Photo Biz: Do Your CODB to Create Your Pricing

I was talking to a photographer friend of mine last night she’s always asking me for pricing advice. I usually tell her to charge her daily Cost of Doing Business (CODB) and then mark it up from there based on the scale of usage.  She told me she’s never calculated her CODB and I scolded her big time. I told her they next time we meet, we are sitting down and doing this together. As I refresher, I thought I would write this blog post and hopefully you find it helpful.

Being in business as a photographer, you have to know your CODB, because that’s how you set your Baseline Creative Fee (BCF).  If you take jobs that are below your CODB, you are operating at a loss. You should also do your CODB every year to make sure you’re staying on track and to set sales goals.

In a very simple formula, this is how you calculate your CODB:

(YOUR SALARY + YOUR EXPENSES) ÷ SHOOT DAYS PER YEAR = DAILY CODB 

Fortunately, there’s an easy way to calculate your CODB and it takes less than 30 minutes to do. You will need two things: Your Profit & Loss Statement from last year and NPPA’s Online CODB Calculator. If you use accounting software like Quickbooks (PC / Mac) or AccountEdge (Mac), it’s really easy to generate you P&L report. Make one and print it off. Then click over to NPPA’s Online CODB Calculator.

For this exercise, I’m using some numbers that I would consider to be average for an emerging photographer in a medium market (i.e. not NYC or LA) and is making a living solely from their photography. This photographer wants to make $50,000 a year, has a small office, no employees, no family to support, and someone who shoots a mix of editorial, commercial and stock. Let’s assume they will shoot 50 billable days in a year (that’s around 4 shoots a month).  Here’s how there CODB breaks out. Note: CODB should be calculated on business expenses, not shoot expenses. So leave out any reimbursed expenses like assistants, travel, food, etc.

Click to Enlarge

If we plug these numbers into our formula, it looks like this:

($50,000 + $44,930) ÷ 50 = $1,798.60

$1,800 is their CODB. So, if this photographer shoots any job that pays less than $1,800, they are losing money. Pure and Simple.

So, now that we know the photographer’s CODB, here are some methods to create a fee structure.

Creating a Fee Structure Based on CODB

It’s been my experience that every assignment is different and your fees need to flexible to accommodate the needs of the job and your client’s budget. I have found three good ways to create your creative fee:

  1. A Day Rate
  2. A Sliding Scale Per Shot Rate
  3. A Project Rate

There’s no one way that works better than another. If the number of shots is very specific, a per shot rate works best. If the number of shots is unknown, but you’re going to be on location for 10 days, then a day rate is more suited. If the shoot is documentary style project where you’ll be shooting a small number of times over various weeks, then a project rate makes more sense.

Using the example photographer’s CODB of $1800, your Baseline Creative Fee (BCF) would be:

  1. $1800/day
  2. $450/shot*
  3. $1800+/- project

The day rate is pretty straight forward. You shoot three days, you charge for three days. The project rate is trickier to figure out because you have to predict how much time you will spend doing the project. Make sure you get as much info before you start shooting. *The per shot rate would get very expensive if you did 20 shots in a day. So, that’s why I do that on a sliding scale:

Price Each Rounded Range
1-3 Shots $450.00 $450 $450 $1,350
4-9 Shots $315.00 $325 $1,300 $2,925
10-14 Shots $252.00 $250 $2,500 $3,500
15-20 Shots $226.80 $225 $3,375 $4,500
21+ Shots $204.12 $200 $4,200+

Using any one of these methods is how you create your Baseline Creative Fee (BCF).

Baseline Creative Fee + Usage Fees

I like to think of the BCF as your local rate. The usage included with that rate would be something like the following:

Use in any marketing materials distributed to a targeted audience. Includes use in printed brochure, catalog, annual report, public relations and sales material. Also includes electronic (PDF) versions of the original printed uses. Use in any web and electronic media for advertising and promotional purposes including website, web banner ad, promotional email and mobile ad.

Side note: check out PLUS Packs if you need help writing your usage terms.

The usage above is basically everything a local client is going to use your photos for. If they do advertising as well, you may want to charge a little more, like 10%.

There are four basic types of clients: Local, Regional, National, and Global. Here’s how I would handle the usage fee markups based on a BCF of $1,800.

  • Local Web & Marketing Usage: $1,800
  • Local Ad, Web, & Marketing Usage: $1,800 x 1.1 = $1,980
  • Regional Web & Marketing Usage: $1,800 x 2 = $3,600
  • Regional Ad, Web & Marketing Usage: $3,600 x 1.5 = $5,400
  • National Web & Marketing: $1,800 x 10 = $18,000
  • National Ad, Web & Marketing Usage: $18,000 x 1.5 = $27,000
  • Global Web & Marketing: $1,800 x 20 = $36,000
  • Global Ad, Web & Marketing Usage: $36,000 x 1.5 = $54,000

So, there it is in a nutshell. Please remember, this is a guide and it’s more to illustrate that doing your Cost of Doing Business is vitally important to being in business. Use this example as a way to wrap your brain around what your creative fee should be and why it costs more for Pepsi to use your photos than it does for the local mom & pop shop. There’s always room to negotiate, too. Don’t live and die by these numbers.

I will say that ever since I standardized my pricing, I’ve gotten more jobs that pay better. It’s also made creating estimates a lot easier, because I charge what I need to charge to stay in business. I also feel good about passing on jobs that don’t pay my CODB, because that gives me time to market to jobs that will pay 10 or 20 times my CODB.

Have  a great weekend and DO YOUR CODB!!!

Announcing Representation by 1Notion

I am very pleased to announce that I am now being repped by Adam Renfree of 1Notion. I have joined ranks with fellow photographers Erin Kunkel, Woods Wheatcroft, The Hendershotts, and Colin Erie.

1Notion represents some of the leading advertising photographers in the market today, while offering full production capabilities to produce shoots for both its represented artists and freelance photographers. Based in San Diego, CA, with strong roots in the production community of it’s hometown, 1Notion has produced successful shoots around the world including the Bahamas, Ethiopia, Zambia, New York, Atlanta, San Francisco, Los Angeles, Palm Springs and Whistler to name a few. Clients include McCann Erickson, Eddie Bauer, Sony, Intel, Bolle Eyewear, Ogilvy & Mather, and more.

“I first came across Lincoln’s work when I was in Portland for wedding and I saw his shot of bacon in the local magazine. Now, I don’t eat pork, but even my mouth watered, so I knew he had talent. It was months later when we finally connected and we shared our views on the business that I learned more about him as an artist, and realized he was more that just talent. Lincoln composition, passion, and narrative in his photography are going to make him a successful photographer for a long time, and I am honored to be partnering with him.” – Adam Renfree

I can’t begin to explain to you how excited I am about this new phase in my career (but I’ll try). The hardest thing about being a professional photographer is selling yourself. I’ve been able to get by over the years, but honestly, I’d rather let someone else handle it so I can focus on the work and my clients. Adam is the right person for the job. He’s been in the photography business for a long time on both sides of the lens. He’s thoughtful, easy to talk to, and listens well. He asks lots of questions and never assumes anything. He brings a level of expertise and experience that I feel will benefit me both professionally and personally for many years to come. They say a man is known by the company he keeps. I couldn’t be happier being with someone I trust.

For portfolios and more information about me, visit www.lincolnbarbour.com

For photographer roster and more information about 1Notion, visit www.1notion.com

The Curved Staircase #1 & #2

We took the Metro to the Louvre, so I didn’t see this entrance staircase until I was leaving. It’s really a pretty incredible feat of engineering. The spiral staircase floats around a column that doubles as an elevator and connects the outside courtyard to the belly of the museum. Definitely go in this way if you ever go to the Louvre.

Interviewed on PhotoShelter

As you may or may not know, I’ve been a PhotoShelter customer for several years now. I love their service. It is, by far, the BEST way to show proofs to clients and deliver high rez finals. It also easily fits in to my digital workflow with Lightroom via a plugin, so using it saves me tremendous amounts of time and energy. Time and energy that I now spend focusing on my business, rather than mundane tasks that waste countless hours like creating Adobe web galleries, FTPing files, or (cringe) burning DVDs.

Every job I’ve delivered since 2010 is online high rez. Not only can my current clients redownload their images at any time, but I can quickly share and relicense available images to new customers. As a bonus, it also serves as an offsite backup in case something every goes terribly wrong at my office (knock on wood).

Anyway, when Lauren Margolis of PhotoShelter asked me to do in an interview about my architectural and interior photography, I jumped at the opportunity. I was totally flattered and I think the interview came out really great. Click the link below to read it on PhotoShelter’s blog:

Architectural Photography: Just Like Playing Tetris…Right?.

Looking Through the Pyramid

I finally got to visit the Louvre on our most recent trip to Paris. The museum is huge and holds an incredible collection of art, I barely scratched the surface of what’s there. I did get to see some of the famous works including the Mona Lisa, Venus de Milo, and Winged Victory of Samothrace. Seeing those was quite an experience on their own.

This shot is from inside looking through the Louvre Pyramid. A trick I learned from shooting with my iPhone is that you can put small camera lenses in places you don’t normally go with bigger cameras. I literally stuck the lens right under the base point of the Pyramid and shot upwards.

These next few blog post will highlight some of my favorite shots I took on my afternoon there. All these shots were taking with my Lomo. And don’t forget to subscribe to my RSS feed if you want to keep up with the blog from the comfort of your own RSS Reader.