Should I raise my prices again?

[jackie_boldt]

I just recently raised my hourly rate from $100/hour to $125/hour. I am

continuing to get the same amount of business as before, including alot of

requests and bookings for next year. My goal is to be at $200/hour by next

year, so I don't want to keep booking $125/hour weddings for next year when I

could be getting $200/hour next year.

 

My question is should I raise them now and how much? Should I jump them right

up to $200/hour or continue to take it slow. If I did raise it slow, I would

raise them up to $150/hour.

 

Thanks for your help and advice!

[bdp]

You could offer it as...

 

Book your 2008 wedding by <insert date> and get 2007 pricing as prices will change effective <date above> for 2008 weddings.

 

Hard to say about raising right to 200 as it depends on your work and location.

[ian_cooke1]

Is this hourly rate you speak of for shooting only? Or does it also include post-processing,

travel, and other time? If you book an "8 hour wedding", do you only bill for 8 hours or do

you tack on the time you spend processing images and everything else? If NOT the latter,

then I would say definitely raise your prices. Even $200 and hour is not that much (in most

U.S. cities). Out of curiousity, why bill "by the hour" rather than by a day-rate or package?

<p>

I view one's pricing as not only an indicator of the quality of one's work and their level of

experience, but also an indicator of one's level of confidence in their ability to deliver.

[conraderb]

Most photographers don't bill by the hour for weddings - why should you? I think it will only confuse clients who are trying to compare apples to apples - ie. packages to packages.

 

ce

[jackie_boldt]

Bob,

 

That's an interesting strategy... I have thought of doing something like that. I may look into it more now. In in the Twin City Area, so $200/hour is still within reason

 

 

Ian,

 

The $125/hour includes everything except travel and any other prints/books the customer wants. I bill "by the hour", because there are PLENTY of customers out there who don't want the proof book, $500 credit towards prints, etc. They want flexibility to choose what they want/need. Not everyone wants a photographer for an 8 hour day. If they want 8 hours, I can give that to them. If they want less, I can accommodate them as well. I just started my business last year, so that is why my hourly rate is lower.

[jackie_boldt]

Conrad,

 

What's the harm in billing by the hour if that pricing strategy has been working out for me and my clients? Most of them have said to me that they like that I offer hourly rates. Sure, if I book a 4 hour wedding on a Saturday in the summer when I could have booked an 8 hour wedding, I would take a loss of those potential hours. Other than that, is there a harm?

[mcarter]

Jackie, do you mean Twin City area in Minnesota, Georgia, or North Carolina? Just curious....

[russ_konrad]

Many customers have told us that they don't like being "nickled-and-dimed" to death by the photographer. We sit down with the customer and quote them ONE price for their wedding photography.

 

It is all-inclusive of the hours involved and the picture packages that they have selected. It also focuses more of the attention on their wedding and NOT on you (and your time)as the photographer.

 

Charging by the hour tends to remind people of what they may make per hour in their own jobs and they don't realize that there are many more hours involved in the production of their album/book/DVD.

 

I really shouldn't be advising you in this area since we are in the same market (and in competition) but we have more requests for our services than we can handle and better business people in our field help everyone.

 

Good Luck!

[jackie_boldt]

Micah,

 

I'm in the Twin City Area in Minnesota

 

 

Russ,

 

Thanks for your advice, despite the fact we are in competition. :) Could you clarify "better business people in our field help everyone." Are you implying that charging by the hour isn't good business?

 

Charging by the hour might remind some people of what they make per hour in their own jobs, however, but most people can put together the fact 4 hours X $125 is equal to $500 for a wedding. I guess it all comes down to the type of customer you want to market to.

[russ_konrad]

But charging by the hour does NOT include everything.

 

If they want to purchase a traditional album / coffee table style book / custom DVD suddenly your prices change dramatically.

 

And most customers really do want something more than a CD/DVD full of digital files of their pictures.

 

Also - telling a customer that your own personal time is not as important as making sure that you have enough time to take the formals that they have requested does make a very positive impression. Once you commit to a full ceremony/reception/dance type of wedding is it really worth to haggle over 6 hours or 8 hours worth of coverage?

 

Bottom line - we sell the customer awesome pictures from their wedding that we captured in our unique way with our two photographers. Our time is irrelevant. All that is important is the pictures that they have to remember of their special day.

[jackie_boldt]

Russ,

 

My clients know up front that everything is included in the hourly rate (online album, post-processing, DVD of pictures, etc.) except for prints and a photo book. None have had a problem with it thus far. The customers I have met with and have lost have mentioned that the other company they went with had more print/book options than I did, so I am aware that I need to diversify my print options in the future.

 

It is apparent that we have two very different business structures. As far as formals are concerned, the clients I attract are not interested in having too many formals. They just want the basics and then leave the rest up to me for the day (aka, photojournalism). I don't haggle on the hours. I leave it up to the customer to decide what works for them.

 

Also, alot of my clients don't want the full dance covered. I did a wedding for a client just a couple of weekends ago who just wanted my services up to the first dance. She didn't want to pay for more than she needed.

 

Again, our business structures are attracting different types of clients and both of our businesses, apparently, are thriving on our respective business models.

[Jerry_]

"What's the harm in billing by the hour if that pricing strategy has been working out for me and my clients?"

 

 

 

There is no harm, but you may miss a few shots if you have to keep checking your watch (or the wall clock) to make sure you exit on schedule. Some weddings go beyond the allotted time: photography provided should be wedding events, not per the clock.

[jackie_boldt]

Gerald,

 

That is a very valid point that I will definitely be keeping in mind.

[cjogo]

We have always been by the hour...you will make considerably more profit : by charging overtime. It's just part of the business. The B&G will try to save money and hire you for 4 hours.....all the sudden you are walking out the door & they will find the extra $4-500 > to have you stay another hour.

[William Michael]

> I just recently raised my hourly rate from $100/hour to $125/hour. I am continuing to get the same amount of business as before, including a lot of requests and bookings for next year. <

 

If I assume correctly that your `recent` increase was at or after this date:

 

http://www.photo.net/bboard/q-and-a-fetch-msg?msg_id=00KdlV

 

Then there has been only a few weeks passed since that increase.

 

Unless your business is booking a good number per week, lets say 3 per week, and that means `booked` with money up front, (requests do NOT count in this equation) then any figures less form too small a sample group to conclude: ` I am continuing to get the same amount of business as before.`

 

It is certainly good to have goals, and getting to $200 /h, but the push to the goal should not cloud accurate business analysis, which here on the face of it seems to be lacking.

 

With 20 - 20 armchair hindsight, 100 to 125 was possibly not enough of a jump to realize the 200 goal next year, unless you HAD already thought through the obvious necessity for another TWO similar increases.

 

Perhaps only a $25 dollar increase was because of nerves, or perhaps a clear pathway to the goal figure was not clearly thought through, what ever, it does not matter, the bottom line is there appears too short a period and too few a sample group to safely conclude any further increase is going to be non detrimental to the business model.

 

If you want to be analytical about this decision with a good sample across various months, then give it about 6 months at the 125 price and review then.

 

Also perhaps (not necessarily though) the $200 goal needs to be re-thought, or the 2008 deadline needs to be adjusted, or when goals are set, as well as being achievable (which this seems quite so to be) adequate thought should be given to the nuts and bolts of the IMPLEMENTATION.

 

On the other hand I sailed with a skipper who raced each week with no fear and was most successful year after year, right up until he lost the whole yacht on the rocks: the point is he couldn`t afford the loss.

 

If you CAN afford to test the waters, then be brazen and go straight to $200 per hour and set a date, sooner rather than later, and advertise everywhere that any bookings before that date will be at the old rate of 125 per hour, thus saving $75 / h or `$450 on an average Wedding Coverage`.

 

Why do you need to do it sooner rather than later? Because it will lessen any skewed figures from those `rushing to book at the old rate` and allow a better analysis in six to twelve months as to whether your business is viable at $200 per hour.

 

Remembering of cause that at $200 per hour you need only to shoot for 62.5% of the time you would need to shoot at $125 per hour to gross the same money. Or the other way around you need to shoot 160% more at $125 per hour to gross the same as shooting at $200 / h

 

Eg: say you do 3 weddings per week average 6 hours each: 18 hours @ 125 = 2250: but 2 x 6 hour weddings at $200 / h = $2400.

 

But my guess is you do NOT want to shoot fewer hours, but rather, in fact gross more money: and hence: can you afford to put the yacht on the rocks testing the waters with inaccurate data?

 

WW

[lisa_berry___northampton_m]

go for the raise! you have to believe that all the hard work you do and the good product

you produce are worth it. go through all your printed and web pricing material and

change it straight away, and respond to all new requests with your new pricing. even at

$200 an hour, $1600 for 6 hours of good wedding photography is still a bargain. you can

do it!

[jackie_boldt]

William,

 

Thank you for your advice and insight.

 

My plan was to gradually inch up my price over the year, so that by December/January I could charge $200/hour. So, another increase this summer to $150/hour and finally one to $175/hour in the fall. Then, to $200/hour. Now, just having started my photography business, to me this sounded reasonable. Maybe I may re-think this and decide to do an increase this summer to $150/hour and then to $200/hour next year if business is continuing on to my expectations.

 

The $25/hour increase was because of nerves. I wanted to really take it slow; grow the rate with my portfolio. Again, I may re-think this strategy.

 

At this point, I can afford to test the waters for business next year. I have exceeded beyond all expectations the amount of business I was anticipating to get for this year. I'm confident that I could do the same next year. The question is, will people pay $200/hour for me.

 

I was wondering what the risks are of increasing your prices for a period of time and then decreasing them again due to lack of business? In the real estate market, if it's on the market too long with no interest, the price has to come down (in most cases). You then know they are having a tough time selling it, therefore putting the buyer in a good negotiating situatino. However, with photography services, I may be $200/hour one month, and the next month, I'm back down to $150/hour (hypothetically speaking). The bride that has never seen my site before would have never known about the $200/hour. What's the risk of "trying" $200/hour for a couple of months to test the waters?

[lisa_berry___northampton_m]

p.s. there may be a business model of how fast you should raise by increment once your

pricing is in a good place, but if you're in the low range, and you've recently become

significantly better / more experienced, you can go for a bigger jump. just for an

example, when I was starting out, I realized I was way too low and actually doubled my

pricing. it felt so strange to quote the new price to my clients, but the inquiries kept

coming!

[dave_thielen]

Raise your hourly rate by 5 per cent with every booking. As for booking by the hour rather than by the package. I do the same thing. I bill by the hour, taking payments before the wedding that equal the estimated time, but I shoot by the event, and bill for the remainder.

 

As for staying for the whole dance - total waste of time, I make sure that the garter toss, bouquet toss, cake cutting etc. are all done at the start of the night, instead of the end of the night, then there is no reason to stay for the whole dance. And with 35 years of shooting weddings behind me - there are not enough pictures that are bought from the dance to make the extra time worthwhile.

 

Why do these at the start of the dance? Because there are more people around than at the end of the dance.

[jackie_boldt]

Lisa,

 

That is what my rationale is. :) It's good to hear that it worked out for you!

 

Dave,

 

I agree with you 100%.

[William Michael]

> Maybe I may re-think this and decide to do an increase this summer to $150/hour and then to $200/hour next year if business is continuing on to my expectations. <

 

To me this is a more logical and better business practice. There are many reasons for this point of view; too many to labour here; but suffice to say one overriding element is the period of time AND the number of confirmed bookings available for a snapshot of the impact and the evaluation of that impact.

 

Example: if you have been, on average SERVING 30 customers and SELLING (i.e. money in the hand) 300 widgets per day for the last three months at a corner shop at $5.00 each, the gross is $1500 per day; on a five day week: 1500 items sold, $7500 gross with 150 customers.

 

If, next Monday, you raise the price to $6.25 (25%: effectively what you have just done) and after 3 weeks you find that you are still serving on average 130 customers per week and selling only 1200 items (gross still $7500), you could rightly conclude that the price increase will sustain and you can look forward to increasing the sales figures at the $6.25 price because even though the TIME SAMPLE is small, the SAMPLE GROUP is reasonably large enough to obtain a TREND.

 

Obviously, there are MANY differences with your business to the example outlined, but I choose it to illustrate only the SAMPLE group and the TIME factors of the evaluation.

 

Also, please note there is a distinct difference when analysing the effect of change on a business between the numbers of ENQUIRIES and SALES.

 

On this thread it seems these terms are used freely and intermingled too often. Evaluation must be by then SALES i.e. in this case signed and PAID contracts, not IFs, BUTs and MAYBEs, which are the enquiries, which have NO place in unemotional analysis.

 

> The question is, will people pay $200/hour for me. <

 

The answer is: `If you are asking that question after you make the commitment, then you bring doubt, and clients will sense it: if you are on a path, there is no room for doubt. $200 per hour is realistic.

 

> I was wondering what the risks are of increasing your prices for a period of time and then decreasing them again due to lack of business? <

 

Good question and one I was thinking about last night after I wrote the previous.

 

I can only come up with one major impact, and its effect is mostly (but not entirely) dependent upon your business model in regards to these elements: your target market; your marketing strategy; long term niche target goal (if any).

 

Expanding and simply put:

 

1) if you target market is vast, your marketing is direct and relies on little or no referral, and little time spent selling, and your target is not a niche market but rather any client who is comfortable paying $400 per hour for a coverage you supply and you can on average supply that four times per week at an average 6 hour engagement: Gross $9600 p/w Then no, IMO there would be little, if any damage done, having price fluctuations.

 

In fact there is good theory to wing it right now and let the response set the final figure, in which case, rather than (as suggested above) increase at each interview by 5%: I suggest the next enquiry you quote an even $150 p /h and do so all this week, and next week $175 p/h and the week after $200 p/h and the week after $250 p/h and the week after $300 p/h (seriously).

 

In six weeks, you would have a reasonable idea where your `base` is to be. From that point, (and being at that point) you might really look at the business model and where it is heading.

 

Alternatively, if there is real resistance to at the $250 p/h mark then you have lost little and the re-track will cost little, in fact a lot less than paying for a weekend at a good business seminar.

 

2) On the other hand if your marketing is more indirect and you now (or intend to) mostly rely on referrals and your long term is to have two maximum (that YOU shoot) Weddings per week, an average year being 70 Weddings ONLY and you eventually want to not shoot AT ALL on ANY DAY for three weeks over Christmas, but you want to gross $12,000 to $20,000 per Wedding, and your vision is to cartel a niche market, then IMO all ups and downs will be deleterious, as too, would be the custom (by you) of having same.

 

Regarding: (lisa berry): `there may be a business model of how fast you should raise by increment once your pricing is in a good place, but if you're in the low range, and you've recently become significantly better / more experienced, you can go for a bigger jump `

 

And: (your response) ` Lisa, That is what my rationale is.`

There is not any one business model that suits all.

 

In fact, often it is those who do not understand the `why` of a particularly successful business model, then copy it, and then spend years spinning their wheels, making only wages.

 

The business model must suit the outcomes, and the outcomes (obviously realistic and achievable) must be in concert with the vision. Now there are those who will read that and say `yea, yea, we went to that seminar too`; but there are very few who actually walk the theory, and fewer who remember the vision indeed is variable and changes, often.

 

Regarding the first jump being big: again that depends upon the business model, it might be very difficult to jump from $500 `Shoot and Burn` (stated as a descriptive NOT a demeaning term) Wedding Package to a $1000 package depending upon the marketing and the client demographic and the `image` one has established.

 

On the other hand it is far easier (IMO and experience) to increase the STANDARD RATE per HOUR, and less imperative to justify this increase to the market place by way of an increase in product value.

 

A fundamental in economics is wages and salaries usually go up not down and there is little (comparative) consumer resistance.

 

In relation to the bottom line, i.e. how much is enough / too much, I assume you are talking $US, then US$200 per hour is achievable, but then again so is US$300, but you will work harder for the latter.

 

In the bare bones of this forum, it is impossible to suggest any figure that will suit you and your business, but you might find an insight to the biases my comments have, here:

 

http://www.photo.net/bboard/q-and-a-fetch-msg?msg_id=00Jt5P

 

On a personal note thank you for this comment:

 

`Thank you for your advice and insight.`

 

The addition of the word insight is much appreciated.

 

You are welcome: please drop me an email, if you wish, I would like to know how it all pans out for you.

 

I wish you well, Good Luck.

 

WW