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photo credit: Lili Vieira de Carvalho

Welcome to the next part of the tutorial on pricing up assignment photography. This part is going to show you how to apply your base usage rate (BUR) to assign a license in a real world example.

The previous three parts of this mini tutorial showed you how to:

1) avoid pricing by making it up as you go along
2) work out how much you need to earn to stay in business
3) understand the need for a constant figure for each assignment to enable you to fairly price usage licenses

Base Usage Rate (BUR)

I’ve already mentioned that the BUR figure is a constant BUT that it can be a different constant. Indeed it has to be, else you’re going to end up charging a PR shoot the same as an advertising shoot and that’s not right. So using you NTMPD figure as a base I want you to arrive at four separate BUR figures for assignment types:

PR
Editorial
Commercial
Advertising

My test NTMPD figure was £480 GBP ($960 USD). This is what I need to make per day if I shoot for 104 days a year, just to break even.

So our BUR figure needs to be more than that right?

Not necessarily! Why? Because we have a range of photography assignments we undertake. We do everything from PR to Advertising so our BUR should suit the job. This is so that:

a) you don’t price yourself out of the market
b) you don’t undercut yourself
c) you can charge according to the value to the client (i.e. usage)

Here’s my example BUR figures:

PR £250 ($500)
Editorial £500 ($1000)
Commercial £1000 ($2000)
Advertising £2500 ($5000)

Remember these figures are your “creative fee” only. They do not include expenses or the hire of equipment , models, catering etc. These should be charged separately on your invoice at cost or a reasonable mark-up. Every job will have different expenses attached but your creative fee should remain fairly constant within that area of operations.

Here’s where this gets tricky. There’s a big difference between the USA and the UK. In the USA usage fees are often charged on top of the creative fees and expenses. In the UK the initial usage fees are normally included in the creative fee. However, the concept of BUR still works for the US.

Okay let’s make up a fictitious assignment and test this out.

A small local design agency has called you and asked for a price to do a shoot for their client. It’s a series of shots in a newly built fitness/health centre. The agency is looking for about 10 shots to be delivered. They estimate it will take half a day (note: never let the client tell you how long it’s going to take!).

So where do we start?

The first thing to rule out is charging on time. Charging for your time is not going to make you rich, and it’s very unlikely even to make you a living wage. Charging for your product is what you are aiming for. If you want to know why charging time is bad business for photographers read this post here.

The first question you should ask the agency is about the usage of the images. Brochure, web, advertisements in the press?

The three key things you need to know are:

1) Where are the images going to be used? List all “media” (where media = each type of placement i.e. brochure, web, press ads would be three media)

2) How long are they going to be used for? You need to know the length of time the images are going to be used for.

3) What territories are the images going to be used? (i.e. state/county, national, international or country, europe, world) etc.

Armed with these three pieces of vital information (you shouldn’t be pricing without knowing these) we can start the formula.

Pricing the example job

Lets look at the roster of BUR charges we set again:

PR £250 ($500)
Editorial £500 ($1000)
Commercial £1000 ($2000)
Advertising £2500 ($5000)

The usage needed is for a brochure, website use and possibly adverts in the press in the future but they are not sure…..

PP note: this is very common. Often clients request copyright or “unlimited use” because they don’t know exactly what they are going to use the images for. Sometimes, if you have produced some great images, once seen the client decides to use them in extended advertising or point of sale, or other media. By licensing your usage, you can charge for each extension of use. But if you granted “unlimited use” at the outset because they said it was “just for a few leaflets” then…….you just lost a load of cash….

So now we know the usage the client needs we pick a BUR creative fee figure to work from. Keep in mind that although the BUR figure is constant (for the purposes of the formula) it can be whatever you like. The BUR is a way of estimating future usage fees. This job is what is known a “below the line” advertising. Its a small local design firm, its a local fitness centre. It’s not a major agency and major client. Its one of those jobs that falls in the middle between regular “commercial” work and true “advertising” work.

So for this example I’m going to set a BUR figure of £1500.

My estimate shows £1500 as the creative fee. This is also noted as the BUR for future usage rates to be based upon. I then add my post-production fees for the 10 master files, a fee for hosting a web gallery, etc etc (this is a whole new tutorial in itself!) plus my expenses.

**Important Bit!**

Under the line item “license to use” (or “licence” if you are in the UK!) we set out what rights are granted. If you need a reminder on what a license looks like:

Download a blank licence to fill in

PP note: as mentioned before - this is where US and UK/Europe seem to divide. There’s no “law of charging” but in my experience US photographers then charge for usage separately from their creative fee, whereas UK/European photographers include the first usage in their creative fee.

Here’s how I would do it.

Licence to use includes: Brochures and web use for 1 year, UK. (Remember its use/time/territories in that order).

Had they only wanted brochures I would have granted: Brochures, 2 years, UK.

Initial Licences: In the UK the AoP (Association of Photographers) recommend granting either one media, one territory for two years - or - two media, one territory for one year

In the US those inital licences would attract further “usage fee” payments. I’m all for usage fees but I do think clients like to see a base usage built into the estimate. Comments from US readers on this would be appreciated.

.Job done…..and that’s all there is to it.

You have set your BUR fee and attached usage conditions to that fee. You have now controlled the usage of your images and charged accordingly. You have rights-managed your images and have the mechanism set up to be able to charge for licence extensions further down the road.

Next time on “How to Price Up assignments”…..

So, we’ve done the fitness centre shoot. It went great. We’ve got ourselves 10 stellar images. Client loves them. They love them so much that six months later they call you and say they want to run the images in fitness magazines in the UK as advertisements. They are also building a fitness centre in Germany and want to use your images in the German brochure and they want to reprint the brochure next year so need a one year extension to the licence.

Q. What are you going to do now? A. Get out your handy re-usage fees table and work out the additional usage fees to charge…..and that will be the subject of the final installment, Part Five.

p.s. if you charge on time or give away unlimited use of your images to clients don’t bother to read part five, it won’t apply to you….. ;)

PP

Tags: Assignment Photography, licences, licenses, Photography Business, pricing photography, usage

If you found this article helpful you may also like to read:

• Assignment Photography: How to charge and price up assignments - part five (0)
• Why photo credit lines aren’t worth the paper they’re written on (0)
• Understanding licensing types: Royalty Free image licences (1)
• Understanding licensing types: Rights Ready Image licences (0)
• Understanding licensing types: Rights Protected or Exclusive image licences (0)