Price determination for part-time business?
 

I'm an 18 year old film student and I'm looking to start up a small videography business, filming and editing music videos, birthday parties/memorable moments, skateboarding videos etc. Because I'm not going to be doing it for a living and rather just to keep some money for leisure purposes and for budgeting my own feature projects I'd like to pursue, how should I determine the prices?

I want my prices to be lower than that of professional videographers with near-equal production quality without pissing them off for poaching their clients...What is the standard, professional videography/editing rate that I can base mine upon?

I was thinking of having a negotiable system, where there is no set fee but my pricing is determined by the scale of the project, is this recommended?

My passion will always be developing (writing, shooting, directing, editing) my own movies, so I'd like to have a means of generating the capital for that (as well as for earning some cash to by the latest gadgets :P).

As a full career, I'm most probably going to go into editing, but I'd always llike to leave the "filmmaker" option open for added income.

[QUOTE=Aviv Hallale]I'm an 18 year old film student and I'm looking to start up a small videography business, filming and editing music videos, birthday parties/memorable moments, skateboarding videos etc. Because I'm not going to be doing it for a living and rather just to keep some money for leisure purposes and for budgeting my own feature projects I'd like to pursue, how should I determine the prices?

QUOTE]

One factor that will determine your prices is your equipment costs. The achilies heel of thes casual videographer is equipment cost. Sure you can rent this and borrow that, but sooner or later you'll want your own stuff, and depending on what you say you can offer to clients, you'll need to spend the bucks. To do that, it's either you become a runway model, or if you don't have the legs, then you'll need to charge more to buy more stuff.

Peolpe will let you work for free, but if you show up with a CVS disposable video camera, you might get a bad reputation and certainly you won't get any referrals.

[QUOTE=Steven Davis]It's my butt that prevents me from doing that... Seriously though, you need to have some decent equipment to provide your perspective clients with quality work. That being said, you don't need to drop 10 grand on a new camera, but if you pick up a cheap VHS-C camcorder, you won't have to worry about pissing off the Pro's, because you won't have much work.

I'm planning on investing in either a VX2100, XM2 or a second-hand PD150...Would the presentation of a finished DVD affect the price? I don't have the meanings of printing high-quality labels, so I was thinking of just either a sticker-label (which has given me problems in the past) or a white disk with a permanent marker'd title.

Don't use those labels. Not only are they tacky, but could potentially damage the client's equipment. You can buy a Epson for around $200 that can print on disks.

The Epson Stylus Photo R220 runs only $99 in my neck of the woods, and prints directly onto DVDs.

The DV Show ran a 10/2005 podcast with my colleague Bill Davis in which he explained a simple formula for figuring how to charge. It basically starts backward from what most people think. The first question to ask yourself is "How much money do I want to make?" Then ask yourself "How much time do I want/have to spend?" Then, you subtract your costs, and bingo - your hourly rate.

This can be quite sobering when you realize you won't be funding your $50,000 feature this year working part-time, 10 (billable) hours a week and buying $10,000 worth of equipment unless you charge $115 dollars an hour!! And that's a simple formula before taxes, equipment depreciation, tape stock and printer cartridges, etc.

It does, however, let you set realistic goals, which is a good idea either as a hobbyist or as a business model:

http://72.41.38.10/shows/thedvshow101005.mp3

I think your rates have to be determined by:

1) What other people in your area are charging
2) How much you need for your time, and
3) If you need to offset additional equipment costs.

When I was starting my audio recording studio I did quite a bit of work for friends (free) and acquiatances (cheap) so that I could build up a portfolio. I worked hard for not much money, but I got several good projects under my belt and had something to show for it: that I knew my business and was worthy of the work.

Then I looked around to see what other folks where charging. Around here (San Francisco Bay, US.) there's a horde of ametures with Pro Tools charging $25 an hour. A rock bottom project studio would be $35-70 an hour and a full service pro studio might start at $90-120 and go up from there.

So my published rates became $35 for tracking (analogous to production in video), $45 for mixing (editing), and $55 for mastering (color grading? DVD creation.)

And from there I can drop my prices if I chose and still be around the level of all the folks around who are charging $25 AND my clients feel like they're getting a good deal.

Anyway, that was my thought process for setting up my rates. Good luck! I think you're doing the right thing by thinking of going into business. One freind of mine did the same and paid of a new (at the time) PD150 in 3 months by doing weddings. Its not a bad way to pay for your habit. :)

Take care,
Chris

Take a look at this little article. He's right more or less -- low pricing is not a key to success.

http://www.entrepreneur.com/article/...325771,00.html