What your pricing strategy says about you as a freelance designer

prIcing strategy freelance designer graphic design blender
13,807 designers received our email newsletter last week. Click here to sign up for free.

Have you ever realized what your price point says about you as a designer?

As designers we worry so much about how our brand looks when it comes to logo, web site, etc.

We obsess over what to name our design business.

We’re constantly asking ourselves if it’s time for a redesign or a rebrand.

But how often do we ask ourselves if we need to rethink our pricing strategy? Believe it or not, your pricing strategy is a huge part of your overall branding and can influence how the world, and your clients, perceive your value, professionalism, and talent.

If you’re too expensive

Let’s talk about designers who charge too much for their services.

I’m not talking about designers who charge a healthy amount but some clients refuse to pay their going rate because they’re penny-pinchers. I’m talking about designers who literally charge way too much for their work.

I’m talking about the designers who charge tens of thousands of dollars to their client just to turn around, download a premium $40 wordpress theme and install it for their client with a few minor modifications.

You know…those designers.

These same designers have a portfolio completely full of student projects or modified templates but insist on charging as much as a large design firm.

So what does such a high pricing strategy say about your design business? If you’re not careful, it could be saying:

  • You’re cockyYou think you’re the design gods’ gift to humanity. Consequently, you’re really hard to work with, can’t take direction, and won’t listen to clients when they have concerns about their projects because, “let’s face it, you know best.”
  • You’re inexperienced. Believe it or not, having a ridiculously high pricing strategy doesn’t make you look like more professional, it makes you look like you don’t know what you’re talking about. And since your prices are so high, you haven’t done many real projects which means it’s likely you actually don’t know what you’re talking about.

If you’re too cheap

So maybe setting your prices super-high isn’t necessarily the best option.

But does that mean you have to adopt rock-bottom prices and beat out every guy in town?

Absolutely not.

There’s also damage in setting your prices too low. Aside from not making enough profit to keep your business afloat, here’s what really low pricing says about you as a designer:

  • You don’t have much to offer. You have low rates because you don’t think you have a lot to offer. You don’t bring very much value to a client/designer relationship and you don’t really know why anyone would even pay you at all.
  • You don’t dedicate much time to your work. If you’re not charging much, you must not plan on spending much time making revisions, hearing out your client, or polishing up the final designs.

So what’s the sweet spot?

So what’s the perfect pricing strategy for designers? How about you tell me what you do by leaving a comment?

Since pricing strategies and costs vary dramatically around the world, it’s hard for me to give a simple answer. But I would just caution you to stay away from the extremes.

Don’t set your prices at the bottom of the barrel.

But don’t make your clients take out a second home mortgage to get their design work done.

Do you agree?

About Preston D Lee

Preston is a web designer, entrepreneur, and the founder of this blog. @prestondlee

Comments

  1. It’s easy to slide the slippery slope to rock bottom pricing! Maybe concentrate on features and benefits rather than price.

  2. The sweet spot is such a trial and error thing – when I talk about rates with a client I’m constantly looking to see if they snap my hand off or look shocked and taken aback. To be honest though- every client will have a different idea about what your services are “worth” so that’s not really much use, lol.

    I guess you just need to play the averages- if you’re getting every single job you pitch for but are struggling to make rent, then you can safely assume you’re too cheap.

    • zbeeblebrox says:

      What I really hate though, is how do you “play the averages” when everyone keeps their prices Top Secret?? I feel like we’re shooting ourselves in the foot here as freelancers by playing our rates so close to our chest. A new freelancer with no experiences should still KNOW without effort what the average rates are. They shouldn’t be going in blind: THAT’S what causes these races to the bottom! They don’t know what they’re worth and they get exploited, then clients get used to those prices and the “average” becomes the “too expensive” category.

  3. Right on the money, Preston, pun intended. I have been talking with a small business about taking over their design needs from their current design resource. He is on the high end of the fee spectrum, and behaves exactly as you describe–hard to work with, cocky and not willing to take constructive criticism. That said, there’s much to be said for a good working rapport, a designer who “gets” the client’s business, and a client who trusts their designer to deliver effective communication solutions that might not be exactly what was ordered. It’s up to both designer and potential client to do due diligence to ensure a good working relationship in the future.

  4. So what is the extreme low to install and basic set up of a wordpress site : 500/600 $ ?
    I ve no idea… usually i charge little for that and the right for SEO.. but often i never get to the SEO part :-(

  5. I think a reasonable amount is $30 per hour. I’m thinking about charging my clients per project. Assuming a project will take a week to complete, I think $500 is also pretty fair!!

    • StephenESC says:

      Hey Karam,

      Sorry to disagree but, to be honest, it sounds like you’re selling yourself short. $500/week works out to be $12.50/hour (based on a 40-hour work week). That’s barely above minimum wage in most parts of Canada.

    • @Karam and @Manuel, your pricing is far too low. If you do your job properly, you do not get anywhere with $500/$600 and you get stuck with the type of clients that want to squeeze you like a melon.
      A serious client knows he/she has to spend money to get quality work.
      it is better to have one job of $5,000 then ten of $500, trust me on that.

      • @Rudolf – you are exactly right!! Many clients do that. And yes, I would much rather have one or two clients for $5,000, than 10 at $500 each. I do not charge an hourly rate, except for changes or anything deemed NOT to be creative/concept. I base it on an hourly rate I deem is competitive for my area for the time it would take me, and what my experience level is, and what the market will bear, all together, give or take. Why? Let’s take a logo for example: There are many factors involved in logo design, some of which are how big a company is, how many “eyes” see the logo/company, etc. (i.e. SEARS is much larger, and advertises more and is seen by many more people than some local “mom and pop” store selling similar items). If it takes you 15 minutes to come up with a logo, and 2 more weeks to come up with several more ideas when you present to them, but they choose the one that took you 15 minutes, rather than 2 weeks, what do you charge per hour??? You don’t, you should be charging per job on most creative. Doesn’t matter how long it takes you to come up with it. You win the faster you do it, lose the longer it takes. Sometimes you make several hundred $$$/hour, sometimes it comes out to be $20/hour. It all kinda balances out in the end. It’s just part of the deal.

      • How about if the website is a simple static one (3-page + Contact form) and you are working with a template. I think fixed price based on a sum of hourly rate + a small service % is okay.

        Nvm the idea that such a job could be a opportunity to up-sell a more dynamic site to the client, …sometimes a simple static site is what a clients actually needs/can manage.

        • I was speaking hypothetically as I’m in the process of learning about web design. For a beginner, I still think my rates are pretty fair.

          I will charge my future clients more as I gain additional experience in this field.

          I also have a few friends who are web designer so I’ll have to ask them for advice to see exactly how much I should charge people when I start designing websites for a living.

          • Not that it’s a bad plan Karam, but be careful. I got caught in that trap. I started with really low prices on the auspice that I was still learning the ropes and my work would take longer than expected. But the clients you get now will probably want to keep you (great prices after all) as your skills improve. You’ll likely come to a point where you have to make the tough choice between loosing a long-term, loyal, paying client vs upping your rates.

    • You have to remember that what you charge has to cover your business costs as well. Upkeep for your office, supplies, software etc. $30/hour is a salary not enough run your business too.

    • That’s super cheap! You also need to think about the big picture, the value you’re adding to their company. That value will play a big part in the overall success of their business—they’ll make money from your design work—but you will make squat.

    • Karam- The only time $30 an hour is ok, is if you are working as a steady in-house freelancer. Also this is a rate for a “designer” level for in-house.

      A “creative director” with their own firm can easily charge from $90- $150 per hour.

  6. Hey Preston,

    Some time ago I had a client (a lawyer) who needed some corp. designs to be done for some of his brands. I started with one of them, I finish it quick as he wanted. My mistake as you mentioned before Preston, I did not make this client sign-off my papers—a contract that I have written—cause I was exited, he will bring lots more clients and work.

    The red-lights started to come off a day that I mentioned him about invoice and money. I never pushed the money part to him because I knew he had money, and he kept saying “Don’t worry about the money.” 14 hours later of work, I told him it was seven hundred for the first logo, and he freak out. He started mumbling and complaining. After 20 minutes of complaining I was sick, I referred him to Kinkos and Staples.

    After all these, I learned and changed a few things; I lowered my rate to attract more clients and created a Contract. I don’t get much for the work I do, but at least I don’t have to see the surprised faces of people that I meet.

    At the end—it’s all for the love of it.

    • Felipe, does your plumber repair your sink for the love of it? Let’s take our job seriously, we are giving a service here, if we don’t believe it ourselves, why will the others ever bother. No offense, that’s what I have learned with experience, if I have ever given a friend price they would on and off come with doubts not feeling confident about the design and the result, because they were not giving it value, the price fixes a value very well! But of course setting it from the beginning and with a contract.
      Greetings

    • Hey Felipe, $700 for 14 hours of work is very reasonable! That’s $50 per hour and that’s exactly what I charge my clients. I’m in California where the cost of living is high and $50 / hour is fairly inexpensive (I’m probably selling myself short too). I know designers who charge $125 /hour (but the clients I know feel that is too expensive). I let my clients know up front what my fee is and approximately how much time I feel that I will spend on their project. They can either take it or leave it. My feeling is that our services have VALUE and if they are too cheap to pay a decent price, then find a new client who will.

    • STAY AWAY FROM LAWYERS…! I have never worked for a lawyer but I have so many friends that did. With no exception none of them got their moey even all of them signed a contract upfront. Lawyers are crooks. Just stay away from all of them. Personally I wouldn’t work for a lawyer even if I got the money upfront. Why work for a crook at first place??? They will screw you…

      • Over the course of about 15 years, the only person who ever did not pay me for freelance work completed was a lawyer. I have been fairly cautious over the years about who I trust to do work without a contract – basically, lower paying jobs with minimal effort and for people I know well enough. But I met this lawyer dude through a friend! I hate to stereotype someone, but since you mention staying away from lawyers, they are 0 for 1 in my book and I’m not looking for another test.

        • Oh it seems like a lot of people have been cheated by lawyers. I am no exception. I have been cheated by one as well in spite of having a contract signed. I had to let go because I knew he is fight his own case and get continuance after continuance wasting more of my time and money. So no use. Lawyers are definitely crooks.

      • I want to jump on this bandwagon. The only client that hemmed and hawed over payment and then dickered then threatened and all this over a LOT of aggravation and MY time wasted which, unlike his which he can write it all off, I can’t, was… yes, a lawyer. NEVER work for these scumsuckers, there’s a reason there’s more lawyer jokes than “a [blank] walked into a bar” jokes only there’s nothing funny about a lawyer for a client. What do you call 20,000 lawyers at the bottom of the sea? A good start!

    • “lowered my rate to attract more clients” What’s the point of that? Working twice as much for half the money? But I’m glad you’ve gotten past the promises of more work. Don’t ever fall for that one.

      • All such great points. When starting out we fall into believing the promise of doing work cheap or free for the promise of more work. It never works out! Ever! We value what we pay for and make sacrifices for it. Sometimes the hardest thing to do is walk away.

        • Coming across this conversation.. FYI I happened across this searching discrepancies quoting print projects.. We have all been through the same thing.. I am a digital printing company, and I try to stick to my price structure.. I’ve been in business 6 years now and have heard it all.. The promise of great wealth if you do this first project (.for free) it’s up to you to put a value to your skills.. I have my standard price, and just this week I was appalled that my best price was more than double someone else.. I don’t care to play the low bid game personally… What I care most about is the end users assumption that the guy giving a job away for basically free is just as good as me..

          Something to compare it to is the client that says… I used to use this company, but they went out of business….. Can you match their price?

          Simple.. NO! Why do you think they went out of business?

          Don’t ever be the cheapest… I sell print.. That’s an art too.. We are not all the same.. Don’t forget that..

    • (Same FELIPE)
      Man, I will die to work for a design firm and make them money,
      instead of me looking for the money.

      Freelancing is great, you get hands on clients, hands on strategy,
      design, art direction and all kinds of experience that comes with
      it—like accounting =(, but it gets to a point when you get to many
      rejections when mentioning the fifty bucks/hour, so I changed my
      strategy to thirty five bucks/hour, and I get more cheap people
      who I give good design.

      It’s all about surviving. Yes I make a ton less, specially when
      your father, and father friends starts to ask for “Your professional
      opinion, please!” and you end up doing Power Points into
      AfterFX videos. ADVICE: CHARGE MONEY FOR IT!!!

      Yes I am a sucker, and I will prefer an Art Director screaming &
      bossing at me, after I finish two accounts I’m working on.

      ————————– ∞ ————————-

      Dear Monica,

      yes you are right, I took the wrong advice from a teacher, yes
      there is LOVE in it—says my pile of design books—but I should
      not mix LOVE with MONEY.

      ————————– ∞ ————————-

      Darice, Alex, and Peter,

      you guys might have a point. I never thought there where many
      cases like mine with the lawyer thing.

      ————————– ∞ ————————-

      Steve,
      I know that I make less money, but it works, got more clients
      and like Kevin O’Leary says, “It’s all about the money, money!”

    • Vandenberg says:

      Felipe,
      It is about doing what you love, I will give you that. But you need to figure out how to make your billable rate competitive with the marketplace you are in. If you do not, you are not doing anyone else in your area any favours.

  7. I think the sweet spot depends on what market you are supporting. Who do you want to work with and what do they expect? I charge $70/hour ($500-1000 for logo, $1500-3000 for WP web) but larger projects always whittle down my hourly rate to be much less. I wish I had the answer to how to make those projects more profitable, though I have lots of ideas that haven’t yet panned out.

    The small business clients that I love to work with on one hand are time consuming to relationships and projects, but on the other hand I love helping the little guy and achieve their business dreams while supporting their livelihood. It is so satisfying to me when I am able to help shape a small business’ brand while making a huge difference in their buisiness. Whether or not my hourly rate does get whittled down, I always quote $70-75/hr to attract the clients who value what I do. If not, they won’t make the changes that will lead to results and my work isn’t as effective.

  8. I have spoken to a number of designers who have a minimum starting price for any given projects. So lets say, a starting price that is presented on their website of $500 and it goes up from there. This can be in the contact form as a budget selector (first option, lets say $500 – $1000). These designers claim to be happy. 1) It conveys to the tire kickers to stay away, so you would not waste hours of production time, talking, quoting, etc.. 2) Your showing the prospect that you are not cheap and value your time and expertize and know what your doing, by showing your starting price. However, I provide print and web design services, so sometimes smaller projects are below $500 mark. Love to hear your input and what you think about this method.

  9. Pricing has always been a sore and difficult subject for me. I live in Spokane, WA which is seen as a $5 an hour town. I charge $65 per hour, with same “piece” prices such as $750 for a logo design (includes LH, EPS, BC). There are others in my community who charge thousands for the same deal as well as some who charge $200. So I figure I’m in the middle range. Still, I see peoples eyes glaze over when I tell him how much I charge. My first instinct is to give them a discount because…they are a new, struggling business, their mother is sick, they don’t have any money, their dog died, etc. You name the excuse.I have to fight with myself to keep my prices moderate.

  10. Horses for courses… is the real strategy. If you deal with Multi – Gazillion dollar clients, What you charge is all relative. The same design for a start up requiring a Corp. ID. is a fraction of what you could charge Mr. Gazillion. So…who are your clients, why are they talking to you, What do you bring to the table… are some of the factors but not all that determine what you charge.
    There is no formula …experience, relationships and most important, delivery will determine your level of earnings… all relative…

    • BCreative says:

      Absolutely right Giancarlo. My pricelist is like a yo yo. It depends on “how much gold my client is wearing”. If I work with a corporate company my hourly rate shoots way up and if I deal with a small one man company my price comes down to his level. I also feel better this way helping a struggling business to flourish but suck some corporate blood whenever I can. :-) It all levels out in the end.

  11. Hi Preston, I’m really enjoying GDB and this article discusses pricing WordPress sites. Clients think that even though they want a million changes to the theme, they shouldn’t have to pay much, something about the fact that WordPress is free maybe? I’ve been freelancing for several years, and still struggle with pricing for small business clients. Have recently started designing for WordPress and wonder if you could take a look at two sites done for a client for $1500 because I’m just getting started with WP. The sites are pretty customized in terms of CSS and some php. Wondering if people think going forward I can charge $900 for ogarnier.com and $2500 for olivettiorganicfinishes.com (this one is an e-commerce site) Links are on the url above–Thanks! Jen

    • Jen,

      So their mother died, or they are struggling: offer a hug, sympathize with them a bit, and let them know what you _can_ do with the budget they have, and offer to come back when they are ready in a nice way. i.e.: “Your mother just died …/stuff here/ … how about I come back at a more appropriate time, etc.?”
      It works well.

  12. This is pretty simple.

    Those who do not really have clients will always start with small prices. $100 per homepage and $50 logos or $15h. These are the beginners prices.

    After you start to get noticed this will double maybe triple in order to filter out clients.

    As long as everything you do is done by your hand you can charge anything.

  13. I like the fact that right next to this article, there is an ad from a site called Fiverr that reads, “I’ll design logo for $5.” The rock-bottom prices that Simon wrote about in the first comment are all there. Sheesh!

    • Huh… feels like there are some designers who offer money to clients for asking them to design their logos… weird.

  14. I am a Freelance Graphic & Web designer at the moment, however I have actual on the job training, and graduated top of my class. I have 12 years experience, but live in an area that even as an in house designer you only make $10 – $14 an hour so charging more than that from home seems strange. Someone told me that I should have at least $1 per year of experience on top of the base of $10 an hour. I wish I could make that much, but unless I basically ask a customer, “What is it worth to you?” I feel like I will not get the job. Is there a better way to handle this or is just figuring work for $4 over min wage ok? Just wondering if anyone else had any ideas.

    • When you freelance, you’re not just the designer. You’re also the project manager and the accountant and the sales staff and the marketing department and the owner, so don’t feel like you shouldn’t charge accordingly. Even if you disregard all of the added responsibility (which you shouldn’t, but if you did), consider the time a freelancer necessarily spends not working because she’s managing other aspects of the business. All of that time needs to get paid for, and your clients receive value in it because it gives them the luxury of hiring you for just the job they need, which is cheaper than taking on an employee.

    • Michelle
      I think you’re looking at it via a slightly blinkered opinion, and lack of self-belief of what you are worth (which many designers suffer) So in order to get a job the’yre willing to mark down to bargain basement like prices in order to satisfy clients who don’t really understand the scope of a project only interested in the final result being done for a price that they feel is reasonable.
      Regarding pricing, remember: an in-house designer’s wage does not reflect what the ad agency is charging per hr so 10-14 dollars per hour may be the going rate for the designer, but not the agency. No agency would charge that rate other than developing countries (and maybe not even them!).

      It is better (though harder) to find customers who understand the value of design for their business like equipment and supplies design is a crucial commodity that gets overlooked all too often by many.
      A decent designer should be confident in their ability and pricing s they know they are competent and are going to do a good job, how much time it generally takes to do it and how much time to allocate for the usual unforseen extras. Truth is, I have seen so many “proclaimed designers” that don’t have a clue and shocking portfolios work that I cant but help feel that they don’t really have justification charging “the going rate” (and these guys probably don’t).

    • Michelle:
      I haven’t done a lot of freelancing lately, so when I was recently asked to estimate a project cost (flat fee) for an email announcement and print invitation, I calculated the amount of time it would take, multiplied it by an hourly rate, and instantly thought, “That’s too much! They’ll never go for that!”

      I resisted quoting less though and gave the quote trepidatiously to the client. To my surprise, they didn’t balk at all. They simply said, “I know the quality of your work and that things will go smoothly. That’s more than worth it.”

      Best part is that I took the job and it was one of the easiest, smoothest and most pleasurable freelance jobs I’ve ever done. Looking back, I’ve found that the clients that value you and your expertise (both in time and money) are the ones that you get the most pleasure from working for. Never sell yourself short.

    • Michelle,
      Did your employer also provide you with benefits such as health insurance, life insurance, 401k, stock options, paid sick time, paid vacations, etc? If so, you were receiving much more than $10-$14 per hour for your in-house design job. Pull out your last year-end pay stub which shows the total amounts your company paid for the calendar year. Now add up all the amounts they paid for your benefits, then add this amount the the total salary paid for the calendar year. THIS is how much you were worth to your employer.

      If you are freelancing, you have to pay for all your benefits yourself. As you can see by this exercise, charging your clients $10-$14 per hour won’t cut it unless you don’t ever plan to need a doctor or take a vacation.

    • Heya Michelle,

      Hi Michelle, just remember that an in-house designer gets paid less then their actual commerical value, that’s how they make money for the company that hires them. A freelancer can charge a lot more for their time and still cost a client a lot less then a design business / agency charges.

      An agency or design business may charge $100+/hour for a designers time, and pay the designer $10+/hour for their time (They certainly should pay more then this, but this is just to give you an idea). The agency has to cover their business expenses and turn a profit. Agencies can charge for things you and I might consider obscure – for example, they will charge for the print-outs a designer makes while developing a logo, or charge a fee for every pdf that is generated (and that just means the designer pressing an “export to pdf” button, on top of the development fees). Agencies also charge for project management.

      So when you come along and say hey, I’m only $50 an hour, and I can really design – well that’s pretty awesome to someone used to an agency price. I say don’t go under $40 when you’re beginning, ESPECIALLY if you know you can design and can back that up with a folio. The higher up you can pull there, the better. But you do have to get a feel for the market. You are giving someone direct access to budding new talent that will polish their business up beautifully, that’s worth money.

      Also, a lot of people actually like spending a bit of money on a design – it makes it exciting for them, a special treat. If you charge too low, they wonder why, and doubt your work and nitpick nitpick, because they start to suspect you can’t really design.

      Sometimes, they can start playing designer themselves, because they think they need to take control, and things can get really messy then, as the design standard starts to slip and slide and gets uglier, and the time spent on it goes up, and it’s hard to charge for an ugly outcome that takes ages to develop.

      Be confident, be clear, show you know what you’re doing. And understand your value – this comes across.

      Also, beware of people who want to pay less then $40/hour. Some people can be quite unreasonable and demanding to work with, which doesn’t go well with unwillingness to pay for the value you offer them. Sad but true.

      Finally, instead of just saying $40/hour, be ready to also give a ballpark of how many hours will be involved. Give an estimate.

      What works well for me, is I give a quote. I say this project will cost you $x. This quote includes 2 concepts, and 2 rounds of alterations. After that, you will pay $y/hour for further alts. You will still pay the $x amount even if you make no alterations – the alterations are a bonus.

      This is to encourage people that they will have some flexibility if they need to tweak the design, but is also communicates that alterations-galore will cost them money.

      Finally, make sure you give yourself enough time to develop the design. Be spacious, clear and realistic. Then you make the deadlines every time, and can even beat the deadline on occassion – this will delight them.

      Good luck!

  15. I’m more on Mandy’s wave length – if you charge low prices, then you’ll get clients, but you may find that you’re pushing a heavy rock up a hill to make sure your work really gives them the benefits they need because they’re either trying to cut costs or don’t value the difference good design can give a business. As soon as you raise your prices that next step up you filter out clients, but the ones you do get are that much more rewarding to work with, I’ve found I get to work more as a partner than a service provider to such clients.

    Just a quick reminder to posters – there’s lots of people who read this blog from all over the world, it’s probably useful to quote money with the currency set clearly, or at the very least convert it to USD and state that this is what you’ve done. As far as I’m aware, I’m in the middle ground – I give an itemised quote at the beginning of the project that is tied to tasks, not hours spent however I base that quote off an hourly rate of AUD$60 (~USD$61.25) with the caveat that I mostly do print work and web design when it ties in to an identity project, there seems to be more cost pressure on straight web design, perhaps because of how many tools there are available to the average user these days?

  16. Going cheaper and cheaper and cheaper is never a good option eventually you will come to free and what then.

    Good article

  17. StephenESC says:

    “How much do you think you are worth?”

    I used to struggle with this question *daily*. I still do to a degree, but after talking to a few colleagues and reading a number of articles like this, I was able to calculate an hourly rate pretty close to what Mandi quoted, and feel like I could justify it to a client should they challenge it.

    (Not that it’ll matter to some of you but, for what it’s worth, I’m basing my pricing on almost 15 years experience as a full-time designer.)

    I’ll admit, the method I used for figuring out my pricing was by no means scientific, but I found it best to start by calculating how much is actually needed to cover all real-life expenses, then work back from there.

    Basically, start by tallying up all bills/expenses that occur within the span of a month then divided that by 160 hours (assuming 1 month = 4 weeks @ 40 hours/week) and you have the bare-minimum “take-home” hourly rate you need to get by, without borrowing money. Now add an additional 40-45% to that amount to account for the 30% of your gross that you’ll need to set aside come tax time. After that, double it.

    This last part is especially important because, as a good friend/colleague pointed out, you’re not going to be full-out billable all week. After taking into consideration meetings, phone calls, responding to emails, coffee, accounting, estimating, invoicing, professional development, etc., you can usually count on only 20-25 of your hours being billable.

    Let’s look at a scenario where we assume you are working out of a home office and you’ve figured you need to make $3,200 every month to cover rent, utilities, food, etc. That means you need to net at least $20/hour and be billable for a minimum of 40 hours each week to make it happen. Now remember, to net $20/hour you’d actually need to be grossing approximately $29/hour to allow for income tax. And again, that’s just to “get by” without any extra money to set aside for savings, and assumes you never get sick or want to take vacation. So, double it.

    $60/hour x 25 billable hours/week = $1,500/week
    $1,500/week x 4 weeks/month = $6,000/month
    $6,000/month minus 30% for taxes = $4,200/month net

    This would leave $1,000/month to set aside for slower times, or even reinvest back into your business with new software, for example.

    I charge $80/hour as my standard rate because I like round numbers, and it has the convenient built-in flexibility for me to drop it to $60 or $40 for smaller companies or non-profit groups.

    Now, I am by no means trying to sound like an expert on this subject. Far from it actually. I’m just someone who has struggle with putting a price on “my own worth” for so long, and now that I’ve finally been able to figure out a solid justification for my rates (for my own brain anyway), I thought the least I could do was share it with others to see how it worked for them.

    Thanks for letting me ramble.

    • This is great advice, as being new to freelance I find this very useful! I have worked in house for years and just started branching out since my day gig is production work.

    • Thanks Stephen for sharing your calculation with us. It seems like such an obvious thing to do, but it hadn’t occured to me to calculate back from what I want to net a month. Good thinking to calculate only the billable time, not the hours wasted on writing quotes, invoices etc. It also works for everywhere around the globe. I calculated that I have the ask for 35€ ($45) an hour to make a decent living in Spain. I do ask some of my clients for this rate, but start-ups struggle to pay this. I will ask a little more for my regular clients, so I can give newbees a discount.

    • Thanks for the insight, Stephen. I think that you make some great points. As a designer, it is important to be calculating and practical when thinking about finances and pricing. Often, we decide for impractical or emotional reasons why we should charge less; small business, company’s financial obstacles, too friendly, etc.
      Nobody is going to stand up for you and tell the client what you are really worth; it is up to you to do that, and make your case if necessary. Yes, we are designers because we love it, but we have to make a living too.

    • Stephen – you’re right on the money (pardon the pun). I’ve been a designer for 20 years and also charge $80/per hour. The trick is to find a number that doesn’t scare away clients, covers all your expenses (+ more), and isn’t so low it devalues your skills. I think designers that are charging $15 per hour are doing a huge discredit to themselves and to the industry. I’m actually considering raising my rates slightly because I find I’m always busy, and I know I was billed out at $120 as a senior designer/art director for 11 years at a large design firm.

    • Brilliantly put, StephenESC — that’s a fantastic breakdown, that’s realistic, especially where “else” expenses come into play. I’ve struggled, myself, with what to charge, but when it comes down to it, a regular office takes away taxes, and might pay into benefits and vacation pay; we need to keep that in mind. Brilliant system!

  18. Thanks for the timely article.

    This is a tough one for me. 18 years ago my rate was $100 per hour and I was always busy. I never did spec work and never had to do a competitive bid on a project. It was an amazing time. Now, my rate is 40% of that and I’m struggling to keep busy. I’ve been offered projects for rates very close to minimum wage and have chosen pass those on to new designers instead. I value my experience and what I’m able to offer clients, but I’m really going through a design pricing crisis right now.

  19. My honest input here is that the majority of freelance designers that I run into are undercharging. Even in this thread, there have been some shockingly low rates kicked around. I would like to assume that people who go to the effort to read articles such as this are “real designers” as opposed to the hacks that most of have at some point been bidding against for a project, but perhaps that assumption is unfounded. My main point: if you have a 4 year college degree and are working in your industry, you should be making over $32k. Period. I don’t care what you went to school for. And yes, that would be the starting minimum for fresh out of school. You need to find your hourly rate by having an annual conversion amount in mind that is respectable and sustainable. If not, you not only short sell yourself, but also dilute our industry. When I see ads for design positions that go something along the lines of, “need a rockstar designer, 2+ years industry experience, must hold bachelors in a related field, $25k to start”, I am just as frustrated with the guy who takes this job as I am with business owner who posted it. Have some respect for yourself. $100 or less for a day of skilled work? You can beat that number waiting tables. Your freelance is the same, but even more so because you need to make the same amount after taxes, which we all know are much higher for contract work. Honestly, my current charge when I must give one is $50/hr. (And no, I don’t make $100k as a freelance designer, because I never work even close to a 40/hour work week, and you also have to subtract all the extra contractor money to uncle sam) I say “when I must give one” because most people are way more comfortable thinking that your product is worth $X overall then they are at thinking about that fact that you are making $50/hr. Always look for your client’s budget and tailor your hours and deliverables to match what they can afford.

    I hope this is valuable to somebody. We are in this together and need to respect ourselves as well as maintain a respectable industry.

    • Loryn, I could not agree more. (Preston, great article, as always) Inexpensive designers DO dilute our industry and make it harder for the rest of us to charge a fair amount for a fair amount of work. Pricing is always the hardest thing and I know I pour over an estimate for a long time before I submit it to a client. But keeping the client’s budgets in mind, size of company, circulation of product you are designing for, etc is key. That’s not to say some of the largest companies can be the cheapest clients, but you need to stand your ground. I price according to hourly rates AND value of the product. (as well as the value of ME) Sure it might only take an hour to whip out an ad, but when the insertion rates are 5 times the price of your design fee, there’s something wrong with that. Designers should decide on a set of minimum rates unless it is a favor for a friend. And always keep in mind that you have a TALENT and aside from hourly rates, clients need to pay for the value of your great work.

    • I agree. I wait tables on my Saturdays for rainy day/ travel money and I average $200 for a 6-7 hour shift. It’s not a fancy restaurant and I’m not in an affluent area. If I make over $25 an hour for running around and smiling, I demand much more from my degrees.

  20. Also, @michelle, asking your client what it’s worth to them is exactly what you should do! Something along the lines of, “I’d like to give you the best product that I can within your budget. That being said, I first must understand what you are looking to spend so that I can give you an accurate representation of how much we can accomplish for you within that price range.”

  21. Timothy Olanda says:

    I ask the client how much they are whiling to spend(budget),that’s after I’ve given them the current market price of the labor.

  22. This is a bit of a killer issue for me. I’ve not long started up as a freelance designer, having spent 16 years as an employed designer. So I’ve heaps of actual DESIGN experience, but not so much experience in pricing. The problem I find is that, even trying to charge a fairly low-medium rate of £25 p/hour, there are a great many “designers” around that are charging much less. I’ve seen some charging as little as £8 p/hour or £25 per page for a website. This is crazy, and just devalues the profession in clients’ eyes.

    I’ve always tried hard not to overcharge, because I believe strongly that good design should be within the reach of any client that wants it. However, some of the more ruthless pricing strategies I’ve seen (including larger design companies hiring graduates at £7 p/hour and charging out their time at £15 p/hour so they still undercut guys like me) are making it quite difficult to keep going in this trade.

    Okay, I’ve finished ranting now! Time for a coffee…

  23. stephenESC

    enjoyed reading your summary of how you evaluate prices related to real costs. I get that and have noted it down to apply to my own pricings.

    i am just about to send off a quote and you have made me stop and think a bit.

    great article, very helpful. nice to hear and be able to share all your relevant comments based on your experience.

  24. As you build your portfolio and get positive feedback and “rave reviews”, you will feel better about charging what you are worth and market price(s). I am in Raleigh, NC and charge [basically] $50 and hour for design, typeset and initial project. I create many logos (discovered it’s my forté). Logo designs are the hardest to determine because it depends on the client’s budget (as you all have stated).

    Recently, I gave a fairly simple logo to a start-up client for $350.00. Another client, a dentist who now has my logo ON HER OFFICE WALL IN METAL-woohoo, about $1,000 but charged for EACH additional projects ($40 to $50 and hour) such as letterhead, business cards, referral pads, web logo with different colors and T shirt logos for sponsor events.

    Another logo included a watercolor horse “bust” with company name and cost them $1,700; and finally, a current client logo, which includes a drawing and company name, $1,500. I will charge more for their business cards, letterhead, etc. Last week, I gave a quote of $300 for a simple logo to another start-up client and they just could not afford it at this time, so I turned the work down…it felt worse to lower the price and “give it away” than to help them out. She completely understood. Hope this helps! – a

  25. Dawn Lewandowski says:

    For a beginner, this is especially tricky. I actually have different rates for different clients depending on their type of business and location. I know what the locals are willing to pay designers/print shops, so I charge accordingly (over $100/hour). For my on-line clients, this is stiffer competition, as it’s worldwide. Minimum I take in this case is $40/hour. Then there are in-betweens. But keep in mind that I’ve got 30 years experience! A beginner shouldn’t expect to charge the same – no offense – but experience does matter. (You’ll realize that after you’ve been in it for 25+ years. Look back at your early design work and gasp in horror!)

    In short, do your homework. Find out what the market will bear, and consider your experience level. That should get you in the ballpark.

  26. You should also consider that you are taking out taxes, you are pricing yourself too low. Your rate reflects on what others are charging too. This is your skill and expertise, get paid for what you do. I have yet to work below $50-75 per hour depending on the project, many times charge per project.

  27. Being a designer for many years (and yes, I’m up to date with current tech) – I’ve noticed a devaluation of design skills. With all the cheap templates, cheap stock imagery and photos, and the built-in “graphics” of business software (Microsoft), I believe many clients think it is as simple as pushing a button and “presto”, a functional design shows up. Over the years, the specialities of typesetting, photography, etc. have gone by the way. And now, with social media, I believe marketing has also become a do-it-youself skill. The field of design is saturated and people seem willing to take pathetically unprofessional fees. It is heartbreaking to see an ad for designer (esp. those competing with designers abroad) where they have a budget of something like $25 for a logo — or $9 – 10/hr for an “entry level” designer who must have expert level skills in every software known to man. Then… on the next page, see an ad for a receptionist at $20/hr. One other concern: it appears that supposed software knowledge seems to take the place of concept ability and designing for marketing results.

    • I have been a designer for 30+ years. Yes, started before computers and software. Picked up my first Mac in 1987, as soon as I saw what it could do and never looked back. Worked in the industry for years until I became unemployable because of my age: 54 at the time. The best thing that ever happened to me. I have been freelancing since. It was touch and go at the beginning but after a couple of years I had a sound client base that I had weeded out. I don’t accept every client or every job. After all, I am freelancing. I have that freedom. I have figured out a fool-proof way to choose clients. My first consultation is free on their turf. If, on the way home I have any hesitation about this client’s personality, I don’t accept the work. Life is too short to work with difficult people. If they got the $25 logo online, they don’t need me and will never get the amount of experience that I bring to every project, so I don’t want them as clients. I have made my contracts “almost” fool proof and never work without them. I was charging $60 / hour for print design before the economy went south. Now I am back up to $55. Logos $500-1000. Web is different. I do Joomla sites with my own custom templates. I have figured out very simple pricing for my clients $200 a page. + $300. Setup. Everything included. It is very easy to add up and I have gotten more work since going to this rate. My clients like it. My overhead is low, so this works for me. If I needed more money, I would charge a little more.

      • Betty, I am with you. Been freelancing for over 30 years. In the beginning I had to explain to people what a “graphic designer” was. I kinda miss the art boards. I did alot more illustration work back in the day before I bought my first computer in ’91. I am surprised to read the hourly rates! What happened? It is a wake up call for me. I was charging $90. hr in the ’90’s and was turning down work. One thing missing in the equation is how efficient designers work. I have not backed down on my rate, however I will reconsider since times are lean. Thanks for the update!
        Denise

      • Hi Betsy,

        Thank you for your very interesting comment. Like you I setup Joomla! + I do print and corporate design :-) I live in Sweden so I think the tax part is a lot heavier here than in the US… Not including VAT, I have to set aside almost 60% for tax. It would be interesting to know your percentage of tax. I have a friend in NY who tells me it’s about 30% but she’s employed so not an expert :-) I guess it also varies some from state to state, right?
        Anyway, your strategy for Joomla! is great I think. I might borrow your concept if you let me :-) Only, I’d like to know, when you say pages, that is the same as menu object, right? And do you count every menu object then (like Home and Contact) as well? Do you also have a strategy when the Joomla site contains more complex extensions?
        It would be great to hear more detail :-)

        Also, I’d like to thank Preston for this excellent article (and GDB as a whole :-)

  28. A great way to price your work is to provide an estimate with a jargon-free description of what you’ll be doing, and then CHARGE A DAY RATE, based on an eight-hour day. Now the client doesn’t have a vision of you micromanaging or teasing out the hours, but simply if it’s worth investing £875 plus tax for her brochure.

    Why charge by the day?

    1. Charging by the day, which you can divide into halves – or quarters if you must – introduces a safe minimum for your time; it gives you room to breathe. My minimum for any project is half a day. I’m no Saul Bass, but clients still need to know my time is valuable.

    2. Our project timescales aren’t measured in hours, but ‘mornings’, ‘afternoons’, ‘days’ and sometimes longer. Plumbers, therapists and personal trainers measure in hours, because most of their work never takes longer than that. Billing in days conveys the scale of our task.

    3. Ironically, clients get a much better sense that the project is worth a concrete amount. As long as I commit myself to delivering within a realistic timescale – and instantly red flag anything which might extend it (add extra cost) – I’ll almost certainly fall within my estimated time.

    4. Managing your workload becomes easier. You now think in days, because you’re paid in days, so determining how much more work you need to get for that month (or if you’re lucky, how much you can take on) becomes a snap.

    As an aside, I have confidently determined my value by finding out what freelance agencies were charging their clients for my services, then charging about 10% less to my own, independently-sourced clients (I don’t poach from my agents; I have a couple of really awesome ones and they’re an important part of my work mix).

    Example: if agencies are paying me around £25/hr and billing the client at £35, then when I source my own clients I know I should probably charge £32/hr x 8 hours to get £224/day. I come with the same skills, but more flexibility, less hassle and less cost, so I KNOW that I’m worth the money.

  29. Interesting subject – i’ve been a freelance illustrator and designer in the uk for over 20 years. I have found it to be the hardest part of my work- what to charge! Currently its £40 per hour. More often the not though,I quote for each individual project rather than a hourly quote.
    Additionally, what has been good for me is agreeing on royalties or reprint of certain designs that have been used, for instance, in retail merchandising.This was actually a suggestion of my client a few years ago, and I am still receiving royalties every six months or so.. it helps with my tax bill!

  30. I base everything on my hourly rate ($65) and figure how long the project will actually take me. I always add about 30% extra time to my estimate, in order to cover myself. It usually works out right. I don’t have a flat project fee (for logos or whatever) because it always depends on the project and client. In reality logo projects can run $400-$1200–from a simple logo update to a larger company corporate logo. And I always price collateral components separately, because those can vary too.

    I have had a freelance side business (20+ years) but recently left a job where I had been for more than 12 years. I was making $50 hourly, full-time, with decent benefits. But the company was bought out and forced everyone into $35 hourly (max) with no benefits. Outside freelancers were willing to work for $25/hr– some with lots of experience, some with next to none. I was happy to get out of that scene, but the economy and a glut of freelancers coming out of dying industries has given me a reality check too.

    Bottom line is while I would be happy to be at a higher rate but I need to be affordable enough to be consistently busy. I’ll continue to reevaluate as I go.

    Thanks for the great question and open responses here!

  31. Great post, Preston!

    I offer a three-tiered approach – one for every budget. I have the economy pricing, middle of the road, and premium…and it’s helped reduce the amount of haggling my clients do. Also, they’re willing to pay a bit more because they don’t want “the economy” package…they want something a little bit nicer. So with less discussion, my clients pay what I’d ideally like them to!

  32. I have worked in print and design industry for over 15 year and freelancing for only two. I have estimating experience from past jobs and knowing your audience helps. The key is to be fair when pricing, not the cheapest or most expensive.

    Sure, there are some things you can work off a price list for basic starting pricing, like basic websites, stationery packages, novel books for example. But the clients that need special items, special attention or something unique need to be handled as such.

    I do my market research to find the FAIR price. I do this by:
    1) Know what the market value is for your area of expertise (are you a freelancer, working in a larger company or a very specialized company/individual.)
    2) Tweak that price based on experience and most of all your customer needs.(not all clients need Drupal websites for example, a template wordpress site can be just as effective)
    3) Don’t charge the client for your inexperience. If being inexperience means it takes you twice as long to complete a project, look at the extra time as continuing education investment.
    4) If you can’t justify charging for it don’t. Always be able to explain your pricing structure clearly to your client.

    This is a very simplified version of how I look at the pricing of a job. Estimating is always complex as each job and client is individual and should be treated as such.

    I have gotten much feedback that my prices are on par and FAIR for the services I offer. I believe that is because I listen to my client’s needs. I’m thankful to be able to get that feedback from my clients.

  33. I’m a graphic/website designer with 30 years experience, the last 22 self-employed. I have never felt truly confident when quoting for any job. Sometimes, when a client rejects my quote out of hand, I lose my confidence and think I’m overcharging for what they think my work is worth; other times when a quote is accepted immediately without any quibbling, I suspect that I’m not charging enough. Both scenarios happen frequently so I think it must be the individual clients’ perception of what design-work is worth in general rather than my own rates. My rates are of the same sort of order as Mandi’s, so I would say mid-range.

    For someone of my experience with a good track record, I should have the confidence to charge more. However, I acknowledge that when it comes to web development, I am rather slow. Unfortunately, these days I seem to spend more time sussing out technical problems rather than actually designing, the thing I am experienced at and have built my reputation on (and generally, the older you get, the more difficult it is to get your head around new technology… which is changing faster than I can keep up). I have tried leaving the site-building to techies but find that I end up compromising the design and functionality too much, and normally there is not enough money in the budget for the techie’s fees and mine as well. And I end up being a project manager, which is also not what I’m here to do. But I know I cannot charge my clients for my own short-comings so frequently end up spending far more time on a project than I have quoted (I always quote in advance, based on parameters agreed with the client, which only increase if the brief changes during the course of the project). So some times it works out that I could be earning more money stacking shelves in a supermarket… but my work is so much more satisfying!!

  34. Nice article, I would have liked more example prices though.
    Every time I give a price estimation I’m a bit worried I will scare the clients away, but at the same time I honestly don’t have time to create for example a logo for someone who doesn’t pay a decent amount. Also it’s really hard to tell how complicated a job will be – a client may change his/her mind a hundred times.
    So what I do is charge the amount that will make it worth doing even if the work will be pretty complicated.

    • Here is a little suggestion : A client is free to change his mind a thousand times but there are ways to handle this situation. Tell him that you will offer x number of concepts at y price and then offer n revisions for the price you are quoting (y). After that every revision will be chargeable as per your hourly rate h. That solves your problem.

  35. To be honost with you guys, i’m one of those that kind of sets a low price, in other words i’m cheap as a graphic designer, not because i’m a bad graphic designer, i completed my masters degree and also did a one year type design class after my master degree. The reason as to why i’m cheap is simply because otherwise i would not have a job to pay the bills, how many times have i gotten the “…oh, i know a guy that does it for half the price…” I’m fairly young and graduated 2 years ago but theses days everyone with a copy of photoshop, illustrator and indesign call themselves graphic designers, so its very hard for me to stay afloat, to do that i’m kind of forced to be cheap, its either that or drown, especially since i can’t fall back on a really serious portfolio,…i got my type designs and stuff but to be honest nobody’s really interested in that.

    • Jack – find some non-profits and do low cost or free work for them to build your portfolio. Also, create some spec designs just for fun that you would like to see someone use. Then get a mentor designer to critique these designs, fine tune them and volia! a decent portfolio.
      Good luck.

    • ” I’m fairly young and graduated 2 years ago but theses days everyone with a copy of photoshop, illustrator and indesign call themselves graphic designers, so its very hard for me to stay afloat, ”
      That’s the problem, you are competing with people who “own the same software”. None of the jobs I get in web design are anything about what software I own. They are also not so much about “can you do a great design”. They are about “can you solve our problem?”. Just this week I accepted a website redo for a non-profit because they are sick and tired of amateur volunteers doing their website – badly I may add. They know they are not serving anyone well. I told it to them straight – your website is boring, it’s aimed at people who already know who you are, a visitor can’t find anything, there are no pictures (it’s an art organization!), the artists who pay entry fees are not getting value, and so on. They lapped it up because they knew it was all true, and I got the job. They don’t care what software I use. Make it about ideas to solve their problem – not software and pretty designs.

  36. One place to start is this formula:
    Decide how much you want to make a year. For the sake of simplicity, let’s say: $100,000.
    Divide $100,000/50 week (cuz you want 2 weeks off at least) = $2000
    Which means you need to make $2000 a week, 50 weeks, to hit $100,000.
    Now, hourly. You can then break the $2000/week down by 40 hours. So 2000/40 = $50 per hour.

    Okay, that’s reasonable, but now we get into the tricky part. You have to view that $50 as a starting point, and one that you adjust based on the actual field you’re in (I’m a writer, not a designer, but I have an idea of what types of work I do and what the “going rate” is, also with my experience and particular expertise).

    The rule of thumb, then, is take that hourly rate you just calculated and multiply it by 3. So: $50 X 3 = $150. That is to say, few freelancers in any field do 2080 BILLABLE hours in a year (52 weeks X 40 hours = 2080) because you spend time on marketing, billing, research, miscellaneous, and you have your own overhead to cover, i.e., insurance, rent, supplies, etc.

    So does that work? Well, I can tell you that as a medical writer, $150/hour is quite high and I’ve never charged that much. But then again, my best year hasn’t been $100,000 either, although in the $80s has been possible. Some medical writers with MDs and PhDs that do a lot of technical pharmaceutical work probably get paid that much, but the type of writing I typically do, $50/hour is probably more reasonable. But I often work on a per-project rate, which involves me calculating how much time I think will be spent on the project multiplied by $50/hour, taking into consideration things like the client’s budget, how much technical expertise is required, whether or not it’s a one-shot or a regular client or a potentially regular client (I’ll work a little lower rate if the client will send me a lot of regular work I don’t have to go looking for), and what I call the PITA tax, i.e. (Pain In The Ass tax, i.e., is the client a jerk).

    You also have to factor in your geographic location (NYC will probably pay better overall than Boise, but the cost of living is a lot higher, too), and the typical pay of people in your field.

    • I started my own business 20 years ago. After researching pricing, I found that you need to work on the basis of 20 billable hours a week. You might work 60 one week, 10 the next and 40 the next and 0 the next. But none of your math works if you think you can run a business and bill 40 hours a week. I’ve always been very profitable. I turn down work that is more trouble than it’s worth. I don’t get out of bed for less than $50 an hour…

      Also, never call yourself a “freelancer” – ever! You are a small business person – you know, like the politicians love to say they are looking out for? When anyone asks you what you do, say “I run a graphic design business.” or similar.

  37. Dianne Deger says:

    So many of your comments are very helpful. I have to agree in many cases, starting out you don’t charge nearly enough for your time and end up struggling. I had a hard time getting over the idea that my “skill, or service” was worth much. I started out doing some freelance on the side, while keeping a 8-5 office job designing billboards, and charged only $15-$20/hr or minimum prices for vinyl banners or business cards wanting to get every job I could. The more business I received and the more experience gained helped me realize that my time really is worth much more.

    Now that I’m a freelancer with no consistent 8-5 office paycheck, and bringing in bigger clients I can charge $60/hr and if someone complains about the price you can also negotiate a lower fee to help meet their budget needs. You can always lower your price, but you can’t go up.

  38. Rule of thumb for me is roughly triple what I would make hourly working for ‘the man’. Consider covering your own insurance, retirement savings, lean times with less work, continuing education, etc. This is likely what your present employer is billing you out at to his or her customers.

    There is no shame in making money with your talent. If you ask directly & confidently and perform the duties with total professionalism, you will have customers pleased to pay your rate!

  39. Such a sensitive topic for me….

    I had many potential clients asking my prices and using those as bargaining tokens to find cheaper designers.

    What I hate the most though is that these people look at the cheapest price rather than the actual work done itself…. Whatever happened to the value of graphic arts, thinking process, strategy, rational, cleverness and beauty of a logo that truly represents a company, rather than some cheap-a$$ clip-art and font nightmare copy pasted logo created by those so-called “designers” that take away my business and also tarnishes the passion that we all have for art and design…. makes me sick.

  40. You have to look at the big picture, before you can decide what you should charge for your services. You need to research what the going rate is in your area. Look at job posting and get an idea of what companies offering graphic designers of your skill set. Look at what your competition is doing and find out what they are charging for their services. What is your monthly overhead? Each job is different so you can really charge a flat fee. Ask yourself what is my time worth $12, $15, $20 hr or more? How long will it take to research and design the logo, ad, brochure etc?
    I charge different rate depending on the task, layout, prepress work, research and design work don’t get bill out at the same hourly rate. Again look at job posting or your competition to get a general idea of what the market is supporting in your area for those jobs and task. (Please don’t use the freelance site that bid for jobs as a resource. Those sites don’t give you and accurate view of design prices in your area). You also have to look at your skill set compared to your competition. An award winning design studio can charge much more than a studio or independent designer who hasn’t won any major awards or work with national/international clients. Be realistic about what you have to offer. Just like every in the design world doing a little research will help save you from a major headache in the future.

  41. This has been helpful! I’m making the transition from doing web/graphic design on the side to full-time freelancing, and obviously need to adjust my pricing. I have no degree in the field and am self-taught so figured I should cut my prices in half at first because of that. I felt it was fair for my first project or two to get paid $15/h. Next, $20. Then $25. Now for new clients $30/h.

    I need to get out of the mindset that I can’t charge more because I’m not expert on Photoshop or don’t know CSS that well. I wouldn’t take on a job yet that requires something else than a modifying a template but at the same time I see websites that are designed “from scratch” for thousands of dollars and do not look stylish, unique, etc. So I think the designer’s ‘eye’ is what is worth paying for and not to sound selfish but I do have that.

    LOL, writing this I realize how much I feel like I need to justify to get paid at all for what I do – because of no formal education I feel less able. Are there any others who are self-taught/ learning? What do you charge?

    • I’m self-taught and always charged the going rate. You are going about the whole “starting rate” thing the wrong way. Charge an hourly rate as if you know what you are going, and quote for a number of hours that you think it should take once you know what you are doing! That way the overall estimate is in the ball park that the client is thinking of paying, and you never have to raise your rates.

      Example: You think this project will take you 40 hours because you’re learning. But you think your friend could do it in 20 hrs @ $50 an hour = $1000. So you bid it as if you are your friend, and it takes you 50 hours; so what, the experience was very valuable. If you had bid it at 50 hours @ $20 an hour, your client will pass around your name saying “she only charges $20 an hour”. You’ll be stuck juggling different rates for different clients and their associates. I’ve done this for every new field I’ve moved into, and it works well.

      • I absolutely agree with this “charge like you know what you’re doing” method! Here’s why:

        1. If you charge a “beginner’s rate,” it will be difficult for you to raise your rate in the future. You may end up losing clients you’ve built relationships with because they don’t understand why you’re suddenly “expensive”—or you’ll end up continuing to do work for them at a rate that’s less than you deserve.

        2. A client advertising your less-than-the-going-rate is damaging to all of the other designers in your community. By doing cheap work, you de-value the industry, our profession and the services we offer.

        If you feel uncomfortable charging a professional hourly rate because you think you work slowly or need extra time to learn, then it’s much better to work some free hours instead of charging less per hour.

        If you’re “just learning” and you take on a small project at $20/hour that ends up taking you 10 hours, that’s $200 in your pocket. But, a year from now, if that client comes back to you, they’re going to expect to pay $20/hour for a job that you can now do in half the time. More importantly, they—and all of their friends—are going to expect any other designer to work for $20/hour.

        On the other hand, try charging $50/hour, but don’t bill for the hours you spend experimenting and learning how to do the work properly. If it takes you 10 hours and you only bill for 5 hours, that’s $250 in your pocket—and when that client comes back to you next year, you can continue to bill at $50/hour without discussion. You’ve made about the same amount of money and gained the same amount of experience without creating an obstacle for your career or our industry.

  42. Reading this and all comments made me realize I need to adapt a more aggressive stand on pricing. I say this because as a designer I sometimes charge as a project, I run the numbers and time and meet a happy number, client has never turned it down. There response is I’m competitive and they have seen my work. Second way I charge is where I need to step it up.. everyone should quite honestly know this, and I use this as a rule.. we can not charge $30 an hour when we know very well we can design a simple to business card layout in 10 minutes and 90% of the time, the customer loves it. Where is our standard morals at.. is it greed for more money.. or self egotostical attitude like discribed above.. I try and time myself, I have a set pricing for 1000 flyers 4×6 uv both sides.. $85 .. I see pricing ridiculously bumped up for this.. yes my design cost is already included for 1 sample proof and billed at $1 per minute after.. reading all this..I feel I’m too low now.. and need a better stragedy.. looks like I need to expand my research more and come up with a clever solution. Good post right here.. good luck to all my fellow designers.

    • “design a simple to business card layout in 10 minutes and 90% of the time, the customer loves it. ”

      This is completely wrong thinking. How many years of hard work did it take to learn how to be so efficient in your design work? You are valuing yourself as if you are a cog in the wheel, working in a sweatshop in India. Your design sense is your asset, not that you can work fast.

  43. Reading this post and everyone’s comments has really gotten me thinking about my own pricing. I’ve only done freelance work a few times (part time job — my clients have all been referred to me) but lately I’ve been feeling comfortable enough to charge at a rate I feel is appropriate for my expertise, time, and value.

    In response to Loryn’s comments, I was one of those designers that worked at less than $32K/year. I eventually made just under that wage ($15/hour) and at one point, I knew that it was time to move onto different horizons. This rate is not sustainable for anybody who wants to live on their own and to quote Loryn, ‘Have some respect for yourself.’ Even though the work I did there was great and I learned even more than what I could have possibly learned in school, it was just insulting.

    I’m looking forward to kicking up my freelancing and attracting some more regular clients and I really love all these tips everybody is contributing. There are lots of great ideas here and I’m definitely going to borrow them. Thanks!

  44. Im sorry but I was hoping the actual blog was going to give some insight and not leave it up to random ranges of “designers” from all over the world. Markets are different. Economies are different. Most importantly, skill levels are different. I am also completely shocked at how many comments are encouraging raising prices. If you are not worth the higher cost, your prices should not be raised.

    Also, I think it is crazy (sort of) to base your rates off of how much your bills are. My hourly rate is $75. I rarely charge that. Why? because as an experienced designer, I have learned that charging hourly only makes sense for quick, few-hour jobs. Actual projects, consisting of many hours, should be outlined by scope of work along with timeframe. If you think a project will take 100 hours =$7,500. If only 10 hours then it will be about $750. It doesn’t have to be exact, but if you are actually receiving work, then it should be very easy to price these out.

    Another thing, for heaven’s sake…GOOGLE. Search for your industry’s geographic pricing standards, evaluate yourself honestly, and see where you fit. If you live in an area where designers are being paid $20 USD at the high end, I suggest relocating or look for work in other cities.

    I’m sorry but the truth if the matter is that your work should back up your pricing. Charge the amount that you feel best compensates you for your time and ability. If you don’t get it…it’s probably bc you are kidding yourself.

    For those of you who still have college or school projects in your portfolio – remove them :) If you are fresh out if school or just getting started, in the beginning this is unavoidable. However, if you want to start making more for your work, you have to “prove” your worth by showing only your best. As I said before, charge however much you think your best is worth…but that doesn’t mean that you’ll get it – especially if it’s not.

  45. I designed this site specifically based on the client’s personality and retail store located in Miami Beach. I tried to capture a whimsical and quirky look, not to be taken too seriously. I incorporated many little details to capture the viewer’s interest. Because of the details, I have to further optimize the site for speed. What do you think this site is worth?

  46. I’m a sales guy that works with our in-house designers – this discussion seems like a “sales issue”. I believe in loryn’s idea of determining what the client wants and what they think a project is worth. This is what I call “feeling their purse” – I think you absolutely need to know what client thinks a project is worth. Otherwise you will under or over deliver.
    If client’s perspective is that the project is worth $5,000 and you are offering to do the job for $1,500 I suspect you will not get the work – same as lady looking for a Coach bag – she isn’t interested in a knock-off and isn’t shopping at Target. I want to be perceived more like the Coach product than the Target product.
    I’m up-front with folks in that I simply cannot compete on price alone! You want quality, attentive service; you want impactful design; you want a well-made sign with top-of-the-line LED (and the right amount of bulbs); and a professional, knowledgeable installation crew? All that is not available from the cheapest company around.
    I would discourage fixed price logos. To a customer who realizes that their branding is extremely important and wants a logo that works for letterhead, business cards, and signage and is truly impactful – the project is worth far more than a simple logo.

  47. I think it partially depends on who your clients are and how you’re positioned in an industry. Are they small, medium or large businesses? B2B or B2C? I specialize primarily in one industry, so I’m imagining that there may be others like that out there too. From the branch out work I’ve done, it’s apparent that there are different ways of thinking within different industries. At the end of the day I have to feel like I’m delivering a quality service…something they can sink their teeth into and actually use. If they love it and it works, then I should confidently charge a decent premium…not the highest out there, but something I can sink my teeth into also.

  48. The problem relays in the countries. In Mexico there is no job over $1000 for a recent graduate. Design is saw as a luxury and ppl rather do an awful powerpoint design than to pay more than $1000 for a design project. :/ is horrible I want to leave from here.

  49. The key to this is asking what sounds fair to the client. If you throw out a price you are instantly labeled as cheap, expensive or just right. The Goldilocks of the mystery price can be easily avoided by just asking, “What do you think this project is worth to you?” or “What have you typically paid for work like this in the past.”

    Your client is the barometer of expectations. You are the one that makes it go up or down. If you throw out a price and it is too low or high you are stuck. I have often found that when I ask those questions, they have a price that is higher than what I was going to charge to begin with.

    Mentally, I just made money and the negotiation is over. Quick and painless. If the price expectation is too low, that gives you the opportunity to sell your services even more or set the expectation that says, “On that budget, this is what I can do for you.”

    No matter what, everyone wins when you are upfront and transparent from the beginning. We are not used car sales people, we are designers trying to do good work at a fair price. Never undersell your design and not all clients are a good fit. When they are not, refer them to a designer that is. Networking will get you more jobs and free beer than anything else on the planet. Ultimately, it is about building relationships and taking care of people.

  50. First, get a feel for the the going rate is in your area +/- based off your abilities, Second, ask/understand what it is the client is looking for, Third, after understanding what it is they desire see if/what they have budgeted for this work. Lastly let them know you are excited to work/help them on their project as well as willing to work with them creatively in regards to how to agree on a fee schedule that will work for both of you. Sometimes a quick in & out job should be priced as such with a pre-agreed fee, On others think of the scope of the project and the hours you will need to produce the work, Take the hours and multiply them by the rate you think will work for you both. You can start a little higher than you hope to get as the client does like to negotiate and therefore feel like they got a deal…

    Good Luck…

    g

    • I agree largely with what Greg and a few others write. There is really no right answer when it comes to pricing. It is true that there needs to be some recognition of a potential client’s reality as a startup, smaller or medium to large size company, but you also have to pay the bills, and have had years of training and/or experience that deserves decent compensation. You don’t see a dentist negotiating with you based on what you can afford. That said, yes, find out what the client needs, ask what their budget and expectations are. If they want to pay you $100 to produce 3 logo concepts and finalize one with changes, you know you are not the right fit for the job, hopefully. But back to overall budget and pricing….I have been doing this for over 23 years and have weathered some of the worst economic times. That said, I have kept my rate on the lower end, in part due to the latest economic turndown. It has kept work rolling in from direct business clients, marketing firms and even other designers who do not want to be bothered with revisions, or prepping final concepts or layouts for print or online. My recipe for pricing? Take your hourly rate (there are various ways to figure this out using number of hours worked in a year and your overhead costs), make sure it is realistic, and then determine how long it will take to come up with several layout concepts, allow for one set of revisions to the chosen concept, and for 2-3 sets of minor revisions after that as well as final adjustments to ready for print or online. Look at the final figure and if you think the client will faint, or you have skimped adjust it. It is better to have some buffer and not charge it in the end, than to have to go back and ask for more or tell the client you are out of time. Most business clients know that there can be a +/- 10% to a proposed budget. I track my time and keep clients updated on how we are doing with the budget that was set. Lastly, to the person who replied they got burned, ALWAYS do up an estimate detailing the pricing structure, as well as what you will be doing for this cost, and what your and the client responsibilities are, as well as payment terms. Hope this helps…just my two cents worth.

  51. Great article! I agree that having a rate that is too low can lessen your worth, but as a freelancer, you should probably charge less than an agency (unless you are booming with a high rate).

    I find the larger companies value your time and worth more, so I tend to quote more hours for them and less to smaller companies with smaller budgets—as long as I’m not losing money and can still produce quality work within the allotted time. This can be harder to do with web projects and easier with print. I do have set pricing for logos.

    Like StephenESC’s comment above (great formula, btw), I also based my hourly rate on a 20-25 billable work week. There’s also health insurance, expenses, supplies, taxes that need to be taken into consideration when freelancing.

    I’m not 100% sold on the location factor as some have mentioned. I have clients all over the country, so I don’t feel I should charge higher than a more experienced designer because he doesn’t live near a booming city. I’d say experience and portfolio should play a bigger role than location.

  52. If you have been working several years in the business, I think at some point you get to a point where you have good idea about how much to price after you consider several factors like your skill level, how fast you can turn around a project, your cost of living, your target market… I also blogged on a similar subject here: http://jasperespejo.com/5222/a-case-for-affordable-web-design-how-to-lower-your-price-without-killing-yourself-your-business-the-market-or-bringing-on-the-ire-of-other-designers/

  53. I saw this great video by a graphic designer who said charge for the life that you want i also agree with Preston’s article in terms of pricing realistically you want your prospective client to seriously think about using you for their next project yet you don’t want to turn them off by pricing too high or too low and dealing with your arrogance or lack of confidence and also do what you do best you are sure to get paid for it.

  54. $50-70 an hour is a fair Interactive Design rate given the cost of living in this part of the country. Rates will obviously vary depending upon the complexity, duration of the Design work and also more importantly location.

  55. So much good advice here… and useful conversations that we all can mull over as we should review our pricing regularly. An old school type myself, I learned early on how to accurately estimate my time based on my usual speedy turn around (compared to others) so my hourly price was always higher than most (cos I worked faster) but with all the pre-planning and client involvement I invited, it evened out in the end. Further for those starting out, I also agree that it only takes a bit of research to discover the market rates that match your own level in your area, so use that to begin with.

    However, you MUST be honest with yourself about your worth based on your years of experience and body of work … NOT necessarily the same thing. I knew a novice photographer keen to freelance who lost all kinds of jobs and never really got off the ground because he assumed he could charge full rate right at the start. Very unwise of him and it only invited scorn amongst his peers.

    I believe in formulae that take into account the scope of each project, the estimated time to achieve it (with some wiggle room), all massaged as the sales guy says by the feel of the client’s purse. Insist on an agreement set up with a substantial deposit to “book the docket/file”. Anyone unwilling to do that, I walk away. I always approach with a desire to give the client the best value I can for their budget…and tell them so. Little consultation extras I can include as we go as long as they understand that I have also built in a “last call” stage for them to make final corrections. After that, anything can be changed but the fee I charge rises sharply and that cuts the wheat from the chaff, I tell ya!

    Also perhaps stating the obvious…I always always quote “without tax”, because all the services and goods I buy do that so it keeps my fees in line.
    Great topic for much useful discussion. Love it.
    RBL

  56. Well, as for my case, I have always yearned to satisfy the client first and this has actually marketed me a lot due to the outstanding performance in any design piece. As a matter of fact the clients have done marketing for me! I am not the designer who will copyright other peoples works but I have always learned to originate ideas and concepts, doing things completely from the norm and this has enabled me to be peculiar in my designs. My pricing has been standard and has always left my client(s) satisfied or even going beyond their expectations! ….there is always a feeling of satisfaction when my client(s) is happy and impressed; they have occasionally commented on my exclusive works!

  57. Hi guys, thanks for all of the posts, you are really helping me out regarding my price structures. I’m fairly new to the commercial industry and have seen some great and sudden success! The issue is that I am still fairly inexperienced regarding licensing terms. I know this issue is completely unrelated to the topic, but I’ve figured why not ask here where we have a bunch of international industry experts?! I need to get permission from a designer to get a commercial license for his fonts, but I have had no success in getting hold of him. I mailed every possible mail of his and all I got back was an automatic response saying “use the fonts and enjoy the designs” – which doesn’t really help or set my client free from any legal obligations. Any advice on how I can go about to get a license? Is there an international “designer’s something” (like an association or forum) that I can contact, who can help out with this? I am in South Africa and I’m doing my research now on going the right route to get a license… while reading all of your opinions, I figured that you guys might give some great tips!!

    • I have a book by the Graphic Artist’s Guild, which can be purchased online. They have sample contracts and pricing lists, and they discuss licensing. I think a resource like this would be helpful for you.

      You can also join membership groups to learn about these things and attend online seminars. I am not sure what they have in South Africa, but here in the US, we have AIGA, and the GAG.

      Good luck!

  58. Where I’ve started I have my business card on every bullitin board of every gas-station, laundromat, and supermaket in town. It’s a small town with a lot of small businesses. It sounded like a great opportunity. After looking into some public records I was able to find a fair price for the various services I have. Any type of design and branding on any printed media etc.

    It turns out my prices are pretty reasonable and allow for an actual profit, but being a small town full of local businesses, no one has any money to spend on advertising of any kind. They usually wind up going with Vistaprint, Staples, or Kinko’s for what they need. Prime design and advertising doesn’t seem to matter for broke business owners depending on each other as customers in a small community.

    Now I’m starting over from scratch trying to figure out where I can find an audience.

  59. i experienced sweet spot is, for the work some volunteer project for any organization or community service, and the critics and complement really put your design skills and boost.
    work few rock bottom projects and and see the critics and complements of client to place your standard. if i see my works meet top class, then i price the upcoming projects according to the company standard and man hours im investing on it.

    but time to time i do free/volunteer works as an appreciation to skills i have be given by Almighty Allah

  60. I try and set myself somewhere in the middle. I’m a little low for my market, but I also work with a lot of non-profits and new business owners and want to set my rates so that they can afford me, and I make sure that they know why I’m a good deal. I don’t want a non-profit or new entrepreneur to miss out on the good branding or marketing tools that are important to their mission, just because I felt the need to charge a rate that’s out of keeping with the work I actually do.

  61. Hi Preston,
    I figured my going rate to include my overheads such as equipment costs, software costs, insurance costs, electrical, rent, etc. I have never had to justify to my clients my hourly fee. My clients have all experienced the person charging lesser price per hour. Generally the end result dollars per project are the same, quality mixed on the lesser fee designer, never the same service.

    Things I do for my clients that also justify my hourly fee.
    – Give them the working/native files. My clients don’t like being held hostage. Ad Agencies and many other Designers do keep the files and never give them up unless more money is asked for. Bad PR in my book. More work for me.
    – Keep communications open with your clients (all of them). Let them know when you are going to be away so they can schedule their projects with you before your trip or after. This helps to keep your schedules full, keeps you on the clients mind and creates jobs the client probably didn’t have planned at the time.

    Not only is Great Design important so is Great Communication and Service. The full package.

  62. Where I reside, it’s difficult so I have a sliding scale. Very large company, $60 per hour, medium $30 per hour, small or new, $25.
    The problem I’ve stumbled onto is now charging 50% for new businesses.
    I have over 20 years in the commercial art field and feel that I have to compete my price just to get the client away from UPS delivery service (in Canada, they offer graphic design).
    Recently I lost a job to a self taught guy who uses only one program, Corel Draw.
    The client couldn’t or wouldn’t understand that education and experience is worthy versus a small formal office.
    Rule of thumb, there’s always someone cheaper and also, more importantly, STOP when they say that they are in a rush. Make certain they sign, even though they are friends and it’s a rush crisis!

  63. I’ve been working in the design industry for around 15 years now and freelance for near on 10.

    My hourly rate started around 10 years ago at £25 per hour ($40 per hour) and depending on the size of the client and the quality of the brief has ranged from £20/hour to £50/hour ($30 – $80/hour).

    But work of late has slowed down and I began to find myself up against other freelancers quoting idiculous rates like £8/hour ($13/hour) for ‘professional’ design work. (I use the word professional, loosely here).

    So I decided to qualify out those businesses who are looking for budget, unreasonable hourly rates and set prices for my craft. My passion. My profession!

    I qualified these bad potential clients out by working out, on average how long it takes me to say, design a logo or design and build a wordpress website. I then applied my hourly rate of £30/hour and advertise that as my ‘packaged’ price.

    So now, I offer a professional, creative and considered logo design and business card at £500. ($800)

    A completely bespoke wordpress website design and build from £695 up to £1795. ($1115 – $2885).

    The result?

    No time wasters. No estimating costs for new business.

    And the people whom I work with are happy. The job costs exactly what the packaged price was (unless the brief changes drastically) and I can plan work much better.

    Great post and I hope you all find your suitable sweet spot!

    Baz

  64. Lori Glennon says:

    My rate is $70.00 per hour for high-end creative as well as lower-end production work.
    I log my time so the higher-end projects that include original design, revisions and tweaking automatically get billed higher because of the time factor.

    So…in your option, is this a good middle ground rate?

  65. Great post… I am in the middle road working my arse off to make ends meet, but with projects everywhere pricing up becomes a fine line. I am sitting on the $65/hr fence, and it seems to work, clients don’t really question it. When they do, I tell them that they should go and find a cheap designer/developer and go with them, they will get what they pay for. Cheap design and cheap looking business. Normally they never go away when I sell myself properly. Depending on the size of the site I will work on a rough 48hr – 55hr time frame.

  66. hi, im a graphic designer in Israel, I have a studio of branding and graphic design and I always wonder about wheather the prices I charge my clients are good or not. for example – a package of branding new company (logo, color template, brand strategy etc.) + wordpress website based on template with a lot of modifications (including convert to hebrew by outsource technician)- 2000$. the whole work took me 3 monthes. what do you think about that? what do you think is a good price at the u.s?

  67. I set my pricing after 3 factors.

    The customers ability to pay – big companies have fatter wallets.

    The nature of the project – doing concept art is a lot more fun than doing the UI of an accounting app, and I prefer doing stuff I love. On the other hand, good illustrators are hard to find, while graphic designers are a dime a dozen. So there is quite a few considerations here.

    How much will the client stand to gain from it – again, if someone stands to gain a lot, they’re also willing to invest a lot. On the other hand, I’d never fleece a charity organisation based on volunteer work asking for some help – and if your gonna work ‘for free’, then you’d just as well feel good about it.

    I set my pricing high, so I’m not competing with first year graphic students, but lower than the professional agencies I compete with – as I do not have the administrative staff expenses to support. And I communicate my pricing first-hand to avoid misconceptions.

    So I end up with pricing between 150$ going up to 350$ an hour, with time for quite a few pro bono jobs. (Sadly the 350$/hour is a rare combination of luck, urgency and getting it right the first time).

  68. Adeel Saeed says:

    Well i am new to freelancing and soon starting up logo design and card design , so how much should I start charging my clients ? I would appreciate my fellow designers to give me a good suggestions !!!!!!!!

    • Logo – depends on if you’re doing several samples or not. If you are talented, and have studied great logos and can duplicate them, don’t charge less than $500. Limit the number of change requests, and charge an hourly rate if the client does want more changes. If you think you have some learning to do, you can charge $300 and work on a bunch of samples for them to hone your skills.

      Business Cards – if the logo is available to you, you should be able to do this in about 3 hours or less (less is good). A flat fee of around $200 should give you the full 3 hours, plus an hour of change requests.

      Hope that helps!

  69. I believe in quality versus quantity. I charge between $50 and $70 an hour, but I make sure the amount, scope of work and the deliverables are very clear. Always ask the client was is their budget, they all have a certain number in their mind, then you will know what the client expectations are. But never compromise the quality of your work for what you are getting paid for. If you feel you undercharged the client for great work that you and the client are happy, then the client will recommend your work to other people, and you will get more new and returning clients.

  70. Deirdre McKenna says:

    It is absolutely true that how you value your own work will affect how potential clients
    perceive you. Your fee is the most immediate way to convey that message. It is important
    to be crystal clear about what your hourly rate is, what it includes, and if/how much you will
    charge for revisions (and what constitutes a revision or “edit”). Some clients are afraid to ask for things because they have worked with designers who just tack on additional fees at the drop of a hat (or worse, without explaing beforehand).
    All that having been said, I think it is bit ironic that the advertisement to the right of this article is to design a “professional logo for 5$”!
    Thanks for the topic.

  71. After 20 years as a small, then not-as-small, then small-again business, I’ve seen pricing go from $75 when we were starting in 1994, to $180 in 2000, to $125 now. We are now a three-person business (12 people in 2000), all trained in graphic design and/or front end/database development. I worry a lot about the perception that what we do is a trade rather than a profession. The low barrier to entry makes this possible, as well as the subjective nature of (some of) our work. I had a plumber come to fix my dishwasher and he charged $125 for the first hour (whether that “hour” was 10 minutes or 59 minutes) and $125 per additional hour, again no matter how long the “hour” happened to be–if he passed the hour mark, another hour was a done deal. He seemed to know what he was doing, had learned the trade from his father and had about 5 years experience. And he walked out with a check for $375 (no waiting for invoices for these guys) and went on to do three or four more of the same before dinner.

    He makes the same hourly rate, and much, much more per year than I do. If he works an easy year of 1200 hours, he gets a sweet $150,000 gross. And he’s a TRADESMAN. So why do we settle for half or less of that (in the final tabulation–our rate is $125, and when the day is done, often we see more like $70-80 in real numbers), when we practice as professionals trained professionals. Yes, there are lots of hacks who do the work we don’t want, and we often end up fixing. Yes, there is a lot of competition (but there are lots of plumbers too!). Yes, any work seems to be better than no work, so when the client offers half of what we ask, we say yes, because we have to keep the lights on.

    So what do we do? I’m trying to figure it out too, but from what I’ve read, there a few things:

    –Be a consultant, not a tradesperson, not an artist, not hands-for-hire. Act like a consultant, know things like a consultant (do you homework), and offer well-research, well-rationalized solutions like a consultant. Consultants are more expensive because they make themselves worth the money.

    –Specialize. The private prep school specialist Whipple Hill started out doing website just for one specific segment and now they are selling software and making gajillions. If you only focus on one, or a few areas (financial services, banking and insurance for example) you’ll be able to speak the language fluently and point to specific work examples with depth and breadth, and charge more because you know the business. That’s part of the reason that the plumber gets his money–he does only plumbing, and even though an electrician could take a stab at it you’d rather have a plumber).

    –Walk away. This is the hardest of all. I have done it only twice in the last year, and should have done it two other times (and those two are STRANGLING me). If they won’t sign a water-tight contract they yo’ve written, pay a third or half before you start work, and agree to a price that is within the 25% safety margin you built in to the estimate, then walk away. You will end up paying for this client’s project yourself and be sorely the worse in morale for it. As I said, I’m there now with those to projects I should have refused and I’d have thousands more in my pocket if I’d walked away, and not be afraid to answer the phone.

    So, I’m still working on it but that’s what seems to be true so far.

  72. I don’t freelance anymore but I used to quite a lot.

    I started out estimating my work at a $60/hr rate in the Grand Rapids, MI area and ended up so busy with work that I could afford to be choosey with my clients.

    Once I had a pretty decently-sized portfolio, even being choosey, I found myself over-booked so I decided to strategically raise my rate in an attempt to ease the amount of work a little bit (hoping to scare off a few of the smaller jobs that I thought might end up eating me alive). That strategy seemed to work in that I didn’t get calls for tiny jobs anymore.

    I raised my rate to $125/hr but I had a perpetual 20% off discount running so my rate was $100/hr (because I too like round numbers). I would also be sure to show the discount on my invoices.

    I found that people complained less about my sale rate of $100/hr than they did at my $60/hr rate because EVERYONE likes feeling like they hit a smart deal and got a special discount… and if the job went well, I’d tell them that I’d extend the discount to them for future work because I enjoyed working with them so much… which turned them into long-term repeat clients.

    The result was that I got interesting jobs, working with people I liked and trusted.

    For the client, I bid everything fixed-bid with a little bit of padding, based on that hourly rate (with an out-of-scope re-bid caveat). That enabled them to see a number they could budget for that would not be a moving target. It also helped me be good and quick at my job without losing money over it.

  73. I started in the graphics business as a “hack & slash” paste-up artist in 1968, when everybody worked with india ink, straight edges, Rapidograph pens and X-acto knives. I worked my way up through the design business, in ad agencies, design studios, and large corporations and finished my time as someone else’s “employee” as the Creative Services Manager for one of the world’s largest oil companies.

    I saw the design world evolve from large format film cameras and illustrations done with pen and ink to digital photography and computer design and have been fortunate enough to have participated in all of it.

    One of the most important lessons that I learned was how to value my work. In 1970, I worked as an art director for a very small company that did package design. The owner of the company called me in to go over some of the artists’ time sheets and gave me an example of how he priced a finished project to a customer. At the time, I was earning the magnificent sum of $8.50 per hour. The other artists made from $6.00 – $7.50 per hour, so, for $40 more per week, I got all the responsibility and aggravation of supervising a roomful of prima-donnas with all the little gripes and foibles that went with them, in addition to having my own projects to complete.

    This is what he said (and you can apply this to your own work, whether you work from home or have an office):
    “Let’s see, this job took this person two hours. That works out to $15, right? Okay, then we have overhead. That’s what it costs us to keep this office open, make payroll, pay taxes, recordkeeping, telephone, electricity, equipment, trash disposal, the cost of sales, meetings, insurance and all the other stuff we need to make this place run. Then last, we need to add a reasonable PROFIT to keep that going.
    “So, we take $15 times 2 and we get $30. We multiply that times 5 and we get $150. Send ‘em a bill for $150.”

    I shook my head in amazement. Then he explained that he constantly monitored ALL of the company’s expenses and the total profit from that bill would yield a profit of about 24% – about $36.

    Now, I freelancing for about six years. I work from my home. I use a computer system that cost about 8 grand. And the software is up there in the realm of ridiculous. Uncle Sam wants me to amortize the cost over 3 years. In 3 years I’ll probably have to buy a new system. So I work it into my expenses by amortizing it over TWO years because I should make a profit on that investment. I know approximately how much business I will do and I track ALL of my expenses on a monthly basis. I know how many hours of billable work I can generate per week and how much profit I need to sustain my business and myself.

    I am also a bit of an anomaly in the business — I can also write coherent copy and have a fairly deep background in photography and offer both services to my clients.

    I make an effort to make my rates relatively flexible because I have some large corporate clients who expect not only good, solid design, but exceptional service as well. But I do make some allowance for small start-ups, however, the only thing that I cut for them is my profit level, not my expenses.

    If I get a request for a quote, I have been involved in the business long enough to provide an accurate range estimate, usually based on the job time with minor revisions at 100% to 130% of the anticipated bill.
    If a client wants a fixed dollar amount, I will quote a dollars/hour amount with the actual time estimated (kept to myself) plus 33%, with all changes and revisions charged to the client as an additional per-hour expense.

    More than anything, my efforts are dedicated to delivering good design, value and outstanding service to my accounts. I have built my business on the trust of my clients and exceeding their demands whenever possible.

    • G said: “Now, I freelancing for about six years. I work from my home. I use a computer system that cost about 8 grand. And the software is up there in the realm of ridiculous. Uncle Sam wants me to amortize the cost over 3 years. In 3 years I’ll probably have to buy a new system. ”

      Did you CPA tell you that? Uncle Sam dropped that requirement decades ago. You can choose to put any capital expenditures (such as computers or furniture) on “section 179″ and write it off in the year of purchase as a regular expense. The only trick is to make sure it was put into service during the year, so don’t buy something like that during the last week of December. I try to buy stuff by October if I want to section 179 it in case of an audit.

      see http://www.section179.org/ for details.

      Keep in mind that FICA taxes are 2% lower this year (at 13.3% instead of 15.3%) so it might actually be better to wait until January 1, 2013 to make large purchases. (That’s assuming that the Payroll Tax Holiday is not extended, but there has been little talk of it so far.)

  74. Good information, but still a little vague. It would be good to offer some examples of hourly pricing and overall budgets for some projects, within a range according to the location of business, considering that most client interface is done over the internet. Its a plus to show a face on location.

  75. Tim Stiles says:

    I’m an illustrator, cartoonist and a designer. I’ve worked for 35+ years, today I teach Graphic Design at our Community College. I’m often presented by students with the question, “Just how and on what do I base an hourly fee?” I have no problem helping them break down what they might do creatively and also as a service provider for a client that can be billed, but when it comes to divining how that rate might compare to what others are charging in the community, I haven’t a clue. Your article which was nice to read, really didn’t address this either.

    In the “olden” days when I was working and a member of the local Ad-Club organization, it wasn’t unheard of to ask another member, “hey, what would you charge for this… fill in the blank?” And in those days you could almost count on the response to be sincere and accurate. Unfortunately today the Ad-Club is a long gone thing of the past in this community, and I really don’t know many of the freelance people that are currently working. Being a college town the turn over is tremendous.

    I know the economy has taken a toll on the freelance graphic design business, but I wish there was some way to track what others are charging for time and services.

    PS… I know I’m getting old… when you asked for “Mail” I listed my mailing address, not my email address. We do still live in houses? If not, don’t tell me.

  76. Ha! Thanks for the article! I was actually in that same position today where a new client hacked me to death with cutting down my price. We have a bit of economical crises in my country so you take what you get and I’m cringing already to see what bills I will be able to pay at the end of the month. Sometimes I find it very difficult to stand my ground and ask my price, so I usually just tell the client I will work out a detailed quote and email it to them asap. That takes the “cowboy stand off at noon” a bit out of the equation and when clients see what they get then they are more likely to accept the quote than to give them a figure over the phone. Designers love their work and will put the same effort into a no pay charity logo as they will into a big bucks corporate. We have to learn to embrace the business side of it as well. If your company doesn’t get paid then the designer cannot do the best he/she can. The more money you make, the better you design. Simple equation. Thank you for all the good advice!

  77. sikelela christian ncube says:

    I’m a graphic designer doing a climb to web design. I enjoy my work (love it) but hearing about plumbers and lawyers has given me a think about why I’m not getting to where I (in my opinion) should be. I’m currently working on my first site. The idea of free web templates is so tempting but for some reason it feels like cheating. I will broach the topic of pricing when I complete my site so that I know exaclty what I’m walking into when I say yes to a client. Thanks for this helpful blog.

  78. After reading this article and all the comments, I realize I’m under cutting myself. My hourly rate is what I’d like to get paid at a J O B, rather than taking into consideration that I’m not an employee with benefits. I never even considered the cost of the hardware, software & educational upgrades that are part of a graphic designer’s future. That being said how do I increase my rates for my current clientele? How do I broach the topic of “I’m screwing myself over” with clients I’ve been working with over the last couple of years?

    I was looking at this from the wrong end. I charge less that what Staples (Canadian version of Kinkos) because I thought I was being competitive when I should actually be charging more because I’m worth more then that, when you add up my experience & skill level.

    Is there a book or helpful sights I can read to help me re-establish myself? I feel completely lost now, and have much to re-do.

  79. * I’m worth more than that.

  80. Princing your work is something to discuss for days, even weeks. It has many variables, one of which is how much you need to keep your business running. You must consider all sorts of expenses, your own salary and what your small business needs to save. So having that in mind, you get the hour rate.

    Besides considering an hour rate and what a project may take you, you have to think about a price listing for yourself. What if you do a logo in 10 hours and put a price to it for that time and he next week you do a logo in 20 hours? Would you charge you client more for it? In many cases, it´s all about inspiration, so I think it´s not accurate to put a price to inspiration.

    Time management is another extremely important thing to consider. You may not have a succesful business if you do all of your projects yourself. You must consider outsourcing. Believe me, I did so for years. Even now, while I´m writing this comment, other professional colleagues are working for me.

  81. can i get some feedback on the pricing structure of my website?
    http://www.merakidesigns.com/pricing
    And my solution for a client on a budget is to write out a contract detailing payment plans from them, with the balance to intended to be paid off within 3-6 months.

  82. How should someone pretty new to the business determine how to price their services? I have been designing and creating things for myself for years, but the closest I’ve come to selling my services is bartering with friends. I have no idea what the going rates are, but I really want to learn! I know my friends have gotten thousands of dollars worth of work from me for next to nothing, (and I don’t begrudge them that at all- I offered!) but it’s time for me to start finding real clients and making real money.

    A problem I face with learning how to price my services is the answer “It depends on your skills”. While this answer makes perfect sense, it doesn’t do anything to help me quantify actual prices to charge. How do I determine real numbers to charge based on my skill level?

  83. Crazy to see the amount of people here who charge per hour, per project usually works better for both parties, no surprises for the client and you know ahead of time what you are getting & bc you have done this before you also know how long it will take.

  84. Pretty good advice there.
    I have made mistake of quoting lower amounts in the past out of desperation and have seen devastating effects.

  85. Robin Monroe says:

    If you’re going to mix love and money, charge at least $275.00/hr or $1500.00 over night. Otherwise, admit that you are doing design work as a business and treat it as such. Even if you were working “in house” you should bill out your time at the same rate the firm would – not at the rate you would receive as a salary. Your firm will charge enough to cover your time, the overhead of having a place for you to work, your health insurance and benefits. etc. If you were doing design work through a temp agency they would bill the client on average 3.5 to 5 times the hourly rate you would get paid. Why should you charge any less?

  86. 30-40/hr especially if it’s ecomm/contract/no benefits/ Otherwise it depends on what city you live in. Some… I don’t think it’s unreasonable to expect six figures for being a front end expert. 70k at least.

  87. I have found useful resources on this website about how much to charge to your clients as freelance graphic designer: http://www.u-charge.com all the best

  88. A very interesting topic so far. Apparently I just subscribed to GDB and have been getting interesting info. This is no exception. I have about 3yrs of design experience (not as strong as it should be though) and I have come across quite a few problematic clients. I live in Nigeria and trust me it’s worse. Graphic/Web Designers are yet to be fully recognised, so when the issue of pricing comes up, there’s a lot of “…but I can do that myself…it’s just that…”. And that’s how the story goes. But I have refused to be intimidated.

  89. Hi , I have been trying to make it as a freelance graphic designer ever since I graduated from Associative Degree of Graphic Design back in 2010. I have suffered from not finding work to charging low prices to the possible clients I found through word of mouth. I feel my work is important and I want to be able to charge decent prices.

    But no matter how many books i read about the topic, I cant seem to come up with a good price list for work such as: Creating logos, letterheads, banners, design a web template, create buttons. newsletters, flyers, Installing and designing word press sites.

    I live in Dominican Republic, but since i studied in the US i want my price to reflect the US market since most business like Design firms here tend to do the same.

    And After spending a year after graduation of not finding work I took on a job as a very basic web designer for this design firm that was establishing themselves in Dominican Republic where I only get paid 730 dollars per month for copy pasting information from one site to another, finishing setting up wordpress design where i usually do up to 25 wordpress sites per week. Its decent work but I was suppose to be an in house designer but ended up being just freelance when they didn’t have work place established. Anyhow i am not complaining about them. They gave me a chance.

    But I have gone from trying to make it as graphic designer to becoming a web designer and slowly digging a deeper hole in web design because job interview i go to need web designer to work on html5/css3 and do wireframes, than designing.

    Anyhow I feel lost and confused and would like some advice.

    Thank you.

  90. This is an interesting article, but the comments are even more interesting…

    I’ve been a freelance marketing/design consultant for the last 13 years. I know what it’s like to charge too little because you’re building a portfolio, and because perhaps the economy and client budgets mean it’s better to have underpaid work than no work at all.

    What I’m reading from a lot of the newer freelancers are the 5 biggest business mistakes, no matter the industry:
    • Self-employed entrepreneurs consider their time as a free or small-value commodity.
    • They focus on cost, instead of value.
    • They try to guess what the client’s budget is.
    • They try to guess the dollar number everyone else is proposing, hoping to come in lower.
    • They apologize for their pricing, they cut their prices or they underbid.
    • The client they cut the biggest discount becomes their worst nightmare.

    How can you avoid these mistakes?
    • Realize that when you are trying to figure out what you should charge per hour, that ALL of the hours you spend working need to count toward your income. If you’re a sole proprietor (I am), you’re spending time talking on the phone, meeting clients, networking, invoicing, reading client emails and you’re covering your overhead. This is the cost of business; if you don’t cover it, you won’t stay in business for long.
    • Be honest with yourself. When you’re adding up your price per hour and multiplying it by 40 hours a week of billable time, you’re kidding yourself. All the activities detailed above mean you’ll have to work at least 60 hours to bill 40.
    • Stop focusing on how much you charge, and start focusing and selling your clients on the value and benefits working with you. Every time a client tells me they’ve got a quote for far less than I’d charge for the “same” service, I smile and tell them that while I am not the lowest cost provider available, I do charge enough to stay in business, so when they need service in 6 months or 6 years, I am still going to be in business and I can help them. I am still working with my first client, and I tell them that.
    • I tell them my qualifications, that I have experience working with companies just like theirs, and that they will get far more value from me than what they’re paying for.
    • Stop guessing what their budget is. Ask. After years of going to meet with prospective clients only to find that they’d hoped to spend $500 on a website, I decided that rather than waste 3 hours of my billable time only to find that it was a dead end, I needed to qualify the prospect before I even considered getting in my car or spending a few hours researching and writing a proposal. I ask what the budget is. I tell them that I am not looking for a number to put in the proposal, I’m trying to find out how much I can do for them. Maybe I can set up the project in stages as their budget allows, maybe (if their credit is good) I can let them pay monthly, maybe they are budgeting more than what’s needed, and I can do more than they’d hoped, or suggest other ways they can spend their remaining budget (and it might not be on my services).
    • If there’s even a hint that they are seeking multiple bids or proposals, I ask how many proposals they are getting before they make a decision. In my experience, if a client is seeking more than 3-4 bids, they are shopping price almost exclusively, and they may be a waste of my time. I politely tell that type of client that I’d love to work with them, but my proposal process involves research on their company, their industry, their competition, plus the actual time to write a detailed proposal. I am not afraid of competing for work, but I can’t spend that kind of time until they’ve narrowed their options. Bold? Maybe, but you’d be surprised what a powerful sales tool it can be.
    • I don’t apologize for my pricing or cut my prices to meet their budget. If I have a client that really wants to work with me, but they don’t have the money to pay what I need to charge, I insert some flexibility for them. I can make their budget work by doing the work in stages, implementing parts as time goes on and they have budget to afford it. My proposal pricing page is like a menu. They can choose the items they want and that meet their budget, and add-on other parts now or in future. I can, if they seem like a good client, get a deposit and bill the balance in installments. Note: this can be risky with start-ups, so your deposit amount should be high enough that you won’t lose your house if they don’t pay the balance. Most low-budget clients are thankful that I can help them to work with an experienced designer.
    • I give more than I promised. I try to beat their deadline, I give them something extra they weren’t expecting (free business card design as part of a larger project… I might even buy their first order). Why? Because this turns my clients into loyal clients that will work with me again and again, they become referral machines and I often get thank you notes with their checks.
    • I have a PIA pricing factor for proposals. If I sense a client is going to be difficult to work for, not get me what I need when I need it or otherwise suck the life out of my time or spirit, I ask myself what it would take to make me smile when I’m putting up with them, and that’s what I propose. I might not get the job, but if I do, I’m going to be happy.

    All that said, there are times when I will work for a little less, and I do pro bono work for a few clients, but most of the time, you need to do that sort of thing wisely and make sure you can make it work for your business in the long run, either by referrals or a valuable piece for your portfolio.

    I know how it feels to be passionate about design, but if you want to stay in business, you also have to be passionate about paying your mortgage.

  91. Ralph Hays says:

    The clients I have I have been with for years on a regular basis. I charge by the hour – with no minimum. In other words lets say I charge $50.00 an hour. If a project takes me 30 minutes to complete I charge them $25.00. But if a more complex project comes in for lets say 3 1/2 hours, then I will charge $175.00. If a group of projects come in and if the client agrees to “batch” all of them then I will charge as a group on the clock.

  92. Hello everyone,

    As a new Graphic Designer/freelancer how much do I have to charge for design logo that requires 6-8 designs based on a creative brief that they will send to me? I need some help as I am not familiar with the prices.

    I’m looking forward for your advice.

    Thanks,
    Mimoza

Trackbacks

  1. [...] What your pricing strategy says about you as a freelance designer …By Preston D LeeprIcing strategy freelance designer graphic design blender. Have you ever realized what your price point says about you as a designer? As designers we worry so much about how our brand looks when it comes to logo, web site, etc.Graphic Design Blender [...]

  2. [...] a price to a client and thing that this is an important topic here is the link for the article:  http://www.graphicdesignblender.com/what-your-pricing-strategy-says-about-you-as-a-freelance-designe… This was written by Edu Pereira. Posted on Thursday, October 11, 2012, at 12:49 pm. Filed under [...]

  3. [...] bigger companies are stuck with the pricing their boss sets, freelancers have the freedom to price each project for the client at [...]

Join the conversation

*

css.php