Undercutting the Market

[rotten42]

I'd slit my wrists and get out of rendering all together if I had to joina union. Unions rewards the weakest members IMO.

 

 

anyway....

 

 

I've run up against a guy who under-cuts in the market I deal in. The guy has some skills yet he charges about 50-60% less than I do. How does he pay for his software? I've had client's price check me against this guy and want me to match. I respectfully tell them that at his prices it is not worth my time to do the work. I also ask them to dig deeper into what they are getting to determine if they are really getting value for their money or just a "drive-by" result.

 

 

 

edit: my typing sucks!

[Sawyer]

Lets face it the biggest problem we face is pirates.

[William Alexander]

I'd slit my wrists and get out of rendering all together if I had to joina union

 

If it functions as a guild- a place to find skilled artisans that are qualified, no strings attached, beyond capable, proven skills and work flows? Need to differentiate bewteen perception/norm in regard to the Pixelcorps. Nobody is looking to take over or mandate anything unless of course the people in that guild are the best trained, most highly skilled and proven. That takes time but on the way being part of a guild with global reach is one hellava a way to network world wide...maximize your exposure to maximize the high/er paying oppurtunities and learn how to do work over the internet-remotely are skills over the next decade/s that just may help keep the good money jobs coming in.

 

 

 

WDA

[alexg]

Union that I have in mind is more for providing protection / standard-isation rather than more focused on training like Pixelcorp.

 

Should there be a 'standard' of minimal fee like in other profession (architecture / accountancy / law / etc?)

It is hard to talk how much low is considered 'undercut' if there's different standard for everybody in the first place.

[William Alexander]

Union that I have in mind is more for providing protection / standard-isation rather than more focused on training like Pixelcorp.

 

Should there be a 'standard' of minimal fee like in other profession (architecture / accountancy / law / etc?)

It is hard to talk how much low is considered 'undercut' if there's different standard for everybody in the first place.

 

Then it is a trade association/affiliation...NHAB, AIA, BBB....yada yada yada they take your money you use the stamp and propaganada. I don't mean to minimize those organazations, they have thier place and function. The idea of a world wide association like this...think it would crumble under it's own wieght before it could even be not recognized by the legal governing bodies as destroying local competitiveness, identity, isolationism......

 

Minimum fees that's regional at best and market driven. Very unrealsitic as a world wide standard. At best it would be averaged out...meaning the big pay in the western world would be like working at McDonalds and the third world would be living "high on the hog". Not what those who want protection desire from the protection.

 

The only real protection in the world is your ability to do it better than the majority anyway...that takes training/constantly improving your skills, in many areas

 

My final 2 cents, don't want to start an endless debate which this line of discussion usally turns into. That's best left for beers at the pub.

 

Cheers

WDA

[Jefferson Grigsby]

I know of a handful of companies in the US that farm out to Freelancers in China, or also broker and offer project coordination services with smaller over seas studios in the middle east and asia. They offer impressive portfolios, quick turnaround, but 0 references as they are the 3D equyivelent of a chop shop. We have little control over anyone wanting to compete in our business and are willing to make unrealistic promises that ultimately effect the way our clients value our services. It is However important to maintain good relationships with our clients, while focusing on quality and service and not just making a buck. Those of us that work directly for the developers should be the most cautious about monitoring these types of practices, which ultimately could both leave a bad taiste with some clients, but also devalue our worth.

 

I have found that through good relationships and a commitment to consistently producing quality work will lead you onto a path where price is no concern. More often then not Architecture fims oare simply spending their clients money for them on visualazation services and these rates still appear commensurate with what a water colorist would have charged 10 years ago. It is our job to at least maintain this standard, if not to find ways to increase our value even more.

[Bhanu]

Lot of discussions on undercutting....this is a ever living phenomenon

Some centuries ago India and other Asian countries were effected by various Western under cut products, methods & industrial revolution products. Excellent craftsman who were living descent became beggers or third class employess with those undercut products.

 

Today world of gloablisation..if the same quality is achieved with a ethical practice using original software ...what is wrong in undercutting ? Huge multinational companies do that in promoting them selves... just see them as business competetors...work out strategies to protect clients...no associations or guilds can solve this.

 

Whatever is the situation of the economy I definitely do not agree to work with pirated stuff .

[ShaunDon]

There's nothing wrong with undercutting if you believe in the free market. Ours is a small company that at its start faced many of our initial clients jumping ship for cheap overseas renderers. They do so because they were little fish and needed to competitively put renderings in front of their clients without breaking their tight budgets. We thought it was the end before anything got off the ground.

 

However they very quickly realized massive explosions in their internal costs. They sacrificed the extra time their highly paid and overworked designers had by forcing them to work with companies halfway around the world. They could never speak directly to the artists as they were asleep when the architects were working, and the language barrier meant their comments never were interpretted correctly. As a result they'd have to mark up images in three or four rounds where one approval is all it took with us. They didn't get what they really paid for, not when internal costs were several orders higher than the renderer's image price.

 

Compitent, competitive firms understand this reality. They hire fully capable firms, and usually locally or regionally because we really care about getting the job done the way they want it. If they have a large project they want us involved in, we come to them. We sit with their team and spend an afternoon talking through what they want to see. Your images will sell their client on a $30 million plus building -- and it makes a hell of a difference in building trust in a relationship when you sit across from the client and demonstrate then and there that you understand their needs.

 

Honestly at this point, I'd rather not work for a company so cut-throat about their bottom line that they'll sacrifice their own staff in pursuit of it.

 

Shaun

[rotten42]

If it functions as a guild- a place to find skilled artisans that are qualified, no strings attached, beyond capable, proven skills and work flows? Need to differentiate bewteen perception/norm in regard to the Pixelcorps. Nobody is looking to take over or mandate anything unless of course the people in that guild are the best trained, most highly skilled and proven. That takes time but on the way being part of a guild with global reach is one hellava a way to network world wide...maximize your exposure to maximize the high/er paying oppurtunities and learn how to do work over the internet-remotely are skills over the next decade/s that just may help keep the good money jobs coming in.

 

WDA

 

Well, I already do 99% of my work over the internet. I live in Canada...most of my clients are from the US. I pay attention to my networking skills. Why would I want to go into a pool for this? I think it's like any other business....the people that know who to do it succeed. The people that don't have a harder time. A guild would maximize everyone’s exposure. In a sense making the competition even tighter.

Obviously I don't have a high option of unions or guilds. I really think that they help the weaker members and hurt the top performers.

[rotten42]

I know of a handful of companies in the US that farm out to Freelancers in China, or also broker and offer project coordination services with smaller over seas studios in the middle east and asia. They offer impressive portfolios, quick turnaround, but 0 references as they are the 3D equyivelent of a chop shop. We have little control over anyone wanting to compete in our business and are willing to make unrealistic promises that ultimately effect the way our clients value our services. It is However important to maintain good relationships with our clients, while focusing on quality and service and not just making a buck. Those of us that work directly for the developers should be the most cautious about monitoring these types of practices, which ultimately could both leave a bad taiste with some clients, but also devalue our worth.

 

I have found that through good relationships and a commitment to consistently producing quality work will lead you onto a path where price is no concern. More often then not Architecture fims oare simply spending their clients money for them on visualazation services and these rates still appear commensurate with what a water colorist would have charged 10 years ago. It is our job to at least maintain this standard, if not to find ways to increase our value even more.

 

 

BINGO!!!..we have a winner;)

[William Alexander]

Well, I already do 99% of my work over the internet. I live in Canada...most of my clients are from the US. I pay attention to my networking skills. Why would I want to go into a pool for this? I think it's like any other business....the people that know who to do it succeed. The people that don't have a harder time. A guild would maximize everyone’s exposure. In a sense making the competition even tighter.

 

 

Obviously I don't have a high option of unions or guilds. I really think that they help the weaker members and hurt the top performers.

 

 

I have great un-ending contempt for unions....period. And am a strong supporter of individual efforts being our greatest assets..... and yet the Pixel Corps works for me...hmmm it's a different animal.

 

If you got it going on....you certianly don't need any distractions man go for it and keep going !!!!

 

WDA

[marklazaro]

There is a bit of "You get what you pay for..." no? I mean quizzy... those renders look like crap... Sure they are cheap, but still. Quick hand sketch looks better than that lego images.

I couldnt agree more. . .

I live and work in a city that has become synonymous with undercutting world over, especially in the USA. Bangalore.

But let me tell you we are suffering from the same problem within the industry here. We have under trained people using pirated software creating terrible work at costs you guys would be totally shocked about. Ive personally met a guy who told me he would do architectural renderings of a commercial mall for the price of 1500 INR, roughly converted that's 35 US dollars. From what i learnt he operates from his house with pirated software on a computer that is ancient. There are thousands of undergraduate and diploma holders similar to him in Bangalore and around South India doing exactly the same thing. There are also small architectural firms who operate totally on pirated software with no intention of bettering their technical or artistic ability. Its all about undercutting the market and making a quick buck. Their lack of training both artistically and technically shows in their poor quality work.

I run a 2 man studio in the city with an office, good infrastructure as far as machines go and totally legal software. I cant afford to compete with their prices because my facility costs me a packet. We actually pay more for software licences here compared to the US because of the heavy taxation on each licence. We aim at giving our clients the best, doing photo realistic mental ray renderings, using DSLRs for photo montage work, building our own HDRIs. . . i think you get the drift. To maintain our software and hardware we have i think to the best of my knowledge ended up charging the same prices that most studios our size around Europe and the Americas would be charging. Our average billing is between 1500 USD and 3500USD per project, with some projects costing much more than that. Our clientele has been built up over the last 4 years and they have changed their outlook on the kind of quality that should be expected in the industry, they empathise with the costs we face and remunerate us well enough to keep us afloat.

My point is if you work above board and produce images that meet the standards of the global community, it is quite impossible to undercut in this business, even across geographical borders. The only ones who can are those who use shortcuts like avoiding paying for software and not spend the time to perfect their work. The only people who can undercut are the ones who produce sub quality work.

 

The client in my opinion is the one to blame. If he encourages sub quality work he encourages that section of 3d artists (dont know if i should call them that) and hurts the industry in return.

ill write more on this, have to get back to work now.

More to come.

Regards,

mark

[Justin Hunt]

You have made two very good points here. Firstly, quality breeds work. Secondly the clients lack of education .

 

Many clients don't understand or even want to understand the process and the true benifit of paying more for quality work. It is our responcibility to educate the uneducated and keep on pushing the quality of our work to keep the industry healthy.

 

JHV

[rotten42]

You have made two very good points here. Firstly, quality breeds work. Secondly the clients lack of education .

 

Many clients don't understand or even want to understand the process and the true benifit of paying more for quality work. It is our responcibility to educate the uneducated and keep on pushing the quality of our work to keep the industry healthy.

 

JHV

 

That’s why I say that networking (relationships) are so important...more so than marketing. I see a difference in the two. Networking is a much more personal endeavor than marketing. The strengths of your relationships are what been in the long term customer. Example:

I was at a marketing event for Herman Miller in San Jose a few years back. I recognized one person there that seemed to be a connected person. I developed that relationship which in turn has netted me 8 repeat clients in the last 2 years. 3 of them I get work out of monthly (or more). There is no way a union/association or typical marketing campaign could return the same results.

[Justin Hunt]

Its the repeat clients that are most important to any business. I have never done or need to do a marketing campain, all my work is done for repeat clients and word of mouth. The same goes for my dads office furniture manufacturing company. They have been in business for 25 years and have never done marketing. They have so much work that they are tempted to turn contracts down. Its all down to strong business relationships and very good quality work.

 

JHV

[alexg]

Nelson

 

I sent u a pm

 

Alxg