Is it fair to charge your bigger clients more?

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There is a lot to know when it comes to pricing. There are whole books dedicated to the science of properly pricing design work.

There is a lot of really good information out there about pricing, and when I was starting out I read a lot of it. You can find almost everything you would want to know online. I quickly settled on a combined system of flat rate and hourly that works very well for me. I was all set.

However, one thing kept bugging me.

When I was quoting on new projects my gut would always tell me to quote higher depending on the size of the company or client. I felt like I should charge bigger clients more than smaller ones, but I really didn’t know why.

I didn’t know if it was fair, and I didn’t want to be seen as taking advantage of clients depending on their financial status.

I have to tip my hat to Jessica Hische, whose wonderful article, The Dark Art of Pricing, gave me a ton of insight on the topic and really helped me draw my conclusions.

So is it fair?

You might have guessed from this posts title that I think it is fair. The reason, though, has a lot less to do with the clients larger creative budget than you might think. Just because the client has a more money doesn’t mean you are entitled to charge them more. That, I think, would be unfair.

So here’s why it’s fair to charge your bigger clients more.

Bigger clients are likely to have a few other factors at play that make doing design work for them a little more expensive. Consider the following when pricing out projects for larger clients:

The size of their audience

When you bill a client, for the most part what they are buying (aside from your hourly work) is the right to display something you have created, and therefore hold the copyright to. This is either done through licensing; where the client buys the right to display the work in an agreed format for an agreed amount of time, or through a buyout; where the client buys the copyright and the work becomes their intellectual property.

A fortune 500 company is going to have a much larger audience to view the work than a mom and pop bakery. As the audience for the work is expanded, licensing and buyouts can be adjusted to match.

The scope of the work

They also have the ability to use your work in more applications and therefore you will have to consider a lot more factors while designing for them. A brandmark that will be on everything from business cards to billboards needs to be more versitile and well tested than the signage for a mom and pop store.

As the scope and mindfulness of your work must increase, so should your rates.

Should I charge my bigger clients more?

Not by default. Every client deserves fair and equal treatment. Larger clients will tend to need more versatile, thought-out work and wider licensing options, and those should be charged for accordingly.

Do you have a sliding scale for your clients? In the comments, tell us if you think it’s right to charge bigger clients more or if you think we’re all wrong.

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About Ben Brush

Ben Brush is a graphic designer working and living in Nova Scotia. You can view his work on his website. Find more posts by Ben on his graphic design blog Design Puffin or connect with him on twitter.

Comments

  1. Ben,

    Thanks so much for the validation! I’ve experienced the same weirdness but gut feeling as you, but again, felt the “bigger budget” was unfair. After all, I don’t want that to happen to me.

    Now I have good, valid reasons that I can explain to clients if necessary that fits within my ethical code.

    Awesome post!

    April

    • Thanks April!

      I’m glad you got something from the post. It’s something that bothered me for a while and when I did some thinking on it I wanted to share what I came up with to see what everyone else thought.

      I’m glad that people for the most part seem to agree.

  2. Rebecca Osterman says:

    Another reason to consider charging more to bigger clients is that usually these projects are going to be more complicated because of the added “cooks in the kitchen”. With your mom and pops you have one person, or maybe a very small number of people who are weighing in on the process. Once you get to a larger company, it’s much more possible that you run into a situation where the people you were dealing with aren’t the ones who actually make the call as to what the approved design is. They’re telling you one thing while the ones who are in charge have something else in mind, leading to more revisions and a generally more painful process.

    • That’s a great point you’ve picked up on Rebecca. I’m glad you mentioned it. Dealing directly with business owners saves a ton of time compared to dealing with a committee or series of decision makers.

      Thanks for the comment!

  3. Another factor to consider is the number of approval stages, and hence the number of iterations the work will have to go through. Large clients, especially those with a national or international scope, tend to have more review steps due to having more stakeholders involved. Accommodating an extensive approval process adds necessary time and legitimate costs (rev’s/comps/presentation decks) to the project.

    • Dave, I couldn’t have said that better myself. That’s a really great point. Anticipating and accommodating that process could make the difference between a project being profitable or not.

      Thanks for your thoughts!

  4. Great post! I do have different rates of pay but for slightly different reasons. As a sole trader – and a mum – I fit my work in around my kids as much as possible. I’m totally up front about this with all my clients but the bigger companies expect a different level of service and I provide that – but also charge more for it.

    For small clients, I’m only available for meetings during school hours and project timescales may be longer if I need to take time off for the kids’ holidays (agreed up front, of course).

    By charging the bigger companies more, I can pay for childcare whenever necessary. This means I can be available for full days, work to shorter timescales and be more responsive to changes of scope or shifting deadlines.

    • Sounds like you have a great system worked out. I like your approach, and honesty with your clients, and I’m sure they do too.

      Thanks for your thoughts.

  5. Thanks for the post! I always understood that the scope of work would be larger which gives me reason to charge more, but I always forget the cost of licensing for their audience. Great tip!

    • I’m glad it was helpful Samantha!

      Some people have brought up other great reason in the comments here that I didn’t even think of as well. I’ll be using a few of them myself when considering future projects.

  6. For me, the best reason to charge bigger clients more is because everything usually takes longer. The research phase takes more time, the approvals take longer, there are more opportunities for scope creep, and there are more decision makers, even if they funnel their instructions to you through one person.

  7. My larger clients DO pay more- but because they have more shot-callers= ( more protracted approval processes), more bureaucracy=( more hoops to jump through to get paid), more pointless revisions based on somebody’s needing to justify their existence= (more hours to completion).

    So in this case “larger” applies not to the size of their wallets, but to the magnitude of their inefficiency.

    • What a magnificent phrase: “the magnitude of their inefficiency” (and, unfortunately, one that I’ll bet we can all relate to!)

    • You said it guys. It’s all about being prepared for the way your client works, and for bigger clients that can be a lot slower and drawn out than it would be with others.

  8. Listen, it’s simple:

    1. If (oh, God please let it be!!!) Coca Cola calls me tomorrow asking for a quote for an ad, or a brochure, or a logo for their new product — they sure would throw my quote straight to the trash can if I charge them what I charged that diner around the corner last week.

    2. Somebody needs to SUBSIDIZE my small, poor clients who can’t afford paying what I’d like them to pay, yet they still DESERVE a decent-looking ad (or brochure, or logo(, don’t they.

    3. I can come up with a couple more good reasons, but some were already mentioned, some are too trivial, some are just plain obvious. The rich CAN and SHOULD pay more.

    Simple.

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