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Negotiating Agency Shooting Contracts

March 8th, 2010

Peter Meo recently pointed out to me that I’ve never talked about negotiating agency contracts on the blog. He’s right. These kind of contracts are not all that common and I’ve never been directly involved in one. So I consulted Mike Miriello (Mike does the RealEstatePhotographyPodcast) and Thomas Grubba. Mike has an exclusive shooting contract with a company in Virginia and Thomas has an exclusive contract with Pacific Union Real Estate and a non-exclusive contract with Empire Realty in the Oakland, CA area.

What is an Agency Shooting Contract?
This is where a real estate photographer enters into a contract with a agency (real estate company) to shoot some number of listings per year. In return for a guaranteed level of business from the agency, the photographer gives the agency a discount on the price of each shoot. This kind of arrangement is a win for all parties. The photographer gets a guaranteed level of business, the agency raises the level of their marketing and the agents get a price break on good photography for their listings.

Agency Shooting Contracts are Not for Everyone
I think before you try getting an agency contract you need to be in demand by top agents. Your demand in the office you are negotiating with will help you in the negotiation. On the other hand, if you already have a large customer base and you are already shooting 400 or more shoots a year then an agency contract may not for you. Oh, yea, with these kind of contracts you probably need someone to back you up so you can take time off now and then.

Key Items to Negotiate

  1. Price: The agency is going to expect between 10% and 15% discount from your established shoot price in exchange for a guaranteed number of shoots.
  2. Minimum Shoots Per Year: Look for agencies that are going to give you a minimum of  250 to 300 listings a year
  3. Exclusivity: Some agencies may want you to only shoot for them. This consideration should decrease the discount you give them.
  4. Permissions: Don’t give away your copyright. Make sure it’s clear that any use of the photos outside the contract needs to be approved by you. That is, if the agent wants to give the architect, builder, stager or home buyer photos, they have to come through you and should expect a licensing fee charged to the appropriate party.
  5. What’s Expected of Agents: Thomas says, “The hardest part of a contract is managing the agents and scheduling. Having a well though out plan in advance is key to making it work.” Here are the agent terms and conditions that Thomas uses.
  6. How Billing and Payment works: Set the contract up so you don’t have to nag agents to get paid. One way is to collect upfront. Another way is bill the agency once a month and they pay you directly. The agency can then bill the agents directly and take care of collecting from them.
  7. How photos are delivered: You need a fast efficient way to electronically deliver photos because of the high volume you are likely shooting for in a contracted situation.
  8. Scheduled rate increase: Once you establish your rates, it’s difficult to raise your rates. Thomas recommends specifying COLA plus 5% or a rate increase per year that you are comfortable with, if this is not agreed upon in the initial contract, it will be difficult if not impossible to raise your rates without jeopardizing the contract.

General Negotiating Advice

  • Mike’s advice:
    • Negotiating a contract has less to do with you, and more to do with external variables than you would think.
    • Small agencies will have the money to contract with you, but they may not have enough volume. Look for agencies that will give you 250/300+ listing a year.
    • You are in the driver’s seat when it comes to writing a contract, if you write one from scratch with the broker/general manager, you’re better off for it.
    • While negotiating price. be sure to give examples of costs like professional camera gear, lighting equipment, a reliable computer, specialized software and travel. By doing this, it highlights the fact that you aren’t being paid just for your “eye” or “creativity”, you’re producing a product.
  • Thomas’s Advice:

The ideal contract is where there is a compulsory aspect that every property over a certain price will be photographed, that will depend on the area but let’s say over $1 million. Everything under that price the agent has the choice to have it photographed or not. The agent will need to give at least 3 days notice to set up a shoot and the images will be turned around the next business day by 12 noon. A standard shoot is $xxx and generates up to 12 images and an Estate shoot is $xxx (double the standard shoot rate) for up to 24 images. These designations are based upon a) How big the property is and b) how many images an agent wants. For example a 4,000 sq ft house automatically falls into the Estate category even if the agent only wants 12 images. If an agent wants the 24 images, even for a 2,000 sq ft house that also goes into the Estate category.

Thanks to Thomas and Mike for sharing all their insights in this area.

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4 Responses to “Negotiating Agency Shooting Contracts”

  • I would also suggest that large acreage properties with multiple structures fall into the estate category, regardless how big the home is.

    It would be interesting to see a range of Thomas’s pricing.

  • I’d caution against the really large brokerages — if the volumes are too high, you are putting all your eggs in one basket. If they go belly up, or simply change their photography policy, you have a major problem. And if they monopolize your time, you become effectively an employee, but without even the semblance of job security, and of course zero benefits. A better course is to have several small-to-medium-sized offices. Then if you lose one, it’s not such a disaster. Also, with the medium-sized clients, the volumes aren’t so great as to pressure your rates too far down. Best of both worlds.

  • I agree with you, having only one big client might be risky.

    Thanks for the post.
    Gilles

  • Have experience as an independent contractor as a photographer. I’m seriously thinking of real estate photography (homes for sale listings). I don’t have a photography specific web site yet, but can create one.
    Should I start with one agency that I’m familiar with? I believe I can offer good quality photos.

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