EP016: The Race To The Bottom

01:00:00:11 - 01:00:14:21
Robbie
You probably heard about the race to the bottom. Well, it's a real thing. And on this installment of the offset podcast, we're going to talk about how to fight it. Stay tuned.

01:00:14:23 - 01:00:33:09
Joey
This podcast is sponsored by Flanders Scientific leaders in color accurate display solutions for professional video. Whether you're a colorist, an editor, a DIT, or a broadcast engineer, Flanders Scientific has a professional display solution to meet your needs. Learn more at Flanders Scientific. Com.

01:00:33:11 - 01:00:39:04
Robbie
Hey everybody. Welcome back to another installment of The Offset Podcast. I'm Robbie Carman

01:00:39:06 - 01:00:40:14
Joey
And I'm Joey D’Anna

01:00:40:16 - 01:01:05:06
Robbie
And Joey. Today I want to talk about something that has been bothering me and it's been bothering our industry. we talk about it all the time with our peers and our friends on, you know, online groups and in person. And that is the old race to the bottom. to be clear, the race to the bottom is not something that is only affecting, the post-production industry and what we do, the race to the bottom is, I mean, whatever.

01:01:05:06 - 01:01:30:22
Robbie
It's always it's always a fight that people are fighting. But I think we should kind of, you know, begin this conversation kind of defining what we mean by the race to the bottom, because I think it can mean, you know, something slightly different to different people. but I'll give you what my understanding or my feeling about the race, the race to the bottom is and that is, is that any time an industry tends to democratize itself and more people are involved in that industry, right.

01:01:31:02 - 01:02:03:18
Robbie
The pie gets bigger, right? And more people, more operators there are wanting a slice of that pie. What tends to happen is that less people are working consistently, and one way to get more work consistently is by doing it cheaper than the person who is also doing that same work. Right. and so, you know, the days of, you know, the early days of this, you know, in our industry in color were when, you know, somebody was doing a, you know, a $1,500 an hour or whatever, $2,000 an hour for a show or for, you know, a grade.

01:02:04:00 - 01:02:26:08
Robbie
And somebody came around like, well, I can do it for $900 an hour, $100 an hour. And now we have this. The race to the bottom part about this means that that snowballs, right, is that people are adding more and more services. Sometimes they're adding services that are dramatically lower than market rate. They're dramatically lower than anybody's offering in different markets, even.

01:02:26:10 - 01:02:47:13
Robbie
And sometimes they're even just tossing things in for free to to build volume and to build that work. we have seen this unit virtually in post-production. We've seen that universally in production budgets are smaller, less value is applied. And nowadays even people are like, well, we can just get ROI to do that and it doesn't matter and we don't have to pay you.

01:02:47:13 - 01:03:15:07
Robbie
Right. Like that's all a contributing factor to the race to the bottom. And I have no illusions of grandeur. I alone, you alone can't fight completely. Right back on the race to the bottom. It's a little bit out of our control to a certain degree. But in this episode, I think I want to talk a little bit about, I do want to talk about things that I think we can do as colorists, as entrepreneurs, as business owners, whatever, to kind of fight this.

01:03:15:07 - 01:03:22:02
Robbie
But first, before we begin, is that more or less line up with kind of your feeling about the race to the bottom in kind of the definition of it?

01:03:22:02 - 01:03:48:05
Joey
Yeah, yeah, there's a couple things going on with it that I think are really relevant today. And that is, you know, as things have been democratized, like you said, and we've gone from very expensive tools to very inexpensive tools. And I remember when Thousand Dollar Final Cut Pro came out. Yeah, most houses were like, this is going to put us out of business.

01:03:48:07 - 01:04:12:21
Joey
You know, it's not what ended up putting the post house out of business. what's important to remember is there is going to be opportunity in high quality creative work and creative talent, no matter what the tools involved to do that are. As the tools dramatically change. I think where we can protect ourselves is by staying competent artists, right?

01:04:12:22 - 01:04:36:18
Joey
You want to sell the artist, not the paintbrush. And we've seen huge changes in the cost of the paintbrush. Right. And we can no longer charge in our hourly rates for the cost of the paintbrush. Not nearly as much anyway. So we need to focus it in on us as the artists to kind of make sure we don't end up completely broke at the end of the day.

01:04:36:19 - 01:05:03:00
Robbie
I mean, it's really well said, and it's something that I think a lot about when I look at a lot of the marketing of, post-production companies where they put, capabilities in, they frame capabilities in terms of equipment. Right? We have this HDR monitor, we have this control surface, we have these GPUs. And half the time I just want to say like, who cares?

01:05:03:00 - 01:05:05:03
Robbie
Stuff that that stuff changes every single day.

01:05:05:04 - 01:05:12:13
Joey
Used to matter, right? You need to deliver. Did you beta you needed a place. Where did you build a suite? Right, right. It's a different place now.

01:05:12:15 - 01:05:36:10
Robbie
Yeah. And I think but in general, I think that that is that is part of, you know, in the general context, in the overall 50,000ft view of this conversation, not losing perspective that the artistry and the personnel matters more than the stuff is one way to fight that. And I think that that is, you know, really well done by some of the biggest companies in our industry, right?

01:05:36:12 - 01:05:54:23
Robbie
If you go to I'm just using company three because they're probably the biggest. Right. If you look at Company three's website, right, there is no mention of what they agreed on. There is no mention of the what they have in their machine room. There's no mention of how fast their internet is or what they use for their upload service.

01:05:54:23 - 01:06:06:11
Joey
I bet you a lot of money that their base hourly rate for most artists did not change. When DaVinci resolve went from half $1 million to $100,000 to $1,000 to 300 that.

01:06:06:13 - 01:06:30:19
Robbie
They're charging people because, oh, it's Stefan Sonnenfeld, it's Dave Halsey, it's even Nakamura, right? These people who have 30, 40 years of experience, who have worked on the biggest productions, who have seen it, literally seen it all, know how to handle it all, have dealt with, you know, clients from, you know, perfectly nice, happy people to the worst of the worst in terms of attitude.

01:06:30:21 - 01:06:54:05
Robbie
That's why one of the things that they're doing, and I just think that again, 50,000ft view, don't lose perspective about that at all in the race to the bottom is that once we start valuing stuff more than we start valuing people, you're going to be participating in the race to the bottom right. And I think that's a danger is that I always want to put myself, you other people we work with first rather than the equipment.

01:06:54:05 - 01:07:19:12
Robbie
But I think part of this, like the real meat and potatoes of this discussion, is rates. Right? you know, it used to be, as I mentioned earlier, you know, thousand dollars, $1,500 an hour was not even all that uncommon, even in medium sized facilities. You know, now we see people. I mean, I, I had a client the other day straight up told me that, like, when we're going to this other place because they're charging us XYZ.

01:07:19:15 - 01:07:41:16
Robbie
And I was like, I can't even begin to think about how I could support my company, pay myself, you know, pay Joey, whatever it may be, charging that hourly rate, like I would have to do 500 of those type of projects every year to even break even. Right. And I think that is a that's a it's a hard thing to find your rate.

01:07:41:16 - 01:08:01:04
Robbie
And I think I think there's three kind of ways to do this, because I think finding your rate and sticking to it is the primary method that we have to kind of fight that race to the bottom, right. So number one, I think rates should be there. I think there's three ways of looking at this. Number one is the the psychology factor of rates.

01:08:01:04 - 01:08:36:16
Robbie
Right. If you feel like your skills and your experience are enough to compete, at the highest level, pick a number out of a hat and stick to it. Right. Like I think what you make your rate says a lot about what value do you bring to a production from a psychological level? Right. I don't think there's really anything tangibly different from, you know, one place that charges $300 an hour and a place that charges $800 an hour, other than the fact that the $800 an hour, I hate hundred dollar an hour place just had the proverbial Cologne is just to say it's $800 an hour or whatever.

01:08:36:16 - 01:09:01:22
Robbie
Right. And I think that the the kind of psychological, perceptual part about setting also really plays into clients that like a client goes, well, these guys must be better. They had they're charging $800 an hour versus, you know, $200 an hour, right? I think not to not everybody that plays in, but a lot of people that plays right to I think the market rate is important.

01:09:02:02 - 01:09:28:03
Robbie
And I think, you know, we talk a lot, to friends about this, about like, hey, what are you charging? Like it's not to undercut them. It's to a certain degree, you owe it to your market to discuss what other people are doing and try to more or less not. You're not going to, you know, yell at somebody for, oh, you charge, you know, 50 bucks under what I would to charge, but to generally have an idea of guys to keep this market intact where we're all doing something.

01:09:28:08 - 01:09:47:20
Robbie
Then in better for all, we need to hold this rate. So market rates are an important one. And then third one is that ROI kind of rate setting rate. What is it going to really cost you to, to, to to service your, your debts, make some money, pay yourself all those kind of stuff and figure out what your rate should be from there.

01:09:47:22 - 01:10:04:21
Robbie
I don't know, I mean, I think that to me, figuring out that number is important and it's not so much the number. It's the more about sticking to that number and presenting that number. And, Joey, I don't mean to throw you under the bus here and put you in an awkward space, but we talk about this a lot, right?

01:10:04:21 - 01:10:06:04
Joey
I'm awful at it.

01:10:06:06 - 01:10:32:21
Robbie
When we talk about it in the sense of like the nervousness about presenting numbers to the people. But I see what I see. Contributing to the race to the bottom is people who are like yourself nervous to, to, to to have these discussions and fear or feel that there is some sort of value judgment as you as a person, operator, etc. if you put out a number that might be perceived as high, right?

01:10:33:00 - 01:10:54:15
Joey
Yes I have, I will admit a weird anxiety about talking about rates with clients, and it's been a struggle over many years because I'm always scared to ask for the higher rate. I'm always worried that they're going to just say, no, we're never working with you again. I'm I worry that this job, the the most recent job, is always going to be the last job.

01:10:54:15 - 01:11:17:19
Joey
Right? Because it's always a possibility. Right. So I would just add this to the entire rate in discussion. You do need to have some consciousness of what your clients are willing to pay, right? Because if you just say, I'm going to make my rate this much, even if you really do believe you're that valuable, if you're in a market where clients just aren't ever going to pay that, you'll make zero, right?

01:11:17:23 - 01:11:23:14
Joey
But you don't want to be at such a low rate that you're undercutting, like you said, that market rate.

01:11:23:19 - 01:11:47:14
Robbie
No, I, I agree, I agree with that. Oh, I guess what I'm trying to say is that, you know, there's nothing like I have never in 25 years I've never experienced a situation that you worry about. Right? I've never experienced a situation where I say to somebody, this is how much it costs for us. And they go, well, we're never working with you again.

01:11:47:17 - 01:12:07:17
Robbie
Now, it's true. They might not work with us on that project, but the idea of being totally, you know, blackballed or whatever, because of your value, I actually found it to be the opposite. I actually find it when you say, if you hold that line to people, it's like, oh, man. Well, one day I wish I could afford those guys to do that work.

01:12:07:17 - 01:12:36:09
Robbie
Like the holding tool rate actually sets up a, like a wall of, like, perceived value to the client. Like they value their time and effort and their experience so much that they're not going to come down to what we want to pay, because it's they're holding that line. Now, I agree that if you hold that line into perpetuity and you're not working, like not working, it's not a good thing either.

01:12:36:11 - 01:13:04:18
Robbie
But I would also make the argument that the clients that tend to balk at rate are also tend to be the clients that give you the most difficulty in the process. In general. Right? Yeah, I, I don't know what it is, but I have always found that clients that are like, cool, that sounds great. like, you know, and again, that's not saying that we might not work something out here or finagle it a little bit, but, you know, they don't have this visceral, like, how dare you charge me that much?

01:13:04:19 - 01:13:20:18
Robbie
Like, all right, cool. That's your rate. Like, let me see what I can do with my budget and come up with it. Those clients. Great. Easy. They respect your work. Whatever. The clients that I find that are trying to force you to the rates the bottom and discount this and discount that you give them an inch. They're going to take a mile.

01:13:20:18 - 01:13:42:14
Robbie
Right. And they're also going to be those kind of clients and those kinds of projects that you end up resenting a little bit that you're like, oh, why do they say yes to this? I'm not making any money on this. And like, you're stabbing yourself in the foot. So I just say whatever. However, methodology you find to stick to that rate, I think is, is is fine, but just stick to it.

01:13:42:16 - 01:14:12:10
Robbie
Now, related to this is I think we there's probably about 5 or 6 years ago we had this discussion, and it was at the time where it was kind of like we were using 1 or 2 rates, kind of as like a catchall for everything. Right? I think another way to kind of combat the the sticker shock sometimes, or the idea of, you know, this race to the bottom is to diversify your services as line items and what the cost of those are, right?

01:14:12:12 - 01:14:26:04
Robbie
So let's say you have a client that comes in and goes, well, I need to grade this spot. And you go, wow, cool. It's going to be four hours to grade the spot. And they balk and they go, well, I really only have 3 hours or 2 hours of time to grade the spot at your at your grading rate.

01:14:26:06 - 01:14:48:11
Robbie
Cool. Well, here's two hours of grading me. Here's my hour of conform. Here's my hour of packaging and deliverables or whatever however you want to frame it to get back up to the number. The bottom line number that you weren't has a surprising psychological effect for clients because they go, oh, okay, I get it. Like, you know, you're this is that, this is that you're doing this.

01:14:48:16 - 01:15:08:16
Robbie
And for whatever reason, it's not just one big catchall number. I think has paid a lot of dividends for us. And I think clients are more, apropos to understand that the more that you can break down. Now, the danger with that, of course, is you don't want to line item people to death. Somebody shared a quote me the other day that I just thought was like, literally one of the most ridiculous things I've ever seen.

01:15:08:18 - 01:15:31:00
Robbie
And it was a not even a gigabyte. It was a per megabyte charge for downloading files. Right? Like I get it, digital deliveries. You can spend a lot of time bringing files down and up or whatever. Some people charge for it, some people don't. That's not what I'm talking about. But nickel and diming people to the the sense that their invoice is going to have 47 items.

01:15:31:00 - 01:15:32:05
Robbie
I don't suggest.

01:15:32:07 - 01:15:51:02
Joey
Any of these things. There's a balance to strike, but you want to have enough detail for the client to understand. This is where my money's going. This is why it's adding up to this total. But yeah, we have seen some invoices and some bids from some facilities where it's like the sweet vacuuming fee and like.

01:15:51:04 - 01:16:11:20
Robbie
Mean, who knows? Who knows? Those people might be geniuses and we might just be doing it wrong the entire time. But I, I, I think that nickel and diming in that line item people to death is a balance app because it can have the opposite effect and, and contribute actually to the race to the bottom because somebody goes, well, I'm just going to go to the guy that doesn't nickel and dime me to death and, and do that.

01:16:11:20 - 01:16:38:18
Robbie
So it is it is a fine line about that. But I guess my point about it is, is that there are sometimes there are other ways to think about diversification of your services that don't add up to necessarily the one big ticket item, right, like, oh, well, you're spending 15 hours at $500 an hour. It's a lot better to go when we're spending five hours at $500 an hour, but we're spending seven hours at, you know, whatever, 150 or $200.

01:16:38:18 - 01:16:45:07
Joey
That specificity and detail is good pedantic ness and pedantry is not good.

01:16:45:08 - 01:17:07:17
Robbie
Absolutely. And I think, you know, the related to that and the rate thing and the line items and stuff like that is and we I mean, honestly, I just full transparency. I've been guilty of this from time to time just in the desire to, to get work is the application of discounting, I think is a really big problem in our industry.

01:17:07:19 - 01:17:27:00
Robbie
And what I mean by that is that you go to a lot of these large facilities and they have, you know, pick a number out of their let's say, let's just say it's $1,000 an hour rate for, for coloring or something. Right? But there's a difference between the advertised rate card rate and then the functional rate of like discounting.

01:17:27:00 - 01:17:53:20
Robbie
And I think that our industry has kind of come to expect discount on services no matter what. Right. It's like, okay, you can charge $1,000 an hour, but really the functional rate comes down to $500 an hour after you're done with all the discounts or whatever. And I think that's another way of fighting this race to the bottom is by being very careful and very selective about how you apply and use discount.

01:17:53:20 - 01:18:15:17
Robbie
So great. You know, case in point, you have a five minute, you know, corporate promo to do. It's a one off, you know, corporate promo in my head. I'm not discounting that. I'm charging you the time that it takes to do that work. because this is a one off thing. There's no volume involved. And honestly, this is what I'm worth and this is what it's going to take.

01:18:15:19 - 01:18:39:14
Robbie
Conversely, hey, we have a, you know, 13 part series and we're going to give you guys all of the work, all of the packaging work, all of that kind of stuff. Can you cut us a little deal for giving you, you know, committing to all of that work? Sure. That's a different use case in applying discount. I might give you an overall series discount or something like that for, you know, the commitment of that work.

01:18:39:17 - 01:18:56:08
Robbie
But I'm not going to do it for, you know, if you're gonna like what, we'll bring you one episode and see how it goes. No no no no no no no. You're not getting you're not getting a discount from that. And I think the other part about discounts to me is that there are certain things that are easier to discount than others.

01:18:56:08 - 01:19:20:21
Robbie
Right. So like you and I can be a little more flexible on our discounting because it's our time as partners in the business. We hire a freelancer or whatever to do, you know, to fill in some work. Like, I can't just automatically assume that the freelancer is going to be cool discounted, right? Or if I have hard if I have hard comps, like I have to buy stuff, you know, you know, let's say a cruise, an SSD or whatever for a DCP, right?

01:19:21:03 - 01:19:53:07
Robbie
Like, I can't discount that. I can't lose money on hard cost items that we're going to hire. Right? So some of these things are easier to discount than others. And I would say in general, when I think about discounting, I try to discount not on rate, but try to become more efficient on time. Right. Because I if I'm charging somebody $500 an hour, like I don't want that 500 and number to move, I would, I would I can flex a little bit is yeah.

01:19:53:08 - 01:20:11:23
Robbie
Okay. Well I've thought about it. you know, we can, we can just we we don't have to do x, y, z to the shot. we can forgo that part of it and just get it done and be doing that. I'd rather discount a little bit, a little bit on time versus dollar amount, because the second I start discounting a dollar amount, I feel like I'm, r rate.

01:20:11:23 - 01:20:13:23
Robbie
Rather, I'm running to the bottom.

01:20:14:01 - 01:20:34:01
Joey
Yeah. And a lot of times when talking with client, that goes a long way to be like, you know, we'll say I'll, I'll keep it to X number of hours. Right. We'll limit this to X number of hours. That doesn't mean we're going to have you sit here with a stopwatch, but it does mean that they have a fixed cost in their mind for the project.

01:20:34:01 - 01:20:43:14
Joey
Now, they're not like, well, how many hours is this going to take at this rate? You know, so I think that helps when you're again, specificity helps when you're talking to the clients about these things.

01:20:43:15 - 01:21:01:14
Robbie
Yeah. And related to that, I think the only way that you can get a better feel for what you just said, you know, we you're right. We do that all the time. We say, hey, we'll limited this to five hours because we feel confident that within that five hours, at our regular rate, we can get this done, even though it might mean we have to hustle a little bit.

01:21:01:14 - 01:21:22:13
Robbie
But like, it's not something so out of bounds that we're like, we're going to be losing money to do this. But related to that is we have the experience. And I think one thing that could help people fight this race to the bottom is being as knowledgeable and as accurate as possible on their estimates about what something really will actually take.

01:21:22:15 - 01:21:41:21
Robbie
And I see so many people going, well, I thought it was going to take five hours and it took 15 hours. And it's like I want to say to them, how could you possibly let that happen to you? Right? Like so, number one, they point out with like, well, the show wasn't what I expected. Like there was a lot more situations.

01:21:41:23 - 01:22:01:11
Robbie
Your fault. You should have watched. You should have watched the show, gotten a sample from it, talk through the client what the needs were. Whatever. That's your fault. Never should happen, right? Two they say they say things like, well, I just wanted to go the extra mile and do this right. And so now, now it took me a lot longer.

01:22:01:13 - 01:22:26:01
Robbie
Yeah, I get it. I feel that compulsive need sometimes too. But as we say a lot, not everything is art. And if somebody is already fighting you on budget, time, etc., fight that feeling to be, you know, the actual you always want to do your best. Of course I'm not arguing that, but I'm saying like I'm not going to get up and start working on a show at 7 a.m. and work until 2 a.m..

01:22:26:06 - 01:22:48:18
Robbie
If a client's battling me on on on on on fees, right? yeah. My my time is money. And then third about that is you never want to be in a position where you're trying to have to come back and upcharge for money, right? Like it's a really bad thing that it's going to force somebody to go to somebody who's cheaper, easier to deal with, etc..

01:22:48:20 - 01:23:12:00
Robbie
Like even if your initial estimate is high and you come back at the end and go, listen, we had it, we actually end it didn't end up using these four hours. I'm happy to take that off. Your the final bill. You look like the hero right. Versus coming back and going oh, I actually need more money for this because, I, I miss estimated how long it was going to take.

01:23:12:00 - 01:23:31:11
Robbie
Right. Like that is a recipe for disaster and was going to force somebody to go, somebody who might be cheaper, faster or whatever. Right. I don't know. I, I just think that that accuracy of ours in estimating comes through experience. But it's a big part, the race to the bottom, like those people were charging 25 bucks an hour to do something they don't.

01:23:31:13 - 01:23:56:22
Robbie
I mean, they're just they have no idea how long it takes because they're just like, oh, well, I'll do it for $25 an hour. the other thing I think is really, how should I say this pandemic epidemic. I'm still not sure of those words after all these years. indirect endemic is, the idea of working for free.

01:23:57:00 - 01:23:58:18
Joey
Okay. Yeah.

01:23:58:19 - 01:24:19:07
Robbie
We recorded an episode earlier today about new colorists and things that they should know. We should have put this into that episode, too, because working for free should never be done. People should never expect it. If somebody is asking you to work for free, give them the giant middle finger because they don't value as an artist in on you as a business owner.

01:24:19:07 - 01:24:36:14
Robbie
They don't. They don't respect you for that. Right now, I want to be clear about something. There's different levels of free. Right. if somebody just says the dreaded E word, right, you know what? We're I'm talking about exposure, right?

01:24:36:16 - 01:24:38:01
Joey
Oh, yeah. Run, run.

01:24:38:03 - 01:24:59:13
Robbie
That is the run. Run for the hills. There's no such thing as exposure. for most of the time. Right. and so many sob stories of people doing hundreds of hours of work for exposure, for exposure is a manipulation technique that should be excommunicated from your your vocabulary, and things that you do. Right. But with that said, there is a different level of free.

01:24:59:15 - 01:25:22:08
Robbie
You have to have a return on something regardless of the project. And I agree, case in point on that is, you know, there are ways to barter for things, right? We've done projects, for example, for, hardware companies, right? We've said, yeah, sure, we'll grade your promo for the hardware company, give us a disc, we'll do it at a cheaper rate, give us a discount on your hardware or whatever.

01:25:22:08 - 01:25:41:15
Robbie
Or sometimes it's, you know, in exchange for the work. Like, I'm fine with that. We got something of value out of the relationship. I see a lot of people, like when we were doing a lot of you and I have, you know, years past in a lot of tutorials, right? Like, hey, cool, I'll give you a discount grading this if you let me have the rights to use your footage in, you know, lessons.

01:25:41:15 - 01:26:04:04
Robbie
It's true. I'm getting something out of that. Right. same thing like you just did over the past year or so. we'll hopefully record this on a future episode. You just did a multi. I mean, probably actually multiple years I think about it, but a long project, doing some film restoration stuff from some classic films from the 40s, 50s, you know, 60s, and you weren't getting paid for it.

01:26:04:04 - 01:26:31:00
Robbie
But guess what? Like you got something out of it in the sense that you were now have this whole new skill set, right, that you were able to develop to film restoration. You developed new workflows, you developed new techniques. But best of all, it wasn't a timeline driven pressure thing. So even though it was free in the real sense, you were still getting something out of it that benefited you and benefited our company as an organization to do it.

01:26:31:00 - 01:26:31:09
Robbie
And so, yeah.

01:26:31:09 - 01:26:51:02
Joey
And intentionally doing something with the idea of, I'm going to use this for marketing for the company, I'm going to use this to expand into a different thing that is different than I'm going to do this for exposure. I know that's a fine line, right? But that is different. As long as you feel that you are getting something valuable out of your effort.

01:26:51:04 - 01:26:54:16
Joey
I think it's okay to negotiate these kind of things within reason.

01:26:54:18 - 01:27:17:12
Robbie
But they but the important thing is we actually have to have real value, right? Just perceived value. I don't think is important enough. I think that like if somebody is saying to you like, oh, well, you know, well, the case of the restoration thing that you did, right, that that's a really tricky one because I think for the, for the average person, they look at that and be like, well, Joey, you just did it for free.

01:27:17:14 - 01:27:43:16
Robbie
But you went into it going, no, I'm going to do this for free. But the value here is that I now have built a whole separate skill set that I did not have on something that was real world, also very interesting. Also very technically challenging. And I develop a skill toolset to. Now I've made the investment in that to where this can now pay dividends for years to come.

01:27:43:18 - 01:28:13:19
Robbie
Marketing, you know, our repertoire to do it. So like we actually had a lot I mean, a lot of discussion about the validity of doing this project. Right? Because I was very steadfast, like, no, we're not doing something for free. No, you're not getting paid. This is bullshit. We're being manipulated all that kind of stuff. And you eventually convince me, like, you, you you, defined and presented what the value was.

01:28:14:01 - 01:28:34:11
Robbie
And we looked at it very much in a pro cons list. And the person, you know, the the the project and the, the person that was running the show, was respectful of that kind of that value. Like, I don't have money to give you. I'm not just saying this for exposure is I mean, they offered multiple times.

01:28:34:15 - 01:28:54:23
Robbie
Is there something that I can do for you to, to help us? And our big answer was, yeah, well, you just have to accept that you're not a regular client, that you have to accept that we're not doing things on a schedule. You have to accept that we're doing this when we can. You have to accept that if there's a problem with something, I'm not going to jump on it.

01:28:54:23 - 01:29:13:07
Robbie
Five minutes after you write the email and make a fix. Right. And so like there's flexibility in that. That's needed to. But in general start with never work for free and then levels down from that. Okay. Free can be okay but have real value for the things that you're doing.

01:29:13:09 - 01:29:21:18
Joey
And this one thing that we're talking about in specific is probably the only time that we've done anything like this and will be the only time.

01:29:21:20 - 01:29:39:12
Robbie
And it wasn't me, it was it. And it was a real like I mean, we I mean, I'm not joking. We debated this probably over hours of zoom phone calls and slack and cetera, like whether this is something that we should do and like at certain points, Joey was, like, disappointed in me because I was, like, being such a hard ass about it.

01:29:39:14 - 01:29:42:22
Robbie
And other times I was like, wow, this is really cool, right? You know, so like.

01:29:43:00 - 01:30:00:13
Joey
When you talk about setting rates and figuring these things out, you gotta look at it from both of those perspectives, right? Because if you always look at it from, I want to be nice to everyone and I want to give discounts and I want to I'm scared to ask for more money. You're never going to get anywhere. And it's good to have someone to be the bad guy.

01:30:00:15 - 01:30:19:00
Joey
Even if even if it's just you and you need to be your own bad guy. Sometimes when you're dealing with these issues, rates and hours and schedules and all of those things put together, you've got to think the good guy and the bad guy, you got to have the angel and the devil together to figure out what the right balance for you and for the project is.

01:30:19:02 - 01:30:44:00
Robbie
Yeah, I agree, and I think another, another thing that comes to mind about fighting this race to the bottom is the idea of kind of being, just up updating your presentation in terms of rates and that kind of stuff. And we mean by that is our client or we had a client that I think I've worked with since 2000, 2001 something like that.

01:30:44:02 - 01:31:12:14
Robbie
And, you know, I eventually got them to a rate that was okay, clearly, a very, you know, friendly, grandfathered kind of thing. Right. And I looked at it the other day and, and we and we end up doing probably 1 to 2 seasons of the show, you know, it's ten episode seasons per year, right. And I looked at this and I was like, I have not updated this rate in like 3 or 4 years with them.

01:31:12:14 - 01:31:33:12
Robbie
Right. And it's getting to the point where, like, I'm resenting the rate and I'm resenting the shows and that's a problem. So like, you know, we talked about finding your rate and sticking to it. Part of that also is being a reality of what the current market economy, etc. is doing. Like. It doesn't take a genius to figure out, hey, inflation side, everything costs more money these days.

01:31:33:12 - 01:31:54:03
Robbie
Costs are going up like it costs me more money now to buy a piece of gear than it did five years ago. It cost me more money to, do marketing and other stuff than it did five years ago. Right. So things should flex, you know, you know, in lockstep with that. I mean, you know, if we had regular jobs, Joey, we would talk about, like, with our employers.

01:31:54:03 - 01:32:13:00
Robbie
We talk about like, cola adjustments, cost of living adjustment. You know, that 3 or 4% every year, you're, you know, your salary goes up. Well, it's the same thing and same thing in terms of rates. Like it's fine to have a rate and stick to it, but sticking to that rate with never changing it as the situation on the ground changes either is equally dangerous.

01:32:13:03 - 01:32:29:04
Robbie
I tend to look at January 1st as kind of like a new calendar year. Hey, rates are going up. Which begs the question do you have a discussion with clients about this, or do you just do it right now? I've made Joey really nervous in the past by just doing it right and going, oh, they're going to hate us.

01:32:29:04 - 01:32:55:23
Robbie
They're never going to work with us again. Like if things come back and they say, well, you know, it was X last year and now you're charging, why? Why is that? Hey, everything costs. Everything goes up. It's not I'm not, I'm not, you know, and I'm not I'm not talking about increasing things 100%. Right. You know, if you're at $300 an hour, going to 315 or 325, like figuring out an increase, but like that, the reality is, is that everything does cost more than it did a few years ago.

01:32:56:03 - 01:33:09:07
Robbie
And you have to flex your business if you stay at that rate for perpetuity, that's you're contributing to the race to the bottom because, you know, everything is getting more expensive. If you're not kind of matching pace, you're going to be losing money as well.

01:33:09:09 - 01:33:11:19
Joey
Yeah. Where that bottom is, is shifting.

01:33:11:21 - 01:33:33:11
Robbie
Now, what I'm about to say, I'm hesitant to say out loud because I sometimes think about this in my head and it sounds like I'm a little bit of, a snob, like, I'm, you know, elitist. I have, like, believe in class systems or whatever. Right? I think there is an inkling by small companies, freelancers for sure.

01:33:33:11 - 01:33:50:05
Robbie
Right. Is that, like, if times are tight, you're just going to go after the thing that presents itself, right? So, you know, if you haven't worked in two weeks, right? And somebody comes by and says, well, I got $100 for this job, you're going to go take the job for $100, because it's been two weeks since you've had any work.

01:33:50:06 - 01:34:17:13
Robbie
Think before you do that, right. Chasing that thing just because it's the shiny object in front of you can have long and far reaching ramifications to your perceived value. Right? And what I mean is that if you do that $100 job for somebody today, you have literally no ability at a later point in time to come back to them for a similar frame job and go, well, guess what?

01:34:17:13 - 01:34:38:18
Robbie
It's now $1,000 to do that job. So I know this is hard for a lot of people to stomach in here. And again, it sounds like I'm getting a little elitist, but sometimes no is in fact the most powerful language that you have as a business operator and as, a freelancer or whatever, not committing to things that are below you air quotes here, right?

01:34:38:20 - 01:35:05:04
Robbie
Because the second that you do, you're going to be painted in that. And I have never, ever experienced a situation where I've done something for cheap and then been able to work it back up to an acceptable rate, right. It's always been a fight to do so. It's always tended to sour the client on on that, etc. the fact is, you can always go down if you need to, which we're not suggesting, but you can do that.

01:35:05:06 - 01:35:24:23
Robbie
It's next to impossible to go the other way if you started already at a lower rate. Right. so when you know, when I think about things like accuracy of bids, accuracy of stuff like that, I mean, every single time, like to me, I'm doing it wrong. If somebody comes back and goes, oh yeah, that's great. I'm totally on that, right?

01:35:24:23 - 01:35:44:04
Robbie
I get what I need. I can feel like I'm in the right space when somebody comes, oh, okay, it's 20 grand. there's no more than we thought it was. And that. And now that empowers me to be like, okay, my real number on this is 14 grand. I put 20 on, on the proposal because I have that wiggle room.

01:35:44:06 - 01:35:55:04
Robbie
I can I they don't have to know that, but I can play in my I can play within that range. Right. Versus I start at ten thinking the show is really worth 14. And I put it at ten just to get it. That's dangerous.

01:35:55:05 - 01:35:57:00
Joey
Yeah. You'll never get that money back.

01:35:57:05 - 01:36:01:00
Robbie
You'll never going to get it. And you're going to set the precedent that it's never going to get back as well.

01:36:01:00 - 01:36:21:06
Joey
So the danger there too is also, you know, just take us to its crazy conclusion is if you take on every cheap job just to get the jobs in, when a job comes, that will pay full rate and will be a full quality, good job, that could lead on to more, bigger, better things. You've already got other obligations that you're going to resent.

01:36:21:08 - 01:36:40:17
Robbie
Yeah. And I think, you know, it's a it's funny, it's like I, I think about this in my head sometimes too, as like, because I like to play golf. Right. I'm pretty good at golf most of the time. but I'm not a professional, you know, PGA tour level golfer. Right. And I think about it, I think about it in this kind of context.

01:36:40:17 - 01:37:04:21
Robbie
There's like, am I competition to the PGA tour a golfer? Of course not. I'm not competition to that because I'm so below their skill level and experience that like I like it would be fun to play with them. Sure. But they're never, you know, they're never going to look at me as competition to their game. And I tend to think that there's a, you know, there's, a feeling that a lot of people have in our industry that everybody is competition.

01:37:04:21 - 01:37:26:21
Robbie
And that's really not true. Right? That, like, I am not competing with the I don't want to compete with the guy charging 24, $25 an hour working out of his bedroom. That's not who I want to compete with at all. At the same time, I know that I can't compete with, you know, a company doing, you know, you know, Netflix, gold level stuff because we're just not that facility.

01:37:26:21 - 01:37:46:19
Robbie
Right. So knowing your lane to, I think is an important part about this and not realizing that not everybody is competition and you don't, you know, in other words, you don't actually have to compete in the race to the bottom if you don't want to. Yeah. Very cool. Well, this has been a fun one. Hopefully. got people thinking a little bit about how, you know, to kind of fight this, this race.

01:37:46:19 - 01:38:05:00
Robbie
It's a real thing. And I'm not saying that, you know, we're not guilty of it. Sometimes everybody is a little guilty of it sometimes. But kind of being aware of the race to the bottom, I think is, is the first step to kind of, you know, to, to battle it. So, if you are checking out the show on YouTube, feel free to add into the comments.

01:38:05:01 - 01:38:26:13
Robbie
It's always fun to take a look at to respond to as well. you can follow us on YouTube, like and subscribe to the show. Every little like and subscribe helps. if you're listening to the audio version of this, the show is version, available on Spotify, Apple podcast, Google, Amazon, everywhere else where you find, podcasts, you can of course always go to offset podcast.com.

01:38:26:15 - 01:38:41:15
Robbie
that is the homepage for the show actually, and where we have additional show notes. you can also submit ideas, and things of that nature, with a little button at the top of that page. If you have some ideas for some shows or things that you want to talk about. huge thanks, as always to our sponsor, Flanders Scientific.

01:38:41:15 - 01:38:59:10
Robbie
Without you guys, we couldn't do the show. Big thanks to Stella, our editor, who, makes it sound like we know what we're talking about from time to time. And to you guys are our viewers and our listeners really, really appreciate you. if you like the show, feel free to tell a colleague, a friend every little, every little like and subscribe helps.

01:38:59:12 - 01:39:05:08
Robbie
follow us on Instagram, Facebook, all that fun stuff as well. So for the offset podcast, I'm Robbie Carman

01:39:05:10 - 01:39:06:22
Joey
And I'm Joey D’Anna - Thanks for watching.