This is the second part of my survey of independent graphic designers working from all corners of the globe and it throws up some interesting results about how they charge. The first survey results concentrated on what designers do and how they make money.
Questions about charging are the most common I get in my inbox. Here’s how my trusty designer respondents answered…
Do you typically charge clients fixed-rate fees or hourly/daily rates?
Clients and designers are most comfortable with fixed rate fees. Here, if both parties agree on the parameters of the task, the designer and the client know exactly how much it’s going to cost or pay before starting the project. Larger jobs are especially likely to be charged this way; whereas smaller jobs may be charged out at hourly rates.
Do you typically charge clients before or after project is completed?
But when can the designers expect to get their grubby hands on the wonga? Half of it up front and the rest on completion is the most common arrangement, although many designers mentioned that this was only normal with new clients. When there is a good working relationship, a more lax attitude to payment can be adopted.
How quickly do you expect your clients to pay you after you invoice?
I was pleasantly surprised to see that many designers get paid straight away. Especially as the law in my country, the UK, permits 30 days to elapse between billing and receiving the money.
Do you bill manually or use billing software?
Nearly half of our designers use billing software. Here’s what they use:
- Harvest Set up takes seconds. Invoices created in minutes and in different currencies.
- Billings 3 for Mac combines powerful features with stylish designs so you can send elegant invoices right out of the box.
Further information about charging
Our designers gave these further points of clarification about their charging – some excellent advice here:
- “For publishing companies I usually get paid at the end of a project, within 15-30 days. For individual clients, typically self-publishers, I get 1/3 paid up-front, and the remaining 2/3 on completion of the project.”
- “I have an Access program that will create invoices as well as estimates.”
- “You can use PayPal to create invoices for you and you can also send W9′s electronically thanks to the good ol’ IRS.”
- “I charge per project on everything except for maintenance work. For that, I charge by the hour, with a minimum charge of 15 minutes. But for projects, the way I figure my fee is to calculate the number of hours and then add 50% for communication (emails, phone calls, NOT including face to face meetings. Because those can easily get long, I charge extra if I know a client will want any) and unforeseen problems that always crop up.”
- “If the client is a new client I usually ask for payment upfront (100% if it’s a small project or 50% upfront for bigger projects and the remaining 50% once completed). With my standard clients I invoice them monthly.”
- “New clients are fixed rate. Established clients are hourly.”
- “I tend to take a 20-30% deposit”
- “In regards to receiving payment after billing a client, it depends on the client. My biggest client takes literally weeks to pay, as all invoices are dealt with by people further up the chain, so-to-speak. However, for most work for regular clients, about 1-2 weeks appears to be the norm. I sometimes offer clients the change to pay in full before the project starts for a 5% discount. A fair few clients take this option, too.”
As ever, there are some interesting ideas there, especially the offer of a 5% discount in exchange for an upfront payment.
Do you have contracts with your clients?
These were perhaps the most surprising results of the whole survey. I have often read that designers should always, always, always have contracts and it seems that this is not the case. I personally believe that 99% of people are honest and therefore it is much more important to be clear about the nature of the job and the payment than it is to sign contracts. However, some designers will disagree with me and, as you can see, 50% use contracts for every job.
Do you have written email exchanges where the price and extent of the job is discussed?
For me, leaving a “paper trail” of exchanges between you and the client can be even more important than a contract. Briefs can change during the course of a job so, in order that everyone understands the extent of the job and the payment, it’s advisable that conversations are recorded textually.
Do you discuss price and extent of the job with the client and leave it at that?
So, similarly, it’s not often that designers accept a brief on a phone without anything in writing. However, it’s possible that this can happen with a trusted client.
Further information on agreements and contracts
Here are some more helpful comments left by some designers about agreements and contracts:
- “I’ve only once had difficulty with – let’s call it – project creep. The project really got off the tracks and took far too long to complete. However, I was compensated fairly for the extra time; but it drove me crazy!”
- “I’ve never had a payment problem. I work a lot on referral these days. If I have a new client I always get the 50% up front (or if it’s a large project), but otherwise I’ll let that slide with someone I’ve worked with before.”
- “For new clients and larger projects I use a project agreement (contract just sounds so intimidating!) where I spell out the scope of the project, deliverables, timetable and payment schedule. I sign it and have the client sign it and return it with their deposit. Once I get to know a client well and we work on many projects together, I generally just use written agreements via email for small jobs and maintenance work. I always make sure to have something written in email that we’ve both agreed on, just in case I need to go back and reference it. I’ve been very fortunate to work with some great people and I’ve never had a problem with clients not paying (knock on wood!!).”
- “I used to have lots of clients but it became too much to manage, and some of them weren’t good with paying on time. I whittled my client base down to a select few clients which I’ve worked with for many years and have a good relationship with. Although I don’t have standard contracts with some of them, everything that is discussed is recorded in some fashion in chat logs or emails.”
- “Moderate to light detail contracts but lots of email trail. You don’t want to refer to contracts to resolve a problem when referring to a simple email does the trick and gets the project moving again. In the end you want to get paid, not go to court.”
- “I have learnt the hard way so from now on I will get every thing written down.”
- “Job specifications are recorded through email exchanges. I haven’t had payment problems for some time now because my work commences upon receipt of 50%, and the remaining 50% is received prior to supply of digital artwork.”
- “I have a contract attached to the quotation. They have to pay 50% up-front, and the rest when the project is finished. What causes payment problems? When the client doesn’t check his/her email after I have sent them the invoice!”
I tried to whittle those quotes down but they were all so interesting and echo the general success of the 50% before 50% after formula for payment.
A huge thank you to everyone who participated. I learned a lot from this. So, heartfelt thanks to the following:
Lucas Tetrault from Phoenix Wave Portfolio
Lynne Venart from The Art Monkey
Matthew Harpin from Freelance Web & Logo Design
Michael King from Black Swan Image Works
Mike Smith from GUERRILLA
Randa Clay from Randa Clay WordPress Design
Ryan Scherf from Ryan Scherf
Stephen Tiano from Freelance book designer, page compositor & layout artist
Derek Kirk from creative web design
Andrew Keir from Melbourne graphic designer, Andrew Keir
Andrew Kelsall from Andrew Kelsall Design
Anne Swanson from Anne Swanson Graphic Design
Bob Raynor from Bob Raynor – Graphic Designer
Carmia Cronje from Clementine Creative
Chris Metzner from data visualization graphic designer
Craig Wilson from Craig Wilson
David Airey from David Airey, graphic designer
Douglas Bonneville from freelance graphic designer
Hernan Valencia from The Construct Creative
John O’Nolan from John O’Nolan
Jon Phillips from SpyreStudios
Justin Miller from Magnum Creative Group
Karen McDade from Omega Red
Kyle Richardson from Enrich Design
Lauren Krause from Creative Curio
Liam Swift from Attract Love to Your Brand
More to come
That’s not it! More questions about our designers’ equipment, software, and more great advice to come!
What do you think?
Are you a graphic designer who runs their own business or thinking of becoming a self-employed work-from-home type? What did you think of this survey? As always, I’d love to hear your thoughts. And, if you enjoyed the article, please consider tweeting or voting for it on your social network of choice!