{"id":7537,"date":"2015-01-05T11:00:53","date_gmt":"2015-01-05T17:00:53","guid":{"rendered":"https:\/\/getflywheel.com\/?p=7537"},"modified":"2023-10-24T14:19:55","modified_gmt":"2023-10-24T19:19:55","slug":"setting-your-rate","status":"publish","type":"resource","link":"https:\/\/wpengine.com\/case-studies\/resources\/setting-your-rate\/","title":{"rendered":"How to Set Your Rate as a Designer"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Here\u2019s to a new year in the wonderful world of design! To start it off right, maybe now\u2019s the time to figure out one question once and for all: How the heck do you charge for your work?<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">It Hurts to Not Have Good Pricing in Place<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Whether you\u2019re an independent contractor or a new firm, setting your price can be filled with uncertainty. If you charge too much\u2014even if you clarify that you\u2019re open to negotiate\u2014you could lose work that you need. If you don\u2019t charge enough\u2026 well, lots of things can go wrong. For example:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You could set yourself up to be undervalued. This is an intangible side effect, but it could manifest itself in making your design process harder. Your input can be questioned more and your expertise valued less. A client who works with you at a low rate could refer you to other potential clients who expect the same rate. You&#8217;ll probably resent every snag that comes up because you aren\u2019t getting paid enough.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Whether you end up bidding out a flat fee or charging by the hour, landing on an hourly rate is the first major step in setting a price.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">You\u2019ve Got to Figure Out Your Hourly Rate<\/h2>\n\n\n\n<figure class=\"wp-block-image aligncenter wp-image-7553 size-full\"><img decoding=\"async\" src=\"https:\/\/getflywheel-images.s3.us-east-2.amazonaws.com\/uploads\/2015\/01\/8143919353_b5c6fb1f12_b.jpg\" alt=\"An analog clock on a wall\" class=\"wp-image-7553\"\/><figcaption class=\"wp-element-caption\">Image courtesy of <a href=\"https:\/\/www.flickr.com\/photos\/gynti\/\" target=\"_blank\" rel=\"noopener noreferrer\">Gynti<\/a>.<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">More goes into it than how much you think a client will pay\u2014though this is admittedly something to consider, especially for beginners needing to build their portfolios.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">One way to determine your hourly rate\u2014a very logical and methodical way (and one I most certainly did not use when I stumbled into freelancing)\u2014is to look at what your expenses will be. These include but are not limited to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Salary<\/li>\n\n\n\n<li>Insurance (liability, health)<\/li>\n\n\n\n<li>Other employee benefits<\/li>\n\n\n\n<li>Employer taxes (freelancers, remember you pay more in taxes since you don\u2019t have an employer covering these)<\/li>\n\n\n\n<li>Office rent<\/li>\n\n\n\n<li>Utilities, phone, Internet<\/li>\n\n\n\n<li>Office supplies<\/li>\n\n\n\n<li>Advertising and marketing expenses<\/li>\n\n\n\n<li>Business travel and entertaining clients<\/li>\n\n\n\n<li>Legal and accounting services<\/li>\n\n\n\n<li>Business taxes and licenses<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">It\u2019s a long list, huh?<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">From there, you can estimate how many billable hours you can manage in a year and divide your total costs by that number.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Factor in What Others are Charging and How Much Experience You Have<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The approach many freelancers use to set their prices is to try to be competitive with other freelancers in their field are charging in their region. (It\u2019s also a good idea to still check your prices against others\u2019 if you did find your number using the logical approach described above.)<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you have friends in the industry, compare notes. Note that we did say \u201cfriends,\u201d not \u201cacquaintances.\u201d Not everyone is comfortable talking about money.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Don\u2019t forget to factor in your experience. You can\u2019t be overly impressed with your work and expect people to pay exorbitant prices if you don\u2019t have the experience to back it up. Are you two years out of school? Don\u2019t expect to charge much more than the average designer. To earn more money, you&#8217;ll have to earn your stripes first.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Remember that you can adjust your rate if what you\u2019re charging right now is no longer a fit for your business. If you get a referral after you\u2019ve upped your price and you\u2019re worried they\u2019ll compare notes, just say, \u201cMy new price&#8230; \u201d or \u201cMy rates increased this year to\u2026 \u201d This strategy works well with return clients you haven&#8217;t seen in a while.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Is it Time to Move on to a Flat Rate?<\/h2>\n\n\n\n<figure class=\"wp-block-image aligncenter wp-image-7552 size-full\"><img decoding=\"async\" src=\"https:\/\/getflywheel-images.s3.us-east-2.amazonaws.com\/uploads\/2015\/01\/4916016221_39cf4b32a1_b.jpg\" alt=\"a receipt for bike repairs taped to the frame\" class=\"wp-image-7552\"\/><figcaption class=\"wp-element-caption\">Image courtesy of <a href=\"https:\/\/www.flickr.com\/photos\/coffeemakesitbetter\/\" target=\"_blank\" rel=\"noopener noreferrer\">Jason Finch<\/a><\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">After spending lots of time in the industry, you&#8217;ll have a pretty good idea of how many hours, say, a website will take, especially once you&#8217;ve had an in-depth conversation with a potential client to define the scope of the project. Simply multiply the number of projected hours by your rate.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There are a couple of benefits to setting a flat rate. For one, invoicing is a cinch. Another is that a potential client knows exactly what they\u2019re signing up for. The only caveat with this is that you must must MUST clearly outline the scope of the project. For example, if outside costs, like stock photography or hosting, are not included, make that clear.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Of course, you could end up eating a lot of hours this way. If things go really badly, you could lose out on a flat fee. You have to keep a good reputation, and, hey, you\u2019re a nice person. So if the client is super unhappy, you\u2019ll do what you can to make things better. But this can occasionally take a bite out of your hours.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Track ALL of Your Time<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Even if it feels too depressing to figure out what you\u2019re making per hour on a project that you underbid just so you could land it, track your time. And don\u2019t undercut yourself by saying, \u201cI\u2019ll just throw this in for free.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">No. Write it down. Even if you decide to discount the amount later, track it now!<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Why? Because you need to know how many hours you\u2019ve put in on your work. That way, the next time you try to estimate how much time a project will take, you\u2019ll have a better grasp of what you\u2019ll actually need.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the end, pricing is a lot like design\u2014it&#8217;s subjective. Decide on a number you feel comfortable saying out loud, say it with confidence, and continue to adjust as necessary.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Here\u2019s to a new year in the wonderful world of design! To start it off right, maybe now\u2019s the time to figure out one question once and for all: How the heck do you charge for your work? It Hurts to Not Have Good Pricing in Place Whether you\u2019re an independent contractor or a new<span class=\"tile__ellipses\">&hellip;<\/span><span class=\"tile__ellipses--animated\"><\/span><\/p>\n","protected":false},"author":1,"featured_media":147268,"template":"","resource-topic":[1396],"resource-role":[1397],"resource-type":[916],"class_list":["post-7537","resource","type-resource","status-publish","has-post-thumbnail","hentry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How to Set Your Rate as a Designer<\/title>\n<meta name=\"description\" content=\"It can be hard to know your worth as a designer. 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