A lot of artists base their prices on things like ‘what they think people will pay’ or what they would pay for a product. The sneaky ones just steal other people’s price lists (no, you can’t see mine, lovely, it’s been ripped off enough), while others just choose prices that sound nice. The really crafty ones steal the price list of their competitors and suddenly appear with an identical one.
These tactics are merde. Utterly useless, absolutely foul bile pulled from the belly of an ancient, stinking dragon.
These merde tactics fail to factor in YOUR costs, YOUR time, and YOUR expenses. It’s great thatTiffany Teenybopper lists $15 5×7′s on her website. Her website fails to mention that Tiffany Teenybopper has a minimum order of $750 and sells her $725 album with every portrait session. Those $15 5×7′s only get sold so clients meet the minimum. (Tricksy, eh?)
Likewise, if Stan Dingelhausen charges $3,000 for weddings, you think charging $3,000 for wedding coverage will be profitable, too. You don’t know about Stan’s wife, Laverne, who can RAW-process all of Stan’s images in an hour. You, on the other hand, process images slowly and clocked 23 hours of post-processing on your last wedding.
Since you have absolutely no idea how others price their work and value their time, others’ price lists are completely worthless to you.
So, how do you begin to craft a decent price list? Value your time and know your cost of goods sold for each item you sell.
A VERY BAD EXAMPLE:
Sweeney Todd just ordered a 5×7″ print. My cost on that item is $1.19 plus .81 worth of packaging, so $2. I’ll multiply that number by 5 and voila! A 5×7″ print is $10!
A VERY GOOD EXAMPLE:
Sweeney Todd just ordered a 5×7″ print. My cost on that item is $1.19 plus packaging, so $2. My time is valued at $60 per hour. Processing, ordering and packaging a 5×7″ print takes 10 minutes. Therefore, my cost of producing a 5×7″ print is $12. I’ll multiply that number by 5 and voila! A 5×7″ print is $60!
See the big huge difference there? A mother of four may value her time at $80 an hour, while a photographer who’s just starting out might place the value at $20 per hour. The cost of goods sold for an artistic product is determined, in large part, by the value an artist places on his or her time.
Other factors — like having to pay rent on a studio space, or a photographer’s average number of sessions per week — will also play a huge role in determining pricing.
If, for example, I pay $1300 per month for a studio space, my overhead costs are much higher than the photographer who works from home. That studio space has to be heated, cooled, and maintained. It requires internet and phone services, etc, etc…in this example, I have to make about $1500 per month to cover overhead before I can begin to make a profit. I might have to charge significantly more for the same product being sold in the same town to the same person to maintain a profitable business.
Please take the time to determine your costs, the value of your time, and your strategy for covering overhead expenses when creating your product pricing.
Thank you for this post- I hear you and understand you! I have been battling with bad pricing for many years, and have never made a proper living. I need to turn this around..Now!
Living in a very small town in the sticks with a very small population and low income isn't very helpful- or is that just another excuse?
How can you create value for your clients without spending a lot? Would digital negatives have more appeal to those around you than, say, trying to sell wall galleries and big displays? How can you define your business as a profitable, sustainable, and useful to your clients?
YES!!! Thank you, again, for another fabulous post.
Amen! People need to read this and get it through their heads. I know I started with a "this sounds good" mentality and quickly revamped it once I realized it was a dumb strategy.
Yes…if you can call it a strategy.
i used to always tell myself i didn't want to be too expensive for 'regular mums like me' to afford me. but what i realize now the that with my prices as they are right now i am dealing with clients that i don't really want – high maintenance and looking for even more of a deal. and i am working my ass off for barely anything! ENOUGH!!
time to fix my pricing and relaunch my brand. i have loved your blog and have also been so lucky to find the easy pricing guide and ittybiz.com, through you! thank you so much for sharing such great advice and great links!
In your very good example, is the multiplier just arbitrary? Or is it a stand in for overhead costs + profit. Also, what happens if someone orders multiple copies of the same 5×7? If Sweeney Todd orders 5 copies of the same 5×7 it shouldn't take you 10 minutes for each. If it takes you 15 minutes total, then the cost per 5×7 would drop to $5. Would you the set the price at $25 per 5 x 7?
Hey there, Adrian,
That multiplier isn't arbitrary — that represents my ideal profit margin. Of course, some will be happy to multiply by 3, others will push the limits and multiply by as much as 20-30. (Yes, people still sell $350 8×10" prints.) The choice of multiplier is up to you and what's right for your business.
As for multiple prints, the example I was giving was to calculate a la carte pricing — if Sweeney Todd needs five of the same 5×7, I'll be selling him a portrait collection, and he'll be paying less per print. If he chose to purchase those 5 prints a la carte, he wouldn't be getting primo pricing, though. His choice!
Good advice but not the whole truth. Photography is also a form of art and how do you put a price tag on art? Well you really can't or at least it's not that straight forward as you depicted it here. Besides fixed costs and how highly you value your time there is the component of "value". How distinguishable is your style, have you made a name of yourself etc. These are also things to consider when setting a price.
Actually, you still need to value yourself first (pay your bills etc) and the “value” component has to do with finding the right “value” customers too.
No point trying to sell a Picasso to someone who is not into art. That doesn’t make a Picasso any less valuable: we just need to search elsewhere for the right buyer, isn’t it? (same with your art: you may end up working for peanuts-and feeling quite disheartened afterwards- if you aren’t selective about your buyer).
Art? business? need to work on both to make a living.