Pricing Formula for Video Production
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- čas přidán 24. 08. 2024
- Adam Forgione shares how to price video production for your clients.
The formula is:
Filming
25% of full day rate is base rate
75% divided by 10 equals hourly rate
Base rate + hourly rate = filming fee
Editing
$100/hr
Pre Production
$100/hr
See part 2 - Q&A of this video
• Pricing Formula Q&A (P...
** Sorry for the occasional noise in the mic. I cranked this out quickly**
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Anyone else watching this in 2020? This is gold! Thanks Adam!
I have clients who roll their eyes even when they are charged 200 dollars for a whole video.
here in brasil is like this
@@oospagheti These are not the right clients for you then...
Jaldeep Tipale Those are definitely the wrong clients LOL
I just got my second client, and they asked if they could pay the 200 fractioned lol. Spain too XD
@@samuelvallecabrera8286 > Fractioned means ? You mean they wanted the sum split into multiple payments or they wanted to pay a fraction of that ? When you type on the internet and want people to read/understand, dont try to use ill matched words which clutter up what your trying to say.
Man! Kudos to you and your team for putting out content like this. Im starting a media company and film work is part of the services we offer, and this video couldnt have come at a more perfect time. Great delivery and content brother.
Love hearing these stories
One of the best pricing strategies I've found anywhere. I've simplified it as "first hour at $XXX, additional hours at $XX." with first hour including local travel time, setup time, administration fees, insurance, file archiving, equipment upgrades, and so on, based on an expected number of jobs during the year. Since I'm just starting out, and still have more to learn regarding camera movements, B-roll, and motion graphics, I'm basing my rates on generic professional rates (i.e. - graphic design, web design, etc.), which in my area are roughly $50 to $75 per hour.
Thanks Alan. Glad you were able to use this as a tool to customize your own rates.
4:38 - Nailed it! I usually like to quote day/half day rates and can easily explain how no project is really just 2 hours...
But when you explain your rates in an easy way like that - it's awesome.
haha exactly
Thanks Adam, makes sense. I really appreciate your education for our community.
That's called a formula. So good and very helpful.
Thanks for the kind words
This is fantastic. Thanks for sharing and being so transparent!
Amazing! thanks for being so transparent, cheers from Dominican Republic
Thank you for the kind words
This information is great. Very detailed and concise. Nice work. Very helpful.
Thank you Terence
This was AMAZING! Clear and concise. Thanks! Huge help!
Excellent video and advise. Big Thanks.
Awesome stuff Adam, Thank you!
Thank you
Oops forgot something. Insurance! Do you carry it and what kind. Me? I worked news so I never had to deal with it. Once again thanks, you’re a God send! This is exactly what I needed to see and hear!
You will most definitely need liability insurance. Many clients may require it. You'll probably want to explore looking into equipment insurance too. You can look for umbrella policies that cover all in one. Every insurance company is different. I am insured through Liberty Mutual currently via my local broker.
Select Music Library This was something is was very concerned about & you answered it on point I appreciate it very much. Have a good year & I’ll keep following you. Thanks again!
Very clear video! This is all I asked for. Thank you!
This is awesome. Super informative.
Incredible, helpful, and well worded/put together. Thank you!
I have just found this channel and this company - my god this was super useful even though I'm in the beginning stages of learning right now... THank you so much for the great content - you've gained a sub! Keep up the amazing work!
sounds like a solid Formula Indeed Great information always Good to know how other People Do it Brilliant
Thanks! This is great - And thanks for sharing!
Thanks, great information as always!
Very helpful! As a beginner one man guy, Rn I'm charging $35/hour for travel, filming and editing and an average job totals around 8-10 hours or so. I've done jobs that took 6 hours and jobs that have taken 18 hours TOTAL.
That being said I'm thinking about adding a Base rate of $125 for Small-medium jobs, and $250 base rate for medium - large jobs and then charge $40/hr from there on.
Any advice? or adjustments you think I should take? Feel free to check out some of my work.
I think adding the base rate is a great idea instead of a straight hourly rate for filming. As for how much to charge for base and hourly, that is subjective. The question is what is your time and talent worth and what are clients willing to pay?
Thank you. This was very helpful.
Hey great job! I'm hoping to expand and this definitely helps!
“Quit charging a day rate!” Two seconds later “Now my day rate is $3700”
Lol
Very informative video, would love if you can share a google/Excel sheet that breaks down the calculation. Thanks
Great! Thank you for clear and honest talk!
Thank you Valerii
Thankyou so much for this video you just changed the way I run my buisness
This is so helpful for production like us
Thank you
I still think day rates are the way to go. It’s one thing not to charge a full day rate for an hour long shoot, but to me it doesn’t make sense not to get your full day rate for a 7 hour shoot just because it wasn’t a full 10 hours. It’s not like you could book other shoots for that day in those three hours.
This is so helpful - why have I never thought of this :P
Great video. Thank you.
Should you tell your client about your Base rate?
duude! very good info! thank you! subscribing!
Thanks Taua.
Love this. Thank you!
Great stuff man.
Can you do a BTS on how you lit this video? It looks amazing
Excellent!
Great content
Fantastic formula. How do you go about invoicing? Do you invoice for the guesstimation and adjust at project completion or just invoice once it’s all said and done? We do 50% up front and final 50% before delivery. Curious how you handle payment with new clients with this type of formula.
We invoice 50% to book project,.50% due upon completion and client approval. Most of the times our estimates are accurate. If we think our estimates may possibly need adjusting, we will tell the client in advance and adjust accordingly keeping them in the loop as we see it about to change.
@@selectmusiclibrary9842 Thanks, that's exactly what we do. Just wanted to see if you handled that any differently.
Solid words.
Great info!
What is your cancellation policy or advice for charging client if cancel within 24 hours of shoot? Or just let that go if they want to reschedule (1 time only)?
This is excellent! I am curious as to how you got your $1,000 base rate. Does that factor in a certain percentage of the value of your gear?
Yes it does. specialty gear or extra rentals would be additional.
Interesting, but I think it only really works if you're charging top end. Myself for example, I wouldn't bother taking a job for less than £600 (just not worth the effort of kit prep and organising getting there and potentially losing other work that day etc) so I guess you could call that my base rate. But if I then started charging extra by the hour on top of that people who employ me now, wouldn't! I'm comfortable earning £600 for a days work, so to me it makes sense to have this as my day rate (8 hours), so in a sense it's £600 base rate and then 8 hours free. I wouldn't want to lower my base rate just so I can then divide a portion of that £600 into an hourly rate, as it would be a very low hourly rate and devalue me. A quick question as well, is your cancellation fee the same as your base rate?
Its designed to customize for any situation. For example, you can use this formula with your £600 (8 hours) and transform that into let's say £800 for 10 hours. Now you can use that as your 10-hour base rate. You can also give yourself a minimum (to book) rate of 4 hours as well. So in your case, it's £200 base rate + £60/hr with a 4-hour min. Which means if you get booked for a 4-hour gig, it costs £440 and it's £60/hr thereafter. If you wind up doing 8 hours, you charge £680 (more than you are now but still in the zone) but you now give the client two things... Flexibility to control their own budget + complete transparency PLUS if you go over an hour on the day of the shoot, you and the client are completely aware that you are on the clock and they know it will be another £60/hr, no questions asked. These factors alone will increase your booking probability over the entire year + you're now making more (you gave yourself a raise and rightfully so). In the event you get booked for a cheaper 4 hour gig that's ok because you may have made zero that day (losing out on the gig) because of your strict £600/day rate + you can also send one of your associates on that part day gig (make sure you have some profit for yourself of course) and only reserve 8 hour minimum days for yourself. This is only one method but you can change that initial £800/10 hour rate up or down and dial in your perfect formula. I hope this helps.
Do your clients pay in full upfront? What about deposits?
Im super late to this video😅 but I have a quick question, Is the base rate charged just for the one hour of a 10 hour shoot day? Like, the first hour is the base rate + hourly rate then after that its back to your hourly rate? Great video 👍
Thank you
Awesome! Question: How much does the length of the finished project factor in? A 30 second video vs. 2 min vid let’s say...
Typically shorter form videos like 15 or 30 second commercials have a higher budget than 2+ minute videos. Short answer, the length of the finished video is much less important in deciding the pricing than the content and quality expectations of the video. A 15 second commercial can easily be higher budget than a one hour interview video.
@@BARKERPRODUCTION Thank you!!! I wish customers got that, smh. When you attempt to explain that a 30 second video is much more effective that a 5 minute testimonial, BUT costs more, they don’t get it.
Quick question, when you say 2- camera crew and 3 person crew, are you referring to 2 cam and 3 cam shoot? Or 1 cam and an assistant or 1 camera and an AC plus gaffer? - i somtimes run solo so i have a full rate for that but sometimes i bring an AC and that's my 1 person + AC, and obvoiusly i charge more, but less than my 2 camera 2 person shoot
Good question. For us our crews are fairly multi tasked oriented so almost everyone is a camera op and can help with audio, lighting, etc. Because of this I treat each crew member the same when charging the client. Occasionally I will bring an assistant, etc. If I do, Ill charge a % of the full crew member amount. If you do this, just play with the percentage until it makes sense in regards to what you need to charge and what you need to profit from that crew member.
What would you pay a production asst. Someone to get releases, be a gopher etc. Speaking of releases can I get some releases online? Or do I need to go through an attorney? Your thoughts? Thanks for the info. This is a great video for neophytes starting a 2nd career also!
Hey Brian, I've heard different numbers for this but for me (based in New York) something in the range of $150-$200/day. You can easily get talent release examples online without an attorney. Something that simple is not a big deal. For a contract or SOW (statement of work) I would hire an attorney or get started with a relevant template and have an attorney fine tune it. Here is one of many examples you can customize yourself - gameis.us/film-release-form/film-release-form-template-then-example-talent-release-form-unique
Select Music Library thanks so much for this information very very helpful!! The transparency is refreshing!
In Washington D.C. the standard rate is $200/10hrs
how do you handle deposits on this pricing model?
There are many ways companies handle deposits. We require 50% of the invoice to book project and 50% due on the final delivery of the project. There are exceptions to this depending on the situation.
@@selectmusiclibrary9842 Awesome I do the same 50/50 structure. So when you send your client an invoice, all of your hours/crew hours are already calculated (educated guess)? They pay the 50% to book. Then if for some reason you don't utilize all of the hours your listed on the invoice, you adjust on the remaining 50% payment? Am I correct in that thinking?
The way you explained it, I got confused because of the hourly billing. If I don't know (100%) how many hours we will use, I can't give the client an accurate number until after the project is delivered. Therefore no deposit can be received. Hence my question. :)
@@VisualAnthony That is correct. It doesn't happen often but if we overestimate hours, we will adjust in their favor on the 2nd 50%. Also if things change and increase hours, we let them know so they are aware of if it's going to change the invoice. Also, We do work with some clients on an hourly basis editing only, so basically they know our $100/hr rate and however long it takes, it takes. We give them an estimated range of how many hours we think it will take (ex. 20-25 hours) so we know we are going to charge between $2000-2500 for that edit.
Great video! The only thing I am always wondering about is... how will the client know how long it took me to edit? I can say 4 hours but how will they know?
Phill Graaf usually the client will want an estimate of hours. This comes with experience. Let’s say you tell your client it will take 20 hours but in the end it really took 30 hours. You can eat the 10 hours yourself or you can tell the client it took longer than expected. Usually they won’t be happy if you went over your estimate. When you do this over and over you usually figure out how long your projects take to edit. A great idea is to always use ranges of time. Next time tell them it will take 25 to 35 hours and if you come in at 30 then you’re perfect. This is what I do all the time.
@@selectmusiclibrary9842 thanks for the quick answer! Makes sense :-)
Curious about how do explain the “base” to your clients?
Dani Croitor for our corporate clients we are full transparent. It's important they understand it costs money to show up. I think this is true for any vendor showing up with gear and experience ready to work. They love the simplicity of the formula and that they can control it.
Select Music Library I’m doing wedding and even that I have a few pre-made packages I’ve priced them according to the time I invest in pre-pro-post production. After I watched your video I plan to rethink the way I present my offer to my clients.
Still it is hard for me to find a good argument for my clients in order to explain the base price. It sound weird in their ears that I must be paid just to show up to their wedding.
I would much appreciate if you could give me a tip or two.
Some people would rather not mention base and that's fine too. It important to explain to the client your hourly rate is not linear though. Example to keep it simple. Let's say your team day rate is $1000. The easy answer is $100/hr for 10 hours, but it doesn't make sense to show up for 1 hour. If they ask, you should explain to them that they are not only paying for your time but your equipment and blocking you from filming another event that day. You can say that your pricing factors in a base rate to start the first hour and then it's xxx/per hour thereafter. This is very understandable. If the client still thinks you should keep it linear, then I would suggest considering them the "wrong" client. Everyone has clients that fit and does not fit their model. That's how I would handle that situation.
Select Music Library Thanks for taking the time answering
Here'es what I'm thinking... You can say your "base" has to be paid up front and doubles as a non refundable retainer for that slot booked.
also explain that it takes about an hour of commuting/setting up your expensive gear before the shoot.. that's time you're working/preparing for the shoot.
What about taxes? I was always told to charge what you think to make a profit and then double it to pay uncle Sam. Great video!!
Thanks. Of course we all have toconsider taxes. We know this works for us with the profit made but everyone has their own expenses so my numbers may or may not work for others.
It's better to know what the going rates are in your area. In other words, what the market can bear. Then you have to figure out how much work you need to do to pay your bills and your taxes as a freelancer. I found, as a freelancer, roughly 22%-25% was paid to uncle same because of deductions. If you're a business and incorporated (which we are) then we only pay taxes on the profit the business makes at the end of the year. If that happens, I'm excited because it means we had a good year.
how much do you charge for music on a client´s project?
I tell clients, "as a rule of thumb, music licensing averages about $100/song. I like to change songs about every 90 secs in the edit to keep it compelling." This will cover the license cost and time to find the song. Some may even want to add a few more hours for music search as well. Ive never had a client question this.
@@selectmusiclibrary9842 sounds good - maybe our stuff can help as well 👍
Adam how long do your corporate videos usually run? I'm trying to corelate your pricing with the length of a typical video. Also, do you ever price per minute or 30 seconds for video? Great info by the way!
All different lengths. Budget really has nothing to do with the length of video IMO. Think about it this way, how much did the last 30-second Pepsi commercial cost vs. a basic 30-second local store online video shot with one-camera? Same length, different factors with pre-production, production, & post-production. I know this is a dramatic example but its something most prospects should be educated on.
Wow, great content. Thanks for sharing.
I have one question though, you say your base price is say $950, and you have a shoot that it's more than one day. Do you charge this base price every day? or charge it only once for the whole shoot and then only charge the working hours?
Estanislao Allende Galluccio thanks. Yes I reset and charge base rate every day. It does not carry over to day 2
Can you explain this statement, it doesn't make sense: "They also know we're there for 5 hours. So we take the 5 hours, with a 2 person crew, and we know that's $2,325."
Thanks!
The formula for 2 person crew for 5 hours = $950 base rate + $275/hr x 5 hours = $2325
base rate is to show up, hourly is to pay you for the hours you work. The base rate concept is designed to make it worth shooting short or long days. Does that make sense?
Where does the $950 come from?
@@MRmediaiFilms ryt , everyone is asking , how much we will pay to crew but nobody is asking , how we get enough much to pay our crew and also for our profit too .??
Hey Matthew, $950 is approx. 1/4 my day rate for a 2 person crew. Knowing my full day rate (10 hours) for a 2 person crew is $3700, I allocate 1/4 to show up ($950), then I spread the other 3/4 over 10 hours. Basically, divide the remaining 3/4 by 10 and that gives me my hourly rate which is added to the 1/4 ($950 base rate).
Select Music Library ok, I see it’s approximate. How do you determine the value of the 3 crew member. When I did the math I was about $100 more than the number your were showing and considerably higher on the hourly.
2000 for editing!
$1000 to do nothing for a day? That's not a very competitive price. I can find people who will do that for $100
For junior filmmakers, that seems like an impossible amount of money
It depends on who your clients are. For a multi-billion dollar corporation, a few thousand for a single day video shoot is nothing.
1000 $ to show up and do nothing? Wow 🙂
Yeah I am confused by this part of the equation as well. What does this mean?
to me this is nonsens, sorry
This is how people can do this full-time. You don't have to charge as much as him. But the formula is solid. Why is this nonsense? I'm curious.
You confused me even more, if I knew my magic number I wouldn’t watch this video. Go watch the futur
This is one of the least in depth videos on the subject I’ve seen.
If you don’t tell people how to determine their day rate, this content is pretty useless
How can you track hours worked? is it just by trust?
Jamil Martinez do you mean how do you track your employees/contractor hours? If so I would say that if you’re not sure if you can trust them, I wouldn’t hire them in the first place. Maybe I misunderstood?
@@selectmusiclibrary9842 I've basically figured it out "mentally". But what I was asking was, if I (video creator) get hired by someone (employer) and I give them a quote saying that it will take me 10 hours(6 hours on set, 4 hours at home editing) to complete their video. Is the only thing that proves that it ACTUALLY took me 4 hours to edit, word of mouth? basically if it takes me an extra hour to edit than quoted with the employer is there a way to prove that it actually took me an extra hour of work or is it just trust based
Jamil Martinez ok I understand. So for us the filming rate is it’s own formula as mentioned in the video. So generally you and they will know how many hours it took to film since both of you May be together during the shoot. No surprises there. If we film less hours then planned, we actually prorate (discount) the original amount since we worked less. In regards to editing, clients generally want an estimate of how long editing will take. For example let’s say I told them it will take 15-20 hours to edit. If it winds up being less, I only charge for what time we spent. If we feel it will take longer than originally planned sometimes we eat the cost since we should have calculated the correct estimate and they may have planned accordingly. This teaches you quickly how to estimate editing accurately. If for some reason the the scope of work changed which increased editing time or the editing is just taking longer than expected and you want them to pay, you should let them know ahead of time (before you go over the time) so their expectation is met and you are on the same page. You never want to go over the editing estimate time and then surprise them with extra costs because they are budgeting for what you originally told them. They won’t want to work with you in the future. The goal is to keep long term customers and do the right thing always. Communication and meeting expectations is the key. Hope that helps.
Select Music Library gotcha, thanks for the response!