How I Price My Design Work

Pricing is hard. If you're struggling to figure out what to charge I can tell you that you are not alone. In this video, I talk about how I price design work and how after years of doing it I find that pricing is still one of the biggest challenges I face

When people ask my hourly rate I never want to be too quick to shoot them a figure. Doing this has never led to any positive endings to projects I work on.

What I prefer to do is gain all the information I can about the project, spend some time thinking and then regrouping with a proposal to the person(s) requesting my services.

Tell us your damn budget already!

At my agency Couple of Creatives, we've yet to have a client voice an actual amount they have to work with. Many are reluctant to even speak of money altogether. With this in mind, we use what we know to craft a proposal. How do we do it?

Since this is our full-time gig we realize we need to be able to survive on the money we make. With all of our expenditures in mind, we can accurately arrive at a set amount per month we need to break even. Of course with business, the goal is to make money so we again factor that in to create what ends up being our final project estimate.

We wrote more about this on my other blog. Check it out.

We aren't cheap. It's for a reason.

I learned in my early freelancing years that working for next to nothing won't get you anywhere. You may be able to pay a bill or two on what you make but the amount of time spent versus the value given is not even and everyone is blind to this. Why are they blind? The internet.

So many websites are devaluing creative services every day and sadly novice and even professional designers are feeding the flame. Fiverr for instance advertise logos starting at $5 almost religiously. Do they care about the creatives making $5 per design? Not at all. All they want is their cut. They'll move on to the next designer and take his or her cut as well. Website builders like Wix advertise as making building a website a breeze but in fact, it restricts users from what they really want to do and charges them monthly for it.

It's a sad state of reality for us designers and developers struggling to make ends meet and it's actually hindering the public perception of our roles we worked so hard to achieve.

What can you do about it?

Increase your rates and avoid these sites and low paying projects like the plague. If you play hard to get in this business it's actually a good thing. Since pricing design work higher, I've fired my worst clients. Looking back I can say it was the best decision I've ever made. It allowed me to value myself for once and broadcast to any new client that I mean business and if you work with me you will get quality results. I may not be cheap but you can bet I will deliver. Get it done right the first time and your clients will actually save money in the long run.

Unfortunately, increasing your rates means fewer people who inquire with you will be able to afford you. People see a large figure and freak. It's natural. It's your job to educate what that rate represents and why it is what it is. Treat this all as a good thing. It doesn't mean the client thinks less of you. It simply means that they assumed it would cost less. This impression was set in their mind from those bidding sites or craigslist like I was just mentioning. See how it's screwing things up?

Project-based pricing

If I had to choose any way to price my work it would be project-based pricing.
Simply put here are the reasons:

A clear set of deliverables is decided upon upfront. Anything additional is added as a new deliverable and or quoted independently.
Realistic timelines are estimated giving me an outlook of what other work I can take on.
Most clients who are okay with this pricing aren't clients from hell
To help the client out and to get paid more often we charge at set milestones. Payments are typically made in a 30%/30%/40% fashion. Where 30% is a down deposit, another 30% is a larger milestone, and 40% is the final project fee.

Hourly Pricing

Hourly has its perks. Here are what comes to mind:

Great for long term projects where deliverables aren't so clear.
Easier than figuring up a flat rate. If you under-quote for a project-based pricing model you get stuck with working for free sometimes. The longer you do it the better you get.
Not so great if you're efficient with time (meaning you earn less because you are actually good at what you do).
Tracking time is kind of a pain. I always forget to start a timer.

How I get paid

At Couple of Creatives, we still send custom invoices that we make in InDesign. These invoices are then sent via email as a PDF. If a client is an ultra old school we mail these invoices out.

Accepting payments typically happens via check and/or bank transfer. It's just easier and there's less to worry about. Accepting payments through merchant sometimes happens but we typically avoid it for the sake of not paying the fees associated with each transaction.

I still suck at figuring my pricing

I've been working as a designer and developer for nearly 10 years now. I got my start working for free to get better. Slowly I got pretty decent and realized I needed to charge more. Now I charge more than I ever thought I could and It's because I value what I do. The key takes away to me in the creative business is value. I don't mean the value of my title or my business but more so the solution I can deliver to make a business grow like they never imagined they could. If I can't help do that then something is wrong.

How do you price your work? What are some issues you've had to deal with and how have you come to resolve them?