Advice for web design freelancers about prices
I wrote this post a while back. The content can still be relevant but the information I've linked to may not be available.
As a freelance web designer/developer, deciding on your pricing structure is pretty important. Get this right and your business has a much better chance of survival… and you might even be able to go on holiday now and again! I think it’s important to review your business regularly and pricing is one part of that. Here are a few tips about pricing from my own experience as a freelancer in the UK.
Comparing and setting your prices
How do you know if your prices/rates are too much or not enough? A comparison with other designers or companies could be a good way of answering this question (at least in part). However, this can be difficult because many other web design freelancers, companies, or agencies do not publish their prices and/or it’s difficult to know if you are comparing like with like.
My prices were roughly in the middle of the range
I confess that (occasionally) I have posed as a potential customer with other local web design companies in order to get an estimate of what they charge. It’s a standard business practice to study your competitors and this subterfuge was suggested to me by a business consultant. That’s my excuse anyway! The results showed that my web design prices were roughly in the middle of the range.
Another way to make a price comparison is to take part in, and browse the results of, web design industry surveys, like this recent survey of web design prices by Phil Matthews or the Web Design Survey by A List Apart. The results of this type of survey may give you just the answer you want. Additionally, by talking to other designers/developers at conferences or on Twitter, you can often get a good idea of the ‘going rate’ (although the figures can be quite variable).
It may be tempting to set your prices lower in the belief that this will attract more work
At the end of the day, it’s up to you to come up with a figure (perhaps an hourly or daily rate or a range of website prices) that represents the value of the work you do, the cost of running your business, and the marketplace that you are in … and enables you to make a living. It may be tempting to set your prices lower in the belief that this will attract more work. Don’t do it! I learnt from experience that this does not work (cheap is sometimes associated with lower quality in the client’s eyes) and often means that you end up working all hours for very little money. That’s not good for you or the client because the job quality is often compromised under these circumstances.
Prices don’t have to stay the same
Don’t be afraid to raise your prices! Your business costs will increase every year and you have to cover these. I know that I learn more every year and I like to think that I am better at what I do now than when I started. If you are the same, this means you are offering a better quality job and this is worth more. Clearly, you need to be reasonable about increasing your rates (and give your clients some warning) but there is some justification for raising your prices every year in my opinion.
You know what the job is worth
My final piece of advice is to stick to the prices you set and not be tempted into a ‘bidding war’ with other designers who (the potential client says) are willing to work for less. Yes, it’s possible to be flexible with any price to a small degree but not when it means that you grossly undercharge for something. For web design jobs, when the potential client asks about the price, my policy is to explain what the price includes, what the website build process involves, and how it will benefit the client’s business. If they ask if the price is negotiable, I say No. I explain that I can reduce the price only if the job specification is reduced. This may sound like a tough approach but I believe that it will not benefit either the customer or me if the price is less than the job is worth.