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Markup? Yes, Mark it Up!
Posted By John Harrington On March 19, 2007 @ 3:57 am In Business of Photography | No Comments
What, the cost of an assignment? Of course, there are photographer’s fees and appropriate usage fees. There are also assignment-specific expenses, such as parking, mileage, and often an assistant. Equipment rentals, and expendables like gaffers tape, seamless, and for old-school assignments, film and Polaroids.
When it comes time to bill for the assignment, why then does it seem fair to the assigning party to pay only the exact total paid for things like seamless, gels, and so on? It’s not.
The insistence for receipts is a common demand made by clients. No markup is allowed. Yet, a well-respected software application ad agencies and design firms use, Clients & Profits , facilitates the proper markup of our services to clients, as well
as the countless other expenses they pay for. Their standard rate?
17%. Why? Because, to simplify it, they spent time finding and securing us, and the other resources they need, and, properly so, they mark us up.
How do we come to secure the equipment we rent? We expend time to call and get it. We expend time to pick it up and then return it when we’re done. Seamless and gaffer’s tape? Same thing. Also, then, there’s the float time on our credit card while we wait to get paid, and often the incurred interest when the client pays late for whatever good reason.
I recently submitted an estimate for my services for an assignment in May. I happen to know fairly well the assigning party, and so I asked, “What is your markup on my services?” For my assignment, which was estimated at $1,015, the client indicated that their time handling me, overseeing the assignment’s pre-production and results, and delivering the images to their final end-client was estimated at $2,000. That figure is what my client indicated they would line-item for photography, including their time, and which their client would pay them.
If a roll of seamless costs $49, there’s nothing wrong with charging more. In fact, what about your time going to the store to get it, parking there, and bringing it back? If not yours, the assistant’s. If not the assistant’s, then the courier charge for an oversized package like that.
When you turn over receipts, you are noting to the client only what the cost was for the item itself, not the cost to know what to get, nor the cost to get it to the assignment. We don’t look at markup so much as a profit center as much as a manner by which we cover our costs. Our profit comes from our fees.
Wikipedia has two entries on the subject – “Markup ,” and “Cost-plus pricing “. To be paid just what the receipt delineates, is to be paid less than what it cost you to acquire it, when you stop and think about it.
[tags]John Harrington, photographer advice[/tags]
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 Clients & Profits: http://www.cnp-x.com
 Markup: http://en.wikipedia.org/wiki/Markup_%<br ></a> 28business%29
 Cost-plus pricing: http://en.wikipedia.org/wiki/Cost-plus_pricing
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