As a young designer I admit that sometimes I find it hard to price some of my design clients. Design for me takes a lot of prep and thought. And charging someone based on hours never felt like a great idea. However, charging a set price according to the type of work always left me feeling upset, used and over worked. I really had to figure out how to price my design clients.
You see when I started design I would listen to the client’s request, ask them basic questions like colors and styles they liked and then got to working. No questions on their target demographic, goals, brand voice or feel was ever asked. I would call a basic price I came up with for that type of work. (let’s say they wanted a logo, I had one logo price) And then got to work once I had a down-payment.
Why this didn’t work.
Well because I never asked the heavy questions that dug deep into what their company was truly about, most times my clients had many revisions and they started adding extra things they wanted. While me being young and shy, I didn’t know how to ask for more compensation. (Plus I didn’t even know how much more to ask for.) In the end, I ended up doing way more work than agreed and only being paid a small amount.
Tough right?
But this is honestly the reality for a lot of young creatives out there. We claim we know our worth but find it hard to call our prices. We didn’t properly sit down and plan out our client process to avoid possible issues. And in the end we’re left underpaid and a little traumatized with our client/work experience.
Value Based Pricing
This week I’m releasing a detailed post of value based pricing and some resources for more info. So sign-up for my mailing list to get the email notification when it’s out.
Read my post How to Use Value Based Pricing as a Designer
[mailerlite_form form_id=2]But in short value based pricing can be defined as pricing based on the customer’s perceived value.
Big words but how does this translate to the real world?
Well when a client comes to me about their design problems I listen to all they have to say. Then I start asking questions that would allow me to get to know their business better.
You need to fully understand your client’s position and the value you’ll be giving to them to know how to charge them.
Ask More Questions
Start with the easy questions like “What does your business do?” “Who are your target consumers,” and “What is the outcome you expect from this service.” That last question is the key. As I’m a visual identity and visual branding designer, most of my clients come to me asking for help in this area. Fully understanding what your client’s business will be gaining from your services is key to your pricing.
For example: A client comes to you asking you create the entire visual identity for their new product launch. You ask all the questions I mentioned before till the last one. “what is the outcome you expect from this service.” The client may say that they expect x amount in exposure and sales. And for them to determine the launch was a success they expect approximately x amount in profit.
With this information you can now fully visualize the impact that your service can possibly make. You also have an idea on the kind of budget your client has to invest in this project without actually asking them. From there you can discuss further ways to ensure the success of your client’s launch. (i.e you can suggest adding services that they initially did not come to your for.) Deciding how to price your design clients is now easier.
Now this isn’t a pricing model to scam your clients but it offers you room to make a larger profit and to actually satisfy your client’s needs far more than calling an hourly price or one standard price for a particular service. Each client and their needs are unique and your pricing should reflect that.
Get Your Documents In Order
One thing I learned about when I did photography was to make sure I had a contract.
Some backstory;
I was a 17 year old photographer that got a lot of wedding clients. Wedding clients meant long hours and in return higher prices. At 17 this scared the shit out of me! How could I convince these couples to drop thousands on me in faith that I was a professional and would do a good job?! Well after days of research I created an entire client process that gave the impression to these couples that I knew what I was doing.
Contracts and Proposals
I created a contract (that I wrote myself). It included the basics like; when I would turn up, approximately how much photos they would receive and a disclaimer that they agree to me using their photos for marketing purposes. Most importantly, it included a page on when I would receive the down payment and balance. (All pages included a place to sign and I made both bride and groom sign.)
I also created a welcome packet that helped the couple plan their wedding. The pages included a place to put all their vendors contact, close relatives contact etc. (Weddings are hectic and I learned that on this day I could NEVER reach the bride). My documents were as thought out as they could be at the time. (Let’s all remember that I was 17.) And I never once had an issue with payment with a wedding client. Not once! I also always landed the client! Now this is not to brag but to serve as an example.
First impressions are important and once you look like you’ve got your business in order clients tend to respect you more. They respect your time, your pricing and your payment schedule way more when you make them sign a document laying out what is required of them. It also helps to include what happens when they don’t do what was agreed.
Now design and photography are obviously different. But 17 year old me’s contract can be used as a model to determine what should be in our design contract.
Even though my contract at that time was many pages long, my recent research advises that we keep it to 1 page.
So What Exactly Should Be Included
Our offerings
Remember when I said that when you fully understand your client’s needs, you can start suggesting extra services?
Well when sharing your price to your design clients, you can include in your proposal 3 different offers. Each going higher in price as you include services that they know will offer them great value and help them achieve their goals.
1st Package
This is your basic offer, this is the service they came to your for in the first place. Lay out what it includes and put one flat price. (do not divide the price into a table and show the cost of each thing. We don’t do that anymore okay!)
2nd Package
This is your basic offer. Include one or two add-ons that you previously discussed with your client that would hep them achieve their goals faster. Again you put your flat rate for this package.
3rd Package
This is your most expensive offer that includes all the add-ons you mentioned to your client that would help them. Be sure that when you’re presenting add-ons that you do so gently and fully explain how this can help them.
If you know an add-on won’t do much for their particular situation don’t include it. If they achieve success they are more likely to recommend you in the future or come to you again. Adding things that did not help them at all can leave a bad taste.
At the end of this offer also state your flat price for the package.
It’s A Process
Figuring out how to price your design clients isn’t an easy process. But taking the time to do the research and learn how other designers price, can really change the way you value your business and do wonders for your profits.
Good luck with your journey of building the ‘perfect’ pricing model and I wish y’all nothing but profits! Be sure to check out my article on Value based pricing that will be posted soon! (I’ll update this article when it’s out!)
Want to know how to start your own graphic design business stress free? Read my article HERE
Read my post How to Use Value Based Pricing as a Designer for more information on value based pricing!
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