Question:
I am working on a big job right now, and I’m trying to figure out how to price it. These are clients I have worked with before on many projects. They are actually my very best dream clients. I would like to offer them 3-tiered pricing but I haven’t done that with them yet. In the past, I billed them for my hours and product cost plus 20% and it worked. I have asked my bookkeeper to pull up one of their old jobs and find out what the hours and product total was so I have some information before I just blurt out a number. I believe that I can do this with my client – I was billing him $1,000.00 per day.
I have not figured out how many hours it will take. Once I get the number back from the bookkeeper I can better gauge the time. I have already made 2 trips to the site plus a lot of background work.
Should I switch over to a fee? How do I figure this out?
Answer:
Sometimes if it works, don’t fix it. But having said that…
“Works” means that you are REALLY GOOD at tracking time and billing ALL of your time to the client without reducing or editing it. If time billing has never been an issue with this client you can leave it be. I would, however, ask for a retainer so that you are not always paid 30 to 60 days behind the completed work.
Most designers are not consistent or accurate about posting their design time and cheat themselves out of a good paycheck on a regular basis.
If this is you and if you are not billing ALL of your time, you are better off using a fee with a defined and limited scope of work. To figure out how much this fee should be, use the Project Time Estimating System – post your estimated hours for all the tasks and add your rate at the end. The Project Time Estimating System will calculate the fee, and then you can figure out how to make good, better and best offers from that fee.
Finally, create and present the Letter of Agreement NOW before you invest any more time in this job.