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Am I undercharging? Is that a problem?

Discussion in 'General Business Forum:' started by CloudCover, Oct 27, 2009.

  1. CloudCover

    CloudCover New Member

    Hi everyone,

    Everywhere I go I hear that you shouldn't undercharge, as it makes people think that you're not very good. At the same time, I'm new to freelancing (set up 3 months ago - although I've been working in a design role for 3 years previously), and I don't want to look cocky. I've got a couple of decent clients (Oxford University, the National AIDS Trust, a PR firm in the North East) and they've always been happy with my work. I also do a bit of work for an agency, who charge £30 per hour for my services (I charge £20 when clients come direct to me). On the other hand, I don't have a website; I've not had time to teach myself to code it and I don't want/can't afford to hand it over to someone else. This is obviously a real problem, as people like to be shown a portfolio.

    My questions are these, given the above:

    1. Is £20 per hour too little to charge?
    2. Will that be damaging my profile, rather than bringing in business volume?

    Any comments at all would be greatly appreciated.

  2. JMCDesigner

    JMCDesigner Member

    You need to ask yourself that question. If you think its too little, justify why your work is worth more. As for your online portfolio, there are plenty of resources out there that let you build a website without having to code. It might be as simple as setting up a blog with links to your work, wordpress is pretty popular.
  3. CloudCover

    CloudCover New Member


    Thanks for the advice. I certainly think that I'm worth more than that, I put a lot of work in to making things look right, and while I wouldn't call myself a heavyweight I think that (printwise) I meet the specs for a middleweight.

    I hadn't thought of wordpress - that's a great stopgap. Thanks a lot!

  4. bigdave

    bigdave Moderator Staff Member

    Theres nothing to say that you cant use a coder and start to take on web work. Just quote per job rather than per hour. Find out what the coders rate per page is, decide how long it's going to take you to design the site and thats what you charge the customer. A mate of mine makes a living from outsourcing web work. eg; I give him my price for design, his coder give their price for coding and then he sticks 10% on top so its definately viable.
  5. MattRich

    MattRich New Member

    Well that sounds interesting.
  6. Edge

    Edge Active Member

    You need three things to start charging a decent rate:
    - High quality portfolio
    - High profile clients
    - A queue of work which allows you to select the better paid jobs.
    Theory Unit and MattRich like this.
  7. Dave L

    Dave L Well-Known Member

    Undercharging isn't necessarily the same as coming in cheap but if you're working hard and not making a decent living then something in the mix is wrong (and I'd say that a business proposition that can't afford to engage a web designer probably isn't yet a viable business). The thing about offering low rates is that they can attract business for the wrong reasons and you end up in a situation where you have to work twice as many hours as someone charging twice as much for the same financial result (obvious, I know, but unavoidably true). In my experience, it's all about the people you work with. Established businesses operating above a certain level have proper budgets for design and are happy to pay decent rates for dependable, professional designers (always make sure - and always remember - that you're offering a professional service and that comes at a premium); these are the people you should set out to court as clients. I'm fortunate enough to have some good contacts and even the not-for-profit/watch-the-pennies element of my client base are happy to pay upwards of £40 an hour, and even that's quite cheap in the realm of professional services. Admittedly, these clients are harder to come by and you need a combination of hard work and good luck to bring them in but, once you have one on board, they'll recommend you on the basis of quality rather than price and that's the thing.

    All that said, I acknowledge that price is an important lever in building a client base from scratch and it's easy to get sniffy about rates when you're comparatively well-paid - so much so that, if my current work dried up, I'd probably find myself having to look at alternative, non-design routes to earning a crust in preference to competing on price in the current market. Like I said at to top of the post, it's all about the value you get from what you do: if it works for you, great (why be greedy?), but I certainly don't want to work twice as hard for the same nett result in a non-salaried position with all the stress and uncertainty that goes with working independently.

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