Recently, Sarah asked in the comments of a post:
Do you happen to have a post on how to price out commission works for clients?
I asked Sarah what type of work she does:
I work in production at a custom wedding/event business but recently I just hand lettered an entire invite suite (invite, guest info,RSVP) plus envelopes addresses, and then I also do seating cards, table numbers, food signs etc.
There are a couple of things to consider when charging your clients for creative work with deliverables (gah, what a corporate-y word, I apologize), whether it's digital or products for an event like a wedding, etc.
Things to consider
- Your level of expertise.
- How long you think it will take you.
- How much materials will cost.
- If you need to live off of this money.
- How much others in your industry are charging.
These are all things that you need to take into account when you quote a client.
Most of my freelance client work is for websites and blogs, so I will only touch on cost of materials, but can say that any expense you have for your business (even if it's for computer design software or an invoicing service), you also need to factor those into your cost of materials.
I'm going to work backwards in the scheme of things to consider.
The best place to start is to see what others in your industry are charging
Looking to do calligraphy for wedding envelopes but have no idea where to start? Get networking. Research and see who offers services on their site. If they don't post prices on their services page, send them an honest email introducing yourself and saying that you're just getting started in the industry. While you can't expect a response from everyone you email, you will at least get a couple of emails in return and can go on from there. Keep your first email short and sweet and work to build a genuine relationship with these freelance mentors as time goes on.
Keep track of who you reach out to, how much they charge, and what services they offer. You can do all of this in the free printable worksheets I've created for you—available at the bottom of this post.
Do you need to live off of your freelance income, or do you eventually want to be able to?
Charge accordingly (build in prices for your office space, electricity, monthly bills related to your business, etc). While this may set your prices much higher than folks looking to earn a couple of bucks, this will also subconsciously tell your client that you're serious about your work and where you want to take your craft.
You'll need to calculate in all the important stuff: personal expenses, business expenses, and how much you want to be saving for your savings account and retirement (adulting is hard!). Factor that in with the income you're already making from your day job or through other methods, and then use that number to figure out how much money you want to be making from client work. Your combined income should equal (or ideally exceed) your monthly expenses!
The downloadable worksheets I created will help you think of all of your expenses and income.
How much will your materials cost?
Make sure to build the cost of materials into your price quote. Whether you choose to charge your client on a line-item basis (i.e. saying $10 for ink, and $3 per envelope, and $20 for nibs - I'm shooting in the dark on calligraphic pricing here) or choose to build materials into the lump sum, definitely take this into consideration, as well as your time and gas money spent getting to the store, etc.
How long do you think it will take you?
This item goes hand in hand with expertise. So: expertise. The thing you need to focus on most here is what you can deliver.
The beautiful thing about freelance work is that you can learn a lot while on the job. If you really don't feel comfortable charging your client on an hourly basis because you know you'll be spending a larger proportion of time practicing or perfecting your workflow, then charge a flat rate. More on this below…
Having charged clients on an hourly rate as well as a fixed project rate, I've often been unsure of which is better. In the beginning when I was learning as I was going, a flat rate was more reasonable for my clients. As I hit my stride, an hourly rate started to seem like a better idea. But now that I've been designing for quite a while, a flat rate is easily the best way to go.
Why? Because of value-based pricing. For example: a client may want a website that will literally take you 3 hours to complete. You could charge your normal hourly rate of $50/hour which would be a very reasonable invoice of $150. However — If you charge them $1500, that may seem ridiculous, since you're ultimately getting $500/hour. But that website will generate something that is incredibly valuable to them: the website allows for them to have a branded web presence for customers to learn more about the company and the products they offer. So the value that you're handing them with their website is quite large, and needs to be charged accordingly. (Remember before when I mentioned that this type of pricing will subconsciously influence your level of professionalism?)
If you aren't convinced, listen to Sean McCabe's podcast about this.
Another vague but important thing I've learned along the way: don't send a quote unless it makes you a little uncomfortable to ask for that amount of money (especially if it's comparable with the research you've done).
Closing Thoughts on How to Charge Clients
The biggest takeaways:
- Do your research and network
- Think about where you want to take your freelance business
- Think about how you want to be perceived. Offering a lowball price to your client may make you seem like an amateur!
Free Bonus: Download the free printable worksheet pack to help you figure out how much to charge your clients.
Getting started with pricing feels scary, but doesn't have to be. The right client will be flexible with you and will understand if it's your first commission. I've had clients come back to me saying that they wished to pay me more, or that the quote was too high. Again, the right client will work with you, because they are interested in what you can deliver.
How do you charge clients? What advice do you have for pricing?