How open to be about how I price commissions.

[mokka]

I'm setting up a business as a commercial photographer and was wanting to know if anyone had any useful advice about how open I should be about my prices.

I've looked at my competitors in my local area and sent them e-mails posing as a potential client to ask for a quote for a typical commission. I've set my price so it falls around the middle of the range (having excluded those whose estimate of how much work the commission would involve was clearly wrong).

In general, my local competitors either don't advertise their prices at all, or say something like 'prices for full commissions start at...'. I've been on a business course where the tutor also advised us to not show our clients how we calculate our prices (or they will dispute it), and not to say 'prices start at' either (or they will be disappointed when you include things like expenses and the actual quote turns out to be higher than expected).

However, I'm producing flyers and keep reading advice on websites about marketing that say 'how much will it cost?' is one of most important questions customers want to know, and should be made clear in your marketing.

What do people think? I'm leaning towards not displaying any pricing information at all, if only because it's what all my competitors do, but don't want to make a mistake here.

[andyw]

There are a 10001 ways to price and how you show this.

For the vast majority of commercial commissions you will be quoting for the work first anyway and for that you would need to know all the details of the job and final usage.
You then give a quote based on that and how detailed you get is upto you.
If you do not include enough detail then (some) clients will query how you arrived at the figures.
If you put everything in there then again (some) clients will start querying individual items.

Whether you show any sort of pricing on your web or literature is upto you.
I show basic pricing but stress that full quotes are given and things like licensing can only be quoted after negotiation and knowing what the job is for.

There is no set formula.
If you show any pricing it may put of some potential customers as they may feel you are too expensive (or even to cheap).
If you don't then again it could put people off who might think your pricing will be too high or that you are trying to hide something.

Only you can say what might be best for you and your potential client base.

Personally I think not showing pricing will get you a lot of queries which won't go anywhere but that is just my experience.

Showing pricing might mean you miss out on some who you may have been able to accomodate but did not call because of the prices shown.

There you go - lots of words, which summed up could of been done with - It is entirely upto you how you go about it.

[mokka]

Thanks. I should add that I'm happy with the prices I've set. They cover my overheads, pay me a wage and fall in the middle of the range.

Having read your comment I'm still leaning towards not displaying it. As mentioned, none of my competitors display their full pricing structure, so if anyone in my area wants a commercial photographer they'll have to ask for quotes and compare them anyway. I don't think I could possibly gain too much by being the one photographer who does display them all.

As for 'prices start at'... I think the safe choice for me is to not bother, because there is still too much uncertainty over whether this will put people off. That perhaps, even if my price is the same as a competitor, the customer may see my price as a poorer deal because it wasn't as low as they expected, because of all the other factors which mean you rarely actually get the 'base' price.

[Brian Mullins]

Hi Mokka,

The rules of the road, from my experience go like this:

No pricing = a higher # of inquiries, but less qualified. You MUST be good at selling yourself.
Starting Price = more qualified leads, less inquiries overall but you can sell yourself for those on the cusp.
Full Price = few inquiries but almost all of them are fully qualified.

Play where your strengths are. If you are really good in sales then no pricing or starting at is a good place. If you are not good with sales then perhaps a full price list will be a good place to start. Just track your results and see what works best for you.

On a side note, my personal opinion on "posing" as a client is it's a pretty nasty technique. You are wasting the time of other photographers with inquiries and, honestly, if I found out, as a photographer, you had shopped me, you would never get a referral if I was booked. Remember clients can come to you from many different ways. I'd be willing to bet that many photographers would be happy to give you some pricing information if you just asked.

[mokka]

Thanks... so in anyone's opinion is there any foundation in my fear that by giving out a starting price I'll be putting off clients who are disappointed when my quote isn't exactly that?

As for mystery shopping...

I'm putting together a business plan as part of a business start-up course which might get me a grant and they pretty much said we had to mystery shop our competitors in order to see what they looked like from a clients point of view or we wouldn't get the grant as they would doubt how reliable our evidence was. It's not just about finding prices but seeing how long it takes them to provide a quote, how well worded the quote was etc.

The way they put it was, it may be a bit underhand but your competitors will certainly be mystery shopping you once they see they have a new competitor so you just gotta 'play the game'.

I think it kind of goes against the camaraderie (or should that be CAMERAderie) that photographers typically have, we're not used to seeing each other as competitors; but this was about business and my advisors (and any banks I apply to for loans) won't care about cameraderie, they want to see evidence that I can run a successful business. In fairness there are lots of other traders that manage to compete with each-other and yet still get on well with each-other.

[OsmosisStudios]

Originally Posted by Brian Mullins

On a side note, my personal opinion on "posing" as a client is it's a pretty nasty technique. You are wasting the time of other photographers with inquiries and, honestly, if I found out, as a photographer, you had shopped me, you would never get a referral if I was booked. Remember clients can come to you from many different ways. I'd be willing to bet that many photographers would be happy to give you some pricing information if you just asked.

Complete opposite opinion, from experience. WHen I was first starting out I asked a few local photographers some pricing and business-related questions: Stone walled. Not just no response, but even when discussing in person I got "sorry, but no". Posing as a client, by e-mail or by phone, doesnt waste any time: it takes maybe a half hour that the photographer is likely used to dealing with if they have no pricing set on their website or literature. You said it yourself: if you dont post pricing, you'll have a LOT of inquiries. These photographers had no pricing; therefore they get lots of inquiries. One more wont kill them.

[Brian Mullins]

Originally Posted by OsmosisStudios

Complete opposite opinion, from experience. WHen I was first starting out I asked a few local photographers some pricing and business-related questions: Stone walled. Not just no response, but even when discussing in person I got "sorry, but no". Posing as a client, by e-mail or by phone, doesnt waste any time: it takes maybe a half hour that the photographer is likely used to dealing with if they have no pricing set on their website or literature. You said it yourself: if you dont post pricing, you'll have a LOT of inquiries. These photographers had no pricing; therefore they get lots of inquiries. One more wont kill them.

We'll agree to disagree on this one. I know it may take some work for you to get pricing, but it's certainly not fair for a new photographer to take the "easy" way out and lie about their intentions when asking for pricing. It comes down to ethics for me... if you want to look at business in a "me vs. them" mentality, then by all means that is your prerogative. However when you can get 25% of your business from referrals, that is too much business & revenue for me to risk by being unethical.

[andyw]

Originally Posted by mokka

Thanks... so in anyone's opinion is there any foundation in my fear that by giving out a starting price I'll be putting off clients who are disappointed when my quote isn't exactly that?

Not in my opinion. If your customers have a modicum of intelligence they will be able to tell the difference between "starting price" and final cost.
You need to make sure in negotiations that you are open with extra costs.

Originally Posted by mokka

As for mystery shopping...

Never done it myself. I have my pricing based on what I want not on what others are charging. If I find out that people are charging less then good luck to them. I know what I need and want to make.
If people are charging more - again good luck to them.

I have had people call me and it was obvious they were other photographers checking on pricing and services. I will give out my day rate but I ALWAYS ask for (insist on) a face to face meeting with potential clients so they soon hang up anyway if they are not genuine.

What happens if you find out that everyone else is charging 25% or more less than you for the same work?
Do you reduce your prices accordingly and potentially bankrupt your business or do you market yourself better to "justify" being the most expensive in town? I know what I would do.

[Brian Mullins]

Andy, thanks for posting that. You really hit it on the head. Getting market information is certainly great, just to see how you stack up, but at the same time, your pricing needs to be reflective of your expenses, overhead, profit, etc. If you see my price is $3000, but have no clue about what my overhead, expenses, etc are, then you really only know that price. If you decide to undercut me @ $2000 to "gain business", without knowing that information about your own company, it's a very quick way to fail.

[andyw]

Brian,

Yeah that's about it really, obviously it is good to know what others are charging but I would never base my pricing on that.

I have had people who are trying to start up ask how I can justify my prices (which are certainly not high for my markets/area). They tell me they only charge x or y and make a profit.
That is great until you go into it with them a bit deeper and they realise that if they actually do it full time then they will have to charge 5 -10 times more than they are.

I am in London so there are loads of customers from the multi nationals with very deep pockets through to the small businesses with very limited funds so there is a market for all ranges of photographers. Therefore it is not so important to pitch at the same rate as everyone else.

I guess in smaller towns/markets then it does change things a bit but I still believe you should be charging what you are worth (or need) yourself and not just price the same as the competition.