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But all this is veering off topic. How do we ease the blow on price quotes? Some of the reasons given for justifying inflated salaries just don't cut it for me.
I honestly don't care whether a template took you 1 or 20 hours to design, so won't be swayed by how much cheaper a package is than if you had charged hourly. I just want a template that works.
I also want a fair deal- if I can get a similar quality work for half as much, I'll feel like I've been taken advantage of. It's also of no concern to me that you feel it unjust that a dentist or a plumber makes more money than you.
Breaking things down in categories seems to have more potential, as long as clients are educated about the importance of seo, design, etc... Perhaps a brochure / page that explained all these things you do would help? References from clients, especially some that have also dealt with other designers in the past, would help as well.
But what adds value that the client already perceives?
One thing many clients worry about is how much the site will cost to maintain. The retainer seems like a neat idea, but I would be wary. How about charging $300 the first year for hosting, and giving them a web-interface where they can make their own changes to the text? Unlimited changes, no extra charges, they retain control. The $25/month can be indefinite, which more than pays for hosting. Clients usually love this, and you don't have to do 5-30 minute jobs 3-4 times a month. $300/yr == $25/month. Hosting + ~1 hour of work for $25? No thanks!
Many clients don't balk at my asking a 25% commission of their online sales. If I make more money it's because I've created tangible value for them. Others happily pay as much as 50%.
For certain types of consulting work, I'll charge hundreds of dollars a day, 1 day minimum. Unfortunately, that doesn't happen often :(
But my approach is pretty simple: I try to figure out what is of value to my clients and prospects. I started doing e-commerce sites because one acquaintance complained that her US-hosted shopping cart did not support multiple currencies, and did not correctly charge taxes on shippping. I could have talked to her about hours trying to convince her of the necessity of SEO, the importance of fast-loading pages and sleek design to no avail. All she wanted was a solution that would handle her two pet peeves.
If you create extraordinary value, then I'll have no problem justifying paying you accordingly. If we have pat answers that don't really convince, we should not be surprised if people take their business to India (or go to Mexico for dental work).
...are there dentists out there that charges $7/hr?Would you really go to a dentist who only charged $7/hr? Would you even trust a professional plumber who only charger $7/hr? I know a lawyer who early in his career riased his rates and found that he got more clients as a result. With almost any professional, unless there is an unusual reason for extreemly low rates (free is a special case), most people wouldn't trust someone who charged way too little. People expect to pay for professionalism and assocciate price with quality, to an extent. As the saying goes: "You get what you pay for."
A balance needs to be met between price compitition and the message a low price conveys. Since I'm still trying to build a porfolio, I have reasons for charging a lower rate than I should for my skill level, but I see no reason to even try to compete with those who chagre very low rates and produce garbage. They are not my competition so much as those who charge a moderate rate and produce garbage. (As far as producing garbage goes, you would need to pay me a very high amout before I would be willing to produce garbage! If I can't stand behind what I produce, the job isn't for me.)
If you project professionalism when interacting with a client, the client will sense it, respect it, and to some extent, be willing to pay more for it.
I try to avoid breaking down the hours for each subtask. Instead I'll itemize the tasks and give a total number of hours at the end. Also, some tasks always have a fixed price with me. How detailed I get varies from client to client, but recently I did give a very detailed breakdown to someone because I knew they'd balk at the price if I didn't. Most people have no idea how much work goes into it.
Two things to emphasize are time intensive tasks and skill intensive tasks.
As an example of a time intensive breakdown, say someone wants you to "whip up" a photo gallery. Not difficult at all, but there's a little time involved so I might break it down into micro steps to convey that:
- scan 600 photos
- crop and color correct each photo
- resize photos to create thumbnails
- convert 1200 photos (fullsize + thumbnails) to web-optimized file format
- create gallery PHP script
- HTML markup
- enter photo captions
- create "gallery" navigation button
- edit every page throughout the site (28 pages) to include the new navigation button
Example of skill intensive breakdown as part of a site design proposal:
- optimize images for fastest possible download times
- create spider friendly directory structure and URLs to assist in SE indexing
- optimize pages for SE indexing
- optimize pages for better conversion rates by adhering to standard usability guidelines
- ensuring that the site is accessible to the widest possible percentage of the target audience through proper coding and design practices
Of course the breakdown should include both time and skill intensive tasks whenever possible.
Some other ideas: testing and debugging, preliminary research (which can also be broken down), consultation time, etc...
Seems like a lot, but like I said most people have no idea what goes into it and the value of the knowledge you bring. We take a lot of things for granted but they actually came from years of study and experience and add immeasurable value to our work. In many cases it can make or break a project.
I asked a business partner. He scripted it, and did it all of that in 15 minutes, plus intermediate size ones.
I know I'll start to sound like a broken record, but sometimes the amount of work you put into something has a very poor correlation to the amount of value clients get out of it.
My wife started her own business about 3 years ago, and was priced very reasonably. The problem was that she was uncomfortable asking people to pay her prices because she really had no business experience.
Now that she has 3 years of experience running her business, her prices are 300% higher (about average for the competing businesses in the area) and she has no problem getting people to hire her.
What it boils down to is how confident you are in yourself when you present your work and pricing. Don't hesitate to ask what you think you are worth, and don't be intimidated when people ask questions. After all if they knew how to do the work themselves, they probably would do it themselves.
If they were not interested in your work or talent, they would be talking to someone else. Present your prices to them, and explain what is included in the price. If they complain or ask for a deal, you really don't want to work with them anyway. Cheap clients always demand more work.
For piece work which is very quick ("He scripted it, and did it all of that in 15 minutes") you can use a per item price, with volume discount.
As someone suggested earlier, Show them the full price, then show them how much there savings. Verry often, how much you "save" is seems more improtant than how much it costs. It's an old marketing trick. Just don't over do it, because then the client thinks your playing games and looses trust in you. If that happens, it's probibly time to look for a new client. Mind you, I'm not saying cheat the client; never do that! All I'm saying is allow for barginning room. If you feel you settled on to high a price, you can always thow in a few "feebies", which is something you can do anyway to make the client feel he's getting an even better value.
jamesa- no offence meant, but I asked my designer what the fee would be for creating thumbnails of 128 images on my site. I balked- CAD$250!?!?
I asked a business partner. He scripted it, and did it all of that in 15 minutes, plus intermediate size ones. I know I'll start to sound like a broken record, but sometimes the amount of work you put into something has a very poor correlation to the amount of value clients get out of it.
i think i'm starting to understand better where you are coming from. if the above example is somewhat typical of what you are saying, then its certainly more cut and dry. after a time in the industry (and constant education and experience gaining) most designers (and developers) can create thumbs in a matter of minutes. that particular person perhaps/maybe (?) is unaware of the multitude of programs that take away the manual labor and therefore charges high ( :) ). i see now where you are coming from, although we each hold our differences in business style. i don't typically do maintenance contracts, but the clients contact me when they need updates. maintenance contracts do work well for others tho.
all this means its really tough for the client who is unfamiliar with what it takes to produce that final product! charge them by the hour and they do not know if a simple form will take you an hour or 10 hours. they may end up paying above and beyond.
Now that she has 3 years of experience running her business, her prices are 300% higher (about average for the competing businesses in the area) and she has no problem getting people to hire her.
i think that is perfectly reasonable and perfectly professional of her. its a good thing she recognizes her value.
as for jamesa's example of breakdowns, that is precisely what i provide. the client may never understand a word of it, or they may examine it with a magnifying glass, but either way they have another tangible to justify the costs. its a sort of 'this is what i did with the time you paid me for' breakdown.
Some so called designers who work at $50 an hour and churn out boiler plate designs that are overvaluing their work. Others who actually make sites that build brand image and contribute to conversion to a sale can be excellent value at $300 per hour.
I don't care how many bells and whistles and fancy new fangled widgets a site has if it can't sell.
A site that actually fits its target audience like a glove can be as simple as can be with no gizmos at all, and still be worth its weight in gold.
Of course, my prices are inversely proportional to how hungry I am :-) It's a free market. Charge what you want, but just remember that there may be someone out there hungrier than you...it'll keep you honest.
Regarding plumbers: No one NEEDS a website, and they normally have time to shop around. But when you need a plumber, you MUST have one. And when you need a dentist, you need one NOW.
Puts rates in perspective when you think like the customer...
It also helps that plumbers, unlike "web designers" don't undercut each other by one or two orders of magnitude.
I would however recommend against comparing your product to a brochure. Maybe you could compare a website to a large color advertisement in the yellow pages, since people looking for "widget seller in my city" are essentially a similar type of pre-qualified lead as you would get from that medium.
Or if you insist, compare it to a glossy brochure that is printed on demand, and factor in the cost of mailing it to people as they request them. Remember to count a human's time to handle those requests. 10,000 requests a year -> $20,000 total costs.
We know the medium, we can compare it to whatever we like (within limits) if it makes the cost more palatable to the client. So let's compare ourselves to expensive stuff! :)
You think $100 to do a few "easy updates" to a site is too much? Well, how about paying $150 to have a tiny, 1/8th page ad run for ONE DAY in the local newspaper? Whereas your edit can stay up there 'til the end of the world.
Sure, the newspaper gets more "impressions" than the website - but I always point out the fact that people visiting your website are INTERESTED in your product/service (they searched you out, right?). Who wouldn't rather get 100 interested people instead of 10,000 uninterested ones? Converting some of them into leads is your business - however, compare it to the one-day ad in the paper, and converting isn't likely to be much worse no matter how "bad" your website is.
As I'll railed before in another thread - everyone from low-end clients to designers unsure of themselves forgets that $100/hr (or whatever) is NOT making $100 for doing that little 1 hour job.
There's 2-3 hours UNPAID that goes into EVERYTHING you do (see, that includes time posting these rants. *L*) Your "hourly" rate has to take that into consideration. That's why our furnance specialist charged us $79.95 for the last 20 min. service call they did... they have to payroll people, pay for tools, vans, and so on. Worst of all, they physically can't do more than 2 jobs an hour, unless they're right beside each other. There's a ton of overhead in those businesses: I don't envy them one bit. (Although we have it overhead too, don't think we don't.).
Both you and your clients have to move away from those numbers, and look at the whole of the service and the value.
And in the end, if the website you're making does NOT create ANY value for your client - "they just need one, everyone else does" - then NO amount of money is worth spending - $10 or $10,000.
Really, every one of us should be glad about the $7 an hour Indian firms, and the like. They're sucking the clients who don't know value and/or are trouble to work with away from us, and leaving us with the good clients. With any luck, they'll learn the hard way, and the prices will start to go up... of course, then the industry will just move to China, or North Korea, or where ever else... :-)
This is my first post on this forum, so please don't be offended if this isn't appropriate.
For anybody that wants some more "involved" information on pricing and ethical guidelines in the world of "design" (including web design of course), check out this book:
Graphic Artists Guild Handbook : Pricing & Ethical Guidelines
Of course, any of the pricing guidelines in this book need to be taken with a grain of salt, and perhaps adjusted for geographic and market conditions. And, of course, there are other books covering these subject as well. I'm not even sure if this is the best one, but I found it to be great.
For those who perhaps aren't sure how to take their self image, as professional designers, to that "next level", this book contains a LOT of very unique and valuable information. It addressed many holes in my own knowledge of doing business...things that otherwise you could only really learn "in the trenches" over years and years (as far as I know).
I am quite a bit more confident about the value my skills can bring to clients (and how to communicate that value to them) as a direct result of reading this book. I have, of course, learned a lot from real work experience too, but there are things in this book I may not have learned for a long time otherwise.
BTW, I don't normally plug products like this, but it seemed to be pretty appropriate for this thread, and this book isn't the kind of thing most self-made designers would look for of their own accord, even if they would benefit greatly from it. Also, the more more professional designers that read this book, the better off all of us (and our clients) are.
Anyway, it was a nice surprise for me to discover. Hopefully I can pass on the pleasure with this post.
[edited by: stuntdubl at 9:43 pm (utc) on May 8, 2004]
[edit reason] de-linked url [/edit]
There's another out there that I've back-ordered - if it proves to be any good, I will post it to the board.
My boss, of course, is the mother of my children, and keeper of the household accounts. She never fails to take a verrrrrry practical perspective: ie. "Do you remember how may changes Mr. X wanted you to make? and how you swore oaths that you would never let anyone devalue your work and your time and talent again?"
She also is good at reminding my that the Natural Gas supplier, the Electric Company, the Grocery store, and the Filling station are not willing to negotiate a lower price for her, or unlimited "free" updates to our freezer compartment.
Believe me, I'd rather explain my charges to a balky client and give him a reason to feel better about paying me a progressive deposit that explain to her why she can't buy shoes for little Oswald.
Perhaps there is someone in your life who can help you enormously by "reviewing" your proposals before you make them.
And yes, I know that your need of money is not the only factor in setting prices, but if you want to do this to feed your family, then it better be a large consideration.
The best advise I ever received on dealing with price was to turn it around and talk in terms of investment. IMHO, too many people I see in the web design world act like they are commodities. If you discuss the investment with your clients, they will begin to see that what they are asking for has a life and expected performance value.
The other thing I would recommend is getting some sales training. The two things that salespeople have the most difficult time succeeding at is closing and overcoming price obstacles. There have been a ton of books and courses written on the topic. You might just need to brush up on and enhance your sales skills.
I've read a number of posts in this topic about the actual pricing of web services and not how to sell them.
My 2 cents.
You will never see the super successful competing for a client. They take it off-line, lead the client towards a decision to pay their price, and quickly walk away from the low-profit opportunities. Confidence is key.
Never say "that would cost $$" but instead say "I can do that for you for $$". Whether you like it or not, you need to let the client choose between YOU and THE OTHER GUY. If you alow the client to choose between YOUR PRICE and THE OTHER GUY'S PRICE you are selling yourself short. Of course, if you never get chosen, you need tolisten to that and do something about your presentation.
I would say it would be fairer to compare 'web-design' with hairdressing - since nobody 'has' to have a hair-cut, you just end up looking like a muppet. These days, in business, if you don't have email and a website, then you look like a muppet.
If you go to the cheap hair-dresser, and they screw up, and you end up looking like something from a Tim Burton movie, then you got what you paid for. If you go to a slightly more expensive hair-dresser, and they do a decent job, then its worth the extra money, because you don't look like a freak. A website which looks the business - and importantly, does the business, is well worth it (as somebody said above).
Hair-dressers aim for repeat business, just like web-designers should - although, going back towards the start of the thread, I don't have to keep my hairdresser on a retainer!
I personally seem to be asked a lot of questions about general computing matters, like 'How do I do x in outlook' etc.. It's difficult to charge for this time, just like some hairdressers give free advice about certain aspects of their trade, like colouring, or style etc..
again, just my 2ps worth..
<added>Something else which would be quite amusing, would be to think about the cross-browser issue with respect to hair.. perhaps if you went out on a tuesday, your lovley hair might turn purple, or if you went out in direct sunlight, all your hair might fall out, and so on..</added>
There is a lot of repetative code from site to site. Take navigation for example. The code to go from page to page should start with a template or a cut and paste. Style sheet templates should exist and modifying them for a new color scheme or font should not take much effort.
You may in fact be charging to little. Be sure to make a list of things along with their counts when you estimate a project. When you present your estimate make sure you list all the things you are expected to do. And make sure you list all the things the client is expected to do and where appropiate an estimate for you to do some things instead of the client.
I worked on automating some Human Resources policies to be put online. The concept was that I was to be give rich text pages completely spell checked with the grammar checked. What I go was an old printed HR manual with corrections noted in it.
Since I had offered to take this kind of work in my estimate, the client had no problem paying the rate I asked. If I had just given a flat-rate for the project and then had to add this expense, I am sure that the client would have been unhappy.
Remember, everything always cost too much and takes too long unless you are the guy that has to do the work.
I think that the designer / plumber comparisons are counter-productive to our industry as a whole. I personally believe that design has much closer links with advertising and marketing.
As an honours graduate in graphic design, we were taught to think about how to promote and develop a client's brand, rather than just do some nice pictures of their product, which should be as read. Designer's work should look good. Yeah, true. Architect's buildings shouldn't fall down. However I think that this a given of the professional skill that these people have.
the skill which I believe a client should pay for, which is essentially the same as that of those in the marketing/advertising professions,(both of which charge sgnificantly more than the prices that I have seen quoted on this thread) is the way in which we listen to our clients and their needs, and to create a solution accordingly. This ability to develop a client's brand (and subsequent sales) is what I think people are looking for, rather than whether or not to have a 5 or 10 page site.
If I have a meeting with a client, use my professional skills and create a 1-2 page solution that brings in 500% more business, and in the process end up charging more per-page than a site made using a template and stretching to, say 5 pages, yet only ends up bringing in 200% more business, surely I'm doing my job?
My minimum for a web site is $1000. It can be one page or 5 pages. More than that, I may consider charging more. The point is that it is the first page that takes the most time. After that, it is mostly navigational, and having already designed the "look" of the site, the rest of the pages just don't take that long.
What do they get for that $1000? They get me. I will do whatever I can possibly do for them in order to achieve their marketing goals. Be it SEO, be it brand identification, be it whatever. I also answer a myriad of questions, teach them, guide them, hold their hands. And cheer them on.
No one has ever asked me to justify my fee. I still have my first client who I charged a measley $350. They love me. They pay me alot more now.
My web sites are not html versions of desktop publishing. I have learned what works and what doesn't. They are paying for my expertise.
One of the problems of web design is the issue of "repeat" business. Many of my clients have the same web sites they had when I first designed them. No need for updates. No need for revisions. So I also provide hosting. And in addition, I have added marketing plan development and analysis to my services offered. (that's just a fancy way of telling them what's working and what's not and where they might better be spending their marketing dollars)
The worst thing in the world is a client who sees their web page as a stand alone marketing tool. Those that think that way don't stick with me. And usually end up not using the web anymore after their first year. My experience is that the more I educate them on using the web as a tool in their marketing program, rather than AS their marketing program, the more successful we all are.
I also hate it when they insist on writing their own material. Often it is dry, tasteless and boring as hell.
So, for that $1000 they get my wit, my positive, go- get-em attitude, my design sense, my experience, my expertise, and damn it, it's working!
So I'll keep charging my $1000 base rate, and who knows, maybe in another couple of years I'll get enough confidence in myself to charge more. Time will tell.
I passed along a job a few months ago for a new website for a newbie small busines owner. He envisioned a 5-6 page brochure website. He had no strategy, and little business sense w/r to Internet. He had already allowed a friends unemployed spouse to design his site, and recognized it was a horrible experience.
Why is this important? He is in Denver, and shopped a few design houses. The bids were $2300 to $3000 for a 5 page static html site, from template, with minimal graphics work (just what I would consider basic support stuff). No support, no hosting, just design and post. He paid at least $2500 for what I consider to be a poor brochure site.
So $1000 is too low.
For those working from home,
At the end of the year when you add up your revenues and take away all costs:
Those expenses associated with specific jobs: bought and resold items, scripts, resold promotions, any subcon work, hosting for their site, travel to and from, phone calls,
Those general costs of being in business: equipment, computers, printers, modems, perhaps cameras, scanners, software, various licences, updates,subscriptions, stationary, postage, print cartridges, misc supplies, additional insurance premiums, time & costs spent training, office space (yes even at home), heating lighting & electrics, some of which are general expenses and others you may consider to be capital investments
How much do you end up keeping as your hourly rate for your years work? and how does this compare with the plumber again?
Re plumbers and websites I like that analogy:
They do not only do emergency work you know.
We all have to learn our lessons somehow I guess :-)