One of the main questions freelancers ask is what amounts they should charge their clients when they provide services to them. After all, you do not want to undercharge because it will result in losses, and overcharging makes you seem like you are overestimating the value of what your work actually is.
As time goes by, you will eventually find a balance of what to charge your clients, through the use of several guidelines. The price you charge when you are a freelancer will not follow one rule alone; but instead, it is a blend of hourly rates and the value of the service you offer.
We will discuss them in this article, and they will hopefully help other freelance web developers to charge rates that are both fair and profitable – as well as doing it with confidence. In addition to this, keep in mind that the same rules can apply to other freelancers like freelance web designer from dormzi or other agencies as well.
Know your budget (factor in the taxes and income necessity)
Assuming that you make regular budgets (and if you do not, now is always a good time to begin), you already have a solid idea of how much money you will need every month to survive. If you are unsure, check the amounts you spend on bills, travel, food, and so on, which allow you to live at a comfortable pace, and that should be the expenses you have every month.
Keep in mind that the taxes you pay should be factored into the expenses. Calculate the total expenses for the year (on average), and then divide per month to see how much average income you should make for each month, and each day of the month. When you figure out your daily rates, you should then set it in place that you will not take projects for less than that amount – subject to regular reviews.
The length of time you will spend on the project
Once you decide on your average daily rate, the next question to answer is the length of time the project is taking. For instance, will it last for a week, or a month? Using the daily rates you are getting, this should give you an idea of the total amount to charge for the work you are doing.
While value based pricing methods may seem like they are making you miss out on the actual value of your work (because you are not using an hourly rate), they are not as bad as you assume. You should think of them as guidelines to use when charging clients, as they take objective factors into account.
This is even more challenging to do when you offer a service like web development, because much of the pricing you do is relative. That brings us to the most important guideline, which is:
The question of your value and experience level
Once you already know the threshold of your financial charges and applied it to the project timing and length to get the total numbers, it is now time to consider your experience on the job. This presents a problem though – for a new web developer, it takes more time to finish a project, compared to a more experienced web developer, even on a freelancing basis.
For instance, if a client wants you to make a landing page for their website from a PSD, then you can do it in a few hours if you are very well-versed in web development, while a new developer will do it in a day or a few days.
If you go ahead with the other two criteria in terms of charging the client, then it means the new developer will get a higher payment than the experienced developer, which ultimately makes no sense. This is why value is the next factor to consider. In order to determine the value you offer, it is important to answer several questions:
- Your knowledge of the system/framework/language you are using
- The value you are adding to the project compared to other web developers
- The knowledge your client has on the system/framework/language
You can then add your own value, depending on the experience you have – more knowledge allows you to charge more.
In conclusion, it is important to consider these 3 factors when charging your clients in order to remain successful and honest with your estimates.