 am

[Jeremy Garchow] "You actually like it, or you have to like it? :)"

I don't know about Walter, but for me, it's a bit of both.

When I cut films, it's generally for a fixed bid. My usual approach is to carefully define the time frame and parameters. I usually assume some leeway. For example, I might stipulate 10-weeks (period), but then I'll be willing to absorb a week or two over that if it looks like we are pretty close to a locked cut. If not, then it's overages after that fixed window. That's only for the creative edit.

Then if I'm also doing the finishing and color correction, too, that will be bid separately on a per-week or per-day basis.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 12:12:27 pm

[Jeremy Garchow] "You actually like it, or you have to like it? :)"

No, I actually like it.

I don't believe that cost creates value. A piece of work is not worth paying a lot for because someone worked a long time on it; it's worth working a long time on because someone will pay a lot for it.

Hourly billing is a poor proxy for value delivered, and it creates a perverse incentive for hourly-billing vendors. If we have a smart new way of doing things that saves a production time/money, we can work hourly and make less money than we would have doing things the dumb old way. We'd rather split that benefit with the client: capture some of that value for ourselves and get some back to the production. To do that hourly, we'd have to be dishonest about our time spent (padding the timesheet) or raise our rate way outside of market expectations, neither of which fits your ideal that hourly numbers provide a level playing field.

This comes up a lot in workflow design. A tweak in a production workflow can be way more valuable than the billable minute and half it took to come up with is.

Some time-based budgets are really project fees in disguise. When we quote an hourly or daily estimate, our clients generally look at that as a maximum. If we underestimate how long something will take us, too bad for us. If something changes from the additional estimate that needs more time to complete, then we can talk about increasing the budget. But then sometimes the risk/reward isn't fair: we have given a ceiling on our price which we are not allowed to exceed for a given deliverable, but if we get it done faster/sooner, they'd like us to charge less for being efficient and taking less time than we both agreed was reasonable!

I don't see a huge difference between saying, "We've run out of hours in the budget, we can't do any more until you give us more money for more time" and "That is outside our agreed scope, we'd need a change order to make it happen." (For me, one of the biggest lessons in scope management has been defining the scope of a project two ways: both what's included in the scope, and things that are specifically excluded from the scope.)

Where I do see a huge difference is the client understanding the price for what they're buying. You know that great video about how a customer would never ask a restaurant's chef to teach them how to cook a steak so they can do it themselves next time? On the other side, a restaurant would never leave their clients guessing what the meal will actually cost, telling them instead, "Our steaks cost $3/min to cook."

This is especially important in work that is hard to price. We've just finished our first Oculus Rift VR project (a big success!), and since no one really knows what that costs yet, our fixed bid guaranteed the client a result without them bearing the pressure of unlimited liability if we went over time.

Basically, we like project fees because we want to be rewarded for output, not for effort. That puts pressure on us to work effectively. Sometimes we win and sometimes we lose, but our interests are completely aligned with the production's. Clients really buy results, not hours, so what should we sell them?

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
@keenlive [twitter]   |   RenderBreak [blog]   |   Profile [LinkedIn]


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Bret Williams
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 5, 2015 at 4:41:57 am

I would agree. Hourly is best reserved for situations where you have no control over the scope. Generally when you're an editor for hire. When someone else is in control of the shooting, the script, the end client, etc.

But when you're being asked to produce something from start to finish, hire the writer, hire the shooters, book the editor, and control the ideas and scope with the client, then a budget should be established. And you're right, a estimate or quote should be the maximum. It should have a hefty contingency built in. And if the product is much simpler than expected then I'd suggest some of that go back to the client.

I have two types of clients. First, producers that book me to edit THEIR projects where I charge by the hour. I try my best to meet their budget but I have little control over the scope. The other type of client is a company that hires us to take responsibility for the entire project, from idea to execution. We control the scope and build a good contingency in our budget and try to both exceed expectation and come in under budget. This type of project usually brings in much more per hour.

I believe you get paid for responsibility. A skilled laborer charging by the hour isn't generally sharing in the risk and should be paid handsomely per hour/day. But if you're taking on the risk and responsibility for a project you should also be rewarded for it.


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 6, 2015 at 4:01:14 pm

[Walter Soyka] "I don't believe that cost creates value. A piece of work is not worth paying a lot for because someone worked a long time on it; it's worth working a long time on because someone will pay a lot for it."

Just to be clear, I don't either. Just because things are more expensive doesn't mean they are worth it.

Also, I am not arguing that one model is better than the other. Clearly, whatever works and maintains profitability is what is best for the business. We often work with project fees, and they are often the least profitable in terms of margin. Margin feeds the business.

Time based fees all us to have better control of costs, that is to say, how much it costs US to do the job. We also have to be a mini lending facility. Very often, we extend out and pay for the entire production and post. This means, you are essentially giving out a 6+ month interest free loan to whoever is ultimately paying for the job. If you have 4 or 5 really large jobs going at once (we are a small company after all), this is a lot of cash out on the table. Sure, we can get up front deposits, but those are almost always spent immediately, they can take a while to get (meaning the job is started before the money shows up), and final billing is now at least 60 days, it seems, with most entities, and often it take much longer than 60. In general, there seems to be a lack of liquidity. A job that takes 6 months to complete, can take 9 months to get paid for, and we assume all of the risk. We pay our vendors, but we have to wait to recoup those costs. An hourly cost structure helps to maintain control of that cost, it gives clients a visual marker, something that can be seen and sometimes felt, about when a job is lagging behind on time.

Not to get too personal, and divulge as much you want, but how often do you hire freelancers, or is your staff salaried? If you hire a lot of freelance, and you have a set budget, do you then set a fixed cost with them as well?

The reason I like an hourly/daily/time based structure (even though, as you mention, it sort of ends up being a project fee in the long run, especially in post) is that right up front, people know how much something may cost. It's all broken out. With project fees the difference between a $20,000 job, and a $200,000 job is less clear to clients, at least that's my experience. When things are broken out by time/person/fee, a client can see where the money is going. With project fees, this can be obfuscated. With repeat clients, if they paid $X for the last job we did, and this job is now $X*10 for what seems like less work, then project fees seem to be a "we will take all the money you have" type of scenario.

A lot of the really large design firms and agencies we work with a now charging and billing, hard core, by the hour. This also allows teams to be spread around and work on jobs for different clients, and those costs can then be tracked (and therefore estimated and billed) much more easily.

[Walter Soyka] "Basically, we like project fees because we want to be rewarded for output, not for effort. That puts pressure on us to work effectively. Sometimes we win and sometimes we lose, but our interests are completely aligned with the production's. Clients really buy results, not hours, so what should we sell them?"

Of course. I didn't mean to insinuate the clients need to actualize our efforts. Part of our job is to make the process seem easy and fun. We don't need to be rewarded for that as that we want things to be fun as well, and we also enjoy challenges.

When I said effort, I meant that often clients don't know what they are asking for. And when they ask for something, that very well could be a very expensive idea,. With project fees, this expense is less clear because it isn't tied to a tangible amount of time, people, or in the case of production, equipment and locations, and therefore it is harder to ask for more money, so what happens is that these new costs end up eating up the little margin that's left.

To our clients, there is no difference between working on an estimated time schedule, or a project fee in terms of our effectiveness.

[Walter Soyka] "This is especially important in work that is hard to price. We've just finished our first Oculus Rift VR project (a big success!), and since no one really knows what that costs yet, our fixed bid guaranteed the client a result without them bearing the pressure of unlimited liability if we went over time."

Yes, this is a good example of where a project fee might make sense. If you don't really know how to bill it (or how much it's going to cost), then sure, sharing the risk between you and your client is the right thing to do. You get the 'billable R&D', the client gets the product they set out to purchase and what probably ends up being a pretty good price. But would you structure the next 10 jobs the same way?


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 6, 2015 at 6:07:10 pm

[Jeremy Garchow] "A lot of the really large design firms and agencies we work with a now charging and billing, hard core, by the hour. "

That's it for me, right there. I charge the same way the client charges. The object of the game is to avoid being seen as "the help." Even $500/hr lawyers can be "the help."

And indeed, lawyers, retailers, and companies providing labor were the people I charged labor for. Hotels, restaurants, medical offices, architects/design firms (in my neck of the woods anyway) -- those all charge by the job, and they pay employees by the hour.

So do you want to charge like a peer, or do you want to get paid like an employee?

And sure, if all your clients bill THEIR clients by the hour, then the more familiar your invoice looks, the better. Hourly, without blinking. I preferred project billing, but the object of the game is ALWAYS to stay out of the way between their wallet and your pocket.

Of course, all of the "by the job" folks I worked for understood that there's a behind-the-curtain calculation that includes an hourly rate. They did the same, so I never found it at all difficult to say, "Let's talk about our next steps," and never found the client hesitant to engage.

Actually, you know who REALLY got this, was realtors. I think if they'd calculated their income hourly, they'd have killed themselves. They worked such long hours, with everything a gamble, and they wanted a price. Gimme the bottom line. What's it going to take to get this done? Which is of course how they got paid. For the job.

And the people they paid hourly were the guys who planted signs in the ground for them.

I also preferred project jobs because I could typically get away with charging more, to be honest. Some of it was because I always built in a 20% overrun, but if I could pitch a 50% overrun from my "real" estimate I would. More often than not, I pocketed a meaningful premium above my hourly rate.

Answering the original question, though, in charging the way my clients did: none of them billed separately for tools. Very simple math for me.

But then I was never a straight freelancer for whom working with anyone's gear but my own was ever realistic.

That was my plan though. My billing was absolutely part of my marketing, much more important as part of my branding than as a fixed financial model that everyone had to fit into because it worked best for ME.


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Aindreas Gallagher
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 8, 2015 at 8:37:53 pm

[Jeremy Garchow] "A job that takes 6 months to complete, can take 9 months to get paid for,"

jesus really?

This is an interesting discussion if only because I understand it from a really tiny tiny limited perspective. Freelance edit this side is daily rate. Longer term stuff is either a buyout for the gig or a somewhat reduced rate given the length of a solid long term booking.

But once a shop is even two people together they seem to immediately and generally bill as a project budget for completion. Anyone setting up a real company, as opposed to my notional company of one, has more cop on than me and the people you meet do -
but really isn't the point with a budget that you can determine a number you rationally know somewhat exceeds not only your notional billing hours, but basically the cost to execute? You're taking greater risks by calling a fundamental budget and relying on your competence to call a mutually correct number. also it makes life clear for the client in their organisation when selecting you for the job? Also budgets set buy in parameters? You're drawing up an agreed definition of the goals, which they subscribe to, and then if you're lucky and they're corporate, their own incoherence leads to late stage overrruns as their own internal structure turns out to be a decision making FUBAR where late stage entrants start tearing up nearly agreed final pieces.

I watched a good talk from a bearded design guy called "f**k you pay me" it dealt with the travails of design agencies who seem less hard headed than production companies, but even in that case, they had mechanisms to control overages where clients had a pool of revisions they could make in stages, but that at each stage they could only choose from within the set of prior notes. That they get progressively and consensually corralled in order to help control the process, and ultimately, their costs. I found it interesting like I would a documentary about mars given how likely I am to ever engage with the issue, but still - I'd like a project budget me.
And also, I think, over here a client would probably be surprised at the notion that they were kicking off a per hourly billing process for multiple personnel within a facility. I think they'd run a mile? (with the proviso that I might have mis-understood everything you've been saying jeremy, which, let's face it - is a solid possibility.)

http://vimeo.com/user1590967/videos http://www.ogallchoir.net promo producer/editor.grading/motion graphics


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 9, 2015 at 5:06:57 pm

[Aindreas Gallagher] " (with the proviso that I might have mis-understood everything you've been saying jeremy, which, let's face it - is a solid possibility.)"

Again, I'm not saying I'm right. In fact, I don't know what's right and would love to figure out how, in production, people can work with flat rates especially when working with freelancers when jobs continually creep out of scope, and still make a favorable margin.

Through my experiences, I find that clients are willing to spend more if they know what they are buying. And let me be clear, if clients pay more, that doesn't necessarily mean we pocket the money, it just allows us to complete the job the way we want to complete it. Also, when the job starts to creep out of scope, you can maintain good working relationships with freelancers as they will also be compensated for time.

[Aindreas Gallagher] "jesus really? "

Sure. Start a job in January, finish around June, get paid in September. It is happening more and more frequently. And these are relationships you want to keep. Good, client relationships. These are people that are doing real jobs, with real money, that have real clients that have real money.

[Aindreas Gallagher] "but really isn't the point with a budget that you can determine a number you rationally know somewhat exceeds not only your notional billing hours, but basically the cost to execute?"

Yes, but at some point that threshold is crossed, especially when it's jobs without an air date or tangible deadline. The jobs can drag on for what seems like forever, clients will make endless changes, and when that happens, all of that cost and risk falls on us, especially if we've hired in some freelancers or if we are so busy we can't go out and find more work. I think project fees are more limiting. Sure, you can argue for a change order once all the money is spent and time has run out, but then what do you renegotiate?

We have worked with some project fees, and at some point, after being completely understanding and working well beyond the agreed scope, we have to throw up a flag and have the conversation about money and time and all of it being spent. Most often, we offer to switch to an hourly billing system. This does one of two things, clients stop making endless changes, and the job finally completes, or the client, suddenly and without warning, comes up with a lot more money to continue the endless changes. We don't mind making changes, and we don't mind when clients come up with new ideas, but that has to cost something, as it certainly costs us something, and project fees have a harder time of recovering those costs because it's not rooted in actual costs, at least from a client perspective.

I will be clear in that setting up a time based system does not automatically equal a 1:1 timer-to-money ratio. Meaning, just because we all agree to and then work for an exact amount of time, and the time runs out, it's automatically time to renegotiate. Often, a time based estimate becomes a project fee, but I find an advantage where it's time to go back to renegotiate, the client now has a sense of how long things actually take, and we can point to the results that we have produced thus far, and then have a much easier time providing another estimate that includes actual costs, and gives our clients a digestible amount of items so that they can see where the money is going and what they are asking for.

It also helps when you are working on multiple jobs with multiple page budgets. Having a way to roughly track all of that makes accounting a little more tolerable. If you are working on one job at a time, then a project fee can be totally fine as there's a lot less to track.

Perhaps it's sacrilege to talk about this out in the open, but since it came up I thought it might be worth talking about. I know there's also a dedicated forum for this, but...this is such a lively place.


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 9, 2015 at 7:15:48 pm
Last Edited By Tim Wilson on Jul 9, 2015 at 7:17:59 pm

[Jeremy Garchow] "I know there's also a dedicated forum for this, but...this is such a lively place."

That COW's Business & Marketing forum has in fact largely been supplanted by this one.

That forum had also originally been started for the owner-operators and small shops who were the original constituents of the site, people like the founders themselves, Ron & Kathlyn Lindeboom, who started the community to find help that wasn't available anywhere else on the web. (That was certainly me as well, when I joined up as a member with my own business issues in 1996.) Moving from that first community to found Creative COW, the Business & Marketing forum that Ron Lindeboom formed here was the first of its kind for our industry.

Those guys are some of the true lions of the business, and in that owner-operator realm, a peerless found of knowledge...but yeah, now, if anybody wrote me offline and asked which was the best forum to bring this up in, I'd say this one, for sure.

Not just because this forum has become more of the "village green" forum than that one once was, but also because the FCPX-ness of it steers the question away from full-range boutique post services.


Tim Wilson
Old-ish lion-ish-in-Chief
Creative COW


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Dave Gage
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 10, 2015 at 3:17:16 am

[Tim Wilson] "That COW's Business & Marketing forum has in fact largely been supplanted by this one."

Cool. I just checked it out. I mostly just lurk here for kicks, but the business forum sounds interesting. I rarely have time to post here or anywhere, but maybe I can add something of worth at that forum.

Thanks,
Dave


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 9, 2015 at 7:54:27 pm

[Jeremy Garchow] "finish around June, get paid in September. It is happening more and more frequently. And these are relationships you want to keep. Good, client relationships. "

A good bit of my business was for US government agencies -- jointly funded by NOAA, EPA, and Everglades National Park -- so the budgets were small, but very, very reliable. I loved these guys.

Also reliable: zero money up front, payment 90 days after completion. I was under the impression that that was typical, but in any case, that was my world: me carrying the entire load until 100 days after completion.

They only wanted to hear project numbers, because most of their budgets were written in advance of course.

So I came up with an informal agreement on my side that said, okay, for this per-episode price, here's how much shooting time I'll give you, here's when I'll get it to you for review, here's how much time you have to review the episode before I ship it. We can talk about what needs to happen if any of those slips.

They were educators who understood the need to stretch budgets, and had also learned the hard way what happens to educational projects whose budgets stretch too far. Our arrangement worked out so well that the following year, they added budgets for things like side projects, repurposing footage for other projects....all of which ALSO had fixed prices.

This worked so well overall that I rebuilt my business around it for all my commercial clients. I think I billed my last hourly project in 1994.

As I mentioned in another post, all but a handful of them billed their own work as projects, and appreciated the need to respect limits. None of them ever asked for a specific breakdown either. I understand that this might be different today, where clients understand more about production and post, and might own many of the same tools I would....

...but everything in my experience points to project billing as the way I'd build a new business, not hourly.


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 10, 2015 at 4:34:53 pm

[Tim Wilson] "As I mentioned in another post, all but a handful of them billed their own work as projects, and appreciated the need to respect limits. None of them ever asked for a specific breakdown either. I understand that this might be different today, where clients understand more about production and post, and might own many of the same tools I would....

...but everything in my experience points to project billing as the way I'd build a new business, not hourly."


I hear you. From the supplier side, I could see how having an amount of money and setting the limits of the work seems to make sense. I mean, look at all the subscriptions popping up. It's a rather reliable source of income if you have the subscribers and provide a good service. Our business simply isn't structured that way. Our products aren't templated. Rental, labor, equipment rates vary and change per job.

Another agency I know has to bundle their entire gamut of services in to an hourly rate. So, no matter who is working on the job, or how many people at different levels of pay grade, all of that is negotiated in to a master hourly rate for their client. So, there aren't different design/production/writing/account management rates. There is one rate, and everything is done at that rate by the person, by the hour, and the production company has to try and schedule people to hit that rate, including hiring outside vendors, any set design, everything. Yikes. That is a kerfuffle, and not what I would want.

As far as pay, everything used to be net 30, now it's "net 60" heavy on the quotes. We don't any work for the government directly, and I would imagine that would be a different scenario as I'm sure expenditures are setup differently.

I don't know, perhaps we are missing out on opportunity, but it seems to me, with flat fees, you are setting yourself up for a devaluation of the service, because people don't really understand the value. I know Walter's argument seems to be that cost is not value, but there is actual cost, and sometimes that cost is higher.

More over, a broken out or time based style of billing shows people how much video can cost. This is not a money grab, this is me, being very honest about what it takes to make a living in a modern video world, especially when clients are asking for more and more complicated (and yes, Walter, expensive) ideas. I don't know how much the client will value it, but I can tell them how much it will cost. I don't think it's my job to determine the value they will get out of it, or how they will use it to assign value. That is a different business entirely.


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 10, 2015 at 6:02:43 pm

[Jeremy Garchow] "This is not a money grab, this is me, being very honest about what it takes to make a living in a modern video world"

I don't think ANY business model is a money grab, as long as the customer feels they're getting their money's worth.



[Jeremy Garchow] "Another agency I know has to bundle their entire gamut of services in to an hourly rate. So, no matter who is working on the job, or how many people at different levels of pay grade, all of that is negotiated in to a master hourly rate for their client."

I actually get this. To me, the highest value of any approach is to reduce the number of questions between the work and the payment, while offering the balance of control and simplicity you want on the supply side.

I saw the flip side of this in a law office where they charged differently for the principal's time and paralegal's time. Clients asked all day every day, for anything short of court time, "Why can't the paralegals do this?" Of course, he billed the time spent answering those questions to the client as "consultation" LOL but man, that'd drive me insane.

So if I were to go hourly, I'd totally do it this way: this is how much it costs to put the team's resources at your disposal.


This gets to a project model of course, but I pay the same for a visit to the dentist whether I spend more time with the dentist or hygienist.


[Jeremy Garchow] ". I don't think it's my job to determine the value they will get out of it, or how they will use it to assign value."

I think that Walter is stating the philosophical underpinnings, and doing a much better job than I've done in my own attempts to describe my positive experience with project billing.

My own take on the philosophical underpinning is that I wasn't interested in being evaluated on an hourly price along the lines of "more than a plumber, less than an electrician" or whatever. You want a half hour of TV? This is how much it costs. You want a spot that's mostly stills? One where I write the script and we shoot on location? This is how much it costs.

Day rate? This is my day rate. More than an hour over that kicks into my half day rate, which is more than half of my day rate. If *I* felt that another set-up or two would make my life easier in the edit suite, *I* added the time on location, but otherwise, clients were well incentivized to be efficient on their part.

I do think it comes back to billing in terms that your clients understand. If most of your clients bill their work to THEIR clients hourly, then sure, trying to fly project pricing past them could introduce unnecessary friction.

In practice, for me, there wasn't that much friction with clients who charged hourly (such as the aforementioned attorney), virtually all (maybe all) of the other producers in the area also billed by the project.

So, in addition to billing the way clients bill their own work, I suspect there might be regional differences in the approach for the entire environment. Chicago might not let you get away with anything but hourly. It sounds like that might be the case, yes?


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David Mathis
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 10, 2015 at 9:58:47 pm

[Tim Wilson] "...but everything in my experience points to project billing as the way I'd build a new business, not hourly."

Tim. what about people who use Adobe do the projects? Would it be fair to slightly increase the cost due to subscription only as a small business? Would this be a flat rate, per project? Just curious as I have subscribed to Photoshop and Lightroom for a year, billed to me monthly. Love to hear your thoughts.

Today is my first wedding video and a bit nervous.


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 11, 2015 at 2:11:44 am

[David Mathis] "Would it be fair to slightly increase the cost due to subscription only as a small business? "

Subscription is overhead, just electricity, property rent/mortgage, cell phone, internet, errors & omissions and liability insurance...and frankly, $49 is typically the least of my monthly expenses by at least half. I think water might be the only bill I pay that's less than $49.

Needless to say, any rate, no matter how it's calculated, has to at least cover your overhead. :-) My suggestion is to calculate overhead -- EVERYTHING, including depreciation on your office chair, how much you want to earn, how much you want to be saving, taxes, pencils, etc etc -- then at least double that.

That's because overhead also includes business time that no clients are paying you for....although hey, if you can be posting in the COW on the client's dime, more power to you. LOL

So then you take that number, divide it by the number of hours you want to work, and there's your rate. How you bill in order to bring in that money isn't as important as making sure your rate covers your REAL costs with room to spare.

Speaking as your old Uncle Timmy, this is the mistake I see young 'uns making all the time: chasing a rate that they think will get them work, instead of charging a rate that they can live on. Nobody can sustain a meaningful gap between those numbers for any length of time.

In general though, I don't see a way to realistically bill almost ANY overhead costs to a client as a line item. Travel time maybe? Although I'm sure that some of the business whizzes here may have even more creative ideas. :-)


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 10, 2015 at 1:19:02 am

[Jeremy Garchow] "Time based fees all us to have better control of costs, that is to say, how much it costs US to do the job."

Yes, I understand, and cost control is important, but cost is not value, which is why it's not my preference to charge that way.


[Jeremy Garchow] "Very often, we extend out and pay for the entire production and post. This means, you are essentially giving out a 6+ month interest free loan to whoever is ultimately paying for the job."

We generally get deposit payments on longer-term projects.


[Jeremy Garchow] "Not to get too personal, and divulge as much you want, but how often do you hire freelancers, or is your staff salaried? If you hire a lot of freelance, and you have a set budget, do you then set a fixed cost with them as well?"

We do have salaried staff, and we've been keeping a group of freelancers busy most of this year. We've done both project fees and hourly billing for freelancers. It's up to them and how they prefer to bill, but we don't change how we bill our clients to match how our vendors bill us.


[Jeremy Garchow] "When things are broken out by time/person/fee, a client can see where the money is going. With project fees, this can be obfuscated. With repeat clients, if they paid $X for the last job we did, and this job is now $X*10 for what seems like less work, then project fees seem to be a "we will take all the money you have" type of scenario."

See where the money is going and getting something for that money are two different things. If a bill is high but that value isn't showing up in the final product, does it really matter from the customer's perspective that 27 people worked on something all month long?


[Jeremy Garchow] "If you don't really know how to bill it (or how much it's going to cost), then sure, sharing the risk between you and your client is the right thing to do. You get the 'billable R&D', the client gets the product they set out to purchase and what probably ends up being a pretty good price. But would you structure the next 10 jobs the same way?"

We didn't share the risk: we assumed it ourselves. We had to deliver what we promised at the price we quoted, whether it cost us exactly that, a lot more, or a lot less.

I would absolutely structure the next 10 jobs that way.

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
@keenlive [twitter]   |   RenderBreak [blog]   |   Profile [LinkedIn]


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 10, 2015 at 4:02:25 pm
Last Edited By Jeremy Garchow on Jul 10, 2015 at 4:45:39 pm

[Walter Soyka] "Yes, I understand, and cost control is important, but cost is not value, which is why it's not my preference to charge that way."

[Walter Soyka] "See where the money is going and getting something for that money are two different things. If a bill is high but that value isn't showing up in the final product, does it really matter from the customer's perspective that 27 people worked on something all month long?
"


I don't know what you keep meaning to try and say here. How do you determine the value* of your client's value?






*edit


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Aindreas Gallagher
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 11, 2015 at 9:43:17 pm

[Jeremy Garchow] "I don't know what you keep meaning to try and say here. How do you determine the value* of your client's value?
"


it's a statement of principle right? I think you're (possibly) being deliberately obtuse here? And if you are it's a good way to force someone to refine their argument. But surely the whole point of positing a budget is declaring your value in the chain. That it presents a figure partners can consider to achieve goals? As opposed to simply declaring the hourly burn rate you run at.

A budget is a higher level object I think - insofar as it moves you up the value chain? Said someone who has no clue about any of it. But budgets look like respectability to me. Respectability and a semi-opaque process where you simply tell them what your engagement is likely to cost.

http://vimeo.com/user1590967/videos http://www.ogallchoir.net promo producer/editor.grading/motion graphics


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 11, 2015 at 11:18:05 pm

I think, as always, I'm being misunderstood in this thread. I'm certainly not trying to be obtuse. I'm trying to have an adult discussion with peers.

Walter says higher cost does not equal value, which implies less cost equals value? Or value is a feeling that had nothing to do with cost?

Look at it from a client side. Have you ever purchased video services before as a client?

If you have a regular vendor from which you purchase video services, and one job costs $100,000 over a scope of 6 months, and another job costs $500,000 over a scope of 8 months, how do you discuss the value and how do you know what you're paying for? And since I'm paying more, was it worth it?

Did we sell more product? Did our viewership increase? Did our social network hits go up? Was it a
piece that meant something to you professionally? Or was it more of a general feeling of a good deal and a pleasant experience and did nothing to help my business? Certainly, that has a value to a client, so how do you assign that repeatedly without having some sort of basic framework?

Basically, I'm asking, how do you know when a flat fee is good value? And as a supplier, how is that calculated, and how do you know your client is getting a good value?

"30 minutes of TV" does not cost the same per show, per episode, per minute.


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 11, 2015 at 11:45:35 pm

This thread certainly has run the range of business discussions. It seemed to me that the OP was about what was primarily an hourly or day-rate situation. I think that's quite a bit different than large full-service productions spanning months.

In my experience over the years, I've worked on tons of large projects and they were always from estimates based on a rate card as a starting point. Either the client said the budget is X and we structured the services that could be offered done for that amount. Or - We'd come up with a bid amount based on the client's request for services and our rate card. Usually it's a give and task.

Take a look at the example of a small indie film. In general, these should cost around $1 Million for something basic and non-union; but, I've certainly done plenty that are in the $200K and below range. When that happens, you really have to stretch the value proposition. Looking at the editing segment, you are generally planning about $25K (no counting room/system) for the creative cut. But when the client says, "No, we can only spend $10K," then you tackle it by offering less time. You only get 8 weeks for a cut, instead of 16 weeks, for instance. That puts the responsibility back on the client (or director) to be in tune with the objective, instead or being open-ended on how long it takes them to decide on a "locked cut". Or - be willing to pay overages.

In all of these examples, a rate structure determines the bid or the guidelines. You can be generous and pad in extra time if needed, but you have to know what the opportunity cost will be if you run over on your dime and thus turn away work.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Mark Suszko
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 11, 2015 at 11:51:43 pm

Two things I say to clients about what Walter and Jer are talking about, which is really the "value proposition";

If they say that a video project costs too much, I ask them: "What is the end result of this video campaign supposed to be, specifically? Is it an increase of sales from 20 thousand units to 200 thousand units? So, for a project that's supposed to pull in a million dollars in sales, what percentage of that million dollars is it worth for you to invest in OBTAINING those sales? Is it one percent of the goal you want to spend to REACH that goal? Is it worth spending One HALF of One Percent? You tell me, what percent of the budget this commercial is actually worth to you, and I'll find a way to make it for that amount, ...if you are SURE you think that's how much it takes to get the results you're after. You have to spend money to make it. What are you willing to spend, to make this amount?"

When they measure the up-front cost against the VALUE of what they will achieve (sales, or number of people changing a behavior, learning, whatever the metric), that's the Value Proposition in action. We do this calculation a hundred times a day without being conscious of it, from deciding when/if to run a load of laundry today, to deciding on a home improvement project, what's for lunch, or a change in careers. Cost isolated out of context is just scary, a negative figure, until you give it a context. That context can be how spending that amount NOW avoids spending MORE later. Or that the expense is actually an INVESTMENT, one that will return more than you put in. Salesmanship and marketing are all about connecting these costs and rewards in the customers' mind, making a context and driving the relative value evaluation, so they decide for taking a risk on the investment.

The second thing that comes up in relation to value is that NOBODY gets an "Atta Boy" for saving money on a failed project. Failed but thrifty does not win promotions in most places. If a project goes a little bit over the planned budget but is wildly successful, nobody really is going to complain all that much. But if you skimp on the front end and deliver a product that totally bombs because of the cut corners, nobody around the boardroom table is going to say: "Well, at least we didn't spend a lot on the commercial" (or whatever it was). That's often followed closely by the opinion that "Video just doesn't work for us, for what we want to communicate".

No; what it really proved was that BAD, CHEAPLY DONE video doesn't work for your needs. Other people are getting great results every day, they're just not doing things the way YOU are doing them.


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Michael Gissing
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 12, 2015 at 12:12:05 am

Long ago I changed from hourly rate to job budget. The reason for this was that technology was both reducing capital costs and creating efficiencies of workflow. So I saw an opportunity to work out a price per finished minute that was based on many previous jobs and hinged around the average.

So then any efficiencies both from technology and also experience in setting up workflows paid off for me whilst the client had a surety of a quarantined amount to cover post. Being at the tail end, post often is asked to tighten the belt when poor location practices may have caused over runs.

That makes it in my interest to get involved early, give advice on workflow before shooting and work with editors to make the hand over smooth to reduce problems. Also it means when the client is in the room doing the mix or grade we are not both clock watching. I find that the client likes the surety, the value they get is not based on the budget but the final experience which I try to make fun. Removing the 'can we afford the time to make the creative decision' process has made it much better value for me and the client. When things go horribly wrong from their end they normally offer to cover extras.

It is a swings and roundabout approach. I do charge a hourly rate for reversioning of jobs however as they are wildly variable and it is to partially discourage too much frame fiddling when editors use a reversion to tweak the cut which creates exponential problems for reversioning sound. That normally says there wasn't enough time for the fine cut and again I refuse to pay for that.


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Tim Wilson
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 12, 2015 at 12:36:39 am

[Jeremy Garchow] ""30 minutes of TV" does not cost the same per show, per episode, per minute."

I think the problem is the word "flat." It's not "flat" as in one thing costs the same to everyone every time. It's that, once they've told you what they want, you give them a price for the thing as a whole, instead of doing it hour by hour.

Since most of my business was 30 minute tv, I can tell you that I found this incredibly easy to navigate.

One show was on the water and in the wilderness. There was no such thing as a half-day shoot because I might have to hike an hour from an already remote location. Because it was nature doc stuff, I was shooting 10:1, easy. It's still my favorite stuff to have ever edited, but it took a long time.

Another was land-based, local PM magazine kind of thing. A couple of larger segments, a couple smaller ones, colorful bumpers, out. Didn't take a long time.

My "flat" rate for the nature episode was multiples of my "flat" rate for a PM magazine episode,

What I did NOT want to get into was, "Hey man, we didn't have to hike for an hour to the location. We just drove right up to the ranger station. I want a 3-hour break on the price."

Or on the magazine show, "You only interviewed one person in their office for this segment, instead of interviewing four people on location. It took you a third as much time to produce, so where's my 60% discount?"

Nononononono. The price for YOUR project is the price...

...but the price is absolutely NOT the same for any two clients.


[Michael Gissing] "The reason for this was that technology was both reducing capital costs and creating efficiencies of workflow...

So then any efficiencies both from technology and also experience in setting up workflows paid off for me"


My emphasis added, because that's crucial.

As I get better at my job, the hours each job takes go down. Why the hell would I pass that "savings" on to my client resulting in a smaller payment to ME, when I can just as easily give the client a better looking project because of my improving skill AND take more time off.

For me in practice, I was never able to shave enough time off projects to take on more clients. But 5 or 6 hours saved through better After Effects chops, less time for lighting setups, whatever, added up to a couple of extra days off every month, while producing better-looking work and keeping my rates UP, instead of my efficiency pressing them DOWN.



[Michael Gissing] "That makes it in my interest to get involved early, give advice on workflow before shooting and work..."

Also HUGE. True for hourly as well, but in practice, project pricing really did lead to much more collaborative relationships. Again, it being part of my branding that "I'm not at your disposal in exchange for an hour's payment. My time is as valuable as yours."

Needless to say, while the consultation made things more satisfying for both of us, my agenda was oriented toward making my life easier. LOL All part of maximizing my efficiency in ways that wouldn't lower my rate, but WOULD increase my time off, and/or general sanity.



[Michael Gissing] "Removing the 'can we afford the time to make the creative decision' process has made it much better value for me and the clients. "

That was my favorite part: the pleasure when it feels more collaborative, which it can when nobody is watching the clock.

This assumes that you've done a good job with your internal estimates of how long things will take AND have a good relationship with a client who won't abuse this flexibility, but I found that switching to project billing made all of my client relationships more enjoyable for both of us.


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Aindreas Gallagher
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 12, 2015 at 1:10:25 am
Last Edited By Aindreas Gallagher on Jul 12, 2015 at 2:16:50 am

[Jeremy Garchow] "I think, as always, I'm being misunderstood in this thread"

complex statements dude, complex statements. We're only discussing money. we all like that money where we don't have to dig roads, or drive roads.

https://soundcloud.com/whatstech/what-is-the-singularity

[Jeremy Garchow] "Walter says higher cost does not equal value, which implies less cost equals value? Or value is a feeling that had nothing to do with cost?
"


that's has to be deflection.You're punching the air.

[Jeremy Garchow] "Basically, I'm asking, how do you know when a flat fee is good value? And as a supplier, how is that calculated, and how do you know your client is getting a good value?
"


you know it by calling the value of your participation?


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 14, 2015 at 12:26:19 am

[Aindreas Gallagher] "that's has to be deflection.You're punching the air.
"


I'm really not, bud.

Nevermind it.


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Mike Jeffs
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 9:26:25 pm

[Walter Soyka] "What's included in "edit facilities" for $120/hr"

Here we are running Adobe, FCP, and Avid machines, attached to a large SAN and MAM. With automatic archiving and syncing of all edit suites. All suits have Color Correction monitors Various IO decks and properly calibrated audio monitors, as well as all the other bells and whistles :)

Mike Jeffs
Production Services Manager
KPBS San Diego


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 9:54:49 pm

[Mike Jeffs] "...attached to a large SAN and MAM. With automatic archiving and syncing of all edit suites. All suits have Color Correction monitors Various IO decks..."

You ought to be in the $150-$250/hour range (including editor), depending on what your market and clientele can accept. That's assuming you have some sort of client amenities, too.

- Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Mike Jeffs
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 11:41:47 pm

[Oliver Peters] "That's assuming you have some sort of client amenities, too"

At PBS only the best that Viewers like you provide :) Only joking our department self sustaining.


[Oliver Peters] "ou ought to be in the $150-$250/hour range (including editor)"

Doing that math I would say that's pretty accurate to what we charge.

Mike Jeffs
Production Services Manager
KPBS San Diego


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Andrew Kimery
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 2, 2015 at 11:56:42 pm

How much use do your decks get these days? I assume there's maybe a tape delivery but are you seeing much tape ingest anymore?


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Mike Jeffs
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 3, 2015 at 12:43:42 am

[Andrew Kimery] "How much use do your decks get these days? I assume there's maybe a tape delivery but are you seeing much tape ingest anymore?"

A smattering of hdcam here and there, a rare digibeta, But surprisingly a lot of Xdcam discs. There are quite a few places that invested heavily in that format and still use it to deliver footage, shows and others clips.

Of course that vast majority is digital files so we need every type of hard drive connection and card readers known to man. :)

Mike Jeffs
Production Services Manager
KPBS San Diego


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Andy Field
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 6, 2015 at 5:07:26 am
Last Edited By Andy Field on Jul 6, 2015 at 5:11:07 am

Here's another way of looking at this.

You aren't selling editing time or gear.

You're selling professional story telling.

I've been a network correspondent, an editor, producer, voice over guy, writer....

I've got my own gear and edit write and produce various projects, from documentaries to corporate video.

Selling myself as an "editor" often has the client look at you as just one cog in the machine...when in fact you are the entire story telling machine who can make or break the message they want to deliver. When you sell yourself as a total solution, you're value soars in the potential client's eyes. Just an "editor" has them running to Craigslist for the lowest price.

I manage and control costs this way.

I lay out how long pre to post production will take, with locations, prep time, pre-interviewes etc. Then build in log and edit time for rough cut -- graphics etc.

Each has a price tag depending on how much I want/need to make on that project - my costs for crews etc and reasonable mark up for profit and taxes.

Then I tell the client - YOU CAN CONTROL THE COSTS.

if they follow the guidelines - get sign off on each step - script approval - rough cut approval - polished cut approval. The estimate won't change.

When they step outside that realm -- then they understand the meaning of hourly rates -- we tell them - after the second round of edit changes - the meter starts running again at x per hour. It's then up to them to determine the final cost.

This is a far more profitable way to produce for hire work....and lets the client know up front you're trying to save them money with a methodical step by step production approval scheme.

We get them to sign the agreement for all of the above. When the client says - but our accounting department has changes after the 12th edit - you point them back to the original agreement and say - no problem - here's what they will cost extra.

Andy Field
FieldVision Productions
N. Bethesda, Maryland 20852


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James Ewart
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 4:36:40 am
Last Edited By James Ewart on Jul 17, 2015 at 4:43:52 am

When a painter of carpenter comes to my house I do not expect to be charged for the use of the brushes or hammers.

I no longer charge for my computer and software when editing. It saves a boring conversation.

I do often suggest a client buys a system for a job (if it's long form especially) and always (well almost) charge clients for storage.



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Mike Jeffs
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 5:09:22 am

[James Ewart] "When a painter of carpenter comes to my house I do not expect to be charged for the use of the brushes or hammers.
"


In my former life I worked as a drywall guy. tradesman definitely charge for there tools. In our case it came in the form of hourly rate being higher in order to pay for new tools expendibles etc. I have know many others who actually add in line items for new tools they need to get a certain job done.

Really I think tradesman are in the same boat as us video editors to charge for our tools or not.

Mike Jeffs
Production Services Manager
KPBS San Diego


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Mark Suszko
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 5:29:35 am

You're paying for the tools, either way. But they're useless without the skill of the man or woman wielding them.


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James Ewart
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 10:47:21 am

[Mark Suszko] "You're paying for the tools, either way. But they're useless without the skill of the man or woman wielding them."

Absolutely. I do think sometimes people charge for their equipment as a way of bumping up their price.

I just charge all in and keep it simple.


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 11:58:11 am

[James Ewart] "Absolutely. I do think sometimes people charge for their equipment as a way of bumping up their price."

If you need to rent equipment for a job at a cost to you, you don't pass that cost on to the job? You absorb that cost in to your normal project fee?

If you hire a DP that doesn't own a camera, you expect their rate to cover the cost of a camera rental?

If you go to a color session, you expect the rate to be the same if you're in the big theater with the expensive projector, or a small room with a plasma?

If you go to a ProTools session, do you think that they shouldn't charge for sound effects search and license? Or custom music creation? Or music license? That should just be included as part of a rate? What if you didn't need to license any sound effects? Should the rate stay the same?


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Oliver Peters
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 12:08:42 pm

The discussion is split, depending on whether you are in a situation where you ALWAYS use your tools versus one where you SOMETIMES use your tools. In the case of most facilities, the rate typically includes a person and the gear in the room. OTOH, if you are hired freelance for some jobs, like editing a film, it's a dry hire, where you may or may not be asked to also provide a bid/estimate with your gear.

Oliver

Oliver Peters Post Production Services, LLC
Orlando, FL
http://www.oliverpeters.com


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 12:20:50 pm

I'm just going to keep hammering that project fees don't do anyone any good in the long run. :) Clients will become even more divorced from what video can cost, and it makes managing cost a lot more tricky for the supplier.

Of course, it's different for everyone, and if you have short jobs that are completed quickly, or you have a specific job with a specific deadline, the yes, you could add up a project fee that would simulate a time based estimate and make sure the costs will be covered. I'm glad everyone's jobs are that tidy, but the second there's a new cost added, project fees can eat up a margin quickly.


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 21, 2015 at 10:43:24 am

Hi Jeremy. I'm revisiting some earlier remarks. As kind of a preface, I'd say that I think we are trying to solve the same problems, but from different sides. More on that in a minute.


[Jeremy Garchow] "I'm just going to keep hammering that project fees don't do anyone any good in the long run. :) Clients will become even more divorced from what video can cost, and it makes managing cost a lot more tricky for the supplier. "

Likewise, I think that hourly billing might not do anyone any good in the long run. Clients become even more divorced from what video is worth, and it makes managing capacity a lot trickier for the supplier.


[Jeremy Garchow] "Of course, it's different for everyone, and if you have short jobs that are completed quickly, or you have a specific job with a specific deadline, the yes, you could add up a project fee that would simulate a time based estimate and make sure the costs will be covered. I'm glad everyone's jobs are that tidy, but the second there's a new cost added, project fees can eat up a margin quickly."

If I'm understanding your POV correctly, you assume that scope will creep, and that costs will creep, and you look to protect yourself against that. You do this by avoiding commitment to either scope or price.

I wouldn't agree that a client having a theoretically unlimited ceiling on the cost of their video is good for them, or that you having a theoretically unlimited obligation to continue working on the project is good for you. The client can't manage their budget, and you can't manage your calendar.

A project fee is not a promise of infinite free changes. It is a commitment to a specific scope at a specific price. While you look exclusively at cost management above, I consider cost management and scope management to be two sides of the same coin.

We are finding that a good way to convey this idea of scope management starts in budgeting. We're currently trying an approach with three quotes (note: not estimates for project fees!), with good-better-best scopes and corresponding prices. We'll spell out specifically what each level includes (and sometimes just as important, what it excludes). This does three really important things:

1) It puts the client in control of price. If they're price-sensitive, they can pick a level that best suits their budget.

2) It establishes a direct link between scope and price. Everyone agrees right from the beginning that more is worth more and costs more.

3) It allows us to demonstrate where we can add value. Keeping the emphasis on what value the client gets for their money -- how much we understand what their problems are and how to solve them -- helps set us apart from vendors who just sell buckets of hours. This is not just a semantic difference; paying us for value instead of paying us for hours focuses us on solving the client's problems, rather than focusing us on completing work for its own sake.

With a scope and a price agreed upon, and with the idea that the client can get more if they pay more out there on paper, and with our value-add obvious, when a scope change comes along that would trigger "new added costs" as in your example above, it's completely natural and appropriate for us to revisit its pricing as a change order. This does two really important things:

1) It triggers a discussion of what the change is actually worth. When there's a budget line item attached to a change, all the client stakeholders get on the same page faster.

2) We will be paid for the new value we add.

Let's think about your "new cost added" hourly-billing example above. Where does the new cost come from? If it's something new the client it asking for, clearly they should pay for it, and that's covered with project fees as above. If it's not something new, why wasn't it in the original estimate, and how did it become the client's problem?

Really, what I'm suggesting probably isn't so different in structure from what you're actually doing, except that one method is built around value explicitly and the other is built around costs.

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
@keenlive [twitter]   |   RenderBreak [blog]   |   Profile [LinkedIn]


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James Ewart
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 2:42:21 pm

Of course extras cost extra Jeremy.
But computer and software are included.


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Jeremy Garchow
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 3:34:46 pm

[James Ewart] "Of course extras cost extra Jeremy.
But computer and software are included."


And that's cool. Computer and software is definitely built in to the cost of doing business for us too. As I stated in my first response to this thread, it's pretty easy to figure out an hourly rate when you know the costs.

If we hire freelance designers, and frequently they will charge a nominal fee for stock and software since everything is subscription based these days (computers will be subscription based one day, too). It is a way to recover their costs. Some just charge a higher rate, which ends up being MORE EXPENSIVE than just breaking out the line items. What I have yet to see is someone charging a subscription rate for their video services. As a matter of fact, if you talk to any size agency, you will find that being the Agency of Record (which essentially means that an agency and a client entity sign a contract for a guarantee of money over a course of time for an agreed scope of work) is increasingly a harder and harder sell. All clients want a project fee, and since the money isn't as steady, it is much harder to staff and therefore control costs. So in that case, "subscription" is losing, which is one of the fundamental problems I have with Adobe CC, is that it really doesn't mirror a production based income stream. Luckily, it's cheap enough to keep around for now.

Really, the point of me having this discussion, despite being called obtuse and deflective and seemingly carrying a minority view among the three or four people really talking about this subject, is that project fees, at least through what is a limited lens set on this forum, are helping to bring down an already thin profit margin. I still haven't heard differently other than 'it works for me'. If I were to budget 3 30 minute blocks of TV show, because the job varies so much, I couldn't put a rate on all three. If it was the same thing over an over, sure, but our business is extremely varied.

I don't know what it's like by you, and Tim Wilson mentioned how he doesn't know "how the youngins are doing it". Well, let's find out how the youngins are making an adult income. And if they aren't, why they don't.


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Walter Soyka
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 3:59:55 pm

Jeremy, you've raised a couple of interesting points above. I promise you a quality response on the issue of project fees.

Walter Soyka
Designer & Mad Scientist at Keen Live [link]
Motion Graphics, Widescreen Events, Presentation Design, and Consulting
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Andy Field
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 17, 2015 at 6:26:07 pm

[James Ewart] "When a painter of carpenter comes to my house I do not expect to be charged for the use of the brushes or hammers.

Yet a profitable, busy savvy painter and carpenter IS charging you for the use of his brushes or hammers....it's part of the cost of them doing business. You can pretend they don't, but if they don't, they're losing money.

I no longer charge for my computer and software when editing. It saves a boring conversation."


But costs you money in capital expenses you aren't amortizing.....I bought an 800 dollar piece of software for animation -- charged the client 1200 for the job.....made 400 dollars for my labor and the rest covered my investment. After that, whatever I charge is pure profit on the first software price investment. That's called capitalism. Unless you're running a charity, it's foolish not to factor in the price of your equipment and software.

Andy Field
FieldVision Productions
N. Bethesda, Maryland 20852


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James Ewart
Re: Do FCPX freelance editors charge for your "Edit Suite"
on Jul 18, 2015 at 5:12:26 am

[Andy Field] "it's foolish not to factor in the price of your equipment and software."

Of course I factor it in. I just save my clients and myself the tedium of going through all the items and bits they get when they ask me to work for them. They get me and my stuff for a rate. My experience is that my clients eyes glaze over if I start breaking it all down. I find (and this is only my personal experience) that it looks like I'm trying to "justify" my costs. So I don't bother. Unless they ask.


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