Pricing - the most difficult task in 3D-graphics

[JuhaHo]

I don't know if this has been discussed here earlier. For me the most difficult thing in doing 3D-animation or visualizations, is the pricing. I have tested quite a many approaches to this question, but haven't found any. Are there any universal guidelines for pricing.

I like working with 3D-projects, but I dislike invoicing. It makes me physically ill.

Any thoughts?

[JuhaHo]

My current pricing model for animations is quite simple - I think.

950€ + VAT including 10 seconds HD rendered animation. Each Additional second 50€ + VAT.

What do You think?

[JuhaHo]

How about still-images. I was thinking to quote first rendering 200€ + VAT per incoming CAD-model and 100€ + VAT from that on? Assembly and scene setting fee 200€ + VAT (included if I get all in one model).

A sample pricing. I get three models which do not share same coordinates and client wants four renderings around the model. My invoice would then be 1 100 € + VAT. 3 x 200 for materializing and preparing each model. 200€ for assembling the scene. 3 x 100€ for additional renderings.

What do You think? Does this pricing model work?

[Pixelcon]

How about still-images. I was thinking to quote first rendering 200€ + VAT per incoming CAD-model and 100€ + VAT from that on? Assembly and scene setting fee 200€ + VAT (included if I get all in one model).

A sample pricing. I get three models which do not share same coordinates and client wants four renderings around the model. My invoice would then be 1 100 € + VAT. 3 x 200 for materializing and preparing each model. 200€ for assembling the scene. 3 x 100€ for additional renderings.

What do You think? Does this pricing model work?

I think you're overthinking it a bit.

Your prices should be probably be at a minimum:

your living costs + your business costs
whatever you can produce per month.

If you've got 'clout' then you can go higher. Any lower and you'll be out of business and homeless...
As for dividing it up into model prep + first/second/third renders. Keep it simple. X per image. X per 10 seconds of animation.

[JuhaHo]

Thanks,

I'm actually trying to simplify my pricing model. I don't think the client is interested in my living costs. They are interested in knowing the costs of my services. In some cases, I think they don't even care what the actual price is as long as it's reasonable, but they need to know it in order to create a purchase order to their system.

The price model is wrong only if I get too much or too few assignments in the long run.

Pricing model has to be transparent, predictable and same for all kinds of clients.

[Pixelcon]

Thanks,

I'm actually trying to simplify my pricing model. I don't think the client is interested in my living costs. They are interested in knowing the costs of my services. In some cases, I think they don't even care what the actual price is as long as it's reasonable, but they need to know it in order to create a purchase order to their system.

The price model is wrong only if I get too much or too few assignments in the long run.

Pricing model has to be transparent, predictable and same for all kinds of clients.

I think you need to re-read what I wrote. Did I suggest you should tell your client what your living costs are?

[fixeighted]

Hehe, I don't believe that James was actually suggesting you give your clients a run-down of your living expenses when justifying your pricing
He was saying that, in any given living situation, you assess those expenses and come up with pricing that accomodates paying for those expenses whilst also making some profit

This clearly will differ vastly from country/region to country/region, from person to person and company to company, so is an unanswerable question generally....just too many variables.

From my experience and point of view and based on an expenses calculation, charge a day/hourly/project rate based on what you believe your skill/experience/output quality is.
This allows for realistic quotes and will probably fit a client's budget better.

[JuhaHo]

Thanks for both,

No, I didn't suggest exposing client my own living expenses. What I mean, my living costs are irrelevant in pricing point of view, My living expenses need to be adapted to what I got.

As a pricing guru once stated: in the end all prices are eventually pulled out of thin air. Or as we say here "all prices are shaken out of sleeves". Some companies nail down the pricing first and then design the product in a way it makes sense start the production - let's produce a table that costs 95€ to consumer and yet be profitable for us to make.

My price model is based on that thinking. It's also important to realize that not every project has to be profitable as long as many enough is.

[Pixelcon]

my living costs are irrelevant in pricing point of view, My living expenses need to be adapted to what I got.

Then charge nothing. You'll get more work than you can dream of but you'll end up living in a cardboard box down by the river.

[JuhaHo]

Then charge nothing. You'll get more work than you can dream of but you'll end up living in a cardboard box down by the river.

I take, You haven't heard about nordic social security. If shut down my business today, government starts paying social security. In my case minimum would be 800€/month. If I go there I may not start 3DSMax, because from that point on they would consider me as an employee even if I don't take any money. I just read about laid of journalist, who wrote an article for free just to maintain skills. The social security was cancelled, because she wrote.

If I didn't got any savings they would pay me even more. I don't have to sell my apartment, car, boat and so on, but I have to sell public shares and other commercial papers first to get more than 800€. Selling those would cover living cost for a few years even without the 800€ monthly fee for doing nothing.

[Pixelcon]

I take, You haven't heard about nordic social security. If shut down my business today, government starts paying social security. In my case minimum would be 800€/month. If I go there I may not start 3DSMax, because from that point on they would consider me as an employee even if I don't take any money. I just read about laid of journalist, who wrote an article for free just to maintain skills. The social security was cancelled, because she wrote.

If I didn't got any savings they would pay me even more. I don't have to sell my apartment, car, boat and so on, but I have to sell public shares and other commercial papers first to get more than 800€. Selling those would cover living cost for a few years even without the 800€ monthly fee for doing nothing.

I am Swedish...

[JuhaHo]

I am Swedish...

Then You should know the system. No on is left alone.

Anyway if I may go back to topic. I think living costs and pricing has no direct link. Others may see it otherwise. Yes, it's difficult to run business, if there isn't enough incoming money for running costs (both business and personal) and necessary investments. What I'm trying to achieve with this topic is to find out a fair market price for still renderings and animations. Also I wonder if fixed prices would work - sometimes You spend one hour and sometimes 100 hours for same the money, but is that even important as long as it's profitable in long run.

When I started doing this for money back in 1992 a bank manager told me that most common reason for difficulties in small companies is the company owners personal spending - a bit too fancy house, or car etc.

[Pixelcon]

Then You should know the system. No on is left alone.

Anyway if I may go back to topic. I think living costs and pricing has no direct link. Others may see it otherwise. Yes, it's difficult to run business, if there isn't enough incoming money for running costs (both business and personal) and necessary investments. What I'm trying to achieve with this topic is to find out a fair market price for still renderings and animations. Also I wonder if fixed prices would work - sometimes You spend one hour and sometimes 100 hours for same the money, but is that even important as long as it's profitable in long run.

When I started doing this for money back in 1992 a bank manager told me that most common reason for difficulties in small companies is the company owners personal spending - a bit too fancy house, or car etc.

There is no fair market price for any product or service that exists in a globalized fashion such as ours. The big players charge 10k for a still image, and the people on fiverr charge under $100.
I'd wager the ones charging 10k and living in New York or Miami or Norway or Paris have somewhat different living expenses than those living in Kolkata or Lviv. But hey I'm sure that doesn't factor into their pricing model at all, right?

[JuhaHo]

There is no fair market price for any product or service that exists in a globalized fashion such as ours. The big players charge 10k for a still image, and the people on fiverr charge under $100.
I'd wager the ones charging 10k and living in New York or Miami or Norway or Paris have somewhat different living expenses than those living in Kolkata or Lviv. But hey I'm sure that doesn't factor into their pricing model at all, right?

And yet somebody is willing to pay that 10k for a still image. I would say that's fair market price then.

Anyway, there's totally missed the point, I've said in the beginning. I was talking about pricing model. The numbers in that equation can be changed at anytime. If I have too few assignments I can lower the numbers to get more money and vice versa. There is no room for living costs in that equation. It's an iterative method to maximize the incoming money.

[Pixelcon]

And yet somebody is willing to pay that 10k for a still image. I would say that's fair market price then.

Anyway, there's totally missed the point, I've said in the beginning. I was talking about pricing model. The numbers in that equation can be changed at anytime. If I have too few assignments I can lower the numbers to get more money and vice versa. There is no room for living costs in that equation. It's an iterative method to maximize the incoming money.

Sounds like you've got it all sorted out then! Good luck with it