“How much do you charge for a logo?”
“What are your rates for a website?”
I sigh when I hear this. It’s like saying to a mechanic, “My car isn’t working. How much would you charge to fix it?” But while that may sound obviously silly, people are less familiar with what goes into design work, so… here goes:
We have a list of about 15 or more considerations we make before we price out a contract. Until our custom calculator is set up, a lot of thought goes into putting together a quote we think is fair, affordable for the client, doesn’t run too much of a risk of scope creep for us, and which is all-around worth it for us to take at this moment in time.
Here are seven of the considerations:
1. Bigger companies should pay more. Most companies will benefit from better branding, but large companies stand to benefit the most. The reason is that a new start-up or brick-and-mortar business probably doesn’t have much of an audience yet. If they don’t spend on advertising because they can’t afford it, or if they don’t have creative social media campaigns, or if word-of-mouth doesn’t catch on, good design may not help them enough—they can still die. But a successful enough company already has an audience. If that audience liked or noticed the company before, they’re going to notice and love it even more with a new, fancy rebrand that targets the audience well. That’s pretty much a guarantee.
Let’s say that a successful rebrand earns Large Companymart a 45% increase in annual revenue, which winds up being a hundred bazillion dollars. Sweet.
Meanwhile, Smally Smalls-and-Things also increases their annual revenue 45% with their new rebrand. Woot! That’s $80,000 more for them!
Should the design agency make approximately the same amount for each job?
Neither of them would have seen this increase without the successful rebrand. And since a bad rebrand could have cost Large Companymart more, too, the work and talent of the agency is imperative to Large Companymart’s well-being.
It’s a part of our culture’s morality to say thank you when someone helps you, and we try to match our show of gratitude to the degree of generosity and sacrifice. When a random citizen risks their life to save another, they get an award and a ceremony and notoriety; they don’t merely get free tickets to a movie. We’re so accustomed to exchanging tangible thanks or at least a comparable gesture in exchange for services rendered that even though reward is not why I would jump into a river to save your drowning kid, I’d still be kind of surprised and wonder what’s wrong with you if you merely said, “Hey, thanks,” and left it at that. I expect something even more so when asked to do something I wouldn’t normally do or offer to do, like make a website for a successful stranger.
Say thank you with money. Small mom-and-pop businesses can be more fun to work with because they’re so grateful and excited and you get to be there from the beginning. It’s deeply fulfilling to help them get off the ground. If design agencies were to make close to the same amount for the work they do, no matter the client, they might not bother to work for larger companies.
I recently quoted a lower-than-usual price for a logo to a company run by people I know, and I did it as a goodwill gesture. I haven’t heard from them, possibly because they didn’t like the price and thought it too high, not aware that I’m aware what they bring in each year. And the reason they may have thought the price was too high was possibly because their previous logo was awful, likely inexpensive, and they’re thinking in terms of “How long does it take to make a logo? Bob made our last one for $200.” Which brings me to #2:
2. As Paula Scher famously said, “It took me a few seconds to draw it but it took me 34 years to learn how to draw it in a few seconds.” People should not be rewarded less for becoming better and faster at what they do. The reward for becoming more proficient and more talented should not be more work load and stress in exchange for mere job security—but that’s sometimes how people are treated in their jobs, right? “Become faster at this or you’ll be fired.” And as they become better, their boss’s gratitude fades into inurement and entitlement; he expects continuous improvement. He’s not thinking that part of his job as an employer is to make sure that his employee wants to keep working for him.
This is to say that most work we do will not be priced by the hour. It’s only a rough metric we use to help us price out work.
3. You aren’t just paying for the time it takes someone to make something; you’re also paying for the expenses they incur to be able to make you something, as well as hidden hours.
This post about photographers explains some of this well.
From our perspective, here’s what eats up our time on a project:
-Emailing! If your emails are not clear, if you don’t know industry terms and you’re trying to explain what you want and we have to read between the lines and ask for clarification… we’re empathetic to where you’re coming from, but this still takes extra time. If you’re just forwarding on other people’s emails for us to interpret, that’s time consuming.
-Or, I had one client who insisted on Skype chats where he would tell me a lot about periphery info I didn’t need to hear. Understandable—I can be chatty, too. I just work that into the price, knowing him.
-If we’re rushing something for you, we might be hasty in our file management. Then we have to go clean up our messes later, because our computers are getting bogged down because of all the files on our desktop or in downloads, or because we haven’t restarted and updated software in a while because we’re always busy churning out work.
-If we are teaching you things you need to know to make decisions about the project, that’s our time. And this happens sometimes where we’re surprised the client didn’t know X and we wouldn’t have thought to work this time into the price.
As far as expenses, just to do your work, we have:
-Adobe Creative Cloud subscription fees
-Google for Business (GSuite) fees
-payment management and time-tracking software (we use Paymo)
-new technology as well as possible repairs
-monthly membership design resources
Costs for design work should also vary depending on where a person lives, because the expenses you’re also paying for are the ones to keep the designers alive. A dead or even hungry designer is of no use to you. 😉 In Victoria, shelter is far pricier than in Northern Ontario, for example. So, if you can find someone in India who can do your design work for twenty times less than I can and you absolutely need to carve off expenses and there’s no language or cultural barrier, and you like the result, we understand and won’t judge. But if you can afford to pay for someone local and you choose not to, well, we’re probably not a good match for each other anyway.
4. If it’s a project we don’t want to put in our portfolio or are not allowed to put in our portfolio, chances are you will pay more. Conversely, if it’s a super amazing project or if it’s a stepping stone to a client we want to land or another kind of project we have in mind, we may give you a deal to get the contract. If we can’t leverage the work to get more work, then it is supplanting other work we could be doing that could get us further ahead. Why would we do that unless you’re willing to pay more and that suits our current needs and goals?
5. If it’s a rush project, you need to pay more. Because, AHHHHHH, so stressful!
6. If it is being packaged with other work—in a contract, not a casual promise made of “more work to come down the pipeline if this goes well” which almost everyone says—then you will get a discounted rate on each individual deliverable.
7. It may only take us a few hours or weeks to make you a thing, but if you’re using it for ten years, that’s a high value item. It means a lot to you, you like it, it’s working for you, and that means it’s really, really important. You’d pay more for shoes that will last you ten years over shoes that last ten months. It’s our job to create something that can endure. The longer it can endure or the more useful it is to you, the more you should pay.
These are just some of our considerations.
If a client wants us to create a rate list for them, we can do that where a poster is a poster is a poster, and it’s $2000 every time. We can do something like that because a comfortable profit margin means we don’t have to stress about whether something took six hours or eight. But if we do a poster for $300 every time, and then some posters take several more hours and a few edits, then we’ve lost money on that poster and it won’t be recouped on the other poster jobs where we’re making just enough.
If you’re willing to pay enough money, you can definitely have an agency treat you like gold, spending as much time as you need emailing and revising and coming up with new ideas to help your company succeed. But if cost is your primary concern, then the agency needs to keep track of how much work you are, how much they enjoy working on your brand, and what the benefits are to them.
“In the third year of the Civil War, Abraham Lincoln ordered work to go ahead on the completion of the dome of the Capitol. When critics protested the diversion of labor and money from the prosecution of the war, Lincoln said, ‘If people see the capitol going on, it is a sign that we intend this Union shall go on.’ […] John Kennedy recalled [this story] when he asked for public support for the arts in 1962. Lincoln, Kennedy said, ‘understood that the life of the arts, far from being an interruption, a distraction, in the life of the nation, is very close to the center of a nation’s purpose- and is a test of the quality of a nation’s civilization.” –Arthur M. Schlesinger, Jr.
In a capitalistic society, our spending shows what we value. Do we value art and design? Do we believe it’s valuable because we believe our society or company will continue to flourish? Or are we sending a negative message of scarcity mindset, that all is not well in the republic? If you aren’t regularly investing in quality design (and if a society doesn’t regularly invest in art), you send the message that you’re afraid for your future success because things aren’t going well. That’s not a good strategy for landing new clients or customers.
If you liked this post, if you have friends in creative professions, if you are in a creative profession and you want people to know what it’s like, please share this post. Please share it in support of the writers, photographers, videographers, graphic designers, clothing designers, illustrators, artists, and other creatives who may be too timid or less able to articulate why they charge what they do, or what they’d like to charge. Women often don’t charge what they’re worth because they’re raised to be accommodating, nurturing, and to doubt their worth. We need people to understand our value from these practical and capitalistic perspectives, so that design and art can be adequately valued and respected in a culture that veers on only valuing that which is tangible or which has a predictable price tag. Art and design are what create joy, compassion, comprehension, delight, empathy, ease, peace, calm, motivation, and so much more in a society and within company branding and communications.
Thank you for your thoughtful reading. If this made a lot of sense to you, I’m sure we’d love to work with you. 🙂
Natasha Clark, Partner at Risk Creative. Republication is welcome only with attribution and a direct link to http://www.riskcreative.com. Thank you in advance for good behaviour. 🙂