This story is common – you learn web design by building your own website. A friend or family member notices. Eventually, they ask you to make a website for them. Your first thought is – how much do I charge for a website?
If they don’t expect you to work for free (which is common), their first thought is similar – how much does a website cost?
It’s natural to go one step further and wonder… how much money can I make by selling websites to local businesses? Is web design freelancing an option to generate a side-income?
The answer is YES – but what you charge depends on many factors!
You could find a number of people to create a website for you, anywhere from free (with upselling) to $10,000 depending on the project and complexity.
Having said that, I recommend two things:
- DO NOT Charge Per Hour – Think about your hourly rate, but do everything you can to charge by project instead of per hour. The reason for that is simple. When a client hears our project price they know what they are going to pay in advance. It gives them a reference point that they can wrap their head around. On the other hand with an hourly rate, you may do the work upfront and then send an invoice, but if it wasn’t clear how long it would take, they may have “sticker shock”. And obviously over time, you’re going to get better at whatever you’re doing, so you shouldn’t get compensated less when you become more efficient per hour.
- DO NOT List Your Prices – People will inevitably go on your website to see what they are in for. But don’t tell them. It could be a one-page brochure website, you might need to setup an e-mail signup form with an auto-responder sequence, you may need to do advanced tracking, you may be working on an e-commerce website selling physical products. Bottom line, it’s best to have a conversation with your potential client before giving them a price range. That way, you understand what work you have to perform before launching the website.
An exception to this is a fixed monthly service (for $99 or $149/month) where you standardize your offerings. In this case, you may want them to sign-up online instead of calling for a custom consultation. If you’re going down that route, be extremely specific with what comes in each monthly package.
Another quote that really does ring true is “cheap prices = cheap customers”
The less you charge, the more your client will attempt to take advantage of you. Psychologically it is weird because the more you pay for something, the more you value it and the less you complain.
So if you have a cheap price, people are going to see how much they can squeeze out of you. Whereas if you price yourself at a premium level, you’ll have more leeway to over-deliver and provide the “wow” factor to please your client.
This can be a hard concept to really let sink in, and even harder to implement. You may need to tap into your personal network for the first couple jobs to build your portfolio before you feel comfortable asking for a higher rate or price.
But one way or another, you need to get to that premium level because if you’re the lowest-cost, you are a commodity and replaceable.
The perfect examples of this are big service companies offering the lowest level website creation packages like Squarespace, Yellowpages, Vistaprint, and GoDaddy. They usually start at $10-20/month but you still need to maintain the website yourself.
And you are looking for the business owners that want no parts of that.
There’s plenty of them in the real world, and they are the people you want to become an asset for and build an on-going relationship with. You will build trust along the way and they are the ones that will ACTUALLY value what you do and see the benefit of having a website as a lead generation method in the marketing toolbox.
Now in terms of gathering the right information to provide an accurate quote, you want to create a web design client questionnaire.
This is what you will send to customers or even just give them a call and go through each question over the phone. Be sure to write down their answers and feel free to ask spontaneous questions if they pop into your mind.
When you have an idea what the project entails and you present your proposal with the price, make sure you give them a bulleted list with everything that’s going to come with the website. If you don’t, a lot of times people are going to push you to do more, or say, “Oh, I thought that was included with the price”.
Bottom line, be VERY clear about what needs to be accomplished so you both fully understand the project.
That includes a list of things they may need to provide you.
EXAMPLE: The website will be 10-pages, one layout for the homepage with an image slider, another layout for all the inner pages, 1 company e-mail address (email@example.com), 1 contact form which forwards to their e-mail, and they must provide all the photos and wording for the website. Simple, yet provides a solid structure for what you need to accomplish and what isn’t within the scope of the contract or “handshake” agreement.
Now when it comes to pricing, it really is determined by two things:
- The Value to the Client
- Your Own Value on Your Time
Notice how neither of these relate to the actual details of the website.
Let’s start with your time…
I want you to think about how long it’s going to take you to complete the project. List out the high-level steps that you need to accomplish, i.e. register domain, setup website hosting, install WordPress, find a professional theme, customize with their logo and colors, etc.
Once you come up with the estimated hours it will take, double it.
Or at least tack on a few extra hours, because more often than not, in the beginning, you will underestimate the effort and communication required. I find this to be true with myself, even to this day.
Once you become comfortable with the process, you tend to have the approach that you can do anything quickly. And you might be able to do a lot, but there are always technical challenges that arise mid-project or a new idea from the client that you need to implement. So be careful of being overly ambitious and underpricing yourself.
So now that you have an idea of how long it’s going to take, how much do you want to make per hour? What is going to pay for your expenses and your lifestyle?
This isn’t about being a baller and charging $150/hour from Day 1.
It’s about knowing you have a valuable skill to offer, and in order to use that skill for someone else’s business, they need to compensate you to live comfortably.
That may be $25/hour now, but it can change at any time or for every new potential client – it’s completely up to you. That’s also why I recommended keeping your prices guarded and also pricing for each project that involves some type of customization or effort on your part.
Multiply your rate by the estimated hours: $100/hr x 10 hrs = $1,000
Obviously, over time as you get better at what you do, you will increase your hourly rate and also find ways to become more efficient throughout the creation process. This may involve creating a systematic process that you go through for each project, or it could simply be outsourcing the repetitive tasks.
Now that we discussed your own time value, what is the value to the client?
As a real world example, a website for a newly created yoga studio will not be as valuable as one for an established divorce lawyer. The lawyer may get clients paying them $10,000 – $20,000 each, so getting leads to them through their website is extremely valuable.
You want to focus on the businesses that already have money coming in offline, and would greatly benefit from adding a website to their marketing arsenal. Those are the businesses that have the willingness to pay you and that get more value out of your services.
The nice thing is those small business owners are often much less of a hassle.
They don’t have elaborate technical ideas that will be over your head, they don’t need to have a meeting to make a decision, they don’t micromanage what you do. They will simply let you do your thing and even fund your ability to learn and test online marketing strategies!
Are You a Designer or an Entrepreneur?
I’ve found that web designers will fall into one of three categories:
- The Business Savvy Entrepreneurs – They don’t care about getting in the trenches with design, they just want to make money. They’re the ones using professional pre-made WordPress templates, adding text/photos, but not doing any customizing. Honestly, with some of the pro themes available, you don’t have to because they are beautiful. But they just sell these to businesses that need them. And for a really nice profit.
- The Uber Creatives – On the other end of the spectrum, you have more creative folks that come up with an idea and design it from scratch. They then create an HTML website or WordPress theme from their design. Fully custom = expensive and time intensive.
- Stuck in the Middle – I believe I’m somewhere in the middle, and I recommend you find your spot there too. You want to start with a nice looking WordPress theme for the vast majority of small business web sites. But more than design, I’m looking for layout. If I find a nice design with the layout I want, I can then spend a couple hours making relatively easy customizations to make sure the website looks completely unique. I don’t like a website that mirrors the WordPress theme demo.
As someone with no design background and perfectionist tendencies, I have to catch myself spending an absurd amount of time on extremely minor details like picking between shades of blue. I’ve been working hard to just pick something and go with it… fast is better than perfect!
But if there is one takeaway, it’s that you really want to focus on efficiency. I recommend tracking your time on the first couple projects so you have a concrete idea of how long it takes, and work to improve from there. That is how you make more money with less effort.
Pricing Structures and Accepting Payments
As I mentioned before, you want to price by the project and not by the hour whenever possible. Most of the time you’ll need to have a conversation with the client before you decide on a price range, but another alternative is to “productize” your services.
EXAMPLE: Create a business website package for $2,000 – $3,000 that includes up to 10 pages, paired with domain registration, hosting, Facebook page and cover photo, logo design, business cards, etc. But a really unique package that will set them up online.
Then they will pay monthly, plus if they don’t want to manage the website or social media accounts, guess who can do that for a LARGER monthly charge?
The great thing about the web is even though there’s a million services that do all these things, you’re the one that’s going to hand-select the tools that best fit your clients and manage them. As you get experience, you’ll learn which methods are working best and you can double-down on those to see better results.
Lastly (but some would say most importantly), how do I get my money?!?
I personally like to charge 50% upfront and the remaining 50% is due on or before launch day.
Other than exchanging information and ideas, I don’t like to do any work before getting paid. There are too many flaky people to do a ton of work without knowing the money is coming. Not to say you should never do this, but it’s more important with one man or woman businesses that you don’t know that well or fully trust.
As a personal warning, I’ve had multiple business owners that have paid me the initial 50%, I finished about 80-90%, and they wouldn’t get in touch with me to put the final touches on the website. It was always, “Let’s review it soon” or “I’ll have those pictures over to you next week”. It became a long game of back and forth where nothing was accomplished.
But I wasn’t empty-handed, I still made an OK hourly rate despite never launching those websites.
The other related lesson here is that money is more powerful than a contract.
People often fret when it comes to doing a website without a contract or they spend weeks overthinking what should be in a contract instead of meeting business owners who need a website.
Let me say this with the caveat that a contract of some sort (it can simply be an e-mail) is GREAT when it comes to turning a client down for work that wasn’t included with the original price. You can point to it and say, hey I told you XYZ would be in there and doing this is more work than we agreed to.
But think about a situation where someone stiffs you, like my situation above. Are you really going to get a lawyer involved because they didn’t follow the contract (which stipulates the project must be completed/paid in 90 days)?
Unless we are talking in the multiple thousands or higher, the answer is no.
So it’s best to meet these people in person if possible to build a level of trust. Or if that’s not possible, make sure they give you those Benjamins before you get your butt to work!
My first two customers went from one-time project work to a paid monthly retainer where I work on essentially whatever I see fit. That’s a much better situation than trying to be a master of litigation, let me tell you.
When you get a handful of raving clients, people will start coming to you because they will refer you.
Ultimately, the best part of working for yourself as a web designer is the learning experience you have. You work directly with business owners and you should be asking a lot of questions about their business. Not only will this give you more insight into how you can improve their website for their customers, but you’ll also be able to take their strategies and stories and use them for your own business.
Plus people like to talk about themselves, so they’ll like you even more when you are interested in them 🙂
You will then transition from a web designer only to a local online marketing expert.
Don’t pigeonhole yourself or think you don’t have what it takes. I felt the same way at times, but I can assure you that you’ll learn a TON from your first handful of websites.
Especially when you know the important factors to look at, and that’s where I want to help you avoid mistakes!
Have a question on this topic or a personal experience with pricing to share? Leave your comment below…