BUSINESS VIDEO MASTERCLASS
PART 2 - AVOIDING MISTAKES WHEN GETTING QUOTATIONS
What’s in a Day Rate
The day rate is the rate a video studio charges you for their services, particularly their illustration, editing or animation services, as these are always a major part of your cost.
Their day rate may be £200 per day. It might be £600 per day.
You need to know this.
Some video companies will make their Day Rate clear in their quotation. Others may not.
I’ve had the experience where a supplier refused to give me their day rate, saying:
“We give an overall price for the job”.
Or “our day rates differ depending on the skillsets needed, so we don't quote them ....”
Or even “we don’t quote this way. We take each project on its merits.”
Let me be plain and state that I don’t like these kind of answers.
I like transparency with all my suppliers, especially on cost.
I might add that I like transparency with everything. It’s just better.
Everyone who ever worked for me told me their day rate, if I asked, including my accountant.
Sharp retail video buyers like Walmart or Lidl will insist on knowing the day rate.
So why shouldn’t you?
Personally I won’t deal with someone who isn’t clear about their rate. I just like to know.
There may be a number of rates, eg, the camera crew day rate, or other specialist rates.
But the illustration, animation and editing day rate is the best overall guide to help you find out
- not just whether a company is expensive or not,
- but how much more expensive they are.
The opposite applies at the cheaper end.
You might have an attractive quote to consider, with an attractive price.
But a day rate of only £150 per day might look suspicious. There has to be a catch somewhere.
Costing more, or costing less, isn’t just the only metric.
Ultimately, it’s the delivered value to meet and exceed your business goals that counts.
What are typical studio day £ rates
Because no one ever has a clear answer on what typical day rates are, I recently did a study on People Per Hour, the popular online contractor recruiting agency.
I analysed over 100 video freelancers, pages & pages of them, as People Per Hour is one of the few place where rates are published.
All the data went to into a spreadsheet for final accuracy.
I found that rates varied extremely from a $5 an hour pittance to £600 plus per day.
Then I did some more arithmetic.
I calculated that the Average Day Rate lay somewhere between £294 and £332 per day.
So around £300 per day was the average market day rate.
At the lower end there were freelancers and producers with no rent, rates, or staff to pay.
At the higher end there were bigger studios with fixed business overheads, wages, and probably some highly skilled personnel you’d expect to pay more for.
And there were elite freelancers who charged significantly above average.
My conclusion was to use this £300 per day as a guide rate for what you might expect to pay in order to get the right sort of skilled people working on your project.
It’s also a target to beat.
If you can get it cheaper, and the quality-to-effectiveness ratio looks right then you’ll have saved.
For example: If your video production needs 8 days work, and you can get £250 per day, then you’ll have saved £400, compared with buying at an average £300 per day.
If your requirement is simple, you might get what you need for £200 per day.
If you need very high specialist skill levels, you might need to pay £450 per day or more.
These are all quick assumptions.
But either way, knowing Average Day Rates gives you a cost target to beat, so long as you think you can do this without compromising the business effectiveness of your video.
The bottom line is that knowing a studio’s day rate
- and comparing it with the average day rate
- will enable you to more objectively compare video quotes for your project.
Apples can now be compared with apples.
As a valued visitor to Business Video Masterclass, you’re now welcome to a FREE 15 minute personal consultation with me, where you can ask about a video problem that’s on your mind.
I’ve spent most of my professional life solving real world video problems.
It’s relaxing for me. I enjoy it. So please share your ambition or concern, and I’ll do my best to help.