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What Would You Charge?

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Jason Nelson
What Would You Charge?
on Jan 7, 2014 at 8:43:31 pm

Hey gang. I create corporate videos for a living and I'm primarily a post-production guy, in that most of the work I do is in the editing, vfx, and animation stage. I have a potential client who is asking for a bid to do the entire process from scratch.

The exact instructions he gave were, "...we would come with you with an outline/rough script and you would need to develop the animations, custom footage, voice over etc bringing the product to completion. We will not have any footage to provide you with so everything will need to be done from scratch."

The client wants about 100 twenty minute training videos produced and they will all include filming, animation, green screen, voice over, etc. I have all of the gear to do all of this kind of work because although I said "most" of my work is in post, I have done some filming and such, so there would be very little equipment investment needed (though, I would probably need to invest in some temporary staff to pull it off).

The other wrinkle in this project is that these training videos will all be resold to other companies at a rate of about $300 per video.

So, my question to you is, if you were bidding on a project like this (about 100 videos, 20 minutes each, filming, animation, green screen, voice over, etc.), what would you charge? Would you charge per video or would you charge for the whole bundle? I know what I would charge for post-production work, but the regular production work is a little outside of my normal duties.

I appreciate the advice you can offer.


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Mark Suszko
Re: What Would You Charge?
on Jan 7, 2014 at 10:13:13 pm
Last Edited By Mark Suszko on Jan 7, 2014 at 10:18:26 pm

They are asking you to be the Producer on this. You should charge appropriately. You might want to think about staffing-up so there's enough people to do everything, because this is a lot for a one-man-band to handle.

Question: are they expecting these to be created in a linear sequence, or in batches? This is important in the sense that you don't want to be on the hook for all the expenses of making 100 programs before you see a dime of payment. You are not a bank, giving interest-free loans. Whatever you decide, get at least a third of the estimated costs paid up-front to start, don't even turn a camera on without the initial deposit. Then think about a progress-payment situation: they must pay for every ten videos done, or they pay the whole thing off in thirds, with your delivery of all the un-watermarked masters, done when they make the final payment.

A "bundle" price for this kind of thing is a mistake, IMO, because there is way too much room for problems to creep in and raise your hours worked, at a fixed price to the client, which means you lose money any time someone else creates a problem or makes a change. Daily or hourly rates, paid in regular intervals at milestone points, protects both you and the client. You don't end up holding the bag for expenses incurred, if the client suddenly quits. And the client is only paying for work actually performed and delivered.



Your shooting cost is going to be at day rate, you don't give enough info to predict accurately, how many of these 20-minute miracles you will actually be able to shoot per day. It could be that you can do two an hour... or it could be that two a DAY turns out to be the best you can manage... What if they require multiple takes, for example? And teleprompting? Is the "talent" any good, or will you need to really hold their hand thru multiple takes to get one that's right?

And that's just the raw shoot: you know that post work takes longer than shooting, especially for animation or complex compositing.


I don't care what price they re-sell your work for (as if that even represents what it might cost you to make it); what matters is that you price YOUR end to not just cover your expenses and any vendors you need, but to actually make you a profit.

Based on your description, these things sound like either internet college lecture segments, or cyber catalog product description and feature promos, maybe a condo or timeshare sales pitch or a product "how-to-use" tutorial. These are some (very) rough and made-up figures; they are a tad conservative;


Script consultation and writing: $300/hr./ one-time charge to finish 100 episodes of the client's "rough outlines".

Greenscreen studio shoot, with prompter, combinationDP/director (you), a separate audio technician/grip, recording files to a hard disk or cards, each segment: $1k/hr. or $8k/day. For between 1 and 7 segments shot.
( You have to allow a lunch and bathroom breaks after all. )

Compositing the greenscreens (with possible roto repair work) and main post work per segment : $200/hr. or $2k/day for a 10-hour edit day. You could save editing time and money by doing the chromakey effect live, on-set, thru a switcher, but then you have to rent the switcher for the shoot days, or buy one for at least a grand.

Animation creation and rendering (2-D flying text "Kinetic Typography" or "fake speed-drawing" ): $400/day. Assumes a lot of the stuff is templated and only needs minor changes for each episode - if each segment needs complete "from scratch" work done, productivity will go 'way down.

Audio work, color grading, music, and compressing finished masters for web/stream: $100/hr. for each segment.

Possible cost per segment: $1,500.oo and up, depending on efficiency of post work and getting at least 4 shoots in one day. Times 100 episodes is $15K in production expenses alone, not counting profit. That didn't count things like the cost of the talent, someone to run the prompter, renting a prompter, the studio rental or utilities, insurance, taxes, expendables, etc. More like $2,500 and up, per episode, IMO.


I think if possible, arrange to shoot ONE of these as a test, keeping a close record of the time everything takes, and what things cost, and carry it thru to post, at day rate or an hourly rat,e based on your existing day rate, plus a 10 percent markup for your time.

This will give you and them the most accurate basis for predicting the time/cost for doing the rest. And it will point out any problems that could affect the rest of the package.

Making 100 episodes of *anything* is going to take up a lot of your time. More than you think. Consider then the "opportunity cost" of missing other, lucrative jobs while everything you have is tied up making this stuff for one client and their deadline. If you may be turning away other work over that period of time, build in the cost of that lost work into the overall bid as well. The point after all is to make a profit, a REAL profit.

What I've laid out is very simplified, and missing chunks here and there. By no means should you write down these numbers and pitch them without doing your own research and planning. Hopefully, others will chime in with their advice as well.

Good luck, and remember that you are a business, not a charity.


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Jason Nelson
Re: What Would You Charge?
on Jan 8, 2014 at 4:02:42 am

Mark,

Thank you for your thorough response. The training videos are safety videos for a chemical company and will require actors/actresses demonstrating things and actions, but no speaking. All of the speaking will be done by a "host" in front of a green screen who will also just provide a voice while the action takes place on screen. However, your response did trigger another thought that I had not considered...insurance...especially with these videos that are demonstrating safety. And possibly, hiring a certified OSHA inspector to be on set to ensure that what we are filming is legal. Your thought of $2,500 per film is about what I was thinking on the low end. In fact, with the added insurance and safety requirements I need in place to protect my own interested, I'm thinking I need to be in the $3,000-$4,000 per video ballpark.

I really appreciate your reply, and if anything else comes to mind now that I've given more details, please let me know.

Jason


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Bill Davis
Re: What Would You Charge?
on Jan 8, 2014 at 3:21:22 am
Last Edited By Bill Davis on Jan 8, 2014 at 3:23:48 am

in the 1980s this would have been an easy quote.

$1k per finished minute turnkey delivered.

So each video would be $20k - and 100 of them would have been a tidy $2million bucks.

So now all you have to do is factor in 30 years of inflation - less the technical advances that has made the equipment cheaper and partially competent talent WAY more plentiful - and there you go.

I say start at 20% of that - look them straight in the eye and quote $400,000 - then after you've revived them by splashing cold water on them - make THEM give you a number.

Remember, the first one who actually quotes a serious number typically loses in any negotiation.

Also, it's going to easily consume a year of your life full time to do this much work at even decent quality - likely two. So how much is a year or two of your business life worth?

Good luck.

Know someone who teaches video editing in elementary school, high school or college? Tell them to check out http://www.StartEditingNow.com - video editing curriculum complete with licensed practice content.


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Jason Nelson
Re: What Would You Charge?
on Jan 8, 2014 at 4:06:07 am

Bill,

Your idea of $400,000 for the entire package is not far from what I had in mind. I was in the $250k-$300k, but the more I consider all that I need to make this really work, $400k is a more realistic ballpark. I'll see if I can get them to give me their budget and see if we're even close to each other before I waste my time putting together a proposal that has no chance.

Jason


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Bill Davis
Re: What Would You Charge?
on Jan 10, 2014 at 6:11:55 am

[Jason Nelson] "I'll see if I can get them to give me their budget and see if we're even close to each other before I waste my time putting together a proposal that has no chance."

My bet is that they're actually going to offer you something between $30K and $40K imaging that kind of money should buy a year of a person's life and dedicated work and thinking you can "do it yourself" with a camcorder and a laptop.

They'll likely think they're being financially smart since they will get all the work and save all the employee benefits and taxes by outsourcing this rather than hiring a kid.

It's how "business people" largely think these days.

For most of today's employers, people have no real value - just slot fillers that they grind down to the lowest possible cost to allow them to make the maximum return.

If they actually offer you anything above $100k - be shocked. You still wont' really make any real sustainable profit for the time and expertise even at that rate - not on a project this massive - and eventually you'll find the actual effort and time to do work you''d honestly be proud of impossible to sustain at that level of compensation, so you'll work four times as hard as you'd imagine and spend a huge chunk of your potential profits chasing efficiency.

100 programs is a MASSIVE amount of work. A grind. And the ONLY thing that makes that kind of grind tolerable is if you have the resources so that you can hire competent people to sub most of the actual production and even a huge chunk of the organizational and oversight work to others - while you spend ALL your time checking things, motivating the team, and keeping everything on track.

Good luck.

Know someone who teaches video editing in elementary school, high school or college? Tell them to check out http://www.StartEditingNow.com - video editing curriculum complete with licensed practice content.


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Jason Nelson
Re: What Would You Charge?
on Jan 10, 2014 at 6:19:40 am

Good insight, Bill. I asked them for a budget and they wanted to see what I'd price at first. So, I went for broke and bid it at $450k with the ability to complete the project in 18 months. Their response was that this was what they anticipated it would be and they want to start drawing up a contract. But, until I have that contract in hand, I'm not going to start counting my eggs before they hatch. I am pretty shocked that they went for my proposal, which makes me wonder if I could have bid higher. Oh well, we'll see what happens.


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Bill Davis
Re: What Would You Charge?
on Jan 10, 2014 at 8:04:29 pm

First, congrats on bidding realistically.

But as you very wisely indicated, don't hold your breath until the contract is on the table and the signatures are in place.

I'll keep my fingers crossed for you!

Good luck and let us know how it goes in time.

Know someone who teaches video editing in elementary school, high school or college? Tell them to check out http://www.StartEditingNow.com - video editing curriculum complete with licensed practice content.


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