In late 2012, I was contacted by a local NJ business to rebuild their website from scratch. After getting a general idea of what they wanted to accomplish, I quoted my hourly rate. However their other vendors usually submit fixed prices, so I was asked to do the same. I was a little uncomfortable locking myself into a fixed price, but I wanted the job. So After getting a few more details, I came up with a price, added 30%, sent it off in a contract, and hoped for the best.
Once the contract was signed and I began working, the end goal quickly became a moving target. Despite the presence of the contract, I spent a number of unbillable hours adding extra features and making changes I didn't agree with. My client was happy with the finished product, but I knew I hadn’t done my best work.
When my client asked about starting a second phase of the project, I re-pitched my reasons for working hourly. They asked for fixed price again, but I explained the benefits of hourly pricing for both sides. (Most of my reasons are explained well here). This time my client agreed, and the resulting project was a notable improvement over the first phase.
I learned a valuable lesson with this project: Work at my full rate, for free, or not at all.
On weekdays, I am a designer and developer for a medium size company. My full-time salary, when combined with my wife’s, is what we live on.
Like many other day traders who build websites for a living, I sometimes freelance on nights and weekends. When I do, it’s to work on something fun that I wouldn’t have the opportunity to work on at my regular job. The extra cash is nice, but we’d be fine if it vanished one day. I imagine this sounds pretty normal.
This all factors in when I decide what to work on after hours. These days, I work at an hourly rate (which I do not discount) or for free. That probably sounds militant and arrogant, so I’d like to explain my rationale.
Working at my full rate
Working at my full rate keeps me motivated to produce my best work knowing that I’ll be fairly compensated for whatever comes my way. Many clients don’t know exactly what they want before a project starts and that’s 100% understandable. New insights appear at any stage of a project. If I’m hourly, I can simply spec out incoming changes and show how they’d impact the invoice. We can then decide what’s best for the project, even though we didn’t think of everything at the beginning.
I’m in a good mood when working like this. If more work is required to make an awesome product, I know I won’t be short-changed for the extra time it takes. I’m motivated to go the extra mile. Clients get what they want and I don’t spend too much unbillable time working.
Working for free
However most of my friends can’t afford my rate. But I don’t want them to have an ugly blogspot website, so I do favors when I can. Since I don’t ask friends for money, their expectations are modest, timelines are relaxed, and special requests are fewer. I decide when I’m able to work and how to best accomplish their goals.
Again, I’m in a good mood when working like this. I often have guidelines, but not a boss. I’m trusted to do what I think is best and the friend is happy for everything they get.
Working for Cheap
It’s everything in the middle that seems to be the most frustrating. No one enjoys working for less than they’re worth, but clients that pay expect something in return. When additional work is needed for additional features or changing scope, it extends the amount of time spent working on an already un-enjoyable project.
These types of projects are neither fun nor lucrative, and I rarely produce my best work in situations like this. It’s taken me a few years of trials and tribulations, but I’m getting better at spotting projects like this.
I work for free or at my full rate
Since completing the project described above, I've worked either at my full rate or for free. I take on less work, but I’m much happier.
My paid work comes from clients who understand and appreciate my work. They know it can’t be done by just anyone with a copy of PhotoShop. I am not just another budget line item. And I work at my full rate for every one of them.