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  1. #1
    $books++ == true matsko's Avatar
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    Figuring out a hourly rate

    I've been coding websites for about six years - and for three of those years, its more or less been on a personal project (although there were some projects back then that I did develop, they just didn't get anywhere).

    Regardless, after six years of programming, planning, coding and designing I'm quite convinced that I'm a mature developer. The way I see it, you can only get so far by studying and reading books, but to get beyond that you must get down to some developing (its kinda like being thrown into a pool and being forced to swim). I will soon have a pretty impressive portfolio and large personal library of server-side and DHTML scripts and snippets.

    In the past I've mostly done contract scripts ... unfortunetly, quite blindy (meaning that I just conjured up a ballpark price). I've had alot of sleepless nights and high phone bills because of this.

    So my next step is to figure out an hourly rate. I am still young, so there's not much to hold me down (no mortgage, no spouce or children). The work delivered is above average (meaning that its really good), but what other factors should I put into consideration for thinking of an hourly rate?

    Since website development is a lucrative industry, the way that I see it, a hourly wage shouldn't go anywhere below $30/hour, but I also think I can go as high as $60 depending on the project.

    For some projects, maybe a fixed price is a good idea (if you're really fast at coding), but perhaps a hybrid is a good idea - that way you can specify a limit and anything extra beyond that will be added as an hourly rate.
    I can't believe I ate the whole thing

  2. #2
    Word Painter silver trophy Shyflower's Avatar
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    Although you aren't new to the work, you will be new to the marketplace and in competition with those who have huge portfolios of sold work. Although you want to be competitive, you probably won't be able to command top-dollar for projects.

    Consider what annual revenue you would be comfortable with your first year in business. A good article that will help you define what you need from your business and set some achievable goals is Andrew Neitlich's "Write a Business Plan that works". Not a take-to-the-bank business plan, the article describes how to create a strategic business plan for your own use. Although it was written in 2004, it helps you understand the fundamentals of doing business.

    Several years ago when I was having trouble deciding on rates, I purchased Neil Tortorella's Rate Calculator. I use it every year to decide whether or not I'm still comfortable with my rates. It's a very small business investment-- $2.50 USD.
    Linda Jenkinson
    "Say what you mean. Mean what you say. But don't say it mean." ~Unknown

  3. #3
    SitePoint Co-founder Matt Mickiewicz's Avatar
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    Some great articles on pricing here:

    http://www.sitepoint.com/subcat/services-start
    and
    http://www.sitepoint.com/subcat/find-clients

    also:
    http://www.sitepoint.com/article/fre...ng-1-set-rate/ - freelance pricing, part 1
    http://www.sitepoint.com/article/web...should-charge/ - how much should you charge for web work
    http://www.sitepoint.com/article/web-design-business/ - Increase the efficiency of your web design business
    http://www.sitepoint.com/article/web...ents-retainer/ - Get web design clients on retainer

    Print & read & make notes!
    Matt Mickiewicz - Co-Founder
    SitePoint.com - Empowering Web Developers Since 1997
    Follow me on Twitter.

  4. #4
    SitePoint Evangelist Fergal's Avatar
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    Have you looked at webmaster forums and freelance sites to see what other providers are charging for similar work and even more importantly to get an understanding of what clients are willing to pay for the type of services you provide?

    Useful list of forum and freelance sites.
    Fergal Crawley (Previous Username: Proudirish.com)
    Business Advice Forum - Webmaster and Business Forum
    < Get a free link & win $5,000
    Forum Coin New World Currency

  5. #5
    SitePoint Enthusiast
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    This is always a difficult aspect of starting to freelance or run your own business. Lets say you want to make $50,000 income this year then you are going to need to work out that you will need to pay yourself about $1000/week. then break this down to the number of hours you work per week (40 hours), this then comes out at $25/hour.

    But realising that there is no way in the world all your time will be billable, you'll need to make the sale, answer the telephone, prepare your books for the book-keeper or accountant, invoice your clients etc etc etc. So we need to adjust this to get your actual hour rate. When I was freelancing I would say that only a quarter to half of my time was billable. I also had a lot of different clients so that added to my overhead.

    Anyway, just some thoughts and experiences.

    Good Luck,
    Colin
    Colin Burns
    http://www.cmsadvantage.com
    Founder & CEO, cmsadvantage
    The premier CMS for Web & Graphic Designers


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