If you're even thinking about branching out into the freelance side of the advertising industry, you've undoubtedly wondered what you should charge. This is one of the most difficult tasks a freelancer can face.
There's no cookie-cutter method to magically set your rates. One copywriter may charge $350 for a direct mail piece and another may charge into the thousands. However, there are several factors you can consider to help you build a strong rate schedule that won't scare off any potential clients.
Hourly, Per Project or Both?
Your first step in setting your fees is how you're going to charge clients. Will you only work on an hourly rate, charge one price for the whole project no matter how long it takes you or will you offer both?
Many freelancers offer both. This gives your client the flexibility of choosing which type of rate they prefer. Most will choose a per project fee because they know exactly how much they're going to get charged up front and don't feel like they're going to get surprised when that two hour estimate you gave them for the hourly rate turns into a six hour project fee.
Rates as a Range
If you decide to use flat project rates, you need to protect yourself by using a range for that particular piece. For example, that brochure you're working on may be a tri-fold or it could be several pages long looking more like a mini-booklet. If you've only listed one rate for a brochure, you're charging the same amount of money for a project that could be twice the size of a previous project.
Offering a rate range helps you determine where that price will fall when you consult with the client. Projects vary and you shouldn't pigeonhole your services by offering one set number for every type of service you will provide.
Rates You'll Be Happy With
Many copywriters or graphic designers new to freelancing start off with very low rates just so they can get their foot in the door. This may seem like a good idea at first but in a few months when you want to increase your rates, your clients don't understand why you only charged them $100 for a commercial script a month ago and now you want $500 for another commercial of the same length.
Set rates both you and your clients can live with. You can increase your rates as you go along (preferably once a year at most). But making any dramatic changes, especially many close together, is just going to scare off your clients.
Don't Price Your Services Too Low...or Too High
Yes, it's a double-edged sword. You don't want to price your services too high if you have little or no experience and you don't want to price your services too low or clients will wonder why your services are so inexpensive.
Plus, setting your rates too low is a great way to get taken advantage of and the quickest way to burn yourself out. Thinking ten projects at $100 each can bring you $1,000 may sound like a lot of cash but you will have a ton of time invested in those ten projects. If you were to average the number of time you spend on each of those projects, you could easily end up making less than minimum wage.
That may still sound better to you since you're your own boss but that doesn't even begin to cover your expenses, which are explained in the next section.