49 min
Setting Your Hourly Design Rate Resourceful Designer: Strategies for running a graphic design business
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- Design
What's your hourly design rate? What you should charge as your hourly design rate is an often debated topic amongst designers. Everybody seems to have their own opinion as to how to calculate what you should charge. I guess I'm no different because on this episode of the Resourceful Designer podcast I do just that. I give you my opinion of how you may want to choose your hourly design rate.
One of the biggest issues I see is designers undercharging for their services. They're either not confident enough in their skills and abilities and are afraid to charge a high enough fee. Or they feel they can't charge higher fees because they're only designing part time.
Regardless of how long you've been designing or the amount of time you currently spend designing you're probably not charging enough for your services, but that's the topic for another day.
Today I want to share why you need an hourly design rate and ways to determine the rate that's best for you.
Why you need an hourly design rate. Even if you normally use project based or value based pricing you still need to know how much you are worth per hour. Even if it's just to know whether or not you are under or over charging on your projects.
You also need to know how much you're worth if someone asks you for your time. Perhaps as a design consultant. Without knowing your hourly rate how will you know what to charge for your time?
What determines your hourly design rate. Your hourly design rate depends on many factors and differs for each designer. Where you live, what sort of clients you're going after, your experience, your skill all play factors in determining what you should charge.
Specializing in a niche can also play a factor. A designer who specializes in a certain industry should command higher prices than a designer not familiar with it.
All of these things should be taken into considering when determining what your hourly design rate will be.
Determining your hourly design rate. Ok, here's the nitty gritty of it. Ways for you to determine exactly what you should charge per hour. You will need to decide which method, if any, is best suited to your situation.
Guess It sounds crazy but guessing is actually a pretty popular method used by many designers. I'm not saying it's a good method, just that it's a popular one. Some designers simply pick a number out of thin air and use it as their hourly design rate. Most of the time the number they choose is much lower than they should be charging but guessing is a viable option for choosing.
Spy on your competition Tried and true for generations, spying on your competition is an easy way to judge what the going market is for designers in your area. Simply call them up, or have a friend do it for you, and request quotes. Use those quotes to determine what they are charging and to set a baseline for your own pricing. Adjust as needed for experience and skill and then start hunting for clients.
Research industry averages There are many organizations that compile design salaries around the globe. The AIGA and RGD are great resources in North America. Research what designer in your area are making and base your hourly rate to match.
Calculate your hourly rate Probably the most accurate way to determine your hourly design rate is to calculate it yourself.
Add up all your expenses including general expenses and labour expenses, savings, etc.. Then estimate the number of billable hours you expect to work each week. Divide the first number by the second number to determine your hourly design rate.
For example:
Your monthly expenses including mortgage, utilities, car payment, fuel, groceries, medication, etc. = $4000/month
A spending allowance for things like movies, restaurants, treats, etc. = $400/month
Money you put aside in savings = $400/month
Total $4800/month
Billable hours you want to charge per month = 80 (20/week)
Remember that billable hours and working hours are two different things. You will only b
What's your hourly design rate? What you should charge as your hourly design rate is an often debated topic amongst designers. Everybody seems to have their own opinion as to how to calculate what you should charge. I guess I'm no different because on this episode of the Resourceful Designer podcast I do just that. I give you my opinion of how you may want to choose your hourly design rate.
One of the biggest issues I see is designers undercharging for their services. They're either not confident enough in their skills and abilities and are afraid to charge a high enough fee. Or they feel they can't charge higher fees because they're only designing part time.
Regardless of how long you've been designing or the amount of time you currently spend designing you're probably not charging enough for your services, but that's the topic for another day.
Today I want to share why you need an hourly design rate and ways to determine the rate that's best for you.
Why you need an hourly design rate. Even if you normally use project based or value based pricing you still need to know how much you are worth per hour. Even if it's just to know whether or not you are under or over charging on your projects.
You also need to know how much you're worth if someone asks you for your time. Perhaps as a design consultant. Without knowing your hourly rate how will you know what to charge for your time?
What determines your hourly design rate. Your hourly design rate depends on many factors and differs for each designer. Where you live, what sort of clients you're going after, your experience, your skill all play factors in determining what you should charge.
Specializing in a niche can also play a factor. A designer who specializes in a certain industry should command higher prices than a designer not familiar with it.
All of these things should be taken into considering when determining what your hourly design rate will be.
Determining your hourly design rate. Ok, here's the nitty gritty of it. Ways for you to determine exactly what you should charge per hour. You will need to decide which method, if any, is best suited to your situation.
Guess It sounds crazy but guessing is actually a pretty popular method used by many designers. I'm not saying it's a good method, just that it's a popular one. Some designers simply pick a number out of thin air and use it as their hourly design rate. Most of the time the number they choose is much lower than they should be charging but guessing is a viable option for choosing.
Spy on your competition Tried and true for generations, spying on your competition is an easy way to judge what the going market is for designers in your area. Simply call them up, or have a friend do it for you, and request quotes. Use those quotes to determine what they are charging and to set a baseline for your own pricing. Adjust as needed for experience and skill and then start hunting for clients.
Research industry averages There are many organizations that compile design salaries around the globe. The AIGA and RGD are great resources in North America. Research what designer in your area are making and base your hourly rate to match.
Calculate your hourly rate Probably the most accurate way to determine your hourly design rate is to calculate it yourself.
Add up all your expenses including general expenses and labour expenses, savings, etc.. Then estimate the number of billable hours you expect to work each week. Divide the first number by the second number to determine your hourly design rate.
For example:
Your monthly expenses including mortgage, utilities, car payment, fuel, groceries, medication, etc. = $4000/month
A spending allowance for things like movies, restaurants, treats, etc. = $400/month
Money you put aside in savings = $400/month
Total $4800/month
Billable hours you want to charge per month = 80 (20/week)
Remember that billable hours and working hours are two different things. You will only b
49 min