The Business

[glorybound]

I have a couple of questions. I think I know the answer, but I want to shoot it past you guys.

First, I have a guy who has some ideas on some properties he is trying to market, no money and wants renderings. He is talking about 2X when the properties sell or stock in the larger developments. I know that this isn't too uncommon, but what are your thoughts? I have to keep my normal workload, which pays the bills, too. I would have to take the risk and work extra hours a day when I am already working 15 hour days. Basically, I don't need the money or work and I don't think 2X is enough of an incentive. Answer: I would need much more to take the risk.

Second, I have a guy who is working on something that will need tons of renderings. He is talking about keeping me busy for a long time. I don't base cost on the promise of future work, but this guy has done a tone of work on a UI, so it is real. I don't want to put all my eggs in one basket, so do I really want to pass up on other one-off projects, that keep me busy 7 days a week, to almost work full-time for this guy? My fear is the project runs its course and then I lost all my connections that have paid my bills for 5 years. Typically, I do 2-3 projects a year for a few dozen people and then another couple dozen one-off clients. I would have to turn these down to do the work this guy is talking about. Answer: Hire someone full time to do must of the work and I would be the creative lead on the project, so it looks like my work.

Currently, I have three people doing work for me, but for the most part, I do the actual render. I can't farm the rendering out because it isn't my style and my clients seem to want my style; they can get cheap 'mediocre' renderings from the majority of the people out there.

Whatcha all think?

[Neilg]

Youre busy, so you dont need to work for free. if he's so certain he can pay double when the properties sell he should be convincing enough to get financing to pay you. Dont put all your eggs in one basket unless you can juggle it with old relationships.

Honestly the thing I got from all of that is that you're working 7 days a week and 15 hour days - you need to raise your prices until you're working 10 hour days, 5 days a week and making the same amount of money. Plan it out and creep them up over 6 months.

[glorybound]

I am already charging more than most. Some of you guys are doing houses (something small) for $250 when I am charging $700. I think I am on the edge and I am not sure I can charge more. I shoot down a lot of work by not lowering my price. I get my share of, "you are crazy, the other guy is charging 1/3 of that!"

[Neilg]

Big archviz studios charge 6k+ per image. people that want to pay $250 an image will always and only pay $250 an image.

if you're that busy, you can raise them until you stop getting work. Better to charge 30% more and work 30% less.

[francomanko]

Would it be that hard to teach the people who work for you, your style? Freeing you up to either do the new project yourself or manage someone else to do it?

[Morbid Angel]

I think I had 0 promised work ever come true. So that's probably something you can cross off your list right away. If some one really needs those renders, they can borrow money from a credit line and pay you. That's how services work.
The power of any business comes from multiple sources, I rarely seen a business survive solely on one source and surely when that one source dies, so does the business which relied on it. So that answers your second question.

For client 1, if for whatever reason you want to do work for him, offer him a deal where you will do the work for regular cost, then he can pay you the other cost once he sells *(which I really really doubt).
For client 2, there is no other way but for you to expand or do what people above suggested. Chop off the low paying ones, until you make good $ while work normal hours. The rule is - you can't do everything your self. Sooner or later you have to choose: stay small, do the work like you have now, or grow.

[glorybound]

When there is a promise of more work I always say, unless things are signed in bulk, I don't discount. I have several clients who do get a small discount if they send me, let's say, ten houses at a time. I had one guy just last week trying to get me down to some discounted price and I think he thought he won until I reminded him it is in bulk; I haven't heard from him since.

The dreamer with the idea to develop some land, I think I will pass on that one. There isn't enough skin in the game for me and I don't think he has anything to lose, I mean, getting people to work for nothing with the hope of making money is a chumps game. When I first started this I was helping a guy put together some home improvement show stuff and when he was done being an ass and asking for unbelievable changes daily, he disappeared. I mean, what was I thinking? What did he have to lose? People like that are just as bad as shoplifters, it is theft.

[glorybound]

Big archviz studios charge 6k+ per image. people that want to pay $250 an image will always and only pay $250 an image.

if you're that busy, you can raise them until you stop getting work. Better to charge 30% more and work 30% less.

Yeah, but I am not there yet and that is an awful lot of money for a still. I would have to rethink everything and try to compete with the big guys. I don't know how they get their work, but they have to have things that work that I don't know about. Right now I have 0 client acquisition cost. I can imagine they spend a lot to get these clients.

[squintnic]

4-6k USD is standard in Australia amongst the decent studios, cant really be cheaper with legit set ups and staffing.
I think you could certainly charge more Bobby - and with a few tweaks to your work (some basic post work in fusion / nuke ) start to add in basic animation extras given your scenes are allready full 3D. Same money less time at computer = more time for family and relaxing.

[glorybound]

4-6 grand per still? Where can I study more about Fusion/Nuke? I have guys calling me from Minneapolis, the closest big city, who used to work for the local architects. These guys used to get $5000 grand for a high-rise, now they can't get near a $1000.

[Neilg]

Yeah, but I am not there yet and that is an awful lot of money for a still. I would have to rethink everything and try to compete with the big guys. I don't know how they get their work, but they have to have things that work that I don't know about. Right now I have 0 client acquisition cost. I can imagine they spend a lot to get these clients.

I'm not saying charge 6k. You charge $700 - next quote, make it 750 or 800. After 3 months, raise it a little more. Keep doing that over a long period of time until you get a drop off in workload then hold there. Find out what the true market value of your work is.

[glorybound]

Yes, I use that methodology already, which keeps me busy year-round. I don't have flat fees, I quote each project uniquely. I'll see what 10% on top of what I would charge looks like and if good, I'll keep adding 10%.

[hoppergrass]

the $4K projects are not for small (or in your case not so small) residential houses, these are for large appartments, commercial and retail projects. For the type of projects you do, I'd say around $1200+ is an average price here in OZ, and thats for a small studio or one man band. Larger studios seldom bother as the margins are too small to justify the effort.

Intersting thing though, once you get into the $4k band the clients treat you with far more respect and more than often dont haggle over the price too much. Its still very demanding and you have to deliver top notch work to keep in the game as its very competitive here.

[glorybound]

I was around $1200 for a good-sized house, but over the year I have dropped my price a little. Now, maybe $900 for one view and less for others, like the back of the house. Usually, I do a front and back and let's say the front is $960 and the back is $480. Smaller houses are a little less and larger houses a little more.

[glorybound]

At this price, over the last year, 1/2 say I am about 3X more than most others and the ones who do go with me say it is very reasonable.