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Higher rates=More work

Member for

21 years
I hear all the time that if you don't charge enough, then people will not take you seriously. Does anyone find this to be true?
I don't mind working for $15-$20 an hour because most of my clients are friends and former bandmates, and I know my stuff is not "major label" quality. But I wonder if I am losing potential work because people will assume I am a hack (which I may be, but I won't know for sure until people reply to my post in the Song & Mix Critique)



Member for

19 years 9 months

Thomas W. Bethel Sun, 03/16/2008 - 06:07
You have to charge depending on your experience, on your location and on how much the client is willing to spend.

It costs a great deal more to work and live in a large city than if you were in a more rural setting. The problem is there is probably more work in a large city than in a rural location. People who do work in cities have to charge more just to survive. People who live in a more rural setting have less cost of living expenses but are farther from their potential client base.

You also have to look at your client base and figure out what they are willing to spend to have you work on their material. I have a very good friend who runs the most successful recording studio in this area. He charges $210.00 per hour for his services and literally has clients waiting in line to use his services. He is located between two large cities with freeway access literally at his front door. I have another friend that has a great acoustical recording space and is an excellent engineer and charges $80.00 per hour, but his location is in a very rural area and he is just scraping by. The differences are the location and what people perceive as the value of their services.

What you charge has to be based on what I stated before and what you think your services are worth. When we did our business plan I took a look at what it costs me a month to operate my business. I then figured out how much per hour I was going to have to charge (allowing for down time and non audio business time to do things like accounting and marketing) and arrived at a figure. I have stayed with that figure for 13 years modifying it slightly as cost increased and as we paid off all our equipment and building costs.

It always helps to have a business plan and to draw it up BEFORE you start into business. You will have to answer to the best of your ability some hard questions like "how much to charge?", "how fast do I want to grow?" "what are my client's willing to spend?" and the hardest question of all "what if this does not work?"

Best of luck and let us know how you are doing.....

Member for

17 years 2 months

JoeH Sun, 03/16/2008 - 09:12
This is a great question, Mark, and as usual, Tom's given a world of great info for you. "What he said", indeed.

You can also ask around to see what others in your area are charging. (use an anonymous third party if you're embarassed about it...).

Sometimes, it's a case of "what the market will bear", (what you can get away with?) and other times it's a case of "The more you pay, the more it's worth." Of course, you'd better have the goods for the latter, if you plan on carrying that kind of reputation around with you, long term.

I have a corporate rate, and I have a non-profit rate. For the corporate rate, it's hourly, and I have no worries when I make up their invoice. (Of course, eveyrthing's been spelled out ahead of time, so there's very little sticker shock, and these kinds of clients are spending company money anyway). I charge EXACTLY what I've spent time on, and the client knows ahead of time what they've gotten into.

For the non-profit rate (a bit cheaper, by 25%), I can still make money, but they don't get the unlimited bennies that a corporate client will get. They do feel like they're getting a better deal, and there's a lot of loyalty generated this way. Most non-profits are spending grant money, or even out of their own pockets.

In my very early startup days, I took alot of work on spec, or was reluctant to charge much for it. I certainly wasn't charging enough. Admittedly, I was scared of losing work or driving people away, etc. Gradually, that changed as I got busier and the clients started showing loyalty. I was able to relax and rethink my worth. (You really do NOT want to get known as the "Cheap guy" who'll do anything for a buck. That's a dead-end street, and you can end up hating life - doing cheapo sessions that never end, for less money than your local sanitation engineers are getting for emptying that can at the end of your driveway every Wednesday....)

I'm very lucky in that I live in a big city, with lots of potential clients, across a wide spectrum of genres. There's a lot of possibilities in any of the big city markets, depending on what you want to do.

There are only a handful of guys in my particular range of expertise around here, and from what I've heard, I'm NOT the most expensive guy.
This is fine with me; I not trying to crush anyone else or be the most (or least) expensive. From all indications, there's a healthy competitive vibe between the few of us that do this kind of work in the area. (I suspect the other guys are as busy as "I" am, and dont' really care about any paranoid competitive price wars, either.)

I tend to take a reverse approach to sales and marketing my business. I feel it's better to be the person that everyone WANTS to use, as opposed to being the guy that wants to SELL YOU (the client) his wares. This is called desirability, and it takes time to generate it, but it can be done. (It's a fun time, a great party, and you should entice clients to WANT to be with you, if that makes sense...)

If someone is in "pain", they want the pain to go away, and they'll find a way to stop it. (Think: midnight toothache - dentist!) If they want the best recording possilbe, as soon as possible (and they've got the funds set aside to do it), they will find you and won't have a problem paying you. Money will of course be important, but far less an obstacle than you'd think.

Bottom line: set your rates for what you need to live on, and increase it with your successes, but don't come off greedy and be prepared to flex as much as you can without being a doormat. I'm going to raise my rates in 2009, but I'll let my clients know sometime this summer, so they can plan accordingly, and avoid nasty surprises and sticker shock in '09.

Member for

21 years

Member Sun, 03/16/2008 - 10:05
I probably came across as a newbie in my post, but I have actually been in business for almost 12 years. I started at $10 an hour and within a few years had bumped up to $20 and was working 25-30 hours per week on a regular basis. I peaked at $35 a few years ago and business came to a grinding halt. I think some of this has to do with the proliferation of cheap home recording gear ( oddly enough, the same kind of gear that helped me get into the business is driving me out)
My biggest problem is I live in a rural area with a pop of about 35,000 and the reality is that no full time pro bands are going to drive 3-4 hours to record with a part-timer so I am stuck with primarily demo work.
I have heard of some studios in the area working in the $50 range, but I don't know how much work they are really doing. And I know thier product is not any better than mine.
To be honest, I actually lay wake at night thinking about how I am contributing to the multitude of hack recordings in this industry and also driving down rates in the process. The thing is I WANT to do better recording and I am happy to be in the business at all!
I would appreciate responses from any certified Psycho-therapists out there (actually my wife has a psychology degree, but she doesn't understand me).