Real World Estimates – Flat Rate Magazine Contracts

by Craig Oppenheimer, Wonderful Machine

As we’ve discussed in a previous post, structuring photographic fees on the basis of a day rate vs, space is customary for many national magazines and is generally the most equitable for both the photographer and the client. But we’re increasingly seeing publications prefer to pay flat fees for photo shoots. While working this way can keep the costs predictable for the client, it puts all the financial risk on the photographer. Any unforeseen expenses can eat into your creative fee quickly if you’re not careful. Here are a few things to consider as you negotiate your next magazine job.

For starters, it’s important that you don’t immediately jump into a budget discussion when a client first contacts you. It can be disconcerting to a client, editorial or otherwise, if you show more interest in the money than the project. Yes, it’s important to understand their budget, but save that conversation until after you’ve expressed an interest in the assignment and an understanding of the concept.

Once you’ve heard the details of the shoot, ask the client if they have a contract or if they’d like to work with yours. Then, ask if they have a budget set for the shoot or would they would like to see an estimate. Unlike a lot of commercial projects, most magazines have a pretty clear idea of what they expect to pay for a given assignment. If the client is offering a flat rate, that can mean one of three things. Either it’s a flat creative fee plus photographic and travel expenses, or it’s a flat fee including photographic expenses plus travel expenses (like this assignment for Fast Company). Or, it’s a flat fee including all expenses.

When presented with a flat budget, it can be tempting to decide on the spot whether the rate is satisfactory for the time, skill, licensing and expenses involved. But in most cases, it’s prudent to call the client back after you’ve had a chance to run the numbers and review their contract. What seems like a lot of money at first may be less impressive once you subtract off all your costs and account for the licensing. And of course, be clear before you hang up the phone about what the “flat” rate covers and what it doesn’t.

Figure out how you’re going to execute the job and then list all of the expenses you’ll incur—subtracting them from the total budget. Compare what’s left to the amount of work involved and the licensing required. Is it reasonable? If it isn’t, don’t assume that it’s a take-it-or-leave-it situation. Most clients are willing to negotiate if you handle it in a thoughtful way. Determine what would make it work for you. Then try to understand which items are important to your client and which aren’t, so that you can make an offer that satisfies their needs without giving away the farm. For some clients, the rights are most important and they’ll be willing to bend on price. Other clients will have a strict limit on what they can spend and they will be more willing to negotiate the licensing. We were recently negotiating a contract with a casino whose legal department completely rewrote our contract. It didn’t take a genius to see what their priorities were. So rather than giving them limited licensing for a moderate fee, we gave them all the terms they wanted and simply raised the rate commensurately.

In another recent situation, we were presented with a contract from a custom publisher that specified that they could use all “works” created on the assignment for editorial use forever. We felt that the fee they were offering would be reasonable for their initial needs (which was four images), but that to have use of any or all of the images from the shoot was excessive. The photo editor was sympathetic to our concerns, but her legal department wasn’t willing to modify their contract. Then we saw that it was actually the assignment brief that defined what constituted the “works.” So the photo editor just rewrote the brief to define the “works” as just four images and specify that use of additional images would be negotiated separately (which they later were). This simple change was enough to satisfy the photographer, the photo editor and her legal folks too. A win-win-win.

Here’s an example of one magazine’s flat rate contract:

And here’s a flat rate contract template we use when the client doesn’t have their own contract (click here to download a Word version):

Most of the terms are similar to our day rate against space contract, except for paragraph 2:

COMPENSATION – The Client will pay the Photographer a flat fee, inclusive of all normal expenses, to be agreed upon per assignment, for a specified usage.

Once the contract is in place, all you have to settle on for each assignment is the fee and the usage. We’re normally comfortable with a simple email from the client saying, for example, that for xxxx.xx including expenses they would use a full-page opener plus an additional half-page picture.

There are a lot of limitations in the rest of the contract that you can negotiate to keep in or take out. But as with any contract, the main thing is to be clear about what you’re going to get and what they’re going to get.

For more information on Wonderful Machine’s consulting services, please contact Craig Oppenheimer at craig@wonderfulmachine.com or 610.260.0200.

There Are 7 Comments On This Article.

  1. Great post. I know this is something that photographers struggle with all of the time. It’s important to know when the industry trend changes for these negotiations.

  2. Thank you, Craig. I’ve asked several times in the past for more information about the business side of editorial photography on this site, but it doesn’t seem to produce much. As a commercial image maker my presumptions have been editorial doesn’t produce much ROI. Possibly I’m mistaken. Would love to read more about the business side of editorial.

  3. Wow. Thank you for your important text, Craig…I am more than 25 years freelance photographer, but every new assignment is like “new assignment”. In Czech Republic – Prague – many of publishing houses, newspapers, magazines etc., doesn’t any idea about rules between photographer and them…I will re-send this text to all my partners. Thank you.

  4. Wow, wonderful indeed! Thank you so much Craig Oppenheimer for sharing this positive, including, transparent and informed attitude for conversations and negotiations on price and contract. You show it’s possible! I’ll spread your word and be sure to amend my communications towards clients as of today. Thank you again and all best.