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Another Day Rate Question

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Katie McCallAnother Day Rate Question
by on Jun 10, 2013 at 9:13:30 pm

I'm fresh out of college with a BA, living in Nashville, TN and trying to figure out this freelance thing. I've been doing my research when it comes to applicable day rates and they seem to be a lot higher than the what the gigs I've landing are capable of paying. I haven't quite figured out the balance between being cheap enough clients won't run when they ask my age and not screwing myself financially. This particular project is a 1-2 minute video I've been asked to be a one-man-band for, with promising potential for several more projects of the same kind. I'd edit, shoot, the whole 9-yards with my own equipment. What do I charge per video? Any insight would be much appreciated.

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Joseph W. BourkeRe: Another Day Rate Question
by on Jun 10, 2013 at 11:56:35 pm

Beware the "promising potential for several more projects of the same kind". That's standard client boilerplate bull for "you do this first one for next to nothing, and we'll move on to the next sucker after the first one...".

I'm not saying that's always the case, but for me 99 percent of the time, that has been the case. As far as price goes, if you can come up with an hourly rate for yourself, adding equipment rental if needed, then you can figure out what you should charge. You'll need a day rate for shooting, editing, and any other post needed - from the sound of it, it's going to be low budget, so you could conceivably use one hourly rate for everything, so come up with a figure you would refuse to work below for ANY job, then use that.

You could also use the "price per running minute finished", which is sometimes used in the industry. Generally that runs anywhere from $1500. to $5000. or more, depending on the multitude of variables which can be part of the production. Here's a good list of what you might run into, and why there is never any real set price for a production:

Joe Bourke
Owner/Creative Director
Bourke Media

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Mark SuszkoRe: Another Day Rate Question
by on Jun 11, 2013 at 12:09:51 am

I agree with most of Joe's post but would not recommend a $per finished minute figure. What you do is NOT installing mufflers or assembling identical widgets. It is custom work, each video has it's own quirks and problems to fix or overcome, sometimes you need to do more audio cleanup, sometimes, some extra special effects roto work, or the client makes a change that costs you more time. Not two "identical" projects ever come out quite the same, so why charge identically?

We used to get away with a $1k per finished minute rule of thumb back in the 80's, but you have to realize that the math problem had much tighter constraints back then: the $1k per minute would give you something shot on one or two beta cams, and edited over 2-3 days in a linear analog system with simple switcher wipes or dissolves, needle-drop music, a simple character generator and some basic effects like luma keys for graphics art, all mastered to beta or a one-inch reel, with a finished running time of a half hour or less.

Today, any laptop has twice the power and quality of that entire 80's editing room, for a fraction of the cost. It can do the same work faster and better in every meaningful way. If you still charge a kilobuck per minute today, with today's technology, are you lowballing, or over-charging? You're almost never right on-target, is my assertion.

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Mark SuszkoRe: Another Day Rate Question
by on Jun 11, 2013 at 12:00:50 am

Katie, the clients gotta come second after you first take care of yourself. You gotta pay yourself a workable wage plus a little bit to put away, and if that makes your rate a little higher than the next guy, you're just going to have to sell them harder on the fact that you bring "added value". Maybe that comes in the form of comping the render times or dubbing time, or giving a discount on transcoding the product so there's a free youtube version for them or something. Find some detail you can point to and say: most people charge extra for that, but I include it in the price".

You don't have to volunteer that you already budgeted for the cost of that, before the "mark-down".

But you can't beat yourself up or cave in right away if someone else's rate is lower. You can't know all the facts about their situation and if they are living off savings and lowballing now to drive you out so they can raise the prices later. You don't know if their business model is unsustainable and they are working out of Mom's basement or what. So don't compete against factors you can't know about. What you CAN know is your real costs and the rate you calculate that covers costs plus makes a meaningful profit above what a burger-flipper could get. Stick to that as firm. Then, use salesmanship to climb up from there.

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John NaughtonRe: Another Day Rate Question
by on Jun 11, 2013 at 12:25:53 am
Last Edited By John Naughton on May 9, 2016 at 4:31:24 am

to add to everyone's excellent answers here: it sounds like you are functioning as a production company and not a freelancer. You should charge according to that standard. -- And set up a business entity.

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Katie McCallRe: Another Day Rate Question
by on Jun 11, 2013 at 1:18:14 am

Thanks very much for everyone's advice!

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Roger Van DuynRe: Another Day Rate Question
by on Jun 11, 2013 at 1:36:54 pm

Hi Katie.

In my limited experience, only in business since 2009, pricing is more of an art than a science, but don't neglect the "science" part. You MUST charge more than it costs you to do the work, including your overhead. The term is "cost of doing business." There are threads here on the COW discussing that, among other places, and they have helped me.

One thing I learned from experience, all work is not equal. Some work is more difficult. I charge more for difficult work than easy work. Some work is SO quick and easy, and requires less equipment even though it doesn't seem to pay as much, it earns more profit.

I try to make the price fit the project. Most clients prefer a quote or estimate for the package price. With experience, that part gets easier. It's both art and science making a quote. It's a lot like going fishing.

Also, since you are just starting out, build up an emergency fund, a stash. And keep an eye on your cash flow. Running my business is more time consuming than doing the projects.


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