by Scar de Courcier, Founder, Bohemiacademia
Last week’s post about pricing introduced the idea of working out how much to charge for your services based on what you need to earn in order to survive (and ideally enjoy life a bit too!).
However, a lot of people get confused about which pricing structure they should use: should you charge by the hour, the day, or the project? If you’re a writer, should you charge by the word? What if you’re transcribing a video or audio file – should you charge by the minute?
The answer, frustratingly, is ‘it depends.’ The plus side is that you can decide what works for you and then charge accordingly. I used to charge by the hour when I first started out, but I work really fast and I discovered I was doing myself out of money. A project I could easily have charged upwards of £100 for would earn me £20, and then I’d have to go out and find loads of other projects to fill all the extra hours. This is not a great way to work.
At one point I started charging by what I internally called ‘number of hours it would take a normal person’, but this was hard to work out and also a bit weird, so I stopped. Instead I started charging by the project, and this is also how most of our freelance projects are run here at Bohemiacademia. There are a few reasons for this:
- People work at different speeds, so if you’re pricing a job that’s going to involve five different freelancers, charging by the hour is more complicated.
- Pricing by the project forces you to define the limits of the project and often makes the whole thing run more smoothly in the end.
- If you don’t put a specific number of hours on something, the client will often give you a more realistic deadline.
Focusing on point number three for a moment: although freelancing is becoming more common, there are still plenty of clients who aren’t used to the process. They expect freelancers to act like employees, and they forget that a freelancer might have several projects on the go at once. Pricing by the hour often ends up in conversations like this:
“How many hours will this take you?”
“OK, can you send it back to me the day after tomorrow?”
In the client’s mind, seven hours is a little less than a working day. And there’s a working day between now and tomorrow, so surely you can do that? This doesn’t take into account a number of factors:
- You probably have other projects to work on as well.
- You might have other plans – a lot of people freelance because it’s flexible, and it means you can structure your own time and not work a traditional 9-to-5 if that doesn’t suit you.
- Taking time away from a project and then going back to it really helps.
Giving yourself some distance from something, then going back over it, is a good way to ensure you end up getting everything done. If you’re writing an article, it’s good to split the job up into sections: (1) research; (2) writing; (3) making changes. Whilst (1) and (2) can be done simultaneously if preferred, it helps to have a gap between writing and checking. This is why I schedule all posts on here and my personal blog at least a week in advance: it gives me time to go back over what I’ve written when it’s no longer fresh in my mind.
For all the reasons listed above, I find it’s better to charge by the project. If you’re only just starting out, it might make sense to initially charge by the hour while you get a feel for how long most things take you and how much effort is required for each task, and then after a few months you can move to a project-based structure. Most freelancers find that even if the work itself is quite varied, the nature of the projects tend to be similar, so you can work out a pricing structure based on your usual projects and then add bespoke options if required.
Day rates are often charged by tradespeople (such as builders, plasterers, etc.) and consultants – anyone who goes into someone else’s space and works a set number of hours before leaving again. If you’re working remotely online, charging a day rate can be harder, and a lot of people find they end up working much longer days than they otherwise would. Don’t do yourself out of money! If you want to work an eleven-hour day, you can, but make sure you’re being paid fairly for it.
Charging by the word (writers) or minute (transcribers / video editors etc.) is another popular way of structuring your pricing. The advantage of this is that you know you’ll be paid based on the amount of work you’ll be doing. However, not all work is created equal. Especially if you’re proofreading, translating or editing, you may find payment by the word doesn’t always work out so well. There is a big difference between proofreading a well-written, grammatically correct article, and having to wade through something that’s been cobbled together and essentially rewrite some parts of it. Charging by the project means you can size things up beforehand and make allowances for things like this where necessary.
In summary, therefore, I would recommend charging by the project once you’ve got a handle on roughly how much time and effort most things take you. And how do you work out how to price each project? Read the first article in this series for some tips.