Have you ever found yourself pulling your hair out over how much to charge for a design project? It can be very frustrating and usually ends up costing you more time (and thus money) than it should.
There is some debate on the merits of having an hourly rate that you charge for everything, or setting prices for certain design services and sticking to those. There are definitely pros and cons to both methods, and it really ends up depending on what you do, and how efficient your design process is.
I’d love to hear what approach you’ve taken. Leave a comment and tell me: do you charge by the hour or a flat-rate per project?
If you can convince a client to pay you an hourly rate for a design project (preferably your preferred rate), then that’s probably the way to go. The great thing about it is you know you’re getting paid for every bit of time you put into a design project.
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Just be honest about how much time you’re actually spending on the project and how much time is spent checking Facebook, setting up your fantasy roster for the week, responding to other clients’ emails, etc. While some design clients have no idea how much time a given task will take, some might get suspicious if uploading a new banner image for their site costs them 9 of your expensive hours. Being a design freelancer, you rely on your reputation, so suspicion is not a good thing. Plus, you want to run a respectable design business, right?
Many design clients (at least the ones I’ve worked with) want a flat quote up front, and it can be difficult to convince them to shell out more later if you underestimated. While it’s great for the client to know what cost to expect, it can be very taxing to the designer if you aren’t sure how much time you’ll be spending on the design project.
If you go this route, be clear in your contract that any work outside the original scope will be billed in addition to the set rate. Be sure to make clear exactly what services you will be providing, how much, and how many rounds of design changes you will allow. If both you and the design client are on the same page as to what is expected, it will be easier to determine what is within the project scope and what is outside. It’s worth the extra time spent forming your work agreement so you don’t shoot yourself in the foot later!
Determining a project rate
But how do you determine set rates for a project? I’m sure there are other ways, but the way I set rates is by estimating the time I anticipate spending on the project, multiplying by my hourly rate, and adding an extra percentage to account for the inevitable time spent that I wasn’t expecting. Starting out, it is very difficult to accurately predict how much time a task will take, so I’ve come up with a few tips that have helped me.
Keep track of your time. The best way to predict your time allotment is to base your figures on previous projects. Keep careful notes of how long each task takes, including changes and revisions. It will take awhile to build up a library of projects to reference, but it will definitely save you headaches in the future. Try using some time tracking software, or online tools like Freckle to help keep track of your time.
Break it down. To make estimating as easy as possible, try breaking the project down into smaller pieces. For instance, if you’re designing a webpage, you could take into account all of the following: emails and dialogue with the client, setting up the template, initial mockups, setting up a presentation file, revisions, client changes, setting the file up for coding, actually coding the page, further revisions, packaging up the final files, etc. Though it may take longer to think about it in such small steps, breaking it down can give you a better picture of the total project scope.
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Overestimate. Do yourself a favor and leave a bit of breathing room. Underestimating can lead to the frustration of watching your hourly rate plummet as you plug along on the project. But if you guess too high instead, congrats! You’ve earned some extra cash. It may even be a good idea to knock a chunk off the final bill–while you don’t see the instant reward of cash, the client will certainly be happy, possibly leading to more work or better referrals.
Know your client. Keep in mind that every client is different, so a lot of the timing will depend on how picky they are, how clear they are in telling you what they’re looking for, and the speed at which they return your calls and emails. As you get to know your client, be flexible. As you work with them more, you’ll begin to figure out how they operate, and that can give you a better idea of how to distribute your time.
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Does the way you quote design projects depend on the client or do you always stick to a particular method? Any tips that I’ve left out? Leave a comment and share your thoughts with me!
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