The art of quoting for new clients.
 

A couple of simple questions for when responding to a new client's quote request:

When a new client approaches you, how many of you ask what their budget is up-front?

When contacted by a big company with the potential for a lot of on-going work, how many of you quote the first job with them at a big discounted rate, just to get your company "in the door"?

Reasons for why you do and don't do these things would be appreciated.

Why do I ask?

Well, I just spent 4 days adjusting and re-adjusting a quote for a new (and very large) client and lost the job for what I believe are two reasons:

1) I didn't ask what their budget was, and

2) I quoted too high (even though I told them we were negotiable)

In some ways asking what their budget was still might not have helped me, because obviously they were shopping around (which quite frankly I was told they didn't have time for) and the fact that I said we were negotiable might have given them a hint that we were overpriced enough to allow some kind of negotiation.

During the quoting period, they gave me no indication whatsoever that we were competing with someone else. They simply told us this afternoon we didn't have the gig and they booked the other company because they were running out of time.

Still, I put it all out there and we still lost the gig. The afternoon before the shoot.

Next time I'll do it differently.

Re: The art of quoting for new clients.
 

I'm the worst businessman ever, but seems to me asking "what's your budget" might sound to them like "how much can we take you for?" (in other words, I don't do this). I think figuring out client/potential client psychology is probably key to landing gigs. So I'm interested in what others have to say.

When folks approach me they usually ask what's your quote/how much do you charge for X. And then I tell them, with everything broken down. I either never hear from them again (VERY OFTEN!) or we go from there.

Every client ever tells me they will have ongoing work (you'll never know 'til that second gig!). How many do? Mostly none.

Seems like giving the initial gig at the big discount is simply going to invite more attempts at getting discounted work. So I guess, don't do it unless you're forever after willing to give that client that rate?

If I'm willing to reduce my rate I certainly don't mention that unless it's asked of me.

("I charge $625 for that."

"We only have $500."

"Will there be bacon on set?"

"Uh, I guess, what does that have to do with--"

"I'M IN!").

Re: The art of quoting for new clients.
 

Tough to answer. Each case is different. I've gone the route of saying something like, "Tell me what you're thinking money wise because I don't want to insult you if we're miles apart." If they say "well we're thinking $1000" and I know the job is going to be in the area of $5000, we've got some talking to do. Of course here's the thing many of them don't have a clue as to costs. So you go ahead and quote it the best you can and hope for the best. If you don't ask them thier budget you could be over by a lot. If you do ask them, you could sound like you're asking them what's the most I can get from you. Of course even if they tell you, they're probably lying. They want to spend as little as possible and you want to get as much as possible. Somewhere in the middle you meet (hopefully). As for telling them you're willing to negotiate, I never and I mean never tell them that. Why? Simple. They're thinking "If you're willing to go to a lower price then why didn't you put that down lower number down on the quote in the first place." You have to imply without actually coming out and saying it that there might be some room to adjust. That's why I always specify everything and breakout all the numbers so I can justify lowering a number if I need to. Unlike 20 years ago, even 10 years ago, many large businesses have really tightened up their belts and of course they all have someone in the mailroom with a camera that can do the work for next to nothing. As professionals we have to justify the reason(s) our price is what it is. Tough to do. Don't feel bad about losing this one, sometimes you have to throw a lot of mud at the wall to get some to stick.

Re: The art of quoting for new clients.
 

It's too bad that simply pointing to your past work, the lighting, camera movement, etc. and saying "but can your cheapo mailroom guy do THIS? THAT'S why we charge the way we do" isn't enough.

Maybe show prospective clients examples of your work that are polished/lit/etc. vs a poor quality video from someone else. THIS is why we bring the light kit. This is why we. . .etc.

Re: The art of quoting for new clients.
 

Again, all great information...thanks guys.

Yes, my offer of negotiation wasn't quite as cut and dry as that - it was indeed hinted at as opposed to being said outright. However, I am not sure why they didn't say "hey we have got a cheaper price - can you get closer to it" unless, of course, we were so far above they bet we wouldn't match it. Or perhaps the other guys had been used before and they were looking at simply getting a newer, cheaper price from new supplier.

Who knows.

Re: The art of quoting for new clients.
 

These are very challenging times economically. Many clients are struggling to stay afloat, and cost matters greatly. Sure, the marketing "gurus" all say to sell based on value, not price. However, in this economy, many clients are extremely concerned with their cash flow, and will decide against doing video at all, if they can't find acceptable quality within their budget.

What we can do is know our price of doing business, and be upfront about the pricing we can afford to give them. Give them a few options to choose from. For instance, a one camera shoot vs. a two camera shoot.

Certain jobs even can be done with the old fashioned "shoot to edit" way back in the linear editing (tape to tape) days.

Some clients barter, offering their services for yours. (Check with your accountant, there are rules).

Re: The art of quoting for new clients.
 

True, Roger. Thank you.

Business is about cash flow. In tight times, it is better to get at least SOME cash flow rather than none, without charging stupidly low rates, of course, as that means eventually you will go broke anyway.

Plus you have to feel like you are receiving a fair amount for your experience and energies whilst giving the client good value for money.

It still comes down to cash flow and that at least some is better than none. Within reason.

Re: The art of quoting for new clients.
 

I hate that situation. Just tell me what you budget is for the project and I'll tell you what you can get for that.

That never happens.

Re: The art of quoting for new clients.
 

I have a day rate below which it doesn't make sense to work. I quote 100-200% above that (depending upon schedule and flexibility that week), state a willingness to budget depending on production budget and goals, and then await a counter-offer, and don't accept any counter-offer that's below the base rate.

If I quote the base rate, I wind up having to hunt for more and more clients, none of whom are willing to move above that base rate ever in the future. If I quote high but won't negotiate, I lose out on work. If I quote high and they say "sounds great!," then life is a bubbling bowl of mirth and glee.

Re: The art of quoting for new clients.
 

I base my pricing on my hourly rate, then adjust the quote based on gear used, expected expenses etc. The good clients understand the tradeoffs between resources devoted to a project and final quality. More hours of work leads to more expense, more gear leads to more expense, but careful planning can reduce the labor hours and sometimes the amount of gear. Sometimes quality drops off too. The key is keeping the quality acceptably high while minimizing the costs.

Once a client knows you, likes you, and trusts you, they are very open to these discussions. (I know, slightly off topic, since we are discussing new clients). However, once you are known in your area, new clients in your business network listen too. (Guys from Rotary, Chamber of Commerce Meetings, Kiwanis, Advertising Federation etc.)

Several of my clients have been keen on learning the tradeoffs between one camera shoots vs. multicam shoots. You miss some of the good shots, but really cut down on the edit times, and hence the expense. Plus, I don't have to haul nearly as much gear to a gig.

It's not what you gross, but what you net. A $500 job that totals just five or six hours is much more profitable than a $2500 job that takes me fifty or more hours of work.

Re: The art of quoting for new clients.
 

Just out of curiousity, how detailed was the "quote request" - I'm sensing a sort of haphazard planning (as in "we shoot next week") on the part of the client?

Sounds to me like this was something on a short timeframe/lo-budget shoestring sort of "plan". Was this by any chance for a cable TV ad where you may have gotten beaten by "the house"? Just a couple things that come to mind...


It doesn't hurt to clarify what the expectations/budget are, of course everyone wants champaigne on a beer budget, right? SO some massaging of expectations may be needed, but no sense in wasting time on someone who has a max budget of $500 for a $1500 minimum job - for future reference, you may want to evaluate ways to "qualify" the client up front before wasting time quoting...

One other possible eventuality is they may go with a "lo-ball" bid, find out what they get for that isn't what they'd hoped, and re-ring your bell... so may be worth a polite and professional follow up?

Re: The art of quoting for new clients.
 

I start by asking them to describe the project and goals in excruciating detail.
1) The details expose how much thought they've put into it.
2) It can results in the client's "self awareness" as they realize exactly what they're asking for.
3) It establishes me as a good listener.

Depending on what I've learned about them I'll take one of two approaches.
Either
1) What's your budget?
or
2) This is what I'm thinking of and how much it would cost.

1 Happens if it sounds like they have a firm handle on things. They're experienced. They probably have some concept of what the want to spend.
2 Happens if they seem a bit more ensure and very much dependent on what I can do to actualize their vision.

On 1 my follow is what I can do within their budget.
On 2 they learn my costs relative to my actualization of their vision.

In each case they are then well informed so that negotiation involves adding or subtracting things so I'm never giving away anything.

In one example I estimated a number of locations and shoot days. My number was too high for them. We consolidated locations keeping the same basic content by shooting a few scenes at one rather than two locations. The result was lower budget due to fewer shoot days yet they got a product that basically included everything they wanted.

Of course you also have to know when to walk. I had one potential client, after discussing production rate, asked if I could throw in editing. Given the point in the discussion this occurred I said I was sorry I can't and got up and left. This was not someone worth negotiating with.

I've also walked out when a potential client said I can get for X$ again, after going through the project description and my price. If they can get it for less then why are they talking to me. If they like my work they'll pay more. If price is more important I'm not going to get into a real or imagined price war.

My rate is hourly although I'll usually talk in terms of 8 hour days although more gear may mean a higher hourly rate considering the cost of additional crew and expenses.

Re: The art of quoting for new clients.
 

So I see a few of your price hourly. Most around here do a half day/day rate.

I'm curious, with you hourly folks: do you ever find that clients try to negotiate down after the fact ("Hey Joe, I see you billed us for six hours shoot time on Tuesday. But really, that first hour was us just walking through the set and then you setting up, you weren't really "shooting", you know?, and then that last hour was you wrapping up gear, so that's not really shooting, you know? Oh, and we spent half an hour waiting for security to clear us for entry into the building at the start of the day, so let's subtract that time too.. .") Anyone ever get this? I always feel like I could get into this with hourly billing ("how do we know you didn't take an extra hour lighting just so you could bill for it?").

Seems like with half day/day rate, it's very clear: if we go past five hours after my time of arrival, rate goes up. Up 'til that point it's what we agreed on.

I know, I know. Some of you don't do half days. Point still applies to a full.

Re: The art of quoting for new clients.
 

Generally while I price hourly I'm quoting the client half day or full day (day = 8 hours).
I make clear that includes all setup time and travel if there's more than one location involved.
Given my "day" is not open ended, I charge if it goes over, they can argue those things just as well. They generally don't though because I make it clear up front that once I start setting up the day has started.

Re: The art of quoting for new clients.
 

I think it is safe to assume everybody will be shopping around these days even if they say they are not. I have had quite a few quotes go into the abyss in the past year or two. Times are just tough.

But, that does not mean you should be asked to work below what you need to be working for. I also have a base wage I never go below for a lot of different types of work. I start with these numbers and if the prospective client can not make the numbers then it is not a fit. Done are the days when I will bend just to get them to say yes because you are setting yourself up for the next request to bend some more.

When you are competing with the guy in the mail room so to speak, that is more of a reason to keep your rates at proper levels. Free or low pay is not your competition, it is just always out there. If the client does not want to/can't pay for proper services etc... they will not. No sense in chasing and putting yourself in a less than optimal position.

So let this float on by as the issue is probably on their end, not yours. (given the last minute nature of the situation).

Re: The art of quoting for new clients.
 

For now at least, I price the on location work as half day or full day (using my hourly rate to calculate). However, for work done in my at home studio/office, it's an hourly rate. I'm not packing, transporting, unpacking, repacking, transporting back home, a lot of gear.

Plus, I use a program that tracks time, along with generating estimates, and creating invoices.

It's necessary to qualify your clients. Since I work from home, a lot of the inexperienced clients mistakenly think at first that what I charge is my salary. So I ask them, "Is what your company charges the customer your salary?" Then we have a short discussion about low overhead, not no overhead.

It's like going fishing. Not every client is a keeper. You throw back fish that are too small. You throw back the trash fish too.

Re: The art of quoting for new clients.
 

I think that asking about the budget is mandatory.Its helps when it comes to managing the expectations of all parties involved. Also keep in mind that it is possible to lose business if your quote is to low. The client may start to wonder if your actually capeable of doing the job.

Re: The art of quoting for new clients.
 

Thank you Kevin. A good way of looking at what to charge and how,

Re: The art of quoting for new clients.
 

Thank you Dave,

Yes it was a fast and furious request. 4 days before the gig with a weekend in between.

And yes they admitted at the start they didn't really know what they wanted. The requests kept changing, as did my quote in response and I know they just ran out of time so went for the cheapest without having time to come back to me.

By the way, the "winner" had been hired by them before and so there was a level of familiarity about this whole deal as well.

It was for a govt department.

Re: The art of quoting for new clients.
 

That's why a good approach to hourly billing is to charge "portal-to-portal," the clock starts to run when you leave 'home base' and includes the travel time to the location (and returning) plus all the other things you mention. It's not the time when the camera is running, it's the time spent doing everything involved with the shoot. Time spent in setup is time that can't be spent earning money elsewhere, product out of the inventory if you will, hence is billable just like cranking the camera is..

Re: The art of quoting for new clients.
 

Maybe it's different where you are, but if I tried to bill portal to portal here I would be laughed off the phone/out of the office/etc.

And I understand that. . .if I'm an hour away from the shoot location, why should they have to pay for that? That's not their fault.

I think time of arrival on location is fair (as opposed to portals or from when you start setting up). If it takes two hours to get through security somewhere, that's something someone on the client end should have anticipated and dealt with. If I have to wait around for 5 hours between interviews (true story) because things weren't well organized, that's on them.

Re: The art of quoting for new clients.
 

Josh, I still charge half-days and full-days on the production side. Half-days are around 50% higher than what two full-days would charge, since I could almost never shoot two half-days for separate clients. Last week I was even asked to split a half-day into two 1/4 days for the same price as a single half-day. When I mentioned set-up/strike time and travel, it made sense to the client why I couldn't meet that expectation and we negotiated a quarter-day rate.

As you can imagine, this is because of a scheduling conflict on their end, and it seems that the day-rate and partial-rates clearly put the onus on the client to schedule efficiently. I'm certain that if I charged hourly, there would be less potential $ coming my way, and everyone on-set would be looking at their watches instead of trying to maximize their investment. When I'm on-location, I'd just as soon be shooting something for the client instead of waiting around, and the day-rate structure sure seems to make this happen.

Re: The art of quoting for new clients.
 

My travel time is on me. I go by When is crew call? OR What time do you want to start shooting and I back it out from there. I always figure at least an hour before the shot starts for call time. So for example, lets say it's a simple seminar. They're starting at 8:30AM and run until 4:00PM. OK first off it's day rate. Second, I want to be there at least 1 hour before start. I actually get there a bit earlier so I can park, load in, have a cup and not start sweating but for SIMPLE 1 camera, plug into the audio board no sweat seminars an hour is generally more than enough to do all of that. I don't play around. Get setup, have another cup, bathroom break, get set behind the camera. So I'm on the clock at 7:30. A 10 hour day and I'm off the clock at 5:30PM. This includes any downtime, strike, load out, whatever happens. It's less money for the client to pay me day rate than to pay hourly since they get a break on the day rate compared to the hourly times 10. Pretty standard in the industry. I almost always figure an hour of travel time in the greater Chicagoland area. You have to know the traffic though. I've gone downtown and left my place at 6AM to get there before the highways get all bottled up and thats for an 8:00AM call time. I'd rather sit around for an hour than be 5 minutes late. Obviously if I have to travel out of the area (another state, Wisconsin, Indiana, Michigan then it's figured differently).
Lots of ways folks figure their time but around here, it's most common to start with call time and go from their with travel time not being counted as part of the day.
Of course every situation is a bit different so flexible is the key word along with knowing the area and how long it takes to get to where you need to be and how long it's going to take to setup.
If it's not a seminar type gig or involves multicams or a crew of more than 2 than timing is different but for the most part it's as I stated. It's worked for me for a lot of years at least around here.

Re: The art of quoting for new clients.
 

People around here seem to generally do their half day as two thirds, rather than half their full day. Btw that applies to labor only. Gear is always full day just like a rental house. Also gear doesnt get OT, only labor does. Although ive been thinking about discounting gear too on half days to make the rates more distinct from each other.

Re: The art of quoting for new clients.
 

I always ask what their budget is up front.
I tell them I need to know if they are looking for a quick web video or all the way up to a full Hollywood production style. I can do both and anything in between, I just need to know what they are looking to do.

Re: The art of quoting for new clients.
 

It depends on the client type but that can intimidate some clients. Experienced clients might have a budget in mind.
Some clients have no idea and their throwing out a number might reveal that. Embarrassing the client isn't good.
Some clients assume if they'll give you a number that you'll target the entire amount. They may prefer hearing whether you're over/under and accept under or negotiate if over.

Of course you may want to know what number they have in mind but it's best to get them to reveal that rather than force it up front in SOME situations.

As per my previous post, I listen to the client first and then, based on my evaluation of them, I decide how I'm going to handle the "reveal."

Re: The art of quoting for new clients.
 

I've always found it quite effective to provide two quotes to prospective new clients (on larger jobs at least), one that caters to exactly what they want/have scripted, and a secondary proposal that suggests a few smarter approaches that will simplify the shoot a bit and save them money that way whilst still getting their story/message across.

This tends to help bring out the discussion of exactly what the client wants to achieve from the shoot, and from there you can sit down with them and help them decide on exactly what they want, and run them through what that will cost.

Because the process is more inclusive, I find I hear back from a much higher number of prospective clients than I do from sending out a single figure.

Detailed cost breakdowns are also really important, production is such an expensive business, I find if you don't provide an explanation as to where all the various costs are coming from, you can often scare a client away (even when you're quoting on low margins).

Re: The art of quoting for new clients.
 

Funny you say that. I just did that, sort of.

Anyway, I was wondering what you think of the phrasing "what were you thinking of budget wise?" or "what did you want to spend?", something a little less predatory than "how much do you have"/"what's your budget". . .kinda asking what they WANT to spend vs how much they have. Really the same question, but a gentler approach.

I get a fair number of inquiries; very few turn into actual jobs. I realize some of this is because instead of networking or word of mouth, these people come to me from ads I have on several sites, stuff you'd find by Googling "houston videographer" or something. I'm sure this attracts a different type of client than getting your biz via word of mouth, etc.

Point is, I'd like to find out earlier if these people are way off on their expectations vs budget. What do you think of the above phrasings for finding out? I realize from their viewpoint it may sound greedy, but we can both avoid wasting each other's time and end things right there if I find out as early as possible that neither of us can accomodate each other budget-wise.

Re: The art of quoting for new clients.
 

Since my last freelance project I decided to come up with an Initial Meeting Agenda which includes budget. I will send this to my clients prior to meeting. This way they don't seem thrown off by having to think about these things and I'll be sure to have all the information I need to draft up a formal proposal/contract.

In terms of budget, I think they key word here is budget "range" and then offering them 2-3 different options that meets their highs and lows as well as outline what they get for their money. That way you don't seem like you are milking them for all they're worth and can negotiate by adding or eliminating services. As for half/dayrate, mine is 4/8 hours from arrival on set and will travel up to 1 hour/60 miles. Beyond that I will billed separately based on mileage. I also have a full time job, I don't include my commute in my hours and the company policy is 100 miles so I think my policy is reasonable.

I posted my Initial Meeting Agenda on my blog but of course this is a general agenda and it should be cater to clients on a case by case basis. Please check it out. I'm still and will always be refining my process so any input you can add would be greatly appreciated.

Initial Meeting Agenda | Fuglee

Re: The art of quoting for new clients.
 

Short version of what I do:

"Here's my number for what I'd like to do for you: $1,923,230.12.... if that's in a different ballpark than your budget, let me know what you have to work with and I'll put together a different option in that range."

Re: The art of quoting for new clients.
 

That sounds great in theory, problem is with a lot of the people i deal with, even the bare minimum they could possibly want (as in cam, me, and a mic) is too much for them!

Re: The art of quoting for new clients.
 

Thanks for sharing your site, very much enjoyed your reel. Nice work!