Great post today by Greg Hoy from Happy Cog regarding project budgets - Bloodhounding Budgets. Budgets are never an easy topic to jump right into, and there are many stigmas we all carry when it comes to cash, especially us creative types. I remember when...
Great post today by Greg Hoy from Happy Cog regarding project budgets - Bloodhounding Budgets. Budgets are never an easy topic to jump right into, and there are many stigmas we all carry when it comes to cash, especially us creative types. I remember when it was unheard of to wear anything other than salvation army purchases to class and bragging rights went to the person who had the cheapest rent for the biggest warehouse space. However, those art school college days are behind us, and you're smoking the pipe if you think money and budgets can be left to worry about "later".
People appreciate it and it saves everyone headaches if you talk budgets and money up front. If you know you don't want to deal with a "barter" project, or that you can't do a freelance website for less than a certain dollar amount, be direct about it. You can say something like "I want to be up front with you before we go into too much detail and let you know that my hourly rate is “$$” and the project you are describing will probably require a budget range of “$$-$$”." This gets it out there and lets the client know right up front what the parameters are. Clients worth pursuing will respect that.
Don't Shoot Yourself in the Foot!
If a client is pressuring you to give them a ballpark, you can let them know you will be reviewing their requests and putting together an estimate or proposal in the next few days. This way you won’t be held to a price you blurted out in haste, and you'll have time to think through the complexities and offer a realistic price. If you are new to this business and you don't have any idea what to charge, set a benchmark that is comfortable for you, and never give a set price (or even a ballpark) on the first call or meeting.
If you're starting out - it's true that many young designers got their portfolios developed by offering bargain prices in exchange for the client’s risk of going with someone new in the industry. It's a give-give situation, and if everyone comes out happy, then it's a win-win. You can’t place a monetary value on the importance of word of mouth referrals so you need those first few clients to love what you do and to tell all their colleagues. If you can get referrals out of cheaper work, and slowly increase your fees, you’ll be better off than someone who never gets the projects due to inflated prices. Keep in mind, this is a good approach if you are getting started, but things need to change once you’ve got yourself established.
What the Client Will Bear
At the end of the day, pricing for website design and development is just as challenging as trying to estimate the value of an oil painting (I know, I'm also an artist). You need you time and your team's time to be paid for. As you gain expertise, your prices go up. As you become more in-demand, prices increase once again. As you get better at knowing how long things will take, you tend to stop under estimating (ahhh - how lucky those early clients were!). And it goes on from there in a natural way, but you can only charge what the market (client) will bear. This is when you need to think long and hard about the work you go after, the time you spend meeting with prospects, and the projects you provide proposals for. It's a balancing act, what can I say - except good luck and happy negotiating!