My process dealing with young talent

I've talked to some artists and writers regarding work for my game system. I used to be in their shoes, and in their shoes no one ever taught us to price our work or how to analyze risks and protect against them. I use the skillset I was taught at work and applied it to art, skills I wish I learned when I was a young and starving artist.

Step 1 Measure Measure Measure 

(note there are rules of thumb that can be used to tell what is a good value)
Look at the Market Going Rate
Measure your performance per day, how many hours does it take for a Finished work
Measure all your distractions, risks, and failrate.
Measure your lifestyle

Step 2 Now compile, organize, and run the data.

Figure out your productivity in terms of a Month, Week, and Day.
Price according to your Cost of Living, not your ideal cost of living but what is sustainable but keep in mind market rate. You basically adjust your costs to be competitive but not far bellow market rate. Offer value not discount (as for value I would provide the skillset needed for customer service rep).
If your still not confident, you can offer a Discount but this is only temporarily and only IF you get enough business from them. IOW lets say you have if they give you 200 manhours worth of work, you can give them a bulk discount (which is only when you go below market rate). These costs have already been factored ahead of time.
Have a price per visit (i paid for the cab of the artists visiting me, when i get a chance), its like software design.

Step 3 Now organize your plan, and write down your assumptions. 

Have a business plan in the end, think through your profession, ideally aided by an experience professional who can help devils advocate all the contingencies and distractions.
Include the Marketing Plan AFTER you finish all these. By marketing I mean all the activities you do in order to keep visibility and relevant. Marketing is separate because it is the most disposable of strategies when times are hard. If they are hard for an artist, its time to consider part time work for a secure income. This is THE Ideal strategy fresh out of college, for most graduating filipinos who want to be an artist. Ideally they are in an industry that compliments or directly involved in their chosen career path.

Let them make up their mind

Of course I can only recommend and they have to make up their mind. Once they have their act and biz plan together, i'm more willing to do biz with them. I don't care much for the margins, thats the artist business, what I care about is value and what they offer compared to market norm. I am an unusual client as I am more like a patron, but I will prep them for harder clients and muddier business decisions. 

I just want to know that I'm getting good value for what I'm paying. Its not about what is cheaper, the value I can get is what I need at a given price I can afford. If I see crap, I need to know they will fix it. Its not their professors they are dealing with, its me and I need to know that they can take the criticism professionally. 

Building Up a Talent pool 

Right now Im running my hobby like a frugal businessman, only making expenses when I'm about to use the product with certainty and when there is a good ROI. Inspired by /r/frugal I've begun tracking my expenses more carefully and meticulously. But being frugal does mean being a cheap ass, you still spend well on other people, especially when you want them to know they matter. You can be cheap with yourself, but not with relationships.