Ultimately, you can charge whatever you choose that your target audience is willing to pay. There are plenty of designers that are available to the market for a couple of bucks on Fiverr, Dribbble, and UpWork. So, start by targeting the right audience.
It’s also not uncommon to see a wide range of hourly rates that graphic designers will charge. The range for starting designers is commonly $25-$50 per hour while established designers can easily charge $250-$300 per hour. Full service marketing agencies that offer graphic design services regularly charge $150-$200 per hour for design work.
You have to decide what your value to the market and your value to your customer is. What I can do is provide some food for thought and some considerations for where your time will be spent so that you can at least assess what kinds of costs you will incur, because you should make a profit after covering your costs.
How Much Does it Cost to Deliver Graphic Design Work
The main consideration is that you don’t want to earn $75 to have spent half a week of your life working with a client to design a logo.
If that’s what’s happening, chew on these realities for a moment:
- You could make 5 times (or more!) than that working for Chick-fil-A and have a steady income to pay off your student loans and save for a house, for example.
- The average cost of living for a single person in the USA is $3,200 per month. That means it costs you around $107 per day just to sustain your existence.
It takes time to deliver graphic design work of any variety and time is the most finite resource in this life. Determine how much your time is worth and ensure you cover costs with an 18-30% profit margin. If you are a sole proprietor or freelancer, some of those costs are “intangible” time costs.
If you own a graphic design agency and have employees on payroll or contract out design work on a per diem basis, those time costs are no longer “intangible” and are quite apparent as dollar signs and zeros on your bank statement.
Let’s start by assessing costs. First “time costs,” then other costs.
Time Spent Closing the Deal
- Plan to spend 3-5 hours conducting “Sales Activities” from meetings, phone calls, and emails back and forth with the prospect to preparing the proposal.
Time Spent on Client Communication
For most client interactions, it’s safe to buffer in 12-18 hours of communication time throughout the duration of the project over the course of about a month. Given the scope of the design project, you may account for more or less communication time based on what you expect for:
- Discovery Before Designing Begins
- Communication During Design Phase
- Rounds of Revisions
- Communication about file types and graphics usage
- Post-Project Communication
I recommend tracking your time—not for the sake of billing by the hour—for the sake of understanding where your time is really being spent. I use Toggl and have a Tag just for “Communication/Meetings” that I use religiously.
Time Spent Researching
Depending on the design work being commissioned, you may need to spend several hours researching design styles, techniques for achieving a certain look, and how to leverage various tools in your graphic design software.
Time Spent Designing
This is the easy part to remember to account for. Just don’t low-ball your estimate. I recommend adding a 10-20% multiplier to the amount of time you think it will take.
Time Spent Organizing Design Files & Closing Out the Project
Organizing files is a dreadful task, but it must be done. If not already accounted for in your “Time Spent Designing” bucket, be sure to add a handful of hours to this category, depending on the project scope. Especially when you are closing out a project, you want to ensure you can easily find files in the future should the client ask for them again. (Many will).
Graphic Designers have fixed costs to worry about too. Namely,
- Graphic Design Product Subscriptions
- Other Business Tool Subscriptions (like Project Management and Communications softwares)
- Workspace Costs
- Computer Setup and Design Tools
- Total Employee Costs
You have to pay for these things monthly, or for items like your computer setup, saving for maintenance or replacement of components should be an ongoing consideration in your business budget.
Some variable costs, like…
- Storage Space for Files
- File Sharing Fees
- Stock Imagery Fees
- Contractor Fees
…should all be accounted for in the price of your project.
Should You Charge By The Hour?
If it were up to me, no creative anywhere would charge by the hour. But it’s not up to me. It’s up to you whether or not you think charging by the hour is the best way to go-to-market with your talents.
I recommend that you be aware of where your time is spent, define for yourself what your goal earnings per hour worked are, and then calculate a project or design retainer price from there. A lot of heartache for you and the client can be saved and your interests will become much more aligned with the client’s interests.
How Much Should You Charge for a Logo for a Friend?
“My friend Suzy asked my to design her new band’s logo. I’m really flattered she asked and it’d be super fun! I know she can’t pay much, but something is better than nothing, right?”
As a rule of thumb, I don’t recommend taking on any graphic design work for less than $1,500. Yes, this will mean your friend Suzy can’t pay you $75 to design her new band a logo. But it doesn’t mean you can’t design the logo for Suzy. You should probably just do it for free- as a gift. Otherwise, you’re just losing money on it, and even the IRS may consider what you’re doing a hobby, not a business.
So, how much should you charge for a logo for a friend? Probably nothing, if your situation is like most “my friend asked me to design their logo” situations.
Your design skills are valuable and your time is finite.
- Respect your time.
- Respect your skills.
- Charge what you are worth.
And if you want to do pro bono work on projects you genuinely WANT to do, but who can’t afford your standard rate, then go for it! Almost guaranteed the relationship in that scenario will be much healthier (and you will feel better).
Building a successful marketing agency takes grit, a focus on your value, and sometimes a *loving* kick in the pants.
Needing an ally as you achieve your long-term goals?
I’d be happy to help.