Hourly rate or fixed prices?

Which do you prefer to work on?:

  • Hourly Rate
  • Fixed Prices

0 voters

Imagine an economy where people were paid for progress instead of time. What are the pros and cons?

I prefer to work hourly on freelance projects, but most clients prefer to know up front what it will cost them.

That’s a tough one. For me I really prefer to work hourly, because sometimes it makes clients a little more conscious about changes. On the projects where it’s not hourly - I find I’m in the uncomfortable position of having to make a change order since the projects projected hours have been gone over. I much prefer to be in the camp of if you want 22 edits trying it this way or that, no worries your paying the tab. :slight_smile:

Now, there are times when it bites me on the butt. I sit down and in four hours knock out the perfect logo for them within the logo sheet… ha ha ha

What if you don’t do hourly or fixed, or maybe rather both.
We have fixed prices for time and materials, but the complexity of the project is what determines the multiplier, so maybe that is considered hourly.
No two projects are the same so totally fixed pricing is pretty much out.

I try to do fixed pricing with an allotted number of revisions, and then charge hourly after the allotted revisions are used up. The fixed prices disciplines me to work more efficiently, while the allotment and hourly revisions disciplines the client.

Fixed pricing for the first and second proof, hourly after that. I’ll remind them when the hourly kicks in. It keeps them sober.

I have been thinking about exactly this for the past few days—should I go the hourly rate route or fix a price.

Suppose you do a per hour rate, and you have two similar jobs where one takes way more time than the other. How do you justify charging a paltry sum for the less time-intensive one?

Fixed price / value price / hourly . . . it’s a big topic. I’d describe my own practice as value adjusted hourly.

The more time-intensive job is a learning experience for you to work more efficiently. The less time-intensive job is your reward for working more efficiently.

Way back in college, I had an internship at a design studio. Sometimes they would take me along to their client meetings. I remember one meeting where they presented three very nice, simple, clean logos to a client. The client looked a little unhappy with them, then asked how long it took to draw such simple shapes. Without even hesitating, the owner of the studio said, “One hour plus 20 years of experience.”


The devil would advocate that efficiency leads to more work and less money.

That’s where the value based pricing or project pricing comes in. Sometimes it just doesn’t make sense to charge hourly. Either that or you raise your hourly rate.

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When paid by the hour, the devil is correct. When paid by a well estimated and worthy fixed price, the opposite is true.

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