A simplified guide to pricing photography
Under iStockphoto licence, copyright Mike Ricca
Most photographers struggle with pricing and often adjust their prices in a futile attempt to find the sweet spot that might encourage their prospects and clients to buy.
Pricing is actually a lot easier than it seems, and many of us over-complicate the process by second-guessing ourselves or allowing our emotions to rule the numbers. It’s our lack of confidence in our prices that can be the real problem.
A simple pricing strategy
The most common formula for developing a price list is to multiply the cost of sales by a mark-up factor. In other words, what does the product cost to produce, and how much profit do we need to make from it? The lab print is not the only cost involved. Many photographers stumble trying to work out the value of the time it takes to create that print, from the first consultation to editing and touch-ups.
Consider an 8 x 10 print, with a lab charge of $5. For the sake of this exercise, I’m assuming a standard mark-up factor of 4 for all costs, which will make our cost of sales 25% of the sale price (an industry recommended amount). That gives us a price of $20, with $15 being profit, right? True, except those figures don’t include the time it took to produce.
If the client hires us for a session, but all they buy is an 8 x 10, are we just going to charge them $20? Hopefully not. Remember the time spent on the sales calls, processing the images, preparing them for viewing, the projection appointment, not to mention the actual portrait session.
Suppose these tasks take five hours. With a conservative hourly rate of $25, that produces a base cost of $125, which we should also mark up. Now our 8 x 10 has a “material” price of $20 and a “time” price of $500, for a total of $520.
Yes, I know what you’re thinking! No one is going to pay $520 for an 8 x 10, but the client shouldn’t be going through the whole process just for one 8 x 10 print. This is why we create packages, in which case we only charge once for our time. That time charge is then spread out over the cost of all the items in the package, making the prices more manageable.
Be confident
Working by the logic of numbers will give you more confidence in your prices and will help you become a better salesperson. Be proud of what you do. If your work is good, then you deserve to be properly compensated for what you sell and for the time you invest in it.
Nigel Merrick
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Nigel Merrick is a full-time professional photographer and founder of the Zenologue Blog, dedicated to helping other photographers improve their businesses and to the preservation of the professional photography industry as a whole. Follow him on Facebook and Twitter. |
