# How to determine average hourly rate?

Discussion in 'Design and Graphics' started by p0intblank, Jan 20, 2009.

1. ### p0intblank macrumors 68030

Joined:
Sep 20, 2005
Location:
New Jersey
#1
I've been working with the same client for a while now, all based around flat costs. We've decided to go the route of hourly rates with all future projects. I have never worked on an hourly rate for freelance projects before; do you have any advice on where to begin? I researched some sites I found on Google, but I can't seem to pinpoint a rate I feel is right. I don't want to under or overcharge my client, so this is important to me. Any advice is greatly appreciated.

Thanks!

2. ### Consultant macrumors G5

Joined:
Jun 27, 2007
#2
Tons of books cover that. Go into a book store and look at the graphic design section.

3. ### jdl8422 macrumors 6502

Joined:
Jul 5, 2006
Location:
Louisiana
#3
Look at your past projects with the client. If you did a project and you charged \$500 and it took you 5 hours then you basically worked for \$100/hr. I would look back at all the past projects and get an average number and then negotiate with the client.

4. ### brisbaneguy29 macrumors 6502

Joined:
Nov 27, 2007
Location:
Brisbane
#4
Before you work out what your charge per hour, you need to work out what it costs you per hour to do the job. You need to calculate your billable per hour cost, and then you can decide what you want to charge per hour. No point charging \$100 per hour, if it costs you \$120 per hour to do the job.

To calculate your billable per hour cost, add all your monthly fixed and variable expenses together and divide by the number of billable hours you can do. Some of your expenses to take into account:
• wages
• leasing / loans
• overheads (electricity and phone etc..)
Then work out how many hours you can bill in a month EG: 7 hours a day x 5 days a week x 48 weeks a year / 12 = 140 hours per month.

Lets say all your expenses came to \$8000. Divide that by the 140 = \$57.14 per hour. That is what it costs you to do that work. So billing at \$100 is profitable. But if your expenses came to \$14000 per month, your cost per hour would be \$100. If you only bill \$100, you are not making any profit.

5. ### THX1139 macrumors 68000

Joined:
Mar 4, 2006
#5
I'll add to the discussion; make sure your talent matches your hourly rates. If it doesn't, then lower your rates, work faster, or work to improve your talent.