Join Richard Harrington for an in-depth discussion in this video What you should know before watching this course, part of Budgeting Video Projects.
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- I've been talking about the business side of video for a long time to both video professionals as well as many photographers and other folks that are just thinking about moving into the industry. And invariably, after a presentation someone always comes up and says, "Can I get that template?" You see though, it's not about the template. It's about understanding your work. Having a template does no good if you don't have the knowledge to fill it out. You're just back to guessing that back of napkin, seat of pants approach and it'll be nicely formatted information but it'll probably be totally wrong.
What it comes down to is really understanding your organization. Now, in this course, I'm going to give you a little bit of our background and how we approach things. But you might have to localize this to your own project or geographic area. We're based in the Washington D.C. area. We focus a lot on corporate and broadcast production, really in the realm of public service announcements and online education. We also do full-service work, including the post-production and video editing as well as motion graphics to go along with it.
Having the template is not enough. It's important that you move beyond this simple request, and instead take a detailed look at what is the information that's needed. Remember, spreadsheets are not the answer. Rather, it's the facts contained within. Using a spreadsheet simply helps you organize your thoughts, but they still need to be your thoughts. It's important that you have the knowledge to populate it with accuracy. The use of a spreadsheet is quite simple.
Now, don't worry. I will give you a template. But you're going to have to do some work on your own, localizing the rates for your company or your market and making sure that all of the services you offered are properly encapsulated into that spreadsheet document. But make sure that that spreadsheet template is up-to-date. We will also show you how to use some standard applications like Microsoft Excel and Apple Numbers to populate that template. What's important here is that you start thinking in broader terms what budgeting really is.
The art of budgeting is mapping up the capabilities of your company with time estimates and determining if there's any other services that you have to turn to an outside vendor or contractor for in getting accurate information, pulling all of that together into a package that's clearly understood by the end customer or internal client and then presenting that, and of course, being prepared to defend it, explain it, or modify it. Now, that may sound intimidating but if you are able to do something like put together a grocery list or throw a dinner party, you probably can figure out how to budget.
People just get really intimidated by things and overthink them. What I find is that it's essential that you map out what you're going to be giving the customer and how much time it's going to take to pull all that off. Once you're able to accurately estimate the time and break down the exact work packages that you're going to be delivering, budgeting becomes pretty clear. The most important thing though to remember is that rates in my market are going to be different than your rates. I'm in the greater Washington D.C. area. It's one of the more expensive areas in the United States.
Now you could be in a much smaller city or a more expensive city like New York and have higher rates or lower rates. What's going to be important is that you take a look at your local competitition and adjust your rates to match the needs. It's going to be important later that we walk through this process. And I'll give you some guidelines on how to set your own rates. Remember, using a template's great. But if the numbers don't line up to your labor cost, well, it doesn't work out very well. It's essential that you get those two things in sync. Additionally, you're going to need to know your organization quite well.
So if you're new at the organization or you haven't thought through some of the things of which services you offered, those are going to be some precursor steps which we'll explore in this course and you'll need to put the homework in. There are a lot of factors that will affect your price. What's essential here is that you pay close attention to the theory and the philosophy behind budgeting and not so much the absolute numbers. You see, budgeting is just a skill, a skill that could be adapted to any user and any company or organization.
It just comes down to really thinking things through and being familiar with your capabilities and your labor cost. Alright, with this in mind, let's take a quick look at the exercise files.
- Evaluating outsourcing and partnering options
- Setting your rates
- Incorporating material and overhead costs
- Scoping the project
- Estimating the production time
- Collecting data with time tracking
- Creating a quote or proposal
- Setting payment terms
- Creating an invoice with Word or Pages
- Dealing with billing and collections