Business to business pricing

[YPF]

I have been approached by a couple of photographers to provide quotes for framing to match the style they provide or are thinking of offering their customers.

Using my pricing software I am quite comfortable quoting/pricing for 'normal' customers but not having any experience of business to business I'm not sure what level to put my quotes at to the photographers. If my software prices a job at about £58 how low should I be considering offering the framing to a photographer if there is an opportunity for repeat work?

Any thoughts gratefully received.

Steve

[Keadyart]

From my limited experience of dealing with photographers -
I would avoid giving too much discount from your 'normal' pricing structure,unless you are getting bulk orders and a good deposit up front.
If your price is too high for them walk away,as you will find yourself working for nothing and the only winner in that situation is the photographer.
Don't worry photographers certainly know how to price their framed pieces to take into account your price.

Just my opinion and experience.

All the best
Brian

[prospero]

My philosophy is to charge retail orders at as much as you can and trade as little as you can.

There may be a few possible advantages in trade orders. No protracted design and selection of frames. Orders for a lot of the same size frame. You know what you are doing and know what materials to keep in stock. These factors may save a lot of time and allow you to do a good price without losing money in real terms.

[stcstc]

nah my philosphy is

charge as much as can for both


no actualy to be serious

i do mainly work for photographers etc

it is well worth developing a relationship with some good photographers, as generally you will get multiple orders for standard parts etc.

I tend to start high when giving them ideas of price and then generally end up with a discount of up to about 20%. BUT i dont give that discount on the first few orders, as i want to see things develop, as a good few photogs are keen on over estimating how much work there is for you etc

[prospero]

One thing with trade work is that one hand sometimes washes the other.

[birdman]

We started with quoting retail prices and told them as a business relationship develops that discount will follow. The level of discount depending on the volume of work.

We do some work regularly for a popular and local photographer. They get a reasonable discount and agreed not to charge more than our retail prices for the frames. They send people to us if they want something different to what the photographer has on display. The photographer also bought and paid for a large range of sample frames for their studio and they regularly change them to keep the look fresh.

At the end of the day they will pass on the cost of framing to their customers, and they charge more than enough for their work to cover your costs.

Prospero says "hand washing" we call it "back scratching".

[Gesso&Bole]

Ultimately 'trade' work has to be profitable, so there is no point quoting low to get it, and then curse the fact that you make no money.

Why should it be at a discount?

1 There is a regular flow of work (so base the discount on volume)
2 Regular, repeat sizes and specifications (so restrict the discount to certain specs as agreed)
3 No 'design time' spent with the customer (so reflect this in your price you can give)
4 Volume of work may give you discount with your supplier (so you can reflect some of that in your price)

Basically, if you know what the volume is, and the spec, and the regularity of the work, you can calculate what to charge. But just because someone says they are a photographer, and might bring you lots of work, then I would start off at, or very near to normal prices, guage the quantity of work, hassle-factor, and how quick you get paid, before going down the route of giving a discount.

My caveat here, is that it depends where your prices start. If you are underpricing to start with, then for goodness sake don't give a discount as well!

[YPF]

All,

Thanks for the responses. I think that my quotes to the photographers will reflect normal pricing and that any repeat work could attract discounts in the future.

Again, thanks all.

Steve

[Roboframer]

I'm sorry but I think the idea of offering your normal price, or close to it, and then some sort of discount once the orders start to flow, just won't work because you probably won't even get the initial order. The customer is not going to think "OOOH - I know, I'll sell these frames at just a 10% mark up for a few months; then, when I've sufficiently impressed this framer in to giving me a better rate, maybe I can mark them up 50, or who knows, even 100%"!

One hundred percent minimum is what they'll be looking at if they have any sense.

You either gear yourself to sell 'trade' or you don't and if you do then you have to know how you are going to do it, what materials; what terms. What if they want 30 day terms, are you able to carry consumables - pay your invoices before you get paid, anticipate being paid late now and again? Trade customers won't be paying deposits or up-front, do you to your suppliers?

You need a formula that works to arrive at a good 'list' price and then need to be able to even discount that further for agreed spends, just like most of your own suppliers will, and if they are already, and if you are basing your retail prices on their list price, you already have flexibility.

[Not your average framer]

Making frames for trade customers can be a lot of grief. It doesn't always work! If the relationship is a good one and there is mutual trust and respect, then it will work.

I think Robo's thinking makes a lot of sense, but to offer big discounts, your margins have to healthy before discounting. Higher value mouldings won't stand such large discounts as the bog standard cheaper stuff. Don't forget to allow for wastage!

If they are gonna standardise on a particular moulding, or two, then it may be worth discussing quantity prices with your supplier.

BTW, my experience with too many so called trade customers is that "talk is cheap". Be careful until they prove they can be trusted.

[JamesC]

Your pricing should probably allow you to give 10-20% as standard, 30% for a really good repeat customer maybe. I've seen companies offer 50% or three for twos even to retail customers but I think that suggests to them you are overcharging in the first place, or low quality.

Agree with the reasons given, and with Robo that you probably want to show a bit of faith in them from the start to get things going. I would never limit them on what they can re-sell stuff for - never an upper limit! The more they make the better and the easier the relationship is and the more likely they will stay in business - and push the market price/expectation up (it's already unrealistically low because of people like we all know who peddling foreign mass made crap on the high street).

We have some pretty big photographers (multi-award winning and MPA fellows) using us but it's surprising how little they order, it's all about discs and albums mainly. Having said this they all tend to send a fair bit at Xmas and get the odd "big job" e.g. we fitted out a whole city centre law firm with perspex. Don't get angry with them too early!

Some of ours are more of a pain than others e.g. grant themselves 30 days credit, or have never ordered something they didn't need within a day. You have to be careful who you upset locally but you can just say no, put the prices up or demand COD - it's your perogative but usually in the end it's best to bite your lip if the work is paying the overheads and you have spare capacity.

Just make sure you have a sensible credit limit for each customer. Don't let any photographer owe you more than £5,000 at the absolute most and probably much less unless you know them or have good history. It's surprising how many only think they need to pay when they want to order something else.

Other customers are a delight to work for and have matched their volume estimates and don't hassle us, of course.

[Framerpicture]

Well over half our work is trade- by which I mean the person/ company buying it is reselling it. We offer discounts of about 30% from our retail price list on framing mounting etc and 40% discount from our retail price for printing.

Not only do the trade customers get this discount they also get 30 days credit and often take far longer to pay. Bad debt hasn't been a factor recently, although I am just going to take customer to court over a debt of over £5k.

So although it has its risks, we do make a good profit from our trade framing as we have volume. This allows me to negotiate good deals when buying materials thus making our retail framing much more profitable.