If you’re new to being a creative professional or are starting a creative side hustle, you might be wondering what you should charge. You want to be compensated fairly for your work, but you also don’t want to drive away customers or price yourself out of the market. How do you strike a balance?
Unfortunately, there are no universal standards for what you should charge. Multiple factors go into determining a fair rate, including your years of professional experience, education, and location. You can research market rates in your geographic area and industry, but it also depends on your target client and the complexity of the project.
If all that sounds terribly complicated, don’t worry: We’re here to go over the common pricing models and the number-one rule for pricing your work.
Are you asking too much?
One of the top concerns that most creatives have is that they’re asking too much. And when a prospective client starts haggling or accusing you of “being greedy,” it’s easy to wonder if you’re asking too much. Here’s the thing: You’re probably not. Unless you have absolutely no experience and want to make $500 per hour, your request is probably within a reasonable range. That’s because they’re compensating you for more than your labor: They’re paying you for your creative input, which is very valuable.
If you spend some time on the “Choosing Beggars” subreddit, you’ll see hundreds of examples of clients who want quality work for dirt cheap — and you’ll see creative professionals charging obscenely low rates for their creations. Sites like Fiverr don’t help matters by encouraging people to do hours of work for only $5. This doesn’t mean that those rates are the industry standard, though. That’s because there really isn’t an industry standard. Let’s take a closer look at this fact:
What’s my work worth?
While there are some “going rates” making the rounds, they’re really not applicable to every situation. Sometimes, it doesn’t make sense to standardize. How do you compare a logo design for a law firm to one for a sub shop? Freelance writing “standards,” for example, tend to rely upon per-word rates (which are a bad idea, as we’ll explain below) or a standard word count. That can lead to apples-and-oranges comparisons. Is a 500-word blog really comparable to 500 words of social media copy? No.
All that said, it’s up to you to determine your work’s value. You can’t base it on what clients say they want to pay. They want to pay less. But remember, you have something that they want, something that they can’t do themselves. You can set your rate accordingly.
You should also take your experience into account, but don’t fixate on that too much. It’s true that a creative professional of ten years can usually charge more than one who has only one year’s experience. But both of them deserve a living wage for their work. Also, if the one year of experience follows years of education, that’s something to keep in mind. And if you have a specialized niche that few others work in, you can charge specialty rates. Remember, you’re providing a valuable service. Don’t undercut yourself!
A key component of the value of any product is what it provides for the buyer. If you’re writing a business’ tagline or designing a logo that they will slap on every single one of their products, you’re providing them with immense value — and they should pay accordingly.
You also need to think about the cost of doing business. Whether you’re selling art on Instagram or running a full-fledged writing business, you have expenses. A business is not a business if it doesn’t make you money. Think of it this way: Your studio, your art supplies, your software and computer, etc. are all tangible expenses that go into your work. If you don’t set your prices high enough to cover the cost of doing business and make a profit, then you’re running a charity.
Finally, take an honest look at your work. If you think it’s not worth more, why not? Are your skills actually lacking, or are you just socialized into thinking that art isn’t worth that much? In a society that devalues creative work, that’s an easy trap to fall into. Don’t let your self-doubt keep you from profiting off your creative labor. Remember that if you price low, you’re also telling your better-qualified, higher-paying clients that you’re not worth much. Have you heard the expression, “You get what you pay for”? You could drive away people who want to buy a Ferrari, so to speak. That’s why it’s important to set your rates to reflect what you’re worth, not to try to lure in more clients.
What are the rate models?
“All right,” you say. “I won’t undersell myself.” But how do you actually set your rates, you wonder? A good rule of thumb is to imagine what someone might pay for this in a similar market — then raise the price by 20 percent. You should feel a little uncomfortable with the rate: That’s a sign that you have priced it above any self-imposed constraints.
Next, it’s time to set your rate type. For design, painting, and other visual work, it’s common to do an hourly rate or fixed-price rate. If you work quickly, don’t punish yourself with an hourly rate. Hourly rates can also backfire because people can easily compare them to those for non-creative work. If they assume that graphic design is easy, they’re going to think that $60 per hour is too high. An hourly rate neglects to include the creative process, such as conceptualization and revision. Using a fixed-price model helps clients understand the value they’ll receive, and they won’t fixate on the hours you’re putting in.
For writers, many clients will ask for per-word rates. As any good writer knows, the word count is hardly an indication of quality. In fact, some of the most effective writing is short and sweet. Why should you be penalized for writing a short landing page rather than a long one, especially if the page makes your client a lot of money? Per-word rates make more sense for copy that has to be short, such as an ad, because the writer has to use their skills to sell a product in just a few words.
Above all else, stick to the prices you set. Somehow it became fashionable for clients to haggle. Many of them seem to assume that all prices are a starting point for negotiation. Think of it this way: You’re running a business. When you walk into a store, you figure the prices are set, right? Your creative business is no different. But if you entertain clients’ “counteroffers,” you’re paving the way for little discounts here and there until you end up working for pennies.
Pricing your work accordingly means that you’re not pricing it for the lowest common denominator. Sure, you’ll get more bites if you’re charging only $5. But those bites will be from clients who likely won’t have regular work for you, might be difficult to work with, or will take advantage of you. To get better clients, you must charge more. Take your experience, skills, creative input, and market into account to find a suitable rate. Remember to set it high enough to cover the costs of doing business. Then, pad it by at least 15 percent to help you turn a profit. There is no shame in making money off your creative work! It is not “greedy” or “selling out” to want to make money.
Need help launching your creative business? Reach out to Free Ring Circus for your branding and marketing needs, and be sure to try out our coaching program to help you overcome self-doubt and price your work accordingly!