How to put a price on your work
polycounter lvl 7
Hey all,
Well, I guess this is something we're all dealing with.
When you freelance, and you enter a project, what do you do when it comes down to putting a price on the table?
I've always had this headache.
I never know how much time EXACTLY I'm going to have to work on a project, especially when I'm the one doing designs, which sometimes can drag along for a long, long time, requiring many iterations. But the employers I met so far, mostly wanted one price tag for the entire duration of the process for a freelance work.
I've always found it very difficult to really give a price I feel is not too high, or not too low for me, and most of the time I end up thinking I should have set a different price.
I've never really seen a thread about this in these forums, so if I'm touching a sensitive subject that's not supposed to be discussed, please tell me and sorry if I did.
Either way - I'd love to hear from your experience.
On freelance jobs, do you think it's best to ask for an hourly fee?
Or set a price for your entire work? And if so, how do you do that?
It'd make my life so much easier if I knew how to price myself and feel comfortable with it.
Well, I guess this is something we're all dealing with.
When you freelance, and you enter a project, what do you do when it comes down to putting a price on the table?
I've always had this headache.
I never know how much time EXACTLY I'm going to have to work on a project, especially when I'm the one doing designs, which sometimes can drag along for a long, long time, requiring many iterations. But the employers I met so far, mostly wanted one price tag for the entire duration of the process for a freelance work.
I've always found it very difficult to really give a price I feel is not too high, or not too low for me, and most of the time I end up thinking I should have set a different price.
I've never really seen a thread about this in these forums, so if I'm touching a sensitive subject that's not supposed to be discussed, please tell me and sorry if I did.
Either way - I'd love to hear from your experience.
On freelance jobs, do you think it's best to ask for an hourly fee?
Or set a price for your entire work? And if so, how do you do that?
It'd make my life so much easier if I knew how to price myself and feel comfortable with it.
Replies
Was thinking (so many hours) for (so much money) and if it goes on longer than projected (this amount of money)
Actually nice to hear from a freelance artist though!
^ OR theres that ;D
Basically you'll want to set up a spreadsheet so you can update stuff later on, and fill it with any and all expenses you could possibly have (assuming that freelancing is your only source of income, and you don't live with your parents). The categories could look something like this:
- Rent & utilities for your home & office
- Power, internet, hard and software, web hosting, dropbox etc.
- Postage costs, stationery, promo materials
- (Art) books, press, video games
- Furniture
- Irregular travel costs (business trips)
- Regular travel costs (trains, buses, taxi)
- Accountant fees
- Banking fees
- Health insurance / misc medical stuff
- Other insurances
- Pension / long-term savings schemes
- Groceries, clothes etc.
- Unforseeable costs (repairs etc)
- ... (any other expenses you may have)
There probably won't be a fixed value for a lot of these things but in most cases you'll be able to come up with a good enough estimate. The sum of the above will more or less reflect your personal burn rate. You could add a little bit on top, in order to maintain your happiness or to be more flexible in difficult times. The sum of both your spendings and your profit is your target income - after taxes. To get to your net income from there, you'll have to work out how much tax you would have paid on the gross. This depends on where you live, but there are plenty of online calculators.
Next up: time. Realistically, you won't be able to work all 52 weeks of a year for various reasons. I typically have a few weeks of idle time that is beyond my control, and apart from that I may be traveling or falling sick every now and then, attend trade shows, or get swamped with paperwork. In all, I might actually only be able to make money for approx. 40 weeks every year. So, the formula would go something like this:
(Expenses + profit + taxes) / work time in weeks = minimum weekly rate
From there, you can easily figure out your daily and hourly rates. A lot of clients will ask you to give a quote for a completed asset instead of a time-based rate though, so you'll have to estimate the task duration based on what materials they send you. Also factor in a certain percentage of time for revisions (up to a certain level) and all correspondence surrounding the job - this typically gets a lot easier to estimate as you spend more time with one client. You can also consider lowering your rate depending on how much work might follow.
Hope this helps!
This is essentially the only answer ever needed for this question. Nice. =P
A lot of people think doing contract work is glamorous or whatever because you can make more money, or look at a day/week rate and think contract artists are rich.
When you consider all of the costs of not only running your own business, but paying for insurance, retirement and taxes, its not so pretty. In addition to the that, you can't ever compare a straight up on-site salary, to a contract position, as the studio paying you is actually paying you a lot more than just your salary(insurance, 401k, paid vacation, any other benefits etc).
So yeah, if your final number looks something like 2x what you would "make" onsite, dont fret.
Oh and also, when considering how much time its going to take to make an asset, you NEVER EVER EVER consider the ideal time. You know, the bare minimum time it would take to make an asset, because it never works that way.
You have to account for design changes, critiques/revisions and time lost waiting to hear back from a client. Generally you will want to make sure you have something in your contract that limits the amount of unpaid revisions, as some clients will completely take advantage of this if they're paying you a per-asset rate.
In my experience very few clients gove you a reasonable amount of time to do the job, so its hard to always rely on my daily rate, so I quote some of my jobs with a daily rate others with a fixed price.
Man I overheard a oonversation recently where the guy was hiring a freeelance producer and he mentioned a figure of 800 pounds per day and reckoned that was cheap
I am in the wrong job:)
My problem is mainly with calculating a fixed price.
Someone comes over, asks me to use a very crappy ortho to model a character they've had designed, tells me they have very little time and they want a good price. O_O
I'm then stuck with a very confusing decision.
I'm facing a modeling process that's very "free" since my reference is really bad, I gotta find many solutions to model it right, which takes time. And I gotta put a price on the whole process, which sometimes is not very predictable. If someone would ask me to tell him my daily fee, I'd probably have an easier time setting that than if I had to tell him how long it'll take me to model a certain character from scratch, using either a good or a bad reference. It's not that I can't estimate it, it's just that it varies a lot with every piece of work... with certain models, for certain platforms, it could take a day or even less. But with others it could take days, weeks...
So that's where the difficulty lies.
Estimating the length of a process based on very little info.