How to Set & Negotiate Your Video Production Rates
Every freelancer needs to know how much they should charge for their services and how to negotiate with clients. Whether you just graduated film school or are a seasoned video journalist, you shouldn’t be expected to accept unfair pay. While not all clients have flexible budgets, you must be able to recognize, avoid, or counter low offers. And if you’re skilled at what you do, you have a lot of bargaining power with clients looking for high-quality work.
Setting Your Production Rates
If you don’t know what your work is worth, then you might ask for less than you can afford. While we set minimum rates for each service offering on Storyhunter, it’s hard for a global industry to establish a standard or calculate average costs. Freelancers’ rates generally factor in experience, market, production type, gear, client type, and more — all of which may vary widely around the world. So to figure out your personal rates, you need to examine what your own costs of doing business are and what the competition in your area is charging.
On a spreadsheet, itemize everything you purchase for your freelance or production company on a yearly basis, your personal cost of living, your taxes, and your desired savings, and then divide this by the number of days you expect to work each year. This will give you an estimate of what your minimum day rate needs to be.
While estimating your expenses, you should ask yourself these questions:
- Will you charge for pre-production, such as concept meetings, research, scripting, scheduling, or set-up on the day of a shoot?
- Camera gear is expensive whether you rent or own. Can you recoup these costs in your production rates?
- Will clients ask for multiple rounds of edits? Will you charge more if you originally agreed on three edits with a client, but later they ask for more?
- Do your clients have particular post-production requests for audio, motion graphics, or color-grading?
- Will you have to travel?
- Will you have to hire other videographers to help on your projects?
- Will you be expected to purchase and send hard drives with footage?
- Do you have to pay for gear insurance, health insurance, or other production insurance?
- Do you spend money promoting your business or finding new clients?
- How much will you need to set aside for filing taxes at the end of the year?
Plus, you will need to decide on a project-by-project basis whether to charge hourly, day, or fixed rates. When working on a fixed rate basis, determine how much you should charge by working backwards from your day rate. And if you decide to work hourly for a client (many editors do this), divide your day rate by the number of hours you typically spend working on a regular day.
Knowing When to Say ‘No’
One of the most important rules of negotiation is to be ready to say ‘no’ to an offer and walk away. However difficult it might be, you shouldn’t agree to work for a client for less than you’re worth — unless you believe it will lead to a long relationship that brings in plenty of work where you can make up the loss. By saying no, you will be able to protect your time, and the client will learn the actual value of their project. If they appreciate your work and unique skills, they will often give you a new offer.
The Counter Offer
When a client lowballs you, but you don’t want to completely walk away from the job, make a counter offer. Break down each of your expenses for them, so that they understand why you are asking for more and why you can’t afford to take anything less. Let them know that you really want to work with them, but that you will be losing money if you go below a certain rate.
If a client simply cannot offer you any more for a project, but you want to work with them anyway, then negotiate for more rights. Ask if they’ll let you keep the rights to the footage or the story, so that you have the option to sell the same material again. Or ask for the client to credit you in the video or refer you to their partners, so that at least your name is getting out there to potential clients.
*A note about working on ‘spec’ or for below your minimum:
When you charge too low, or worse, shoot for free, you are devaluing the market and making it difficult for both you and other creators to charge a living wage. If a creator would normally charge $5,000 for a job, but you offer to do it for $1,000, you make the value of that work plummet and let clients get away with lowballing others.
What other tactics do you use to set or negotiate production rates? Tell us in the comments below!
Want to get more insights into the video production and media industry? Sign up for our newsletter here!
By D. Simone Kovacs, Storyhunter Editor