Or pricing yourself into Bankruptcy….?
Web Designers, developers and creatives are often asking – How much should I charge?
How many times have you heard the following or something so similar it will make you laugh out loud?
‘Could you do this (Logo, Website, Branding), for free as we are a small start-up selling pink widgets and we know there is a market for pink widgets but we really do need to test it and can’t afford to invest too heavily in our web site or brand (even though it is our only point of sale) so if you could just give us your best work and we’ll tell everybody we know that you did the website for us and we are very grateful. You can replace this with ‘I have a few websites on the go and real good connections with other people so if you give me a massive discount on all three of my websites I could put the word around for you’ and similar other well known ‘Please do it for nothing’ type requests.
AND, how many times have you fallen for these lines because you really need to develop your portfolio and this seems a great way of doing it.
Simply put, most people out there want something for nothing, it’s the way of the world, free this, discounted that, buy this, get this – etc, etc…
BUT, we all have to make a living right? – RIGHT!
So, how are you pricing your work?
As a former caterer I know about mark ups – boy do I know about a mark-up!
Buy a bottle of wine at $2.00 sell it at $15, buy an egg at 5c sell it fried, scrambled, poached at $2.00
You go to your local coffee shop a cappuccino costs them around 50c including the damn paper cup but you’re pretty happy to spend up to $5 on it because you love it, you see value in someone taking the trouble to get it ready, make it to your liking and serve it to you with a smile.
Of course the coffee shop, restaurants, bars and eateries have a cost base, plates, cups, knives and forks, staff to serve you and somewhere for you to sit AND it’s convenient – the price includes all that doesn’t it? That’s why you are happy to pay. AND, so is your web, branding, logo client – you see them in there all the time, giving it the large (English Saying) about the next big thing, waxing lyrical about their next big idea and telling all their friends that they are going to change the world with their pink widget – and all the time paying $5.00 for a coffee and $3 for a chocolate tiffin – why, because they see value, they see that they can sit there and talk about their projects with their friends, drink their coffee and eat their tiffin in comfort and plan for global domination!
How is this relevant to your design business?
Think about it – A restaurant or bar needs your custom all the time – yes they have the one time visitors, yes they have the walk ins and have to deal with that too but, they rely on regular, sustainable, REPEAT business, they NEED that business to keep ahead of the game and to be able to cover their overheads, they rely on John and Jane coming in and having their cappuccino and tiffin – every single day.
So, is it about time you started thinking about how to sustain your web design and branding business?
Of course it is…
From the start, make sure you ask the right questions, make sure you know the client better than they do and make sure you know what they want – you are not simply about building a website with a write home to your grandma knockout, bleeding edge design – no, you are about supporting your clients through innovation, knowledge and skill.
If you value your clients from the start, they will learn to value you. This business is full of people that don’t know what they are doing, they might know the basics of how to put a web site together or how to design a logo that is relevant but no ONE person can know everything about the digital marketing world we are in. You need to team up with freelancers that are the same as you but – different!
SEO Experts, Social Media Experts, Copywriters, Designers and PPC advertising experts – you’ll have to dig deep, kiss a lot of frogs and eventually you as a freelancer will have built a team to be proud of, a team that only gets paid when they do some work with you and the more work you pass their way, the more work they will pass yours and you will eventually build up a sustainable, profitable business. As your clients get to know your value, they to will pass on your skills to their friends and colleagues – it is the oldest form of networking – take full advantage of it!
Your clients will know that you are the go to person for everything that is web related, you can SOLVE their PROBLEMS and you can charge them a reasonable, profitable fee because YOU and YOU alone have helped them build their business. Your clients will also know from the very beginning that you will charge for every aspect of work you do for them, they will know that they cannot ask you to do them a ‘favor’. The will know from the very first conversation that you mean business and they better had too or they can go and take a running jump off a pier!
In the end, the way you charge for a website or logo/brand is irrelevant – what you do for your customers is not. If you have a unique message – make sure you tell it – if you are simply a web designer – you simply won’t last in this ever changing, ever adaptable and ever increasing circle we call the world, wide, web!
Here’s my costing model:
My cost base /by hour X 5 – Rent, Rates, Heat, Light, Power, Software investment, Computer hardware, dev site hosting – anything else that costs you money to run your business
My outsourced work x 2 – Simple one there.
My outsourced Hosting x 15
I work on a reseller account that gives me unlimited hosting of unlimited accounts – We currently host 130 sites at a cost of say – $1 a site per month x 15 = $15 a month x 12 = $180.00 x 130 = $23,400 – now that covers a bit of overhead huh?
Built in here is the odd phone call telling you that they have changed their phone and lost their email password and can you help them format their iPhone (latest) even though you don’t have one and have not got a clue so you will have to do some research!
Or the client that calls you and tells you he can’t get his email from his computer – and after checking his settings, password and pretty much anything else he needs to check you ask him to go to his web mail – and then he says – oh, I can’t get on the internet as we are still waiting for (phone company) to connect him – (Biggest Face Palm EVER!)
As an example you can start here and work backwards – but these prices represent an average across our industry around the western world.
Starter website $1950.00 – 5 Pages plus a contact form plus hosting as above
Medium Website: $3850.00 up to 10 pages and a couple of complex forms – hosting as above
Ecommerce Website: $7500.00 – Singing and dancing
Now, these prices may seem a little high or a little low – the simple truth is that a website is worth more than you can imagine. Umpteen meetings, a proposal that takes hours, outsourcing for really techy stuff and a built in wait for payment, images, text content etc…..
If you don’t want to do anything other than web design and not get involved in the WORLD WIDE WEB just make sure you value you, set some goals and Your skills, talent, knowledge which have been built up over time will be valued – never, ever let anyone dilute that – never let people tell you your services are not worthy of their hard earned dollar – as soon as someone wants to dilute your prices, they are half way down the road of not paying you at all – be brave, be strong and kick the tire kickers into touch!
But, remember to share – there are people out there that are literally dying to work with you – reach out and stop burying your head in your work and share the load – it will be worth it in the end.
Hi Andrew. I’m working in New Zealand and our pricing is not very different from what you sketch out in the article. As for my own work I add value in working out a web strategy and how the site fits into it to create leads, whiich is what most businesses want.
I charge separately for that consultancy and have a post-grad business degree to anchor my fees.
I do not pursue the low-cost clients who start out trying to nickel-and-dime you, charge out all costs and set terms and conditions for ownership (when fully paid) and payment (50% deposit, balance in 30 days). By making this clear at the start I don’t run into problems later.
I would recommend a monthly income beyond hosting – as lucrative as that seems – and usually insist on a maintenance package. This can include traffic monitoring and then generate recommendations for improving SEO and other marketing.
It is vital to set up repeat business and an ongoing regular income. Some of your readers might also benefit from watching this video: https://youtu.be/jVkLVRt6c1U
Nice one. This helps me alot for preparing myself when someone asks “How much will you take for a website?”. Thanks
the article was fabulous! In Fort Lauderdale, which is a strange bird, I constantly fight the _web.com, _wix.com, etc. “free” design. It doesn’t matter how much they charge for a monthly fee, the design is free. Any suggestions on how you over come that? Again, great article.
Thanks Patricia – To be honest I generally say – no problem, go for a Wix site – we’ll be here when you need us – it sound arrogant but it generally works.