Cost-based pricing is an excellent place to start when trying to determine what to charge for a product, but it doesn’t work for everything. This month, we examine additional factors that may break the cost-based mold. Some strategies allow you to charge more than what cost-based pricing suggests, while others force you to charge less (or get creative).
In last month’s Business Corner, we discussed controlling one of the two types of expenses in your business: general expenses, also known as overhead. This month, we examine the other form of spending, cost of sale. Cost of sale includes all money you spend serving a client.
To a lot of photographers, the various parts of commercial work can be extremely confusing. Many struggle with how to break into commercial work, or figure out how commercial work differs from editorial work. The one thing that’s not often talked about is how to price commercial work.
In many markets, wedding photography has become a commodity. A commodity is an item or service for which the market will accept only a specific price. Most of us know the current price of a gallon of gas, and we would not go to a gas station that charges a dollar more per gallon, no matter how much better the station claims their gas is. Quality is perceived to be the same, and the distinguishing factor is price alone. If the market accepts only a certain price and that price is not profitable, how do we succeed?
