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business My Client's Video is Going Viral....

I started my business 6 months ago. Like many video guys new to working for themselves, I struggled with pricing. I've been doing weekly videos for this client since the end of December, shooting his Vlog, editing and uploading. Afraid of not landing the client, I slightly lowballed him. As of last week, the videos we're producing are now bringing in 40,000 plus views and I know that he's gotten more business because of the videos. My current (and ideal rate) for my new/other clients is about 1/3 higher than what I'm currently charging this gentleman. Because his videos are weekly, I basically have set aside one day a week just for him and my average time investment is around 5 hours. I will say, his consistent patronage is what's allowed me to barely keep my head above water, even when I don't have other clients. But given the 16% rate of inflation, and that my other clients are paying more, do you think it's worth keeping this client at that lower level?

My conundrum stems from him being the first person to say "yes" to me, but I'm starting to get to the point where I'd rather schedule other jobs that pay more. Anyone got some experience in this area that would chime in? I plan to raise the rate come the one year mark, but with inflation being so high right now, I would really like to raise it sooner. Not to make more money, but to be able to pay my bills.
 

mlesemann

Staff Member
Moderator
Do you have a contract that specifies that the rate he's been paying is good until date x?
If so, you have to wait for then.

If not, you're free to raise it for the next job that you do for him. You should give him some advance notice (like now), and of course be aware that he might be pissed off and/or go elsewhere. But you certainly aren't obligated to continue to under-charge him.

And there's nothing room with making more money :)
 
I should add, we've never signed a contract or agreement. I do the work, then send him an invoice. He's a financial advisor and well aware of inflation and such, so it should be easy, but right now, he's the one paycheck I can count on week after week.
 
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mlesemann

Staff Member
Moderator
He's a financial advisor and well aware of inflation and such, so it should be easy, but right now, he's the one paycheck I can count on week after week.
My approach would be to raise his fee by a moderate amount, and then do so again in a few months, with also an eye to what your competitors are charging. ALSO, even if you normally just send him the invoice after the fact, I strongly recommend that you let him know in advance that you're raising your rates due to inflation. Doing the work and then having to fight to get paid would be a step in the wrong direction.

When I have repeat business with screenwriting clients, I always re-iterate that the price again will be x for part such and such and y for part such and such.

It's always a crapshoot, though.
 
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You could be honest with him. Explain the original price and why it was as low as it was. Explain that you are forever grateful for his business and how he helped put you on the map. Maybe even show how much he saved with your low pricing compared to the rate you would have otherwise charged him... and then tell him the time has come to raise prices for the work you do for him. Obviously, you need to be prepared to lose him as a client... Such is business.
 
Has your work for this customer brought in other work? Sure, just being regularly active means you'll be more reactive with regards to other projects, so there's an inherent advantage in having that week-in-week-out session. But can you identify any clients who have come to you specifically because of what you did/have done with or for this guy? If so, then that's an added benefit that you shouldn't ignore.

In any sector, it would be normal to negotiate a reduced - sometimes much reduced - rate for regular, repeat business. If I were such a client, I'd be looking for a 25-33% discount off your "list price" precisely because I'd be providing you with a guaranteed income. On the other hand, if you're now so busy that you're having to turn down better paying jobs, then the basic principles of "supply and demand" apply: put your prices up.

Adding inflation into the mix, it sounds to me like you should simply announce an increase in your rates for everyone ... but you could increase this one client's rate by (say) 15% while "only" increasing your standard rate by 10%. Do this again every six months or so (using inflation as a reason, if necessary) until you reach a point where the gap between the rates for one-off and regular customers is less extreme.
 
I may have missed it, but I'm not sure how long you have been working for your financial advisor client.....or how much longer you expect your client to need your services.......both of which may help determine whether to increase your prices.

Your situation is somewhat how I started my business.......why would someone choose me over others who had more experience?......and that was price, and it worked.....and I didn't raise my prices on my "base clients" that I could count on.

Then, later down the road when my business grew.....I could (and did) gradually raise my prices.......but in the beginning, I didn't raise my prices and risk losing my "base clients" that kept my business paying its bills....To this day, due to our reasonable rates, I still have other tax professionals referring our services to others.
 
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Thanks for the responses, guys.

This client did put me in touch with another that was a decent sized gig and had my flying to Chicago, so that is something to consider. I think for now I will try to ride this out until the one year mark. While never explicitly stated or agreed to, I do want to try to only raise rates once a year, if that. Living in a smaller town, reputation is everything.
 

indietalk

IndieTalk Founder
Staff Member
Admin
Has your work for this customer brought in other work? Sure, just being regularly active means you'll be more reactive with regards to other projects, so there's an inherent advantage in having that week-in-week-out session. But can you identify any clients who have come to you specifically because of what you did/have done with or for this guy? If so, then that's an added benefit that you shouldn't ignore.

In any sector, it would be normal to negotiate a reduced - sometimes much reduced - rate for regular, repeat business. If I were such a client, I'd be looking for a 25-33% discount off your "list price" precisely because I'd be providing you with a guaranteed income. On the other hand, if you're now so busy that you're having to turn down better paying jobs, then the basic principles of "supply and demand" apply: put your prices up.

Adding inflation into the mix, it sounds to me like you should simply announce an increase in your rates for everyone ... but you could increase this one client's rate by (say) 15% while "only" increasing your standard rate by 10%. Do this again every six months or so (using inflation as a reason, if necessary) until you reach a point where the gap between the rates for one-off and regular customers is less extreme.
THIS. You need to raise rates while offering discounts to partners of forged relationships. You ride the wave together and are both expected to raise respective rates (based on industry if they have clients as well).
You could be honest with him. Explain the original price and why it was as low as it was. Explain that you are forever grateful for his business and how he helped put you on the map. Maybe even show how much he saved with your low pricing compared to the rate you would have otherwise charged him... and then tell him the time has come to raise prices for the work you do for him. Obviously, you need to be prepared to lose him as a client... Such is business.
I would not suggest this approach. It needs to just be clearcut business (but friendly and personable). Raise rates and let them know you are taking off x% so you can continue the relationship. The last thing you want them to feel is that you are raising rates based on their success and not yours so avoid the whole "Back then I needed you as a client" speech.
 
Thanks for the responses, guys.

This client did put me in touch with another that was a decent sized gig and had my flying to Chicago, so that is something to consider. I think for now I will try to ride this out until the one year mark. While never explicitly stated or agreed to, I do want to try to only raise rates once a year, if that. Living in a smaller town, reputation is everything.
I think you basically answered your own question here... Let your client know while you certainly appreciate his business, because of the current state of affairs, you're giving him six months notice before you have to raise your fee. Six months notice is MORE than enough time for him to prepare. I certainly wouldn't wait until then to give him notice. I don't think you would either.
 
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The last thing you want them to feel is that you are raising rates based on their success and not yours..............

The above is so true.......but if your client was bringing in only 40 views rather than 40,000 plus views....and his business was faltering instead of increasing, I doubt very seriously you would be considering raising your prices on him.
 

indietalk

IndieTalk Founder
Staff Member
Admin
Since when do views pay so much? Sign me up! 😂
 

indietalk

IndieTalk Founder
Staff Member
Admin
The above is so true.......but if your client was bringing in only 40 views rather than 40,000 plus views....and his business was faltering instead of increasing, I doubt very seriously you would be considering raising your prices on him.
He was very clear in stating he already has a new rate but this is the only continuing client from the old rate. And he stated he is considering taking on different clients due to better money. So on the contrary, if they were faltering he would have less of a conundrum here and just take on better business.
 

indietalk

IndieTalk Founder
Staff Member
Admin
If it were me, I'd let them know you raised rates but give them the discount for a continued relationship, which should put you at just a little over what they are paying now. Win win. I would not do a 6-month grace period, who knows what can happen in that time anyway.
 
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