Photography & events
Commercial Photography Pricing Calculator
Prices commercial photography, where the licence rather than the time is the product.
Result
Overhead and margin are taken as shares of the selling price, which is why the cost is divided rather than multiplied. Adding 15% to cost does not produce a 15% margin. Gross profit is what is left after the cost of doing the job. Overhead comes out of that: the building, the office wages, the vans, insurance, software and advertising. A healthy gross margin still loses money if overhead is larger.
Get a Free Business AuditHow the calculation works
A creative or shoot fee for the work, plus a licence fee reflecting the scope of use, plus expenses for crew, talent, location, props and equipment. The licence is the element that most distinguishes commercial pricing, since the same images used in a local campaign and a national one are worth very different amounts.
What moves the number
- Licence scope: use, media, duration and territory.
- Crew, talent and location costs.
- Usage exclusivity, where granted.
- Shoot days and post-production.
Where this one goes wrong
The photographer owns the copyright from creation unless it is transferred in a signed writing, and work made for hire is a narrow statutory category that does not cover most commissioned photography regardless of what a purchase order says, which means a client asking for all rights is asking to buy something that has to be priced and documented. Price the rights requested. Model and property releases are also required for commercial use and obtaining them is part of the job rather than an afterthought.
Before you quote
- Price the licence separately from the shoot fee.
- Get any rights transfer in a signed writing, priced accordingly.
- Obtain model and property releases for commercial use.
Where the rules come from
Questions
About this calculator
Why does commercial photography price on licensing?
Because the same images used in a local campaign and a national one are worth very different amounts to the client. The licence is the product, and pricing on shoot time alone gives away the value the client is actually buying.
Can a client buy all rights?
Only by a signed transfer, which is something to price rather than assume. Work made for hire is a narrow statutory category that does not cover most commissioned photography regardless of what a purchase order claims.
What should a licence specify?
Permitted use, media, duration, territory and whether it is exclusive. Each of those changes the value considerably, and a licence left vague is either underpriced or an argument later about what was bought.
The formula
price = direct cost / (1 - overhead% - margin%)
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How to use this calculator
- Labour cost ($). Burdened: wages plus tax, insurance and the vehicle, not the hourly wage.
- Materials cost ($). Enter your own figure; the page starts at $60.
- Other direct costs ($). Permits, disposal, equipment hire, subcontractors.
- Overhead rate (%). Overhead as a share of revenue. Work it out from last year's accounts.
- Target net margin (%). Enter your own figure; the page starts at 15%.
The result updates as you type, so you can try a figure, see what it does to price to quote, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Labour cost | $300 |
| Materials cost | $60 |
| Other direct costs | $0 |
| Overhead rate | 22% |
| Target net margin | 15% |
What comes out
| Result | Value |
|---|---|
| Price to quote main result | $571.43 |
| Direct cost | $360 |
| Overhead recovered | $125.71 |
| Net profit | $85.71 |
| Gross margin | 37.0% |
| Markup on direct cost | 58.7% |
Quote $571.43 to cover $360 of direct cost, recover $125.71 of overhead and leave $85.71 of net profit. That is a 58.7% markup on cost.
How sensitive the answer is
Holding everything else steady and changing only labour cost, this is what happens to price to quote. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Labour cost ($) | Price to quote |
|---|---|
| $150 | $333.33 |
| $225 | $452.38 |
| $300 example above | $571.43 |
| $450 | $809.52 |
| $600 | $1,048 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Labour cost ($)
- Burdened: wages plus tax, insurance and the vehicle, not the hourly wage.
- Materials cost ($)
- A money amount, starting at $60.
- Other direct costs ($)
- Permits, disposal, equipment hire, subcontractors.
- Overhead rate (%)
- Overhead as a share of revenue. Work it out from last year's accounts.
- Target net margin (%)
- A percentage, between 0 and 80, starting at 15%.
What the results tell you
| Result | What it is |
|---|---|
| Price to quote | The headline result. A money figure. |
| Direct cost | A money figure. |
| Overhead recovered | A money figure. |
| Net profit | A money figure. |
| Gross margin | A percentage. |
| Markup on direct cost | A percentage. |
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.