I’ve been consulting (both in employed roles and independently) since 1997 – and I’ve been on my own since 2007.

Re: What to charge: It’s my view that a client’s perception of how they value you is directly proportional to the fee rate you offer. My clients know they will get a certain outcome (no matter where in the development process, be it concepts, CAD, documentation and so on), and so they are happy to pay the hourly rate I charge them.

Admittedly, I probably charge at the upper end of the scale, given the years I’ve been doing this, and I don’t often go over budget… that said, there is also an art to successfully negotiating additional budget, which if done poorly, means you’ll be working for an ever-reducing rate per hour until your job is finished!

I’ll generally provide an estimate if asked, but I’ll only charge based on the hours I spend… so this often results in projects being completed for less than anticipated – the savings of which are passed on to the client (which they love).

I’ve considered sliding-scale fee structures, special package deals and so on – but in the end, clients that really want to work with you (and you with them of course) will more than likely pay what your asking.

Fee negotiations (and business negotiations in general) is something sorely glossed over in undergrad ID studies, and I have seen situations where clients (who may be inexperienced product developers themselves) have bargained the designer down to such a level that you might as well go flip burgers somewhere (Ok, so I exaggerate a tad). It’s not anyone’s fault in particular, just that the collective awareness of the value that a designer can bring to a client’s project is often underrated (unfortunately).

Only around 39% of Victorian businesses use Design (either in-house or external), and only about 4% use design as a strategic input to their innovation processes. When you consider that around $7b (yes, billion) is spent in Victoria each year on design, one could be confident to assume that there is plenty of scope for new business, provided we can educate the remaining 61% of businesses about design and its benefits.

The problem we face is that Design (and more specifically Industrial Design) is often considered an upfront “cost” rather than a long-term “investment” – purely due to the risks associated with new product development, and the very real possibility that your client could be developing one of the 90% products to never successfully launch. It’s unlikely that Design will ever be regulated, so the task will continually fall back to designers to educate clients about the merits and ROI of design-led product development.

ID’ers need to master the art of the Design Brief, and be skillful in managing requirements, variations, deliverables and timelines (aka Project Management!). If you can service your clients in a professional, timely and accurate fashion, you’ll stand a far greater chance of charging your ideal rate.

The morale: Don’t just be a great designer – be a great business-person… learn about business, negotiation, project management, collaboration and communications. That’s what I’m trying to do, anyway…

I’d love to lob to the next coffee / connexions session if you’ll have me.

Cheers

Besides the cost of labor, there are fixed costs of rent, electricity, telephone, couriers, conveyance, hardware depreciation, software upgrades, etc… what we call overheads which should also be factored into hourly rates.

Then there’s the experience factor. A young designer would charge less; an experienced designer would charge more, as he brings more value to the table, and pre-empts a host of issues otherwise unknown.

Finally there’s the softer side of which clients you want to retain, how much credit period is involved, what is the scope of work (creative, conceptual, engineering), where is the client situated (US, Europe, Africa, Asia), etc.

My minimum is $20/hour (AUS), but this comes with some major non-financial benefits. Experience and environment being the 2 major points. I work at this rate when I freelance for a particular studio, working on varied and interesting projects, developing skill and knowledge sets while under guidance. The experience is invaluable

My general rate for freelance work (with 3d modelling and imagery being my specialty) is $60/hour (AUS). But the way projects and budgets have been worked while I’m involved, the overall budget has come first, then I’ve been able to decide on the hours I will spend on certain areas of the project. The 60/hour is a guide, but depending on what exactly I’m doing and the difficulty level, this will go up or down.

However, what I can’t forget to include is that I have a sessional teaching job, which is 6 hours per week for 12 weeks (twice a year), at a very handsome rate. This job gives me the insulation I need to allow me to pursue freelancing and developing my skills / knowledge / networks without having to be too concerned on where my next freelancing job will come from.

Cheers,

Waikit

I have a couple of years experience in doing commercial design projects from industrial design through to branding strategy, here in Australia. I charge between $40 to $70 dollars an hour for design work.
It is a sliding scale per hour fee based on several things including:
If the client is a newer and older one – older clients I tend to give better rates to particularly if I want to keep them long term.
The type of work – so straight CAD I will charge less for than ideation or conceptual work.
Often I will do an upfront quote for an entire job. I will then take 50% of the total up front and then 50% upon completion – this gets a bit more complex as you need to have the experience to judge how long something will take you.
As you can see even after a couple of years I am still playing around to find a suitable fee structure that works well.
Also a piece of advice for anyone just starting out, make sure (at a minimum) you factor fixed costs into your rate….I didn’t do this early on (my first couple of jobs I just picked an arbitrary number) and wondered why I was essentially not making any money.