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Billing Procedures for Assignments

Just curious what other LS members are doing with their billing, since we all seem to be working in the dark a bit. For example, I have read several times that people are billing for processing times after the shoot—that is, they are billing clients for the time they spend tweaking and preparing the digital files after they have uploaded them. Now my limited experience so far with editorial clients is that they do not allow for such expenses. You are paid for the day(s) and working expenses, and that is about it. So is this a charge that is only paid by commercial clients?


Just thought I would kick off this thread to see if our billing procedures vary greatly and why, and maybe some thing will come of this, like maybe another tutorial that spells it all out for everyone. Comments dont have to center on processing charges, just whatever comes to mind.

by Jon Anderson at 2006-06-06 00:24:40 UTC (ed. Mar 12 2008 ) Back Home , Dominican Republic | Bookmark | | Report spam→

I would estimate the time to be spent editing the raw take and the toning of images as part of the fee that i would charge any client.It does take time to do this plus adding all the EXIF data. Not trying to be devious but your time as a whole together with the final usage of the images need to be taken into account when billing. There is no need to itemize every single element but they should be taken into account to have a clear idea. Also you have to take into account if you are going to agree with a day rate, which is a mistake in my opinion, you probably stand to lose if you don’t retain your copyright when the shoot is done.
We are photographers, not making sandwiches( no offense to sandwich makers, a noble task) In these time where everyone is trying to squeeze the photographers out there (myself included) and face it folks there are MANY photographers and someone will bite no matter how paltry the fees offered or the draconian contracts offered. We’ve seen it on this list.So add it all up and come up with a fee that you can live with. Also do your paper work, Assignment estimate forms are a great tool, have it signed and ASK questions before agreeing to the offered fee. That’s my .02 before taxes.

by Jaime R. Carrero | 06 Jun 2006 00:06 | San Antonio Tx, United States | | Report spam→
Agreed Jaime, but sometimes it is not possible: they give you a day rate, your expenses, and not much else. Now the day rate can be negotiable sometimes, but most magazines have a clear idea of what they can pay and that is that. You can sometimes negotiate extras like processing time, but sometimes not. Depends. And we are not talking about cheap little mags; on the contrary, I am talking Time/Life here. The contractual matters are one thing — I myself have never had to surrender copyright or even give way to outrageous licensing terms (but I have never worked for Natl Geo). I am just talking about the inevitable fact that day rates dont really cover all the work. Also, it is not so much a matter of being chiseled by draconian contracts or cheap bastards with paltry fees. No, the day rate is good, the licensing fair, all is in good order — except that some extras are not taken into account. Anyway, while I certainly agree that one should not sell out just to get work, or that one should give in to extortionate contracts, I really have in mind the high end magazines. It is pretty much impossible to say no to Time, Newsweek, Fortune, the New York Times, etc. We all need those credits on our resumés.


Mientras tanto, Jaime, ¡te felicito que ya te vas! No te vas a arrepentirlo. ¡que te diviertas! y cualquier cosa . . . ya tu sabes. a la orden aquí, en kiskeya la bella.

by Jon Anderson | 06 Jun 2006 01:06 | Back Home, Dominican Republic | | Report spam→
Not always easy, but at Magnum we try to impose a ‘digital processing fee’ AND a ‘digital rental fee’. I mean, before the client would pay for films and processing. So why wouldn’t he pay for the digital processing? For clients in Cambodia (and there aren’t many!!!) I charge 1,80$ per edited image. That’s peanuts compared to what the agency charges, but it is more in line with the local possibilities. Magnum tries to charge 0.50$ per (unedited) frame shot (film would have been 0,66$ per frame shot) and 50$ per day of assignment for the digital rental fee. At 100 days of assignment per year (I wish it was true) that’s 5000$, barely enough to recoup your investment of cameras, computer, software, sat-phone etc…

The trouble is that if everybody shooting digital had asked for this right from the start some five years ago, replacing the film expenses by the digital expenses would have seemed a natural thing to ask for. Today with a vast majority not asking for it makes it difficult to impose… And guess who is taking the benefit??? Well not the photographers..

by [former member] | 06 Jun 2006 03:06 | Paris, France | | Report spam→
from Editorial Photographers (EP)

A DIGITAL MANIFESTO
March 17, 2004

This document is also available as a PDF

Preamble

We have come to a great divide, a fork in the river. Now we face a decision that will affect both the future of our individual photographic careers and the vitality of our entire industry. We must choose not only which course to sail, we must also choose whose hand will be on the tiller, guiding our craft. And we must prepare for the journey before us.

The divide is digital, and we are arriving at it in growing numbers and at increasing speed. The future of editorial photography appears to follow this course, so most of us are acquiring the skills and equipment to succeed in this evolving medium. But who will guide our craft down this river? While we may be the captains of our own crafts, we must acknowledge that we have given far too much control in guiding our business course to our clients. How much can we charge for a day’s work, how much for the use of our cars, how much for a day of travel and our meals on the road? Our clients have largely dictated these monies, and we have gone along. That is how it has been for decades. And for decades our remuneration has hardly changed. In 1984 an editorial photographer might have been able to show a decent profit when the day rate was $350 and all his Nikons and Normans cost $7,000. The issues of how those fees were dictated, and who was doing the dictating, was not perceived as urgent. It is urgent now! In twenty years the creative fee at most magazines has increased approximately 14%. Consider two important facts: during that same period inflation has totaled 80%; and, during that same period our average equipment overhead has risen 1000%. One thousand percent! When corrected for the rate of inflation, our 1984 creative fee of $350 would now have to equal $630 just to keep us even. Instead, we are receiving just $400 from most magazines, a net loss of $230 per day in relative income. This decline in remuneration is dramatically compounded by our 10-fold increase in equipment costs. We can no longer afford to allow our clients to determine our course. As we begin charting the waters of digital photography, many of our clients are attempting to dictate the amount we charge for digital services. Some magazines claim a limit of $150 for digital services; some argue that they will pay nothing. The fact is that it is not our clients’ role to dictate our pricing; it is our responsibility to determine a pricing structure that will allow us to pay for our equipment and training, compensate us for the added work, and allow us to show a healthy profit to grow our businesses. As we face the huge financial investment of going digital, a cost that we will face not once, but approximately every 3 years to stay current, we must charge enough to cover those sizeable costs. We must charge enough to be profitable now and into the future. Our relationships with our clients are symbiotic. We need each other. We must consider this in determining our fee structure and find a mutually acceptable number. Despite some clients’ apparent disregard for the costs of our craft, we are better served by developing a collaborative relationship rather than an adversarial one. The individual editors with whom we work often are in the unenviable position of forcing policies set by others far removed from editorial processes. We should make every effort to educate and inform these colleagues, while being firm regarding our need for additional compensation for these expensive digital services. The more united we photographers are in approaching this matter, particularly in this evolving territory of digital charges, the fairer that compensation can be. While we may be unable to collectively establish pricing, we can share our individually established pricing strategies and adopt methods that facilitate our shared goals of becoming more profitable, more independent, and better able to meet our creative aspirations. We must share a unity of purpose if we are to succeed in improving our lot.

Strategies

While we are incurring significant costs to be digitally capable, acquiring the requisite technical knowledge to enhance and manage our images, and facing the added time burdens of digital post-production, many editorial clients are adopting the attitude that our invoices should be lower because, after all, there is no film and no processing. Some clients further argue that they will not pay special digital expenses because they do not pay for photographers’ equipment. While that claim is suspect in itself, that is not the point of digital charges, they are in large measure production expenses. Digital charges, just like mileage reimbursements or film & processing charges, reflect production costs. Clients aren’t paying for our cars, but rather for our costs in using our cars on their behalf. Likewise, when clients are billed for film & processing, they are paying for the costs of producing their specific job. It is not only fair; it is financially necessary that clients pay for the specific production costs related to our assignment work. We must realize that our digital equipment is expensive and has a short lifespan in terms of being current and competitive. A basic digital set of two professional SLRs, several lenses, dedicated flashes, laptop, card reader, memory cards, desktop computer, software, monitor, printer, and CD/DVD burner, will cost approximately $20,000 to $60,000. That equipment, in order to remain technically current and keep you competitive, will need to be replaced every 3-5 years, some much sooner. Comparatively, a basic film system for editorial work would likely cost under $20,000 and would likely remain current and functional for 10 years or longer. So here is the comparison: $20,000/10 years = $2,000/year average cost if you’re shooting film $40,000/5 years = $8,000/year average cost for digital While we’re investing $20-60,000, we are also faced with possibly losing the significant revenue stream we were receiving from our film mark-up. This has been particularly important while our creative fees (née day rates) have languished unchanged for more than two decades. For even a small-timer in terms of mark-ups, that amounted to an average of $5000.00 per year in cash flow, which has helped offset rapidly rising overhead expenses. Faced with greater expenses and falling revenues, we must return balance to this equation if we are to survive. Often how we label a production charge determines if the accounts payable person flags it or pays it. For example, just utilizing the term “digital production charge” and placing it below the line amongst expenses may be more successful than labeling the same amount as a “digital service fee.” Some clients may appear unwilling to budge on the issue of digital charges. However, we can often invoice an equipment charge as a production expense in such cases. This has long been the billing method used by film and video freelancers, and it is a paradigm we must consider. We have two basic strategies, both of which can be combined or modified to suit our own preferences:

The Prix-Fixe approach (better known in the USA as “The Full Meal Deal”)

Utilizing this strategy, the photographer rolls many additional digital charges into one line item, often called a “Digital Production Charge.” This may include, at the discretion of the photographer and the acquiescence of the client, equipment charges, digital capture charges, and even CD’s, DVD’s or FTP uploading. With such a broad approach, one would expect a higher “digital production charge” than one levied by a photographer who itemized the individual charges (e.g. equipment rental, per image digital capture charge, media burning, etc.) Please note, however, that extensive post-production is intensive and time-consuming. For that reason, consider carefully any inclusion of such services within a single line item on your invoice. Please note that labs and other editorial photographers frequently charge in the range of $100-$200/hour for such services.

The à la Carte approach (or “Would you like fries with that?”)

Some photographers and clients will prefer a clearly itemized set of charges. This might allow the most frugal clients with the simplest of needs to feel fairly served by only getting what they are paying for, while allowing the photographer fair compensation. For example, one might not charge an overall digital production charge, but itemize your costs utilizing such job-specific charges as digital capture, equipment charges, and media production time and costs. Following such a strategy, charges may include (but are not limited to) some combination of the following:

• Your usual creative fee
• An overall digital production charge
• A per unit digital capture charge
• Equipment rental (camera, computer, card reader, etc)
• Image conversion charge
• Retouching (Photoshopping)
• CD/DVD/FTP production charge
• Contact sheets (inkjet, etc)
• Reference prints (inkjet, etc)

Survey Results

Following are some of the aforementioned categories and a range of charges, followed by the averages from a 2004 photographers survey. As mentioned previously, not all categories are charged by every photographer. The objective, however, is the same: fair compensation for the added services and equipment we provide when shooting digitally. It is worth noting that these added services reduce our clients’ own post-production costs: no need for scanning technicians or lab techs, for example. Further, there is a growing number of “digital assistants,” who charge $300-$400 to help photographers transfer, caption, convert and archive. We should not be expected to provide the same services at lower rates just because it is our own photography. Having surveyed numerous photographers, a variety of methods and categories for digital services have been revealed. Here is a list some of the general costs and services for which we should be compensated:

• Production equipment (cameras, lights, etc)
• Postproduction equipment (computers, printers, card readers, scanners, monitors, burners, etc)
• Reusable media (memory cards, which will eventually need replacement)
• Consumable media (CD’s, DVD’s, prints, digital “Polaroids,” inks.)
• RAW conversion, digital downloading and basic file prep
• Postproduction refinements and enhancements (Photoshopping)
• Contact sheets and web galleries
• CD, DVD and FTP delivery
• Archiving

Please carefully note that the following survey results are for editorial work in 2004. Commercial, corporate and advertising charges are usually considerably higher.

Digital Production Charge

A basic charge that helps cover the added expense of the equipment and cards. This flat charge usually is in lieu of a per-image digital capture charge (see next item). Photographers at the low end of the Digital Production Charge spectrum occasionally include separate equipment charges, CD burn charges, etc. $200 – $850 per day

Digital Capture

This is a charge for every picture shot digitally. It equates to the cost of film and processing, a production charge many editorial clients understand and are comfortable with. As mentioned, some photographers in our survey use this line item in lieu of the previous “digital production charge,” billing in the range of $200 -$500 for the first 50 captures and incrementally lowering the rate as the number of captures increase. Some photographers use the following delineation when itemizing this expense: Fewer than 50 Captures (base minimum): $250 Up to 100 Captures: $300 Up to 200 Captures: $400 Up to 400 Captures: $750 Up to 500 Captures (base maximum per day): $850

Image Prep

Basic downloading and conversion from the camera’s memory card to a readily accessible format, such as TIFF or JPG. It is not to be confused with more detailed post-production enhancements. The respondents who included this category often did so in lieu of a digital service fee or a digital capture charge. $10-$75/image

Final File Prep

Any post production work beyond basic downloading and uploading.
$100 – $200/hr
CD burning
$25 – $35
DVD burning
$35 – $75
FTP uploading
$25 – $100
Equipment charge
$150 -$500/day

Of the respondents to our survey, the photographers having a low “digital production charge,” which may be at the insistence of the client, added this expense. This line item has long been a critical component of other equipment-heavy visual media freelancers, such as film video cameramen. As our own investments approach similarly stratospheric levels, we may be wise to reconsider this paradigm.

Contact sheets, prints and digital Polaroids

$200 for Digital Polaroids
$15-25 per contact sheet or straight reference print

Conclusion

It is clear that we are being pressured by clients who are insisting on digital while resisting paying for our added work and investment. It is also clear that if we are to survive, we must make a stand by insisting on added payment for our added services and expenses. Our suggested pricing which follows is in 2004 dollars. These figures need to be increased over time to reflect both inflation and rising equipment and production costs. Once again, note that these are for editorial projects. DIGITAL PRODUCTION CHARGE: $300-$1000/day CD burning: $30 -$50/disk DVD burning: $50 -$75/disk FTP uploading: $75 -$150 Digital (inkjet) contact sheets: $20 -$50/contact sheet Inkjet reference prints: $15 -30/print Digital post-production: $150 -$200/hour Let us remember, and let us remind our clients, that all these added services are for their convenience and that convenience comes with a price. Simply because we are now charging our clients for the higher production costs of digital does not make the charges less valid. Further, our efforts and investments in digital technologies decrease our clients’ production costs. We must take action now, while policies are still evolving. If we fail to assert reasonable compensation structures, we will soon find ourselves unable to afford to practice our craft. That will benefit neither ourselves, nor our clients.

www.editorialphoto.com

EP Digital Manifesto – PDF

EP Home page

by [former member] | 06 Jun 2006 05:06 | New York, United States | | Report spam→
Yeah, now that is what I am talking about! Thanks John and Tim. Btw, digging out that article from EP is a great boon. Excellent detailed advice.

by Jon Anderson | 06 Jun 2006 11:06 | Back Home, Dominican Republic | | Report spam→
Apart from not billing for our costs – by charging a post-production fee which covers the cost of our time sat in front of the Mac processing images AND the cost of the Mac itself, not to mention the cameras etc…

…we’ve also failed to grasp how we should be billing in a digital marketplace.

We should calculate fees not based on shooting time, but on our working costs and how the images will be used. It’s important to establish this first off, because digital images are so mobile and reproducable across many media, that often the only protection we have against widespread image infringement is a written agreement about specific usage. Go to any major digital RM stock image portal and the first question asked before a fee is calculated is “how are ya gonna use the image?”

Shooting time doesn’t really come into it – that’s already happened, and has been factored into the fee anyway. The fee is based on:

1/ A bottomline basic fee for every image licensed which covers their running costs.

2/ An additional fee which changes according to usage – what are the images used for and for how long? Exclusive or non-exclusive?

This is the single fee the client pays. A taxi driver doesn’t give you a breakdown of “fuel costs, plus the cost of the meat pie I ate for lunch, plus the fare”. He simply gives you the fare – but it includes his costs, and your usage (the journey) in one easy to grasp fee.

Stock portals bill on how the images will be used, and a license is drawn up accordingly.

The license stipulates how the buyer can use the intellectual property they’ve just licensed. The client needn’t know or care how long it took to get the image. Its already factored in and is kinda irrelevant. They just need to know what the fee is. How you break it down in your office is your own business, but if it isn’t being broken down to cover your costs in the first place, you’re killing yourself.

If you actually know your business costs to begin with, and the fee offered is too low, you know the job is literally not worth getting out of bed for…or is only worth doing if you can recoup your costs in secondary usage.

Either way, at least you’re working from a plan, and not the amorphous ‘pull a number from the air’ way a lot of photographers seem to work…a lot of broke photographers.

We need to ask how the client intends to use the image and bill accordingly. Billing on a simple time basis, and not usage means the client equates your value, and the images value, with time…and so do we. But it’s not how long it took to get the image which determines it’s value, but how its gonna get used – in other words, what the images value is TO THEM.

We can probably all name and shame clients who gave us a day rate, then used the images in print, on the web, as a poster, promo card…you name it. But often they simply worked on an assumption that they could use images like this (especially clients not used to commissioning photographers), because we failed to lay down the stipulations beforehand.

It’s often because we’ve been willing to work this way, that many clients largely assume they can use pictures any way they like after just paying a dayrate. Some clients I’ve dealt with even express surprise when I politiely remind them that this isn’t the case. But this assumption on their part is largely due to our failure to change billing practice as tehnology changed.

So billing should be based on:

1/ Your baseline costs of running your thing, along with any (mutually agreed) additional costs, like hiring specialist equipment, assistants etc.

2/ The usage of the images. Print? Web? DVD? Flash fee in a TV progam? Editorial use? Advertising use? How long are they gonna be used for? Exclusive or Non-Exclusive? Different fees for different uses – license drawn up at the comissioning stage. It can always be amended with additional licenses (and fees) later.

3/ The costs of post-production – unit costs agreed beforehand (i.e processing costs per image) and based on the clients order. For example you can offer a discount for bulk purchasing.

by [former member] | 06 Jun 2006 13:06 | London, United Kingdom | | Report spam→
There is a guide published by the NUJ in the UK (http://media.gn.apc.org/feesguide/index.html).
I’m South African but I try to apply this guide here and it seems OK.
Educating your client about the way things work now is the most important thing to do. They need to know what it takes to give them what they want!
I think there should be an international rate card guide ’cause we are living in a global village more.

by Willem de Lange | 08 Jun 2006 08:06 | Port Elizabeth, South Africa | | Report spam→
I read that EP article a couple of years ago and it changed my life. I suddenly felt a lot more confidenc in my billing procedures and that confidence helped get more jobs shot and paid for. We do need the magazines and vise versa and we need to do our best to educate those magazines about how this works. The problem is there is always a rookie willing to shoot for free just to get a foot in the door. That has driven the value of work down over time. In the long run there might not be anyone left who can afford to do our work. Teh magazines will be just as hurt by this as us. Every job we do at a reasonable pay rate actually adds to teh lifespan of our industry.

by Michael J. Mc Crystal | 10 Jun 2006 12:06 | Tampa, Florida, United States | | Report spam→
Harumph. There was a time….. … when day rate meant the MINIMUM you would be paid even if they did not run your article/photos. But if your work was published, then you got the PAGE RATE which was more generous than the day rate which came with tear sheets and bragging rights to boot.

Best policy for today’s conditions: Figure out how much you need each year to keep your lights on, insure and replace your equipment, and fund your retirement. Divide by the number of days you will likely work each year. This is your day rate. Refuse any job that pays less than this number. If you charge less than this number, you are VOLUNTEERING and you’d better get something good out of the deal, like a nice portfolio piece or business contacts or a happy inner glow. Otherwise you are subsidizing somebody else.

I know this sounds horribly grumpy and crotchety, but anyone who does not get a handle on their finances had better learn to sell shoes.

By the way, the “digital manifesto” is fabulous. I will print it out and use it for my own estimates.

by Warren Leimbach | 24 Jun 2006 00:06 | Tampa, FL USA, United States | | Report spam→
Harumph indeed WCL, you are quite right. Thanks everyone for contributing. I wasnt aware that this thread had received so many good posts, because the email notification doesnt always work. I will, as usual, take all this and turn it into yet another LS tutorial, along with links (the EP link is great, thanks Timothy), and of course credit to all the contributors. Should be done by end of the weekend.

by Jon Anderson | 24 Jun 2006 00:06 | Santo Domingo, Dominican Republic | | Report spam→

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Participants

Jon Anderson, Photographer & Writer Jon Anderson
Photographer & Writer
Ocala Florida , United States
Jaime R. Carrero, Photographer Jaime R. Carrero
Photographer
(Independent Photographer)
Puerto Rico , Puerto Rico
Willem de Lange, Photographer Willem de Lange
Photographer
Johannesburg , South Africa
Michael J. Mc Crystal, Freelance Photographer Michael J. Mc Crystal
Freelance Photographer
Key Largo, Florida , United States
Warren Leimbach, Photographer, Photo Assis Warren Leimbach
Photographer, Photo Assis
Tampa, Fl Usa , United States


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