Charging for your valuable time

If you’re a freelance designer, you’re running  a business. That means you charge for your time and – in theory – your clients should be happy to pay for it.

I see many discussion threads on the pros and cons of hourly rates versus flat charges and both arguments have their merits. I do feel, however, that there is a third option.

An hourly rate is traditional among designers, and I myself have often quoted for work on a ‘should take me about 10 hours’ basis. Time is, after all, money. Most designers that I know charge by the hour, although many have instituted guidelines in order to aid the client in estimating the probable bill. Much like the way mechanics will say ‘should take me about 2 hours, so with parts, I expect around $400’. Then, if it takes longer, due to broken bolts or whatever, and the bill comes to $600, you’re not usually surprised (when was the last time your mechanic charged you exactly what he quoted?).

Unfortunately designers also fall into this category. The feeling among the great unwashed (those who make up the prey of designers) is that receiving a bill for the ‘quoted’ price is worthy of celebration.

A flat rate can therefore have major advantages of its own, especially when dealing with a client who is new to the concept of using a designer – a new business owner for example. Or a client who has been burned by extra hours spent in the past.

$500 logos, or $999 websites allow the budding businessperson to budget accurately, and if the designer actually honours those charges, should bring him or her back for more.

But flat charges have one major flaw; no two logos are the same, just as no two websites can take the same time to design, assemble, test and launch. Another problem with flat fees is that by offering a set figure, you open yourself to direct comparison (and competition) based on price – not your skill level, your past successes or your ability to get the job done. And with some websites offering $60 logos while-U-wait, and Free Websites (just host with us), that competition is unfair.

Okay, so what’s the solution? I did say there was a third option.

How about… wait for it… an unadvertised flat rate.

Here’s how it works. You’ve been around a while and have some examples of what you can do. You know, for example, that the website for the old lady’s flower shop took you X-hours and you charged Y for it. You also know that the logo you designed for her was a simple three hour job. And there are more.

So you have a $500 logo, as well as a $1000 logo and a $2000 logo. Plus you have a $1000 website and a $2000 website and so on.

When you’re speaking with a client, you show them a logo you have done that suits the expected budget of their company and tell them “that’s a $1000 logo”. Then gauge their reaction. If their unimpressed, and seem able to spend more, you continue along the lines of “but of course for your company, I’ll pull out all the stops. This was a strict budget job.”

See where I’m going here. If you want to advertise a flat rate, do so – but with the addition ‘from’. For example “Websites FROM $999”.

But most important of all, MAKE SURE YOU STICK TO THE CHARGE. Nobody likes extra charges or fees or unquoted elements. If the job does take you longer than you predicted, consider sticking to the quoted amount and swallowing the extra. You’ll gain a lot more business than the few extra bucks you’d get by charging those extra hours.

Trust me… having the adjective ‘reasonably priced’ in front of your name when being recommended is worth its weight in gold. You just don’t want to be ‘cheap’.