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Hey photographer friends! Welcome back to our Photography Blog, Mastering the Wedding Photography Biz with Hunter and Sarah! In today’s blog/video, we’re talking about one of the most common contract mistakes that we see almost every one of our new photography students making: not understanding the difference between a deposit vs. a retainer. And if you don’t want to make this same mistake that could cost you thousands of dollars, then keep reading!

 

 

The Difference Between a Deposit vs. Retainer

So for starters, let’s talk about the difference between a deposit vs. a retainer. A deposit is a payment made by a buyer to a seller to secure the purchase of a good or service. It’s typically a percentage of the total price and, once the transaction is complete, the deposit is applied towards the final payment. Or, if the sale falls through, the deposit is refunded. An example of a deposit is when you’re buying a car. Unless you walk in and write the dealership a check for the full amount of the car, you’re usually required to put down a deposit while you get a loan for the car. If the loan is secured, then the deposit goes toward the purchase of the car. And if the loan falls through, you usually get the deposit back.

 

On the other hand, a retainer is a fee paid by a client to a service provider to secure their services for some period of time. The retainer is also paid upfront, but instead of being just a portion of the total amount, it also ensures that the service provider is available to the client for the entirety of the project. This is true whether the client engages with the service provider all the time, or never reaches out to them once before the project is complete. Because of this, retainers are typically non-refundable, as they’re used to cover the service provider’s time and expertise.

 

An example here is if you hire a lawyer to represent you in a legal matter, you may be required to pay a retainer fee up front just to secure their services, and then additional fees for each hour that they’re working specifically on your case.

 

 

Why Photographers Should Collect Money Up Front

Here’s where this becomes relevant to photographers. If a client reaches out to book you and signs a contract, you obviously want them to have some “skin in the game”. If you’re going to give them a date on your calendar and start turning away other jobs for that date, you want your client to have some incentive to actually show up and pay your rate. And so collecting some sort of money up front is super important! If the client stands to lose some money if they cancel, they’re much more likely to actually show up and have their photos taken.

 

And we think this is true no matter what kind of photography you do. If you’re a portrait photographer, collecting money up-front ensures that people aren’t just going to book a handful of photographers for the same session, then decide at the last minute which one they want to hire. It’s super frustrating to schedule a portrait session 30 or even 60 days out, turn away other opportunities for that date, plan your whole weekend around that session, only to have them cancel at the last minute and you have nothing to show for it!

 

And while that can be frustrating for a portrait photographer, it can be financially devastating for a wedding photographer. Especially for popular dates like Saturdays during our busy season, we might get 5 or even 10 leads for the same wedding day. Imagine we booked the very first person who reached out to us about the third Saturday in October and turned away 9 other couples for that date. Then in September, the first couple reached out to us and canceled their wedding! We would have turned away all of those couples for nothing, and would have $0 to show for it.

 

 

Why You Need a “Nonrefundable Retainer” Instead of a Deposit

So at this point, we’ve hopefully convinced you that you need to be collecting something up front. But it really matters whether you do a deposit vs a retainer. Because, like we mentioned at the start of this post, deposits are the first payment toward a total purchase. So if a client cancels their wedding or calls of their portrait session, you’re usually obligated to refund their deposit. So in the end, it’s no different than if you hadn’t collected anything up front at all! For this reason, we think that deposits are basically useless.

 

On the other hand, in most places, retainers are not considered refundable. And to be extra safe, everywhere that we refer to our retainer in our contract, we specifically call it a “nonrefundable retainer”. We make it very clear to our clients up front, both verbally and in our written contract, that if they cancel their wedding or portrait session for whatever reason, we are going to keep their nonrefundable retainer as damages.

 

And here’s what we mean by that. As wedding photographers, we’re going to make ALL of our money for the year in just a handful of weekends. If you only shoot 15 weddings per year, and suddenly lose one of those weddings off your calendar, that’s 7% of your income, gone! So in the event that one of our couples makes the heartbreaking decision to call off their engagement and cancel their wedding, we don’t want to be completely out of that income. And since it would likely be too late to re-book that date, at least keeping some percentage of it is better than none.

 

 

Even MORE Photography Business Advice

Now, as is hopefully obvious, we’re professional wedding photographers, not lawyers or accountants. So always have your contracts reviewed by a legal professional. But if you’re in the earliest days of your portrait or wedding photography business, and want to learn from more experienced photographers like us how to initially set up your business, we’d love to let our years of experience running multiple businesses go to work for you!

 

That’s why we have our “Photography Business Basics” workshop for sale on our website! If you want to learn more about the best way to officially and legally establish your business, as well as how to navigate business bank accounts, insurance, taxes, and so much more, then click the link above to learn more about that, as well as our other workshops! And even if all you wanted to learn about was what percentage we ask for in our nonrefundable retainer, or how we manage payment plans and work those into our contracts, that alone would be worth the price of this workshop! If you’re interested, check out that link!

 

 

Want More?

 

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