A very long post for photographers learning to negotiate photography fees.
“Money can’t buy happiness but it can buy a better quality of misery.” – anonymous
Three important points to remember when pricing photography:
1. Never give a price over the phone. When someone calls and asks, “How much do you charge to shoot this?” don’t give a price over the phone. You need time to get more information, figure out all the details and then determine the proper price.
No job is ever as easy or as quick as the client says it will be. If the wrong price is quoted over the phone, it will be difficult to increase it later, if required. Verbal quotes are often misunderstood by the client.
Being in a hurry and pulling a price out of thin air is always a mistake which leads to point #2:
2. It’s important for you to have your own set of pricing guidelines. This comes from experience and from comparison with other photographers’ prices. But never follow other photographers’ numbers blindly. Each photographer must factor in their market, their overhead, their competence level and their business goals.
Be prepared ahead of time and have some numbers already written down. A photographer must believe in the value of their photography. Learn to say, “That will cost $1200” in a confident voice instead of, “Maybe around $1200 or so, if that sounds okay?”
It’s also important to have a bottom-line number below which you won’t go. If the negotiation gets down to that number, you must say, “Sorry but I can’t accept that offer.” It’s never wrong to turn down a money-losing job.
3. Negotiating is not you against them. It’s not a competition. It’s not a win-lose thing. It’s not haggling over price. And most importantly, you’re not playing The Price is Right where you’re trying to guess the client’s secret price.
A photographer should go into a negotiation with the plan that they and the client are trying to find a mutual point where they’re going to give the client a certain amount of photography services in exchange for the client paying a certain amount of money.
More services requires more money. Less money buys fewer services. This is how all other businesses operate. This mutual point cannot always be found. Tough. All photographers lose jobs so get used to it.
If you get every job you quote then that might be a sign you’re charging too low. :-)
Also, never offer to “split the difference”.
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We now look to the noble car salesperson for inspiration.
When a customer walks onto a car lot, the salesperson is not just friendly but is now the customer’s new best friend. The salesperson wants to help the customer buy a new car.
The salesperson’s first question is about what type of vehicle the customer is interested in. The second question is always what price range the customer is shopping. If the customer can’t or won’t answer both of these questions, the salesperson will walk away.
Assume the customer has picked a vehicle and is now negotiating the price. If the customer lowers their price offer, the salesperson will remove car options:
“Sure we can do that price but not with the deluxe audio package.”
Less money offered for the vehicle = fewer options. Nothing is free.
The salesperson will take the customer’s price offer to the sales manager. Even if the manger refuses the offer, the salesperson will always come back with a positive answer:
“Good news! The manager says that if you come up just a little bit more in your price, you can have your new car!”
Or, the sales manager will counter-offer with a higher number along with an excited note:
“Great work!! Please help us make this deal happen so you can drive your new car home!!”
The point here is that the salesperson has removed themselves from the negotiation. The customer is not negotiating against the salesperson. The salesperson is just trying to help the customer get the vehicle they want, at a price they’re willing to pay.
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When a photographer negotiates with a client, the same principles apply. The photographer needs to know what “vehicle” the client wants, (i.e. what photography is needed), and what price the client is willing to pay.
Unfortunately, not all clients will reveal their price range or perhaps they haven’t set a budget yet. This can make negotiations more difficult.
Let’s assume the required photography and a starting price are known. If the client offers a lower price, the photographer must remove some options. If it’s not possible then like the car salesperson, the photographer might have to walk away.
If the client takes something away, the photographer must also take something away. Less money offered = fewer options. Nothing is free.
Say a photographer quotes $1600 and the client offers $850. If the photographer doesn’t remove any options and just says, “Yeah okay, $850 is fine,” this means:
• The photographer is doing a $1600 job for $850 and has lost $750 before the job has even started.
• The original $1600 meant nothing. The client will never believe any future quote and will always expect a discount.
• Was the photographer trying to cheat the client with the $1600 number since the “real” price was only $850?
More services for the client means more money for the photographer. Less money for the photographer means less services for the client. This is exactly how all other businesses operate.
When negotiating, a photographer should remove themselves from the negotiation equation. It’s not personal, it’s a business deal. The client is not negotiating against the photographer because the photographer is trying to help the client buy the photography services they need at a price they’re willing to pay.
Avoid the word “I”. Instead of saying, “I charge …,” use phrases such as, “That assignment will cost … ,” or “The expenses will be … .”
When taking services away, try to use positive phrases:
Instead of: “No, you can’t get both web and print rights for that price.”
Use: “Yes, for that price, we can license web rights.”
Instead of: “We can’t do five executive portraits for that price.”
Use: “Yes, for that price, we can produce three great portraits for you.”
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Some clients, such as newspapers and magazines, may have set pay rates and there won’t be any negotiating other than “take it or leave it”.
Some clients won’t even think to negotiate with a photographer. They will either accept or refuse the photographer’s quote. (Do read this post about the value of triple quoting.) This can be good or bad.
If a photographer is a good salesperson, when a client refuses their photo quote, the photographer would ask why. If it’s due to price, the photographer could then ask, “What’s your budget for this project?” or “What do you think is a fair price?” The purpose of these questions is that the photographer is trying to start a negotiation rather than losing the customer outright.
If the client does give their idea of a fair price or reveals their budget, the photographer might then say, “Okay, let me think about what I can do for that price and I’ll call you back tomorrow.” The point here is: don’t rush a negotiation. Don’t put yourself on-the-spot by trying to instantly reconfigure an assignment in your head.
Losing some jobs is normal. It only means that the price the photographer quoted was too high for that particular client and that particular job. However, if a photographer loses every job then perhaps it’s time to either review their pricing or start marketing to higher-end clients.
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A newspaper might say it pays $200 per half day and $325 per full day, and this is presented as a take-it-or-leave-it offer. But if the job requires special skills, studio lighting or anything else beyond the usual, the photographer should ask for a higher rate.
I was sitting in the photo department of a large Toronto daily newspaper when the paper needed to buy a stock picture. The photo editor asked an assistant editor to call the photographer and ask to buy the usage rights. Before the call was made, the photo editor said he was willing to pay up to $250 but told the assistant to initially offer the photographer only $75. After negotiating with the photographer, (who kept saying “no thanks”), the paper, which really wanted the picture, ended up paying $400.
Lesson: Don’t assume that a client’s first offer is all there is.
Generally, newspapers don’t care which photographer shoots a job. They just want a warm body who owns a camera and can get the pictures to the paper on time. Newspapers want cheap pictures that are good enough to use.
On the other hand, most other types of businesses want good pictures at a reasonable price.
Newspapers will rarely negotiate unless they’re desperate. Even then, a verbal agreement over the phone is tough to prove if the paper reneges on its deal with the photographer, (e.g. the photo editor is on holiday when the photographer’s invoice arrives). This happened to me with a large, well-known wire service.
In all cases, if an offered price is too low and a better deal can’t be negotiated, unless the photographer is desperate for money, that photographer should not be afraid to say “no thanks.” Walking away from a bad deal is never wrong.
A photographer should never assume that if they start working for a low-paying client, that client will suddenly come to their senses one day and raise their rates. This will never happen.
Don’t be fooled by a client who promises lots of future work if the photographer just does the first, low-paying job today. Even if it was true, that would mean the photographer would be stuck doing more low-paying jobs in the future. Accepting low-paying jobs will only attract more low-paying jobs.
Being taken advantage of is never a good feeling. Practice saying “no”.
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For clients who want to negotiate, where does the photographer start?
Often, the photographer will send an estimate to a client and that becomes the starting point for a negotiation. Never assume that price is the only issue to be negotiated.
Before sending an estimate, the photographer should note, (only on their copy of the estimate), which items are negotiable and which are not, and write down a bottom-line price below which the photographer will not go.
What is negotiable depends on the assignment. It might be usage rights and/or photography services.
Expenses should never be negotiable. Otherwise the photographer ends up subsidizing the cost of the shoot. Never be afraid to tell a client:
“Expenses are non-negotiable. They cost what they cost. They can’t be changed just like you can’t change the cost of gas or the cost of a loaf of bread.”
Less money offered = less usage rights or less photography services.
If the client takes money away (i.e. wants a lower price), the photographer might remove some photo services. For example: a product photographer might offer to do two product shots rather than four; an event photographer might offer to do two hours of photography instead of four hours.
If nothing can be taken away by the photographer then possible options might include:
• Do the opposite and add options. If a client wants the job done for, say, a third less money, the photographer might offer to add some usage rights if the client sticks with the original price. The bold photographer might try to up-sell both usage rights and services, and ask for even more money:
Say a photographer quotes $900 for three business portraits and the client offers $450. The photographer might then offer to do six or seven portraits for $1000 and point out that it’s about the same $150/portrait that the client wants.
Sure, $1000 is more than the $450 the client has offered but now the client gets twice as much for the same unit price.
Or, offer to do the same three portraits for $900 but include a second delivered image per person.
Point is, try not to let negotiations come down to a single issue, usually price. If it does come to this then it can be a win-lose situation for both parties which is never good.
If it does come down to a single issue, try to add issues (e.g. more usage rights, more pictures, shorter delivery time, etc).
• Accept the assignment at the client’s lower price, (which means the photographer has lowered their photo fee for the job), if and only if the client adds or does something of value. This may not be possible in all cases. Don’t accept a lower price for no reason otherwise your pricing will have no credibility. If you’re in a corner, create a reason:
“Since we’re in the process of updating our studio equipment, we’ll do the job for your price if you pay us on the spot (or even a 100% deposit). That would really help us speed up our studio plans.”
Here, the client is getting a one-time discount because they’re helping the photographer.
• It may be possible to barter for products or services from the client. But this may not always be advantageous to a photographer. Keep in mind that Canada Revenue Agency changed the tax laws many years ago. Anything of value received by the photographer in exchange for services rendered is taxable.
Never barter for a credit line as credit lines are the law in Canada.
If you barter once with a client that client will always expect it again in the future.
• If a job might have great resale value, (and assuming the photographer retains copyright), the photographer might accept a lower fee. This is based on the gamble that resales will more than make up for the lower photography fee.
• Say “no” to the client’s offer:
“If we accepted that offer, we would lose money and no business can afford to do that.”
Unless the bank is foreclosing on your home, your kids are going to school barefoot or the electricity is being cut-off, no one is twisting your arm to take any job. It’s never wrong to walk away from a bad deal.
“It wouldn’t be fair to our other clients if we accepted this assignment at that price.”
If you charge $1,000 per portrait to your other clients then accepting a similar job at $500 is really a slap in the face to those other clients. Or maybe you’ve really been over-charging your other clients?
• Remind the client of the value of your photography. Point out that since they’re planning to spend thousands of dollars, or more, for a newspaper advertisement, a corporate sales brochure, a public relations campaign or a web site redesign, then surely the all-important photography is worth at least 3% (or whatever) of their budget.
Photography is the first and only thing that will draw readers. It’s the make-or-break pillar of their project. It’s the most valuable piece of the puzzle. Isn’t that worth at least 3% of their budget?
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Occasionally, a client may call asking, “We need some pictures of our new factory for our web site. Can you do it for $500?”
The photographer can’t (shouldn’t) answer without first knowing a lot more about what pictures are required and if web use is really the only intended usage. But what’s really happened here is that the client has thrown out the first pitch. A $500 pitch. Should the photographer swing at it?
When offering a price or starting a negotiation, it’s usually better if the photographer makes the first pitch by naming the starting price. Remember our friendly car salesperson who always throws the first pitch by pointing out the sticker price on the car windshield.
By quoting the first price, the photographer sets the ballpark in which they will be negotiating. But, this price must be chosen with some advanced thought. This is one of the reasons why a photographer should never quickly quote a price over the phone.
Remember that the right price is that which allows the photographer to cover their cost of doing business and make a profit.
If a photographer quotes $1000 for a job, the client may counter-offer with $500. The photographer is now negotiating in the $500 to $1000 ballpark.
If a photographer quotes $2000, the client may offer $1000. The photographer is now negotiating in the $1000 to $2000 ballpark which has much greener grass than the previous park.
Worse case, a photographer quotes $2000 and the client offers $500. The photographer is in the $500 to $2000 ballpark which may still be better than the first park.
Of course, there’s an upper limit to this. If a photographer’s first offer is much too high, the client may think the photographer doesn’t know what they’re doing or is just wasting the client’s time. The client won’t bother to counter-offer and will just walk away.
A photographer must have some of their own pricing policies ahead of time (and also have lots of information about the proposed photo assignment) to help decide in which ballpark they should be pitching.
But what happens if the client throws out the first pitch and it’s a perfect pitch? Do you just go ahead and swing at it?
No. Ask for improvements (remember: don’t assume the client’s first offer is all there is). If nothing else, at least offer to think about it and call the client back later.
If you accept the client’s first price right away, the client will think that they offered too much and will regret their decision. They might think that they aren’t really getting their money’s worth.
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Every professional photographer will lose jobs because either the client’s budget is too low or another photographer charges less. All businesses lose sales so don’t take it personally.
Negotiating is a simple concept which means it’s easier said than done. Your attitude often affects the outcome. If a customer asks for a lower price or other concessions, you might tell yourself:
• They’re trying to cheat me.
• They don’t respect me.
• They’re idiots who don’t know anything about photography.
In this case, you’re playing the victim card and will be defensive. You’ve assumed the worst before it’s started.
Instead try to change your inner story to:
• They need more information about my photography.
• We’re going to make a few changes in the job to get a positive outcome.
• They need help clarifying or prioritizing their photo needs.
Here you’re no longer a victim. You’re working with the customer and you’re (hopefully) more positive.
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Some final tips:
• The photographer is working with the client not competing against them.
• Listen to the client. Understand what they’re really saying.
• If a client pays less, they get less. If a photographer provides more, they get paid more. Do not accept less money for the same work.
• If a client names a lower price then the photographer should reply with something like, “Okay, let’s see what we can do for that price,” rather than, “Are you nuts? That’s way too low!”
• A negotiation is easier when there are many items that can be taken away. Know ahead of time what you must have and what you’re willing to give up.
• Learn to say “no”. It’s a strong, important word in any negotiation. Know your bottom line before you begin.
• Some negotiations will end with the photographer saying, “I’m sorry we couldn’t work out a deal this time. But please call me for your next photography assignment.” Walking away from a bad deal is never wrong.
• Don’t fall in love with a (proposed) photo assignment. If you do then you risk accepting a bad deal.
• At the start, try to find some sort of similarity between you and the customer, for example: “Oh, you’re a photographer too? What camera do you use?” Or try to complement the customer, for example: “I took a look at your new web site and it looks good, very modern. Getting new business headshots is a great idea.” This is always better than starting with, “What’s wrong with my price? I’m worth what I charge.”
• Perhaps you can plant a seed of suggestion, for example: “Past experience has shown that a customer will want a lower price only because they’re not aware of how much use they can get from the photos.” Or, “Of course we all want lower prices. But all my previous customers were happy with what they paid and what I delivered.”
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Inc. magazine’s section on negotiating has some useful information.
Harvard Business School has some articles on negotiating.
