I'm putting together a proposal for a client to pitch to their boss, and I need to come up with a per diem fee. I can't decide on a method for generating a per diem. At this point, I don't know how much time I'll spend shooting, either. I want to quote a fair price, but I'm unsure of what all to account for. How should I go about calculating my fee?
Billing for travel should include 3 parts: Work, Travel, and Per Diem
Billing for the work is often the most difficult. The easiest way to quote a fair price would be billing hours worked at your standard rate, or your average income in a single day, whichever is greater. For example, if you work 8 hours, but in a normal day at the office you'd work only 4, bill for the 8 hours. If you work only 4 hours, but on a normal day in the office you'd work 6, bill for 6. This is so that you're not operating at a loss during travel. Include all days that you're away from the office, unless a day is leisure.
Include all travel expenses that are specific to the job. Don't forget car rental/cab fares/parking fees to the airport and at your destination.
Travel is difficult to estimate for a quote. Google (among other travel sites) does a decent job at estimating plane tickets. Offer the client a discount for booking early to promote cheaper airline fees. Always give yourself buffer and don't forget the fees for extra checked baggage.
Quoting hotels are much easier since the government provides per diem estimates for lodging (see next category).
Exclude any expenses that aren't necessary for the job. Example: if you stay an extra day for leisure, don't charge per diem or hotel for that extra day. If the return ticket cost more for the one day later flight, charge what it would have cost if you left the day you completed the job.
The U.S. Department of State sets international per diem rates for civilian (non-military) travel on government business. These rates are a great area to reference and, in my experience, have been practical. This also gives you something solid to reference when a client questions your per diem rates.
Per diem rates shouldn't be specific to the time that you are working. Per diem should be included for the entire period you are away from home since you cannot bring meals with you and will be subject to the cost of meals at the destination (excluding leisure).
The rates can be found here.
This issue is true for all businesses. the question:
Do I bill an hourly rate plus expenses and "diets by government rates". Versus what is the service worth to them. And is the travel time worth as much as active time? will the bill be too high vs the value of the service? Can you pool other work time with the travel time? Knowing a set amount of hours for this service is worth something to you as well (package deal = lower hourly rate).
Is it a strategic job for you that you want to do as well? I'd say the "diets" and direct expenses are a minimum, how to handle travel time * hourly price vs service value vs personal interests is up to you.