Professional Operators: How to Price Drone Services

The drone industry is still in development mode – which means that professional operators don’t have a lot of examples or guidance to work with when it comes to setting prices that will be both profitable and competitive.  Pricing varies based on location, type of application, deliverable – and what the client will pay.

While there is no set price range that will work across regions and applications, there are some basic guidelines and industry averages that can help professional operators set reasonable pricing structures.  Here are 5 questions which will help operators to determine the right price.

What are Your Costs?

Professional drone operator and entrepreneur Kam Yee, senior manager at Beacon Sky Survey, took a classic business approach to setting the pricing structure at her company.  A highly skilled aerospace professional, Yee specializes in survey-grade mapping, 3D terrain maps and photogrammetry; the company provides consultation, education and written materials along with the data that they deliver.  Yee carefully estimates her costs before setting her pricing, to ensure that the business can stay healthy even if they may discount a bit on initial jobs to grow the customer base.

“Both the SBA and SCORE websites have several templates on pricing structures,” says Yee. “I used one of the templates and consulted a coach at my local Women’s Business Center for help. SCORE has volunteers who will sit down and walk you through it, too.”  After calculating the fixed costs of running her business, Yee calculates the costs per job – including field work, travel costs, data processing time, and customer acquisition.  Some jobs may require a full day – even if the actual flight time is less, Yee points out. “While most jobs will not be 8 hrs of flying, if it’ll take a day of my time from doing other revenue-generating tasks, then it’s a full day to me,” she says. “If it’s a repeat job, then we may charge a one-time set-up fee, plus a service fee for each time we go out.”

In addition to calculating a minimum charge to keep the business in the black, operators should calculate an ideal markup – then they know what range they can work in to acquire new business.

What’s the Application?  

Not all drone jobs are created equally.  Some applications require more expensive equipment, more skills, or more data analysis.  Expert pilots who can provide mapping, modeling or analysis services may be able to charge more than those who provide only images.

If you are having trouble commanding the price you need to stay profitable, it may be worth investigating platforms and adding to your education to expand your offering.  DroneDeploy, a leading drone data platform, says that data shows mapping services command a premium.  “We have had over a thousand pilots sign up to our Drone Mapping Directory. The price per operation on the Directory vary, but it’s clear that drone mapping helps drone pilots earn, on average, 16% more than general drone services,” says Mike Winn, DroneDeploy’s CEO. “Any commercial drone pilots that would like to increase their earning opportunity should consider adding drone mapping to their portfolio.”

What’s the Deliverable?

Professional pilots all know that flight is only one part of the job.  The deliverable is a key differentiator.  Agree with your customer in advance – and then charge accordingly.  Operators may provide a basic map for a basic price – but add further processing and insights for additional costs.  NDVI, thermal mapping, or 3D modeling may cost more.   If you provide engineering or agricultural insights in addition to images, your price can reflect that expertise.

Drone operators specializing in photography or video may also vary their pricing based on deliverable.  Quality of processing and presentation can make a big difference to customers.  Operators specializing in this area should investigate what standard photography studios deliver – and what they charge customers for premium service.

What’s the ROI for the Customer?

It’s worth knowing what value your services provide for your customer base.  In enterprise or industrial applications, the ROI can be very significant.  Insurance companies can find that drone inspections save them significant money on processing claims; construction, agriculture, energy, aggregates, and turf management are all areas where drone technology offers clients significant value.  Those customers may be willing to pay more for a reliable, knowledgable service with a provider who can guarantee insurance and compliance with any other specific requirements.

In more competitive markets like imagery for real estate or marketing purposes, operators might have to get creative on deliverables and services in order to command a similar price.

Am I in the Range?

When you’ve established your minimum – and made a guess at your maximum based on deliverable and value – you’ll need to check that against the data available to see if your pricing is within range for the industry.  While that can be hard to determine, the tables in this blog post published by DroneDeploy and Airstoc based on a broad survey of professional operators may help.  Hourly rates vary based on region, travel time, insurance coverage, certifications and more.  Reaching out to other pilots through social media forums or at conferences can also provide a sense of what’s reasonable.

While determining pricing structures for a new industry is tricky at best, new businesses should take heart.  As drones become more common, industries are realizing the benefits of drone technology and demand is growing across verticals.  It may take another few years for rates to rise with demand, but those businesses who have stayed in the game will reap the rewards.