I ran across this article this morning and thought it would be an interesting read for some here.
http://www.alistapart.com/articles/pricing-strategy-for-creatives/
The main arguments to the article are a) raise your rates and b) don't charge by the hour.
The "Hourly Rate" argument is one I take with a bit of "yes, but...". When you're pricing for an overall deliverable you certainly shouldn't bill based on hours but you need to know, at least roughly, what the hours involved are. And if you're working with or as a daily hire then you need to think about hourly rates.
From my perspective, an hourly rate is a tool to make sure the customer doesn't view my time as "no object". The important part of the equation is overtime, not the hourly rate. As a grip/electric in the San Francisco Bay area, the billing convention was to charge a flat fee for a day up to ten hours and then overtime for anything after ten hours. In this way both parties had a clear idea of what the charges would be.
If you take this more abstractly, the strategy is to have a flat fee for the service or deliverable but to have a means of charging more when a project goes beyond it's original scope. Charges for changes and overages are similar to charges for overtime, but the triggers for the charges aren't as clear-cut.
It's been about a decade since I've worked as a grip/electric in the Production side of the film/video business. I now have a bit more contact with and appreciation for the Pre and Post-production side of things. From this side of things I can see that it's more important to charge for the deliverable rather than for the hours. Client's want a bottom line, crew want to charge for time. If you're the creative producer standing between the two, you need to be able to translate these two needs.
Rob
http://www.alistapart.com/articles/pricing-strategy-for-creatives/
The main arguments to the article are a) raise your rates and b) don't charge by the hour.
The "Hourly Rate" argument is one I take with a bit of "yes, but...". When you're pricing for an overall deliverable you certainly shouldn't bill based on hours but you need to know, at least roughly, what the hours involved are. And if you're working with or as a daily hire then you need to think about hourly rates.
From my perspective, an hourly rate is a tool to make sure the customer doesn't view my time as "no object". The important part of the equation is overtime, not the hourly rate. As a grip/electric in the San Francisco Bay area, the billing convention was to charge a flat fee for a day up to ten hours and then overtime for anything after ten hours. In this way both parties had a clear idea of what the charges would be.
If you take this more abstractly, the strategy is to have a flat fee for the service or deliverable but to have a means of charging more when a project goes beyond it's original scope. Charges for changes and overages are similar to charges for overtime, but the triggers for the charges aren't as clear-cut.
It's been about a decade since I've worked as a grip/electric in the Production side of the film/video business. I now have a bit more contact with and appreciation for the Pre and Post-production side of things. From this side of things I can see that it's more important to charge for the deliverable rather than for the hours. Client's want a bottom line, crew want to charge for time. If you're the creative producer standing between the two, you need to be able to translate these two needs.
Rob