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Quick Contracting Question - Regarding Overhead

high dynamic range
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Brian "Panda" Choi high dynamic range
Assuming an "Expenses" Section exists on a Work-For-Hire Agreement:

Do most clients assume subscription based software overhead is already factored into a given hourly or flat rate for the Work?

-or-

Is that invoiced under the "Expenses" section along with the agreed upon payment in the contract?

By subscription, I mean something like Adobe Photoshop CC or Autodesk Maya.

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  • Playdo
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    I think it depends on what the client is expecting from you. If the work is outside of your usual scope and you need to rent additional software, then you could add it onto expenses. Otherwise it leaves a bad impression and should be factored into the rate.
  • VelvetElvis
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    VelvetElvis polycounter lvl 12
    The less you expose of your billing, the less ammo you give the client to try to pick and choose the costs they feel they shouldn't have to pay. We aren't doctors, we don't need to line item every little thing.

    Roll all of your overhead + your base rate into your hourly rate you charge. Only add extra charges on invoices for things that are explicitly custom to the project. An example would be that I get a client request for an animation on a tight turn-around. I'd add in an extra charge item in the invoice for the online render farm charges. Though, before even accepting the job the client is aware that there will be an surcharge for online rendering and the tight deadline. You don't want to spring stuff like that on them.
  • Brian "Panda" Choi
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    Brian "Panda" Choi high dynamic range
    So, assuming a subscription to a 3D program I definitely need should already be rolled into, what they describe as, the labor cost of the contract, I should negotiate for a slightly higher flat fee?
  • Eric Chadwick
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    Yes.

    If you're tracking your work properly, you'll get a handle on what it costs for you to do business. Software, hardware, training, etc. Plus how long it takes you to do things... it's smart to keep a timesheet, just for yourself. Rent, food, entertainment, etc., costs of living. All these should be factored into your rate, plus at least a 15% profit margin. You'll need it for the slow times. Build at least a 3-month buffer of survival money. Blah blah blah you get the picture.

    More details
    http://wiki.polycount.com/wiki/Freelance
  • low odor
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    low odor polycounter lvl 17
    Yes, have all your costs figured into rate.

    the only thing you should need to justify your fee is your work/XP...I'd be suspect of any client that wanted to know the specifics of how I run my business in terms of expense. "yes that 5% is for my beer allowance..to get my creativity going- I read it on polycount....the 2% for afternoon napping in nonnegotiable."
  • Brian "Panda" Choi
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    Brian "Panda" Choi high dynamic range
    Definitely.

    I suppose, in this specific situation and being that it's only my second month of actually freelancing ever, the breakdown of the flat fee and the given time on the contract works out to it being barely above minimum wage in the US, and more or less half my lowest rate I've been paid.

    I want to give it some allowance since they seem to implicitly word it as "if this works out, there's more in it for you" and I DON'T think this character asset is terribly complex.

    The overhead is payable, but it'll leave me significantly less than what I would expect from studio work in two weeks.

    Someone tell me if they see something fishy, I might be too optimistic here.
  • VelvetElvis
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    VelvetElvis polycounter lvl 12
    "if this works out, there's more in it for you"

    This is the 2nd biggest line of bullshit you will ever hear. Yes, the is more ultra low wage work in it for you. Whooo!

    The first biggest line being, "Work for free this time. The exposure is good for you and will lead to better things."

    Once you've been pegged as the cheap option, it becomes really hard to ask for higher wages. You'll get the puppy dog look from the client and they'll go, "But you did it for us last time on the cheap."
  • WarrenM
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    Yep, you can always come down in price but you can never go up. That's a general rule.
  • Wolthera
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    Wolthera polycounter lvl 5
    Btw, little tip when it comes to time sheets: Just press ctrl+shift+; in any given spreadsheet cell to make a timestamp.
    If you do this for the start and end of every task and are able to make a simple description of said task, your future self and their bookkeeper will love you.
  • Tits
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    Tits mod
    All of the programs needed are usually included in the price (hourly rates and stuff)
    the only exception would be if a client ask you to specifically use a software in particular (or engine) in the context of that project only
    Exemple I worked on a project where I was require to used UE4 (before it was free) and then I added the price of the subscripton as a second ''item'' in my invoice.
  • MephistonX
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    MephistonX polycounter lvl 9
    Yep, i would say you want to include any costs for your equipment/software in your rate, the only reason to add it as an extra expense is if the employee explicitly asks you to use something you do not own and agree that they will pay for it. It's something that should be in the contract. The only other expenses like that would be for purchasing stock/assets/video/fonts etc... that can be added to the bill.
  • kanga
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    kanga quad damage
    Definitely.

    I suppose, in this specific situation and being that it's only my second month of actually freelancing ever, the breakdown of the flat fee and the given time on the contract works out to it being barely above minimum wage in the US, and more or less half my lowest rate I've been paid.
    Yeah it is up to you if you accept the commission. The promise of more work like this is moot because more work at the same rate isnt really attractive. Mostly I say it is time better spent looking for good clients or improving your folio. I think we all underestimate the effort needed to establish a good client base.

    As for overheads, nobody really cares about them unless you are being flown from Beijing to Rotterdam.
  • Brian "Panda" Choi
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    Brian "Panda" Choi high dynamic range
    Thank you for the advice everyone! I'll definitely remember it going forward. What I'm getting mostly is that overhead for us generally just covers weird, but neceessary expenses like a proprietary, but expensive game engine or file converter, etc.

    That being said, I'm definitely open to hearing more thoughts. This is by no means the end of this thread, I'd imagine. I'd love to hear other perspectives.
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