Topic: Web Dev Hourly Rate?

[micah]

So I've been programming professionally for 12 years now, the last 6 of which were for agencies that charge clients $150/hr for my time.

When I first started doing freelance work, 10 or more years ago, I was charging $35/hr.   I haven't done much of anything on the side over the past 5 years, save for a couple projects where I just charged a flat fee of a few hundred bucks.  I want my hourly rate to be $75/hr.  I think thats reasonable for my skill level and comparable to what some of my colleagues charge to do freelance.

The problem is I've never been able to get that rate.  I've recently had several solid leads from Craigslist that all fell through (I'm currently 0 for 4) but even when they seem'd like they were going to work out, the negotiated price I ended up with was more in the $35 to $50 range.  No one I can attract wants to pay close to $75.

The other day I responded to a craigslist ad, a guy said he'd pay $50 for what he perceived as "a couple hours of work."  He e-mailed me his problem, including the error he was getting. Being the nice guy I am, I wrote him back with a quick solution to fix it himself.  He wrote me today to say thanks for the free advice and also said, "I am always in need of good programmers for projects that I undertake. What is your typical hourly rate?"

So what do I tell him?  On the one hand, I want to say $75/hr.  But I know thats going to sound unreasonable to someone who just wants a cheap, on-call freelancer.  I'm willing to take much less, after all, anything above minimum wage beats having to go out and get a second job at burger king, but I don't want to undervalue myself or rip myself off.

What do you think?  If you freelance, what do you charge?

[Perspective]

Here's my shot at trying to say the expectation while still bringing in the leads from him.

"I generally charge $75 / hour for freelance work, but I also do flat fees for smaller one-off jobs. Feel free to send me a brief description of any work you need done and I'll give you an estimate."

[ober]

I think Perspective's idea is good.

On the other hand, I broke out my 'services' and they all have different fees.  PHP work is 40-50/hr (although I want to bump it up to 60).  Anything touching the database (creating tables, changing tables, indexing, normalizing, etc.) is 60-70/hr.  UI (Javascript/CSS) is normally in the same range as the PHP stuff.  And you might ask... how do you separate it?  It's not always straight forward, but if you separate your stack well enough it's not that bad to split it up and track time accordingly.

I hate flat fee contracts but sometimes you have to take them just to get the business.  I agree it's hard to get some people to pay a decent rate and sometimes you need to go in high and negotiate.

[micah]

Thanks for the answers guys.
I went with a combo of "its $75/hr" but that its "variable" based on scope, complexity, availability, and clients budget

[Jake]

On the other hand, I broke out my 'services' and they all have different fees.  PHP work is 40-50/hr (although I want to bump it up to 60).  Anything touching the database (creating tables, changing tables, indexing, normalizing, etc.) is 60-70/hr.  UI (Javascript/CSS) is normally in the same range as the PHP stuff.  And you might ask... how do you separate it?  It's not always straight forward, but if you separate your stack well enough it's not that bad to split it up and track time accordingly.

I hate flat fee contracts but sometimes you have to take them just to get the business.  I agree it's hard to get some people to pay a decent rate and sometimes you need to go in high and negotiate.

In my world this approach usually works the best. We have different fees for Professional Services vs Technical Services. If possible, we go in at a time&materials basis, and try to stay away from flat fee - however, does end up happening about 60% of the time anyway. An approach that I found works well (and is pretty easy to sell) is a T&M capped. We bill a customer an hourly rate and the total price will not be over X amount of dollars. If you set this up correctly you should not lose your ass on any deal.

[micah]

Interesting.

realworld, crowdsourced freelance rates by type of work, skill set and location: https://www.hellobonsai.com/rates

According to that, my $75 rate is more than reasonable

[ober]

I wonder what the sample size on that is.  If you look at the people taking jobs on most freelance sites, the hourly rates are FAR under that.

[micah]

yeah, looking into it, their data comes from people using their service which is mostly still in beta.  Their service is just for invoicing and billing, verses those freelancers job posting sites were everyone has to outbid each other to get clients who don't want to pay more than minimum wage.  On the flip side, people who freelance full time for a living have to include all their overhead in their rates.  They need to get a livable wage and pay all their bills, insurance, taxes, etc off the freelance work.   Completely different from people who do work on the side for extra income.

3 of my coworkers do side work, one of them just design/front-end work; they all charge in the $75/hr range and seem to do just fine. 

[hans]

I think the rough calculation is usually about 30% overhead for handling all of your own stuff (taxes, insurance, etc) so from $75/hr that drops it to something more like $50/hr equivalent which means it would be roughly equivalent to working a $100k/yr gig if you worked full-time at that rate. Not too bad.

Bear in mind though if you're not working full-time or fully booked you'll generally want to bump your rate up. And typically the shorter the engagement the higher the rate. One off work can also be a bit higher since there's a limited time you're needed for.

The bigger thing is clients want to pay as little as possible, usually, and sometime you need to ask yourself if a client that doesn't have the money to pay what you want is actually a client you want to have. Sometimes they can be the ones that will take much more of your time, trying to get the most value for their money.

Start higher with room to negotiate (give a range you're comfortable with) and if the low end still isn't good for them and scares them away you can usually use that as a good indicator.

[micah]

So I actually just landed a new client for (what will hopefully be) some long term work.  He didn't question my $75/hr rate.

On a side note, I used that Bonsai service to write up the contract and e-sign it.  Their contract service is pretty sweet and totally free.  I sent my client the link and within minutes he had e-signed it too. 

They also let you do invoicing and payments through them for a nominal fee. I might check that service out later, but the contract part was cool enough.  Check it out at https://www.hellobonsai.com/invite/6fb630df  (if you sign up after using that link I get a $5 credit to try out some of their paid services)

[KnuckleBuckett]

 

[ober]

I checked it out, Micah.  Good stuff.  I wish the font on some of the site was easier to read.  Maybe it's just me, but the site itself looks terrible in Firefox.  Not a reason to hate the service but meh.  I'll probably stick to freshbooks and my own contracts.

[micah]

So an update on Bonsai -- I drafted an invoice a few weeks back but never actually sent it to my client.  (I ended up giving him a pdf of a custom invoice I wrote up and he wrote me a check in person).

Fast forward to tonight and the client just forwarded an e-mail he received from Bonsai saying the invoice was now past due and he owed a penalty. 

So that's not cool.

EDIT: I'm also pretty sure that the site is just run by the one guy who liked my tweet about the service, is listed as the "co-founder" and is the one who just immediately responded to a support message I sent, stating this was a bug that they are fixing right now.   I still like the service, not sure if its ready for prime-time.  I'll keep using it though.

[ober]

Yeah, I checked it out.  Didn't really like it.  I use Freshbooks for invoicing and I'm just going to manually manage my contracts.

[micah]

Need some quick invoicing advice.
All of my freelance work over the past 4 years now has been invoiced at the end of the project (or on a bi-weekly running invoice) at an hourly rate.  So my invoice would list out what I worked on, times the number of hours and my rate with a total at the bottom.

I just landed a smallish freelance job from an agency and they want to pay me a flat rate for the project.  25% now at kick-off, 50% at hand code hand-off/launch and the last 25% net-30... a month after the the project ends.

So how do I invoice that first 25%? So far I have only done about 2 hours of admin work (mostly reviewing specs and talking on the phone) and haven't started programming... but to get that first 25% they want an invoice.  What do I put as the description?  How should it look?  I want to send them the invoice ASAP so I can get the money and start working.  Its a few hundred bucks and I could certainly use it right now!! LOL.

thoughts?