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writing an estimate

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Mark Stuartwriting an estimate
by on Jan 21, 2008 at 2:06:47 am

OK, I've got my price decided and the general terms for an upcoming corporate project. Part of which was from the helpful advice found here, thank you.

Now I'd like some advice on writing a proposal/estimate. The info in general for this on line is very sparse in so far as actual samples.

What do you all here use for giving a prospect a proposal? Basically, I'm looking how to word how much their production will cost on an hourly rate. Sorry I may sound awkward with this, as this is my first big corporate opportunity, and want to sound more polished (which I know I'm not here!).

If you could give me some tips, maybe even an example if you are willing, of how you write a proposal/give an estimate for a prospect based on an hourly rate, I'd very much appreciate it.

Thanks, and have a great night!

Mark

http://www.mediaartsolutions.net


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Randall RaymondRe: writing an estimate
by on Jan 21, 2008 at 3:46:30 am

[Mark Stuart] "Now I'd like some advice on writing a proposal/estimate."

Keep it simple. 'Proposal/Project go-ahead' should require both you signatures, include the invoice for the down stroke. Don't be verbose on the actual project.

List the fine print of your contract on the back of the 'Proposal/Project go-ahead' then call it your standard contract. They are much more likely to sign if your stipulations are 'standard' - they assume that all your clients are signing under those terms.



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Mark SuszkoRe: writing an estimate
by on Jan 22, 2008 at 1:46:11 am

Ask three people this and you'll get four answers, and every one of them will be right. For that person.

Is this client very hands-on? Are they really doing the lion's share of the organizing of the project and all you're doing is shooting to their schedule and editing to their preset list? Or on the opposite extreme, did they give you a sketch on a napkin and tell you to figure out all the rest? (Really happened to me once, client said it was the best work I'd ever done for them)

The amount of hours you will have to put in on those two scenarios could vary widely. Once you know how detailed or un-detailed the client is, you can try to match them with the detail level of your estimate. The more you know about the project, of course, the better you can refine the numbers.

On the skimpy side, the best you might be able to say is: "We estimate N number of shoot days and editing at between X and Y number of days, based on Y number of days, the day rate will be this and the total will be THAT. The shooting package will run Z amount for the N days we estimate this will take. Additional rain days for shooting will be billed at N rate if needed. We would need your approval to do and bill additional editing work beyond Y days. Terms are one third of the total minimum estimate upon signature of the contract, payable immediately. One third to be paid upon viewing the first cut of the edited product, final amount outstanding to be paid in full upon approval of the final cut master and duplication order."

You name the deliverables, any specific items that make this bid distinct, like use of a jib, and the due dates for each. That kind of wording tells the client you've done enough homework to narrow it down to min/max range, and he knows what the costs will be if something goes over. But it doesn't give away the store and it remains flexible should situations change. It doesn't give a competitor too much information that he could use to undercut you. If he says he can underbid you, you can point to your bid and say: "well, he's cutting costs because he's not giving you the high angle jib shot you specified, if that quality touch is still important to you, he'll have to up his price to give it to you". It also protects both sides in that, if the project has to die at some point before completion, you get paid for what you've done to that point and they don't spend more than that.

I would not tell the client your hourly rate or break out every little roll of gaffer tape and clothes pin bag, etc. on the estimate unless they bent your arm about it. Because the first thing a grinder will want to do is tear thru your detailed breakout sheet and question every item until you want to stick a fork in his eye just to stop the conversation. Also, some of your pricing info may be proprietary, like your discount rate on blank shooting stock or the sweetheart deal on the jib rental for that sweeping closing scene they want. Don't give away all your secrets. That's one of the places your markup and profit come from.




"Oh, you wanted to RECORD that?"


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Mark StuartRe: writing an estimate
by on Jan 22, 2008 at 2:40:44 am

great! thanks for the help, guys. Today I had the opportunity to see a few proposals from a variety of services, and they certainly vary enough. I like your tips on not getting too detailed or wordy. Basically, I just don't want to get ripped off, like we all do ;-)

http://www.mediaartsolutions.net


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Randall RaymondRe: writing an estimate
by on Jan 22, 2008 at 5:21:24 am

[Mark Stuart] "I like your tips on not getting too detailed or wordy. Basically, I just don't want to get ripped off, like we all do ;-)"

Just stay focused on the solution you are providing to the problem they have. They want results and will pay for those results - and they will smile while paying if the results are there.

Provide the solution and you will never get ripped off. Communicating the perfect message is not easy - but that is exactly what they are paying you for. Stay focused on your mission, not your fears. That attitude should be reflected in your estimate. They are not the enemy.



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Mark Stuarthow to charge for revisions
by on Jan 23, 2008 at 2:23:44 am

Interestingly enough, someone else on another message board just told me the same thing! I agree totally, and it's the same situation in any video production, even in the TV commercials I produce. The client only wants to sell their product/service from the commercial.

As long as I'm here and on the subject, I could also use some tips about dealing with revisions. My plan so far is to estimate how long a project will take (how much is will cost), and for revisions negotiate further. Basically, I would just want to charge hourly for these.

What I could use some guidance with this is how do I go about adding revisions. Is it necessary to get that in writing as well? Do I send another estimate for the revisions and have the client sign another agreement for them? I know it likely will vary with different clients.

Although I've been in video production a long time, I recently have started my own part time company, and am learning as I go, especially the business side of it. I really appreciate all the advice I'm getting, including here at Creative Cow!

Thanks,

mas

http://www.mediaartsolutions.net


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walter biscardiRe: writing an estimate
by on Jan 23, 2008 at 12:06:23 pm

[Mark Stuart] "What do you all here use for giving a prospect a proposal? Basically, I'm looking how to word how much their production will cost on an hourly rate."

You actually just keep this very simple. I create a very simple Word document that spells out everything in a very simple outline.

I have a line item for each and every item of production showing the hourly / final cost for each item. Such as $75/hour: $1,500

You lay it all out in a very easy to read outline and it doesn't matter if the client understands each and every line. They will ask you if they don't understand what a Production Assistant is and what they will do. But they can clearly see all the numbers and what they are paying for. Corporate folks love easy to follow outlines, especially when it's something they're not used to like video production.

You also must lay out exactly how much revisions will cost should there be a need for additional production due to client changes or revisions. My proposals always clearly state that "based on the current information available from the client, we have prepared this estimate to complete the proposed project. Client shall be billed for any additional work required due to changes in the scope of this project, changes by the client or any other unforseen circumstances."

Then I notify my client immediately if something is going to cause the project to go over budget and get their approval. Generally I like to do this both by phone and then follow up with email or fax so I have something in writing that they are ok with the changes.

But when preparing the proposal, just keep it simple. We are proposing to create a marketing DVD for you no more than 10 minutes in length. This will cost $10,000. Price breakdown is as follows:
Pre Production Planning - 2 days: $500
Videographer - 2 days: $1,500
Camera Package - 2 days: $3,000 (Camera, 3 lights, 2 mics)

And so on, just lay it all out there so they know the total costs and each line item, including all the expendables. Some folks don't like to lay out all the items, but I have found corporate folks really appreciate seeing everything. They really don't understand video production and by laying out everything in your estimate, it makes it easier for them to understand than just a final number.

Walter Biscardi, Jr.
Biscardi Creative Media
HD and SD Production for Broadcast and Independent Productions.

STOP STARING AND START GRADING WITH APPLE COLOR
The new Color Training DVD now available from the Creative Cow!

Read my Blog!


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Mark StuartRe: writing an estimate
by on Jan 24, 2008 at 12:47:01 am

Walter,

Thanks much for your helpful advice!

mas

http://www.mediaartsolutions.net


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Mark StuartRe: writing an estimate
by on Jan 27, 2008 at 11:28:52 pm

Hi Walter,

Thanks for your tips about writing an estimate. I have a question for you. Where you say

"Client shall be billed for any additional work required due to changes in the scope of this project, changes by the client or any other unforeseen circumstances"

would you give me some examples of the unforeseen circumstances? I'm not sure what that would be other than "changes by the client".

Also, I checked out your website and have to say I really enjoyed the photos of your cool editing suites!

Thanks for all your help!

Mark

http://www.mediaartsolutions.net


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walter biscardiRe: writing an estimate
by on Jan 27, 2008 at 11:54:50 pm

[Mark Stuart] "would you give me some examples of the unforeseen circumstances? I'm not sure what that would be other than "changes by the client"."

Let's say you show up at a location, but they're not ready for you so you have to sit around for a while. Or the location is locked and we have to wait an hour for someone to show up with the key. Or the talent that the client insisted we use (their family, friends, whatever) is running late / not showing up, whatever. So you have a crew standing around running late, not of your own doing.

Or all that b-roll that was going to be arriving today doesn't show up. Or it does, but it's really bad quality VHS that you simply can't use.

In other words there are many times when a client will "take care of some details" only to to have something go wrong. Let's just say I've seen this happen first-hand more than once. So while not changes by the client, they do hold you up, delay the production, delay the edit, etc.... These are unforseen circumstances for which I'm not going to be held liable and be held to both the deadline and the budget because now I have to stretch the edit into another day or pay the crew overtime.

Glad you liked the website. We REALLY need to update it badly. Finding someone to do it for us has been a challenge.

Walter Biscardi, Jr.
Biscardi Creative Media
HD and SD Production for Broadcast and Independent Productions.

STOP STARING AND START GRADING WITH APPLE COLOR
The new Color Training DVD now available from the Creative Cow!

Read my Blog!


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Mark StuartRe: writing an estimate
by on Jan 28, 2008 at 3:02:59 am

ah... got it! Yes I know all about client supplied elements and the quality, or lack thereof, from my television station gig. I can't count how many clients were going to supply a logo that turned out to be a black and white comic sans in Publisher! Or, "yes, we can supply some stills" and they are about 300 X 200 pixels... I've since learned to always say the minimum size is 720 X 540 and if they look at me puzzled, I suggest, "maybe you have a professional photograph we could scan?", etc. And, I have also ran into plenty of times when a client thought their SLP recorded VHS would be just fine for broadcast!

I was just earlier today sorting out how to prevent such delays, and I can see now how the unforeseen circumstances could cover it, at least be a start.

Great advice, thanks!

http://www.mediaartsolutions.net


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