How to set your prices as a professional photographer

Most of us get into photography because we love the art and creativity of photography, but we quickly realize that unless we can get people to pay us for our work, it'll be nothing more than a hobby. Making a living as a professional photographer is realistic, but you have to put in some time setting the foundation, and pricing is a part of that foundation.

Pricing isn’t a topic that most photographers like. While it might be boring, tedious and unimaginative, it is an important part of running a photography business. I’ve talked about it before in this introductory Sprouting Photographer article, but it bears repeating here. Most of us get into photography because we love the art and creativity of photography, but we quickly realize that unless we can get people to pay us for our work, it’ll be nothing more than a hobby. Making a living as a professional photographer is realistic, but you have to put  in some time setting the foundation, and pricing is a part of that foundation. Luckily, pricing is a topic that I love (I know … I’m a nerd) and am happy to discuss it in today’s article!

 

This article is all about the mechanics of pricing, and in particular how to price your physical products. At SproutingPhotographer.com, our mantra is to be specific, direct and share concrete business ideas. Therefore, to accompany the discussion here in this article, I am going to use the example of an 8×10 print to illustrate the concepts. This discussion could be adapted to any physical product, however, so please feel free to use the ideas here and apply them to your own product offerings.

Some photographers pick their prices arbitrarily without real reason. They simply feel that they should be charging a certain amount, and so they just pick that number. This isn’t the best way to set yourself up for a successful career as a photographer though, as you can’t really be sure that your “out of the air” prices are realistic, profitable, or appropriate. Also, when you arbitrarily choose pricing, it also doesn’t give you any measurable or repeatable way to establish pricing for other items in your product line. You end up with inconsistent pricing that is all over the place without logic or reason.

Pricing: Influencing Factors

There are five main factors that should influence your pricing. They are as follows:

  1. The quality of your work and your finished product
  2. Your perceived value in the marketplace and the perceived value of your products
  3. How confident you are as a photographer
  4. What your competitors are charging and what the market will bear
  5. Your cost-of-goods

When looking at these very basic factors, the first three (quality, perceived value, confidence) are all intangibles and therefore slightly subjective. You can offer the best quality, present your work beautifully and be entirely confident in your ability, but all this doesn’t help you come up with a price. At best, it gives you a self-focused approach to pricing, which says “this is what I think I’m worth”, but that isn’t enough.

The fourth influencing factor on pricing (competition) is an important one to note. Of course it wouldn’t be smart to copy your competition’s pricing, but I feel it’s important to at least be aware what your local market will bear and keep that in the back of your head as your establish your own price structure. You don’t want to be so far off the line that you are looked at as being unrealistic.

 

While we’re on the topic of relevancy, creating a pricing structure that your local market will bear is important. As I mentioned in the first SproutingPhotographer.com article, there are so many great educational resources available to us as photographers, but you must to be realistic and relevant to your local market when making business decisions. For example, just because an established photographer from Southern California tells you in a workshop that he charges $165 for an 8×10 print doesn’t mean that you should, too. You need to be realistically priced for your area otherwise you’ll price yourself completely out of the local market.

Measurable Pricing

While there are five influencing factors on pricing (above), it’s clear to see that the only real measurable way to establish your pricing is by using the fifth factor, which takes into account your cost-of-goods. Before we go too deep into the mechanics here, I’d like to explore the concept of cost-of-goods for a minute. If we’re using an 8×10 print as our example product here, the cost-of-goods does not mean just the cost of the print from your lab. Many photographers make this mistake and don’t factor in the real costs of a product. Cost-of-goods for a product is so much more.

Cost-of-Goods is defined as the direct costs involved in producing a product or service which usually includes labor and materials.

It’s important to note that cost-of-goods includes labor. Many photographers don’t factor in their time when establishing their pricing, and that is a sure way to not make a living with your photography business. 

What does an 8×10 print cost?

Let’s go back to our example of an 8×10 print.  Let’s walk through the process of producing an 8×10 print for a client, from start to finish, and see what is really involved:

  • First you spend 10 minutes retouching the image in Photoshop to make sure it’s perfect.
  • You spend a quick minute cropping and sharpening the image for the size of print (8×10) ordered by your client.
  • Now that the image is ready, you spend 3 minutes to order the print from your lab via the ROES software, choosing the right paper stock, finish, shipping option, and so on.
  • The print costs $3.50 from your lab.
  • The shipping charge to get the print from your lab to your doorstep is $6.50.
  • When you get the print in to your studio, you spend 3 minutes unpacking it and inspecting it.
  • You package up the print in a museum-quality arrival sleeve, a beautiful box with tissue paper, a “caring for your print” card and wrap it up with ribbon and a beautiful bow. All of this goes into a custom-printed tote bag with more tissue paper. The cost of your packaging is about $5.00 and it takes you roughly 5 minutes to package it up.
  • You spend a quick minute writing the e-mail to your client, letting them know that their print is in and ready for pick up, and you propose a time for them to come in.
  • When your client comes to pick up the print, you spend 10 minutes chatting with them, making sure they’re happy with the print and talking about their next session.

That sounds fairly average, right? I don’t think that this is an unrealistic workflow. If anything, it may be underestimating some of the time calculations, but let’s go with it for now. Let’s calculate what actually went into the print.

Labour and material costs of an 8×10 print:
33 minutes total time and $15 total hard cost

If you’re a full-time professional photographer and are hoping to make a sustainable living from your business, let’s put your annual salary at $60,000, which I think is more than fair. We have 50 weeks of work (2 weeks vacation) and 40 hours per week, which calculates out to $0.50 per minute, calculated as such:

$60,000 annual wage
÷ 50 working weeks
÷ 40 hours per week
÷ 60 minutes per hour
= $0.50 per minute wage

If our per-minute wage is $0.50, and we put a total of 33 minutes into the 8×10 print, then that means our labour cost of the print was $16.50. Add to that the $15 hard cost, this brings our total cost of the 8×10 print to be $31.50.

Mark-Up

So far we haven’t taken into consideration any other ongoing fixed expenses such as utilities, taxes, equipment, education, and so on. The PPA benchmark survey recommends that a home-based studio operates a business model of 35% cost-of-goods, meaning that your variable expenses (cost-of-goods) should be 35% of your total revenue. The remaining 65% is eaten up by fixed costs and business profit.

Therefore, if we’re operating under a 35% cost-of-goods model, we must mark-up our costs by 2.85 (100 ÷ 35 = 2.85) to arrive at a final product price that:

  1. Covers our hard costs
  2. Pays for the time that went into creating the finished product
  3. Leaves room (65%) for overhead expenses and business profit

This means that we need to multiply our 8×10 cost of $31.50 by 2.85, which gives us a final product price for an 8×10 print of $89.78.

Let’s stop there for a minute. Many of you may be saying that $90 for an 8×10 print is outrageous and that you couldn’t sell a piece of paper for that much in your area. That’s ok. You’ve just hit on the other “influencing factors” that we discussed earlier:

  • Confidence – you don’t think it would go over
  • Perceived value – you feel that it’s just a piece of paper
  • Competition/Market – your area wouldn’t support prices that high

These are important discussions to have. Maybe with these three influencing factors, you have come to the conclusion that somewhere in the $65 price range is more appropriate and realistic for your 8×10 print price, and that’s ok. That just means that you need to price other similar products in your line-up (i.e. 16×24 prints) to have a higher mark-up so that it’s balanced with the lower mark-up on this product (8×10 prints).

There still ends up being some guess-work with using the factors of confidence, perceived value and quality to adjust your prices, but at least using the cost-of-goods pricing model, you have a foundation to start off with. 

Action item:

First, calculate what your per-minute wage is (annual salary ÷ 50 weeks ÷ 40 hours per week ÷ 60 minutes per hour).

Determine your labour costs by recording how much time goes into the production of the finished product and multiply that time by your per-minute wage (above).

Determine your material costs by adding up the hard costs associated with the product (printing, shipping, packaging).

Add the labour costs to the material costs to determine your total cost of a product.

Multiply your total costs by your mark-up of 2.85.

Adjust your price if necessary to be in line with your quality, confidence, perceived value and local market area.

This process might seem tedious, but it is crucial to the long-term success of your photography business. Repeat this process for each and every one of your products and services. If you don’t want to do it manually, we’ve designed a great pricing calculator here that will do it all automatically for you. If you’re interested in learning more about the mechanics and ideas discussed here in this article, you should definitely check out our book, “Pricing for Profit” where we dive deeper into all of these ideas. You can buy the physical book from Amazon here, or you can grab our eBook for immediate download here.

52 Comments

  • khaled Mosli says:

    Thanks for sharing such an amazing knowledge! Truly helped me look at pricing differently 🙂 Thanks

  • Well put and a great read!!

    • Bryan Caporicci says:

      Thanks for reading, Denise. Hope that you can apply some of the principles to make a difference in your business!

  • Dustin says:

    This is insane! In a great way though. I’m looking at my prices right now, and my work. It never seems to add up in my mind right. This is exactly what I needed in order to kind of look at my business a little bit differently! Definitely an enjoyable read. I’m glad I found it.

  • Tara says:

    Hi, this was a very helpful article. Can I ask how do I cost and price digital files? I want to sell them as an add on to art pieces but I have no idea how to price them.

  • Emmy Silvius says:

    This is very helpful for printouts. However, these days many organisations arev requesting the use of images for their website and brochures. How do we determine the price for this? Does it depend on resolution size? Would the buyer be able to use the image for multiple publications? Are they required to acknowledge the photographer? How to avoid the image being used for anything other than agreed or passed on to others? As you can see, heaps of questions. Hope to see an article on this soon… Thanks

  • Paul Kepron says:

    Bryan this is great but one thing I don’t understand is where the 100 in mark-up our costs by 2.85 (100 ÷ 35 = 2.85) comes from. Is it 100% ÷ 35% ? Also, is this amount a standard amount that can be used?

    • Bryan Caporicci says:

      Hi Paul! Thanks for the question. The 2.85 suggested mark-up factor is using a 35% cost-of-sales model, which means that for every $1.00 of income, $0.35 of it goes towards the costs of the product. By dividing 100% by 35%, we get a multiplication (mark-up) factor of 2.85. Hope that helps!

  • Great article for new-coming photographers! Thanks for sharing.

  • dave says:

    Of these five factors that you say you should consider for your pricing – only one is valid – the cost of goods.

    The other 4 are exactly what you shouldn’t be doing to determine your pricing because none of them are relevant to setting a profitable price.

    There are five main factors that should influence your pricing. They are as follows:

    The quality of your work and your finished product
    Your perceived value in the marketplace and the perceived value of your products
    How confident you are as a photographer
    What your competitors are charging and what the market will bear
    Your cost-of-goods

    • Bryan Caporicci says:

      Thanks Dave – is this just your favourite quote from the article?

      • Tom Temple says:

        I have to mostly agree with Dave. As a gallery owner, I find that “labor” costs cannot realistically be part of the equation. “Percieved value” is really the ONLY way to price your work. The list Bryan provided gave me a chuckle when I saw the last line about adjusting your price etc. Basically, Bryan, you’re suggesting a good formula and then ending with a statement that nullifies the above guidelines. The real challenge for any artist or photographer is being objective. Being honest with yourself and understanding your work and the market you want to appeal to. Having said all that. I know I’m not being helpful. Ha ha!

  • Steven Nereo says:

    Ok, now can you explain how everything else in the world works? This was great.

  • This is by far the best, easiest to understand pricing article I have read in my 4 years of photography!! Yes, after 4 years, pricing is STILL my biggest barrier. It creates an insecurity that even holds me back from doing more business. Major help here…thank you!!

  • Pip says:

    I really like this article. Thank you for writing it, I’ve been looking for something useful to help me establish consistent pricing. But I have hit a snag if you could help me.

    I used your information as a model for pricing things. I really like to do canvas photography. I was trying to see how much to charge for a 16 X 20 print on canvas. When I used the cheapest pricing I could possibly find, the markup multiplier led to a selling price of about $230 and that’s not even taking into consideration labor costs or other things like that. But when I looked up similar products I didn’t find anything selling for much more that $130, let alone even getting close to the $200 range. I know in your article you said that we might need to adjust things based on what others in the market are selling. But it seems to me that if I m not careful I could easily be selling things at a lower price in order to compete with the market and not have any hope to make anything back from it (some places you’d have to spend $130 just to print the photo canvas, not to mention the turn around of selling it)

    Is there something I need to understand about being able to set prices that are lower but still profitable? Or am I taking this whole things too legalistically?

    Thank you

  • Jay says:

    Excellent information, Bryan. Thanks for posting something concrete that I can use as a guide.
    One question. What about customers who buy my photography online and have it drop shipped directly to them from a website like SmugMug? They are paying for the processing and shipping costs directly. I’m not putting that money up front and then charging to get it back. Therefore, it seems like I should not include that in the formula. What do you suggest for a pricing structure in this situation?
    Thanks
    Jay

  • ken says:

    Hello! I need some help on pricing my work, I’d really appreciate it 😀 I normally shoot weddings, so I have packages for hours of coverage. I recently start doing some work for a local online blog – they are sort of still in its early stages but have about 20K followers on Facebook now. The type of work I do for them various from edgy portraits of people on the street, to some food photography, to interior design photography, to event photography. Jobs range from 30min (portraits) to 12 hours (events)… How should I price my work? THANK YOU!!!

  • incagraphy says:

    very useful article, Bryan.
    Some feedback/questions:

    How should we take into account the lowered cost of goods and labor when we deal with more than one 8×10? For example if same client asks for 10 instead of one, then shipment cost will be less per photo; likewise time it takes to write an email or chat with the client during the delivery will also be less when you consider that you give 10 photos instead of just one.

    The calculation seems to depend quite a bit on what we think we should get as an annual salary. I guess we should adjust that amount if were to work less than 50 weeks a year or less than 40 hours per week, for some reason, right? For example, if we can work only part time, it would mean 20 hours per week rather than 40 and that would double the cost of our labor, even though the actual labor per 8×10 is not changing. We are not adding any value, but the calculation suggests us double the hourly rate.

    Finally, I wanted to share about another approach in this calculation that I read somewhere else. I cannot remember where it was, so I am sorry for not giving credit to the site. Their approach was to calculate an annual total cost for running our business (costs of cameras, lenses, software and computers we use, union memberships, insurance, etc) and then divide that number with the hours to be worked in a year to come up with the average overhead per hour we should include in our pricing strategy.

  • incagraphy says:

    And here is an additional question:

    How can we apply this method to non-print work, say if we are delivering digital negatives from an event, for example?
    Is our labor the only variable cost-of-goods? Or should we find a way to calculate the depreciation rate of our equipment (camera, sd cards, computer, etc.) to include them as variable COGS and then use the 35% rate as you mention to reach a total revenue value?

  • Justin says:

    This doesn’t factor in the ordering of multiple prints. If someone orders 5 8 x 10’s of the same image, the time to retouch stays constant, shipping costs likely stay the same, time and cost to repackage is reduced, only one email is needed, and one meeting with the client. The point being the overhead is greatly reduced with the ordering of multiple products and transferring the costs and overhead in a linear fashion and passing that on to the consumer is a poor business model.

    I imagine you wouldn’t determine the cost of a session by determining the cost and time to take one photo (advertising, consulting with the client, driving to your studio,setting up and taking down sets and lighting etc.) and just multiplying that by the number of photos taken.

  • Stacy says:

    Thank you Bryan,the information you have given is excellent!!But can you give me some names or ideas about which labs we can use to get pictures printed?and what if it’s more than one 8X10 per say?

  • Leah says:

    Thank you for posting this article. I really enjoyed reading it. As a photographer myself I do have a question for you though that I am having a hard time understanding. I am still trying to get established in photography myself and my question is this. Won’t (and they do) the client just take that “digital file” and go to Walmart and have that 8 x 10 print done there? Course they will, because I am guilty of doing it myself. Is there a fix to this? What can be done about it?

  • Diogo Maia says:

    Link for sprouting the young photographer is broken, Great insight!

  • Micah Miller says:

    Question… is the annual salary that you are talking about GROSS or NET?

  • sharon says:

    How much do you think I should sell my digital photos?

  • Doug says:

    Do you have to let customer know about the mark up? And if so is it a good, up-front, business practice to let them how exactly you figure your mark-ups? i.e. say on a price sheet you write something like this—“Prices are marked-up using the industry standard 35% cost-of-goods model. Shipping and handling included. Thank you for choosing Doug Finger Photography.”

  • Sarah says:

    it doesn’t look like you’re accounting for income taxes. Mine are roughly 45 %. So for your 60k annual salary (if you want to keep it all) you’d need to actually earn a little over 100k. People will be in for a rude surpise come tax time if you don’t plan for income taxes.

    • Bryan Caporicci says:

      Great point, Sarah! I normally talk about salary in the sense of gross salary, as that’s the way most people talk about it.

      If, for example, you’re a teacher and your salary is $65,000/year, that is referencing the gross salary, and then income taxes are taken off of that.

      Either way, though, you’re right – we need to make a lot more money than we think we do in order to survive, in more ways than one!

  • April says:

    Very helpful, thanks!

  • wow, based on all that, no wonder why people think paying for photography is so difficult to afford and probably why so many want the digitals.My persoanl take is you just can’t mark up by 2.85. That’s crazy town. Try 1.3 or 1.4 tops. I’m in a saturated market though.

    • Alberto says:

      I feel one of the biggest challenges (certainly in my small market) to earning a respectable living as a photographer is that many (if not most) photographers give out the digital files either for free (most of local ones do), or charge a very small amount for them. I do not as a general rule give out the digital files, unless the client is willing to pay a substantial fee for them. And in regards to being able to sell photos for a decent profit, if your work is substantial, and unique, people will be willing to pay. Try to remember that the image you captured whether at a wedding, graduation, or other similar event no one else has or will have, and if the client verbally gasped with delight when seeing that image, charge what you are worth.

  • jcveilleux77 says:

    This is really helpful. I had not heard of the 35% mark-up before, nor the pricing by minute rather than by hour. I’ve been calculating the time and hard cost, but adding in the 35% mark-up means I will have enough to reinvest in my next show, plus may be able to pay my grocery bill this month up front rather than charging it! It is the little things. I think this clarifies the mystery of pricing. Thank you for sharing!

  • Ludwig Alberty says:

    Hi I just got your ebook of pricing for profit but im really confused because there is pricing for one thing (service) and other pricing for the formula of gross revenue and a third for products, you give an example of pricing wedding collections that you multiply by the mark up of 2.85, but you give other example of how to price products like an album and at the end you coming with the total of gross revenue. My question is at the end you have to sum all this together and this will give you the final price? or we just have to give the final price from the gross revenue and dividing by the total of session? please clear me this issue. thanks.

  • I liked your article but you didn’t mention other direct costs such as getting the photo in the first place. These could be the cost of camera gear, gas for travel to locations, auto maintenance, food and other miscellaneous travel expenses. These also do not include the hours spent scouting and taking the photos. You rarely get a salable photo during each outing. How do you brings these expenses into consideration without pricing your work at unrealistic levels?

  • Amber says:

    This was wonderful and very helpful information, thank you so much!

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