I get a few e-mails every so often asking for advice in regards to how I price my projects and what I consider and include in a proposed quote for a certain project. This guide aims to explain some of the considerations I include when coming up with a quote for my customers. Please note that this article is a general broad guide to coming up with a pricing plan, so customization to fit your specialty is highly recommended.
As designers, we love creating, and we love executing things that effectively enhances a business or a individual through use of creative marketing, websites, and advertising. I can tell you straight from the start that pricing is unfortunately one of the task that we have to do that has nothing to do with creativity but strictly business. Regardless of you liking to do this or not, it is not an easy task, but a rather important one that determines how much you are getting paid for the hard work you are doing.
Some elements that are included in a proposed quote
The most important thing you need to know when coming up with a quote is that you are not quoting your customers based strictly on production. Production is the labor part of our job and although that is definitely something you need to include in your initial quote, it is not the only thing that keeps our mind busy. Here is a list of some of the things I consider when putting together an initial quote:
Meetings and travels
I do not usually charge for meetings and travels, but there are exceptional times that I do charge for these sessions. Meetings that happen after your 1st initial meeting can be charged if you choose to do so. I personally do not charge for meetings that are not exceptional in nature, but meetings that require me to do work on the spot, meetings that require me to give a formal presentation, and meetings that last more than 3 hours will be considered billable in my services. I do not particularly charge for travel time or distance unless the travel time and mileage is over 30 miles. Any traveling that requires me to take a plane, boat, or train will be billable for the cost of those transporation services. If you are required to stay at a hotel within that travel, you most definitely can ask your client to reimburse you or pay up front.
Consultation is another element that is possible to be included as a charge, although, just like meetings and travels, I do not charge for consultations for the most part. Consultation can be anything from the 1st meeting to planning your project with your client. Although most of my consultations in person or over the phone are free, there are certain exceptions.
If you are giving a soundly and high quality advice about marketing tactics, advertising tactics and business idea’s with your customer, please do consider it to yourself that this is no different from conceptual development or idea generation. If your consultation is full of rich information, do consider charging for it.
Brainstorming and research
Brainstorming and research are really important tasks that determine if the project is a success or not as a designer. Although some projects can be done without much research, big projects almost always require some kind of brainstorming and research before you begin. Some elements of research is a core component of you understanding who your client is, what type of business they are in and who their competitors are. Although as a graphic designer, you can never promise a client that their business will reach maximum success, it is still your responsibility to at the very least understand what business they are engaging in. Remember that design itself means nothing without it communicating something, and remember that the core element of a graphic designers job is to effectively convey a concept. Design that only functions as a pretty element is not effective if there is no concept attached to it.
With all the time you spend creating mood boards, story boards and researching about the business industry and more, this time is definitely billable in your service. Do consider putting research and brainstorming time as a billable section in your pricing because without the first planning phase, good design is almost always hard to reach.
Conceptual development and idea generation
Many people ask me what the difference is between conceptual development and brainstorming. Yes, you are trying to narrow down idea’s during a brainstorming session but remember that brainstorming is a phase when you are breaking things down to the most important core element of a business, while conceptual development is the phase when you start putting together idea’s you have on your own. Brainstorming is also a time you collect data, while conceptual development is a time where you create an idea.
Coming up with idea’s or a concept for your next client project is the most difficult task. While production can be the most time consuming task, conceptual development is where you actually use your brain the most. Can you bill someone for coming up with an idea or an important concept? Most definitely!
Are your customers always asking you to create or generate content for them such as copy writing or draft them up text content? Copy writing and content generation is no easy task and it also requires some form (although not same) of creativity. Can you bill your clients for this? Of course you can. Remember that coming up with good copy is the same type of work as coming up with a good concept. Although copy writing may not be the strongest suit in your talent pool, it is important to know that you probably have a good experience at it if you’ve done advertising projects in the past.
Pre-production, production, and post-production
The most time consuming task is usually the production phase, so it only makes sense to bill them for the time we spent on our production efforts. Pre-production is the preparation of the project such as HTML wireframes, rough drafts, concept pitches, and more. The production phase is basically when the concept and design is approved and we start working towards the final goal. The post-production can be anything from pre-press checking, file authenticity check, file uploading and launching website. All of these phases of the project is billable and should be done so 100%.
I usually charge a small fee for communicating with third party vendors. This could be anything from a phone call to you actually going to the shop and checking out the final outcome. I usually deal with local printers that I can get to quickly, so I can check out the file if something were to go wrong. It also helps me to go there in person to do a proof check so I can see if all the design, fonts, and colors are correct with the digital file. With the time I take to do a proof check and to communicate with the vendors, I usually bill a small fee for this because it is something I am doing on my own time.
Debugging is when you test your product, and this can be anything from testing out a website, an app, a software or even testing out to make sure your print project functions the way it should. Of course these attempts and tests is billable to your client.
Should I tax my clients?
Honestly this depends on where you live (country or state), as the laws are different based on your location. For instance, in California, I cannot tax a client for something that is a “service”, so I do not tax my clients with the total cost of a specific project. The only time I can tax a client or a customer is when I sell a tangible product to them. Make sure to check your state or country tax laws to see what you need or can bill accordingly.
Material costs/Third party costs
I usually do not pay out of my own pocket for anything that is related to my clients projects. This includes paying the printers for the cost of production, buying stock images, buying materials for a product, and so on. In return, absolutely do not charge your customers for personal studio and inventory items such as computer hardware, software, subscription to websites, printer ink, paper cost, and so on. This is where the tax write off pays off at the end of the quarter or year. If you charge your clients for external fee’s, you will not be able to write it off on your quarterly or yearly taxes and will only balloon how much you owe in total.
Remember that any time you invest for your customer is a billable time most of the time. I have my personal rules and principles for what I charge and what I do not charge, and you should establish your own set of rules too. The most important thing to understand as a freelancer is to be fair and don’t be charging your clients for every little tiny thing. For instance, as stated above, I don’t charge for meetings usually and I don’t charge for small things such as the amount of paper I am going to use for their print project and so on. It is always good to have a fair and open stance on what you charge and what you do not because these clients may possibly come back to you for more business in the future.
My name is Chris Takakura, I am an art director and visual designer servicing businesses and studios around the world. I specialize in print design, brand/identity, with a strong concentration in web design & front-end development. I am always looking to connect and be involved in creative projects, so if you are interested in my creative services, please contact me here.