Should Freelancers Bid By the Hour or By Project?

Whether you’re a freelance designer, writer or programmer, the question of how exactly to charge your clients is sure to come up.

We’ll get to how you should charge for a project, but first things first: it’s always a good idea to know what you want to earn per hour, regardless of how you charge for a project.

Use your ideal hourly fee as a platform to determine what you’ll ultimately charge for a project. For instance, if your hourly fee is $55, you can use that to estimate the amount of time you’ll work on a project if your client wants to pay a flat rate.

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By the Hour

Charging by the hour can be helpful in helping your client understand how much time it will take to complete a project. However, there are some instances in which charging by the hour is helpful to both parties.

Freelancers who charge by the hour will typically quote to a prospective client that they charge a fixed number of dollars per hour for as many hours as it takes to complete a project. Good freelancers will also quote the number of hours it will take to complete that project. Either way, if you’re charging your client an hourly fee to complete a project, this gives them a good idea of how much the project will cost, how long it will take to complete the project and, ultimately, how much money it will cost them on a daily, weekly or monthly basis until project completion.

For ongoing projects that may require regular updating or maintenance, it’s also best to charge by the hour. In this case, you would quote to your prospective client that you charge a certain number of dollars for a certain number of hours per week — or per month — for the duration of the project.

By the Project

As mentioned before, you already have an ideal hourly fee that you’d like to earn and it’s best to use that fee to help determine what you’ll charge per project. If, as a freelancer, you run a company that performs several services, you can use that ideal hourly fee to create a fee schedule (also known as a rate sheet). In any case, you’ll know what you want to earn by the hour, you’ll have a rough estimate of how many hours it will take to complete a project, but the only difference is that you only quote the total project fee to the client.

Let’s say your prospective client asks you to bid on a graphic design project (such as a brochure, flyer or newsletter design). Sometimes it’s better to charge a flat rate, as some clients, who are often laymen in terms of how freelancing works, cannot imagine paying a writer or a designer $55/hour for something that may take 20 hours to complete.

Many clients do not care how hard you have to work to complete the project or how many hours it will take to complete it. They know that they’ll pay a single price for a single project, and most times, this is easier for the client and the freelancer.

For ongoing projects, some freelancers may charge a retainer fee. This is typically a monthly arrangement. Monthly retainer fees often involve a more varied number of services that need to be performed.

Conclusion

There a few things that you’ll want to remember when determining how to charge a client.

First, you always need to have an ideal hourly fee in my mind. If you decide to charge an hourly fee, you would disclose your fee, as well as the number of hours that you would expect it to take to complete the project.

Secondly, in the case of charging a fixed price for a project, you wouldn’t disclose this hourly fee to the client, but you would use it to determine what to charge for that project.

Want to bid for freelance design work?
Regardless of your chosen method, a good place to start is DesignCrowd.com where you can bid on graphic design projects, bid on logo design projects or submit freelance website design bids.

Lindsey Gregory is a freelance writer for DesignCrowd.com – an online service for freelance designers and freelance design jobs.

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6 Responses

  1. PSD to CSS says:

    Thanks for the tips. I was in confusion about how to charge – by hourly rate or per project.

  2. Snoggle News says:

    Wow great stuff. really supportive post and I enjoy your ideas on freelancing. It’s not an easy job but it does provide a lot of freedom!

  3. You said “and most times, this is easier for the client and the freelancer.”

    In my experience as a webdesigner (over 10 years in the business) that’s a risk worth taking if it’s a small enough project. But for a big project I would advise any freelance designer never to work at a fixed price as I have learned that it opens the door to some clients to ask for countless iterations and changes.

    I however understand that this way of doing things is easier if you already have recurring clients that know and trust you.

  4. Mobarak says:

    By Project is good way with me .

  5. Insightful article I think that whether to charge by the hour or by the project can largely depend upon the client.

  6. Bid Writers says:

    An hourly rate can always be worked out but if a process takes 1 day, for instance, how much experience has gone into that 1 day’s work? I don’t always agree with charging by the hour. Per project is the way to go. A percentage of the project value whether it is won or not.