Hourly-rate changes in post
 

Hi,

If you're giving a customer an hourly rate for a job, do you still charge the full hourly rate for tasks that you're just waiting for a computer to finish processing (i.e. file conversion, rendering, DVD burning), or is a discounted rate applied, or maybe do you not charge anything (but then say do the computer processing at night when you're sleeping)? Thanks,
Tim

Everyone is different. I personally try very hard not to bid a job by an hourly rate. But when I do, I have my full rate for "real" work, and then a discounted rate for computer down time like rendering and compressing. If it's a great client who shoots me a ton of work, I might not charge at all. I just make sure the invoice reflects that so they know I threw them a bone.

Mick Haensler
Higher Ground Media

Anything I need to attend, I charge full rate for. If I can do a render over lunch or other break, it really depends on the client. If they are already getting a great deal OR are pushing for more and more "value added" stuff, I charge as I see fit. I almost always charge SOMETHING as there is wear and tear on my system, power being consumed and I'm unable to use the edit bay for something else. I may choose to multitask while encoding MPEG-2 for DVD ASSUMING that my edit software isn't locked down as a result (in FCP, an Export Using Compressor for example means that I can't edit).

I charge the same whether I'm editing or rendering. It's the same machine, with the same hardware and software doing exactly what it was designed to do. Rendering is just a cost of doing business with the machine and you're still putting hours on it and miles on the processor. While editing, do you drop your hourly rate to leave FCP create a quick graphic in Photoshop and then raise your hourly rate again when you go back to editing? I doubt it. It's all part of the process.

I do sometimes charge a little less for "unattended" functions, but only a little less. Like Shaun and Rick said, you still have costs associated with running the computer whether you are there or not. You have the electricity, the fact it is unavailable for other tasks while you render, the cost of the hardware and software, the cost of eventually upgrading the machine, costs of the overhead (i.e. your office, or your home office), your advertising, your insurance (you DO have insurance on your equipment and yourself don't you?), and all the other costs of doing business. Many people make the mistake and think that they can work for $10 an hour, or in this case do work "for free" while they sleep. The reality is that there is a cost for just keeping the machine turned on and you should be charging the client for it at a rate that allows you to sustain your business.

Have fun!

Rob

To clarify my above remark, relative to Rick's statement above, which I agree with:
Any cost reduction I give around rendering etc. is based on the labour component being removed from the equation. IMHO, to charge full rate for UNATTENDED functions would constitute fraud. If I'm otherwise working with the client or on the project while the computer "does it's thing", it's full rate.

I do sort of a hybrid. Generally it's full rate, unless I can do something else at the time which results in billable hours -- then I charge each client half. They get a little price break and I don't reduce my rates. To double-bill would be unethical (and oh yeah, illegal). Same goes when I'm on the road: If I'm in city A for one client and I go straight to city B for another, they each pay half the travel time and half the expenses for the flight.

You might consider double billing unethical, but why do you think it's illegal? It might be unethical, and possibly illegal, if you are double billing one client. But if I've got my computer rendering for a few hours for one client and I can do work for another client at the same time, I'm going to charge both my full rate. As long as it's not taking away time from one client (which with rendering it's not, the computer is just sitting there chugging away), I see no problem is double billing for the same hour. It's called maximizing time and profits.

Matthew

I had an editor who I was paying $60 an hour try to charge me $600 for a 10 hour render. I laughed. He argued that it meant his computer was offline and unusable for other projects for 10 hours, and thus he was "working". I told him that I knew damn well he was rendering overnight while he slept, and if he wanted to ever work for me again, he'd take the charge off the bill. He took the charge off the bill.

I don't believe in charging for full rate rendering time when you are playing in a small ballpark. The same goes for logging tapes. We all know that we are watching American Idol audition episode reruns or playing Grand Theft Auto while we are logging the tapes... if you aren't working, you shouldn't charge "working" rates. Just ethics.

Wow, I couldn't disagree more. If my computer is tied up with your project and I can't do another project and I have to babysit the render every so often to make sure all is going well- guess what? I'm going to charge you full rate AND I'm going to play XBox while doing it. It's not unethical IN THE LEAST to charge you for my machine and my power that I paid for to do your work.

And if had tried to pull that crap with me on my invoice, I would have fired YOU as a client and sued you if you didn't pay the bill.

But that's me...

Wow, you guys all have just one computer? :)

QuickBooks timer only lets you time one event at a time. That's a good guide for me. I'm not a "down time" kind of guy, so I'm always working on something. If my editing workstation is busy rendering, then I'm working on a web site on the other workstation. Whatever has my attention at the time is what is being billed. I don't bill more than one project at a time.

STRICTLY to play devil's advocate: I agree with Dylan if the project had a significant workload outside of the render. But, if for example you were asking me to stitch 3600 still images into a QT movie and the setup took 5 minutes and the render took 10 hours, you'd be paying more than the 5 minutes... Again, solely devil's advocate...

LOL....

Here's the cooler part.... if you "fired" me as a client and derailed the timeline of my project... I'd sue you for failure to complete the project, breach of contract, diminished revenue, etc... and since *I'M* the one with the contract, AND could prove damages in terms of lost sales/time and make it stick... Not only would you not get the $600, I'd also end up with a winter home in Las Vegas. :)

Just kidding... I wouldn't really sue you... I'm Canadian, we only settle our differences on the ice with sticks. Courts of law are for wusses.

Maybe what you aren't seeing Bill, is that in my case, we had an agreement/contract as to the specifics of the job, and the $600 came as an "oh, I also need to charge you $600 for rendering". I didn't agree to pay it up front, and the rendering was technically covered in the contract specifying the delivery of the project.
Now...
If at the start of the project, he quoted/included $600/10hrs for rendering there never would have been an issue later. Having said that, I still would have told him I wasn't paying full rate for rendering, and if he wanted the contract, he'd better drop the price by 50% or better.

Also Bill... buy yourself another damn computer, even if it's a $500 cheapo system. It'll increase your productivity by at least 30% if you are doing a lot of editing, and will pay for itself in no time. You'll love it.

That's true. Each job is different. In my case, the rendering time was roughly 5% of the total project time.

You are the guy I would hire over, and over, and over.

Yeah I really don't like downtime either. FCP and Compressor does tie up your editing, and sometimes I have trouble with that, but if things are slow, that's when I work on new quotes, update my website, pay bills, generate invoices, etc. If I start it just before I leave it for the day, 99% of the time it's done before morning. Plus you can send a list of projects to export to Compressor, so I'll do 3 or 4 edits at a time and export all at once at the end of the day. This by itself saved me a ton of time when I realized I could do that. You also don't have to render out your timeline before exporting to Compressor, so if I'm confident that it's good, I'll usually skip that step.

I've never counted that as work time except in a few rare cases where it was a rush job, the client needed it done that day, and I was locked into waiting for it to render out. As long as you have a workflow that makes sense and schedule accordingly, you really shouldn't have to sit there and wait for it.

I do have a second computer that I have set up to use in a crunch for capturing and rendering, which is an investment for me but saves my clients money and saves me a lot of time. I also have multiple external drives set up, so I can swap drives back and forth between the two computers when it gets crazy.

First of all, courts are not for "wusses", they are for making people stick to the contractual agreements that we do business and make our livings by. I bet my house in Vegas you WOULD sue the guy if he somehow made you lose your client and revenue.

Secondly, you didn't state in your original story about the fact that you had a detailed contract and these hours weren't originally included. To that I say, that is the bad of the contractor not figuring that into the cost of his bid. He should eat it for not having forethought. Having said that, it is up to the contractor, not the producer, to set the price of the bid. If you say "I'm not going to pay this amount" (BEFORE the job of course), then it is up the contractor to either decide to alter his bid or not take the job.

Both parties need to clearly define their roles and expectations in a deal before work starts or money changers hands.

There is a saying that goes "with the right client, a good contract is never needed, with the wrong one its never enough"

I'd like to add a caveat here: based on a situation I'm CURRENTLY involved in that has cost me approaching $20k in "free" work due to a contract that set out my obligations and ESTIMATED time based on the scope of the project we had discussed, ANY VARIANCE to the scope of the project (including additional sign off copies and subsequent edits) should be billed as additional work. Unless we as the contractor can effectively keep a project on track, I feel we should not be held financially liable for non-discussed (therefore unagreed to) additional labour and expenses. I never intended for my business model to be an "All You Can Shoot and Edit Buffet". Give 'em an inch...

Take that bet, prove him wrong, and recoup your losses by selling his Vegas house.

No, seriously, I think that you might as well be as transparent as possible with business partners. Tell them that you're not going to pay for render time, and then you won't have to bother suing. If that's not acceptable for THEM, work out a solution. If you can't, find another editor.

Hear hear Shaun, I totally agree.

Still waiting for that sense of humor transplant, huh?

True!

I think almost all of us (producers, editors, cameramen alike) have been burned by a client uttering those three horrible works "can you also..."

The last time it happened to me it was "can you also... reproduce this entire 8 hour shoot, with a second variation of our product, in a single hour, and we don't pay you any more money?" Ok ok, that's my interpretation, but is basically what they were asking. Needless to say, it didn't happen.

Editors probably have it the worst. It's critical to tell the client asap how many extra hours a simple change will add, and what it will cost them. Otherwise, they'll just assume it's covered.

In my case, they just looked at the bottom line of my line-item specific quote and said to themselves, "Oh, that's how much our video costs..." and ignored all the specific prior discussion of "this quote assumes that industry standard protocols and workflows will be followed... blah blah blah"... ARGH! And there are TOO many people who have assumed "ownership" of this darned thing so I'm just putting in time to get through with it. Oh, and by the way, the client calls my house at 10 pm occasionally...

Analogy: a client hires you to tape a speech and just wants a straight locked down wide shot. After the 6-hour shoot (say, the guy is Castro or Clinton or something), they only pay you for the combined 45 minutes it took you to set up, tear down, and change tapes because you were reading or emailing while the camera did its thing unassisted.

I cannot imagine a happy camera owner in that scenario.

Any time my computer gets tied up and cannot be used for other tasks, I'd better charge or I am cheating myself. Of course, how much I charge is between me and the client. Rush jobs get full rate, overnight jobs with good clients usually get substantially reduced rates, but whatever it is, we agree to it beforehand. If I find mid-project that I didn't mention a charged item, I'll make sure to let them know before I slap it on an invoice and we'll talk it over like adults instead of playing the piddly passive-aggressive BS games that are so en vogue in our rapidly declining Western culture.

speaking of which, what's that 2 cents worth now with inflation? $4.73?

An interesting choice. If my camera operator went and read a magazine while his camera sat churning away... there is no way I'd pay him full rate. But he wouldn't be doing that, he'd be at the camera, making sure second by second that nothing went wrong. No one sits and stares at a render bar for 15 hours straight to make sure nothing goes wrong down to the second. They check on it during pee breaks in the middle of Firefly marathons.

I'm not saying render time is not worth anything... it definitely has value... but it isn't full editing rate.

To me render time is worth the same as a camera rental, because that's basically what you are doing, renting time on equipment, without any real human time involved. Yes, the editor gets paid full rate for setting up the render, but after that...

And if the editor only has one computer and it kills his productivity during renders... that's not my problem. He can render it at night or get another workstation.

Send their office a notice of new rates/billing. Include one line that states all calls after 6pm will be billed at $30/15m segments. Keep track of time. Send them a bill.

I think I got that from Paul Tauger actually...

You better get a second computer or you're cheating yourself.

Your Castro speech analogy is flawed. The main reason you'd charge full rate for the duration of the speech is because of "lost opportunity". While you're recording the speech you have no opportunity to do other work.

I charge for travel time. Sure I'm not doing anything other than watching the road, but the time I spend on the road is time I don't get to work. However I can do lots of things in my office while a video is rendering.

Unfortunately, yes. Our healthcare system down here in the States does not cover free humor transplants. :)

But I got my feathers ruffled a little about the "wuss" comment because I had a good friend just go through the lawsuit thing because a producer didn't want to pay her for the work he asked her to do.

The point I was trying to make is, contracts are essential to both parties so neither side gets taken advantage of. But if one party doesn't want to hold up to their side, a lawsuit is pretty much all you can do other than eating it (which for a small operation in this economy can mean the difference between staying open or not).

And back to the original point: It is up to the contractor to factor in what their "cost" is in render time (lost productivity, wear/tear, power, time babysitting, etc), and if/how they want to pass that on to the client. But then both parties need to be "on board" with it beforehand...

Laughing out loud.... :) I'm going to have to steal that line!


I didn't mean to ruffle any feathers with that one. While we really aren't very litigious up here, the truth is for a lot of small businesses and contract workers/shooters, suing someone is rarely worth the time. On principal, it's always worth it, but when it comes down to it (and for me it's come down to it at least 3 times in the last year) the extended process of taking someone to court, making a case, and then trying to collect, isn't worth a couple grand for the time and stress.

The one lesson in this business that has cost me the most money, lost me the most time, and took me the longest to learn is... always have a contract... even at least a paper or email that spells out point by point:
*what tasks the person will perform
*when they will perform them by
*how much each will cost.
Doing this is critical if you are hiring someone.

Amen. That is the sad truth 99% of the time!