Guide to Pricing Your Work
Ask any freelancer out there, and they'll tell you that pricing their work is one of the hardest parts of the job. It's hard to tell someone how much you think your skills are worth. Imposter syndrome is real and something you'll have to deal with at some point or another. But we can't let that keep us from charging what we deserve for the work we do. You've worked hard to learn this skill and your personal style is valuable!
So how do you know what to charge? Here are a few things to take into consideration as you jump into this:
- How experienced am I?
- Who is the client?
- What is the scope of the project?
- How long will this project potentially take?
- How many pieces are involved in this project?
- What kind of value does this project have for the client?
There are a few ways to price your work, so I'll talk about a few different ways and tell you about my preference. But first, I've got to mention something super important:
Having your clients sign a contract is really important to ensure that you get paid and that they abide by your terms. It can be super simple, but should include:
- Agreed upon price
- Number of rounds of edits - I only do this for projects with a set price, not for hourly pricing, but we'll get to that.
- Rights to work - make sure you specify that you still own the rights to your work to use for your site, social media, etc. and specify what they can use your work for.
- Timeline if applicable
- Both yours and their signature
Here is a sample of the contract I use that you can take and tweak to fit your needs!
Now onto pricing. Here are the two main ways you can price your work:
- By the Project
You can make a price list and include all the things you do and have a set price for each item. For example, a business card design might cost $50 while a logo costs $500. This system is ok if you've done a lot of work already and have an idea of how long certain projects take you. The problem with this is that you don't know how your client will be, so you may end up spending 7 hours on something that normally only takes you 2. Which brings me to the next way to price...
- By the Hour
My personal preference is charging by the hour because that's what's worked best for me. I suggest trying multiple ways and seeing what works best for you! I used to charge by the project until I had one very special client. He wanted a logo designed and we agreed on a set price. I didn't have him sign a contract (mistake #1) and I didn't specify how many rounds of edits I would include for that price (mistake #2). Long story short, I ended up sending him over 100 logo options and edits and it took me way way longer than I had anticipated. That's when I started charging by the hour so that I can give clients as many edits as they want, but I'm guaranteed to get paid for my time. The downside to pricing by the hour is that maybe a project only takes you two hours, but it looks great and the client loves it and you know they would have paid more. That's why I have a minimum charge of 3 hours for logos, regardless of how long it actually took.
This is where you have to use your discretion as to what is best. Sometimes I give a client a set price for the project, and sometimes I charge by the hour. It depends on the client, scope of work, and the value I'm giving them. Designing a page layout isn't quite as valuable as designing someones logo, so keep that in consideration when setting your price.
Dealing with clients & agencies
Another thing you'll run into is the client wanting an estimate of price, even if you've told them you charge by the hour. In that case, I usually give them a broad estimate (ex. 5 to 10 hours) and include in the contract that the time I estimated is in no way guaranteed.
Sometimes your client isn't just a person, but an agency. A lot of times agencies will hire freelancers or contractors to help with a specific project or for a certain season. I've had agencies tell me how much they pay contractors and had agencies ask how much I charge. In this instance, it's usually better to let them know how much you usually charge. Sometimes they'll want to negotiate, but other times they'll just pay what you charge. They also may ask for your day rate if you're going to be working in the office from 9 to 5, so that's definitely something you want to figure out before going in. You can take your hourly rate and do it x8, or have a completely separate number for days rate. Sometimes you don't know how many hours you'll actually be working in a day, so having a separate day rate is a good idea.
So now you've scored a job and you're about to jump into the work. If you're charging hourly, the best thing to do is get a time tracking app. There are a lot of free ones out there that you can download onto your desktop, and you start and stop time for whichever project you're working on and it keeps track for you down to the second. Finding a good free one can be hard, or you may only get a week or a month free trial, so I would test out different ones and see which one you like best!
Before I had a time tracking app, I would write the starting and ending time in my Illustrator or Photoshop file so that every time I opened it I would remember to write the time, and then I wouldn't save and close until adding my ending time. You could also write it down on paper. It just looks a lot more professional to have it recorded on a time tracking app if a client questions your time for some reason.
The easiest way to bill clients is will an invoice. An invoice includes:
- Your name, address, phone number, email address, website
- Client's name, address, phone number, email address
- Invoice #, date, and payment due date (I usually do two weeks from the day I send the invoice)
- Description of each individual service, hours worked on each thing, and rate charged for each
- Total price
- Any additional notes about payment, etc.
There are a lot of websites that have free invoice templates where you can just plug in all this information and download a pdf to send to your client. Here's one I use: Invoice Quick. And here's an example of what the invoice looks like:
As always, if you have questions about any of this, send me an email or comment down below!