Pricing a freelance project is a very tricky task, sometimes we get stumped when pricing freelance projects because we try to think without certain factors and criterias.
There's certainly a lot of factors to consider, but here are the most common ones:
Your hourly rate
- This is the most important thing to know
- How much do you value yourself?
- Every decision you will make with regards to accepting the project will revolve around your rate
- As a rule of thumb, your desired value might not be far from your current value on the job market
- E.g. If you're earning 20-30k/mo whilst employed, and your target for your next job/project is higher than that, let's say 40k. 40k divided by 21 days divided by 8 hours, that's more or less 238/hour.
- Don't forget to factor in the utilities, tools, services costs, if valuing self at 238/hr for example, add 30% more for the utilities, that's 309/hr
The project's complexity
- You should factor in how much mental load are you capable of and willing to use up for the project
- There are projects that are inherently complex
- There are projects that not complex but tedious
- There are easy projects
- There are projects that are easy when you think a mental model of it but becomes complex when implemented or when a client introduced a change jn the requirements that throws the project into a whole new level of complexity
The project deadline
- You should always try to charge more for projects that have a shorter timeline
- This means that the client really needs this to run before that date, so the client must be at a difficult position and you should leverage that
- A shorter deadline also means there's very little room for feedback loops and requirements changes
- knowing clients, they always have changes so you should always bear that in mind because a client will have changes to the requirements but not the deadlines
Your interest in the project
- It really depends on what kind of a freelance dev are you
- If you don't really need the project or the project is not that interesting for you, you have liberty to play with your pricing model and see what works
- Similarly, when doing a project and you're offer is more than what the client can afford, if you are really intrigued by the project, you can have some kind of equity arrangement or something to that effect
Client's initial estimate
- Of course, all of these boils down to what the client can afford or is willing to pay
- Should you try to lower your rate to match the client's estimate? It depends, is it reasonable? Is the project still worth it with a lower rate?
- Should you chase after clients who says they can get things done for a lower price with another freelancer? Personally no, I don't chase clients, I'll say that's ok, I price higher because I'm confident and is equipped with the right skillset to do the project, if by chance the other freelancer cannot do it, you can always return to me.
Compromises and meeting halfway
- Everything can be sorted out with proper communication
Everything above is not set in stone, you can have your own pricing model, this only serves as a rule of thumb when you are new to freelance projects.