It is best practice as a photographer to clearly establish your deposit/retainer policy within the terms and conditions of your contract. In fact, in my opinion a deposit/retainer policy is an essential policy for a photographer to have in their contract.

 

Why Should I Require a “Payment”?

Your time is money, literally. As a small business owner, you may be the sole photographer for your business. This means that the time you set aside for one client is time that you cannot set aside for anyone else. If the client is a no-show, you have potentially lost out on other business.

 

However, I believe this concept is best expressed in the form of real world stories from some fellow photographers:

 

“Had someone stiff me for a newborn shoot…Spent over an hour getting the entire studio set up. I emailed them asking them what happened and never heard a word back. Never again will I book a last minute session to be nice and not make them do a deposit … even if it’s PayPal!!”

 

“Spent the time planning a boudoir session, had studio all set up (about 2 hrs. worth of cleaning & arranging furniture etc.), had a professional make-up artist there waiting, & a hair stylist there who drove an hour to be there, only for client to not show up! No call, nothing. I had even confirmed the week before. So I was out all of my time plus we had to go ahead and pay the makeup artist and stylist for their trip out there. We always take deposits now! They are non-refundable and that is always told to the client up front. If they cancel or reschedule it will remain as a credit if they choose to come at a later date. Hard lesson learned.”

 

“I had someone book his dogs birthday, with the dog cake smash and all. He never showed up, and since he’s the guy who’s been doing my hair for years, when I saw him I asked what happened, his excuse was “ten o’clock was just too early to wake up, so I slept in till three. I knew you’d understand.” By the way, I’ve never stiffed him on a hair spot!”

 

“I had set a day of on location photography in one of my fav spots (keep in mind I was new to MY photog biz and not working for a big box photog studio that didn’t take deposits/retainers).  I scheduled 3 shoots for the day… to sit there… and wait… and wait…. and… well you get the drift… turns out one forgot, one had an emergency and another decided to just not show… 4 lessons learned that day… Take a retainer, confirm shoot times prior to shoot day, no special treatment for family and MY family is number 1. I wasted an entire Saturday afternoon waiting on the maybes and not with my family…. Never happened again!”

 

How to Avoid these Situations:

Do the above stories sound familiar? Would you like to avoid this happening to you? Then, make sure you get an advanced “payment.” This is not an uncommon practice in the creative industry. Many studios, big and small, require a “payment” up front.

 

The stories listed above could have been avoided or mitigated if the photographers had required a reservation “payment” fee. This fee would have compensated the photographers for their lost time and mitigated the expenses related to hiring hair and makeup artists. A “payment” clause will give you piece of mind that the client will show, and adds credibility to the professional relationship between the photographer and client. Especially, when paired with a professional legal contract.

 

>> the above stories were taken from TheLawTog community on Facebook – Feel free to join!

 

So How Should Your Deposit/Retainer Policy Be Worded? 

Within the contract, expressly state that a deposit is required from each client in order to secure a time slot with your studio. This does two big things for you the photographer. (1) It makes the client realize that your time is valuable, and (2) it gives your client a financial incentive to show up for the shoot in a timely fashion.

 

Note: You can decide to have a refundable or non-refundable deposit/retainer. Whichever way works, just make sure whichever you decide is included in the signed contract.

 

Clarity is the Key: The Difference between a Retainer and a Deposit

This distinction between a retainer and a deposit is a big one. However, the two are frequently confused, and often the terms are used interchangeably; when they are in fact not interchangeable. When it comes to spelling out a non-refundable “payment”, there are a variety of opinions on the matter, with very little case law clearly defining what is acceptable and not acceptable.

 

Retainer: This is a fee paid in advance to someone, which secures the right for you to have that individual’s services when they are required. An example of this is an attorney receiving a retainer from a client, the client has bought the attorney’s services for a set period of time; or, until the retainer runs out. Typically, retainers are not refundable. You either use them within a given period of time, or lose them. You may want to think twice about using ‘retainer’ in your photography contract, however, because this definition has often been interpreted by the courts as having a meaning specific to the practice of law, and does not carry over in a substantive way to the photography business. [1]

 

 Deposit: This is a payment made in order to show good faith that the buyer intends to complete his end of the transaction. It functions as a pledge for a contract, with the balance being paid on a later date. Deposits can be either refundable or non-refundable. It is for a specific job at a specific time and place in the future. There is no industry standard here; you have to formulate a refund policy that works for your studio.

 

It is important to note that whether the word “deposit” or “retainer” is used may make a difference if the photographer in fact breaches the contract with the client.

 

A client may pay a retainer to a photographer in order for the photographer to ensure the client has the photographer’s services at some future time and place. Upon acceptance of this retainer, the photographer agrees to forgo accepting other clients which might interfere with the retained client’s future photoshoot. If the client then cancels the contract, if the signed contract so delineates, the photographer can then keep the retainer as compensation for the loss of business that they might have been able to book during the period for which the retainer has been paid.

 

A client may pay a deposit to a photographer in order for the photographer to ensure the client has the photographer’s services at a specific time and place. Upon acceptance of this deposit, the photographer agrees to forgo scheduling any other client at the specified date and time. If the client cancels the contract, if the signed contract so delineates, the photographer can keep the deposit as compensation for the loss of business or preparation that they may have done for the photo shoot on the specified day and time.

[1] US Courts have tended to point out that the word “retainer” has a specific meaning; because of this specific meaning, “‘[A] true retainer “is not a payment for services. It is an advance fee to secure a lawyer’s services, and remunerate him for loss of the opportunity to accept other employment.’….‘[i]f the lawyer can substantiate that other employment will probably be lost by obligating himself to represent the client, then the retainer fee should be deemed earned at the moment it is received.’ If a fee is not paid to secure the lawyer’s availability and to compensate him for lost opportunities, then it is a prepayment for services and not a true retainer. ‘A fee is not earned simply because it is designated as non-refundable. If the (true) retainer is not excessive, it will be deemed earned at the time it is received, and may be deposited in the attorney’s account.’” Cluck v. Comm’n for Lawyer for Discipline. One might argue that this definition is specific to the practice of law, and does not carry over much to the photography business.

About Author

Rachel Brenke is a lawyer, photographer and business consultant for photographers. She is currently helping creative industry professionals all over the world initiate, strategize and implement strategic business and marketing plans through various mediums of consulting resources and legal direction. Disclaimer: I am a lawyer but I'm not your lawyer! View my entire disclaimer here /// Download free contract form!

7 Comments

  1. Pingback: What if my client doesn't want to sign a model release? - Legal Photography Tips

  2. Thanks for your comment!

    I was offering a more general instruction rather than telling readers to spell out liquidated damages provisions. My goal and message was pretty clear that there were no magic terms that would automatically make a retainer non-refundable. – I also emailed you directly!

  3. I just want to thank you for all the free advice you give. I am terrible at explaining things to clients and to be able to just send them a link from someone who spells it out in an understandable and simple terms is very helpful and wonderful! Thank you again from a loyal fan!

  4. Rayleigh Leavitt on

    Hi Rachel! Thanks so much for this advice! I was wondering if I have to have an actual contract stating these things that the client signs or can I just put a paragraph on the invoice that says, “By paying this invoice, you are agreeing to….”. Thanks in advance answering my question. :-)

  5. Wooooah! Awesome.. You couldn’t have nailed this better.
    While I”m happy my contract is in good order.
    But I learn a lot on this too.
    Keep up the good work :)

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