Setting an Hourly Rate for Desktop Publishing

Pricing and estimating

Although some consider it the most difficult aspect of starting a desktop publishing business, the basic process involved in setting prices and estimating jobs is fairly straightforward.

Calculate Your Hourly Rate
Now, you may be saying to yourself "I don't want to charge by the hour. I need to know what to charge to design a brochure or do a newsletter." But before you can calculate how much to charge for specific projects you need to know how much your time is worth.

That's your hourly rate. In "Expand the Plan for Your Desktop Publishing Business" we made some preliminary calculations to arrive at an hourly rate. Now we'll fine-tune those numbers and introduce profit into the equation.

One basic formula is Salary + Overhead + Profit / Billable Hours = Hourly Rate. That rate may then need to be adjusted based on market conditions but to arrive at a starting point you need to figure out how much of a salary you want or need to make, what your expenses are, how much profit you'd like to generate, and how many billable hours you can put in.

  1. Salary. This is what you want to earn. What you want to be able to pay yourself. It might be based on what you earned in past jobs, what you might be earning doing this same type of work for an employer, and what you know it takes to maintain the lifestyle that you want.
  2. Overhead. This is what it costs to run your business. These are your office supplies, utilities, software, costs of advertising, educational costs, self-employment taxes — all your business expenses.
  1. Profit. Profit is over and beyond what you pay yourself. It's money left over after paying yourself and paying the bills that can then be used to reward yourself for being a good business person (your Christmas bonus) or it can be put back into the business to pay for a new, expanded marketing program. New businesses, if they make a profit, will often put it back into the company in the early years in order to help grow the business.
  1. Billable Hours. This will require some research. If you've done desktop publishing work previously you may already have a good idea how long it takes to do specific types of projects. What you'll need to also take into account is non-billable hours necessary to running a business such as bookkeeping tasks and marketing. The exercises in "Do You Have the Time to Do Freelance Design?" can help you develop a realistic idea of how many hours you can expect to spend doing billable work.
  2. Hourly Rate. (1+2+3)/4 = 5 This is your starting point.

Adjust Your Hourly Rate
After you know what you need to charge per hour in order to pay the bills, pay yourself what you want to make, and turn a profit without working more hours than you've planned, it's time to see if that's a realistic rate. You do this by doing some research. Find out what other designers are charging, especially those in your area and those doing the same type of work. You may also need to calculate flat fees or project pricing - based on your hourly rate - to see if that's in keeping with market conditions in your area and within the comfort zone of your potential clients.

If you find you need to adjust your hourly rate down then you're going to have to take a cut in salary, trim some expenses, lower your profit expectations, or increase your billable hours in order to make up for the cut.

Your Assignment: Using this lesson and the resources in the sidebar, calculate an hourly rate for your business based on your actual expenses, desired salary, and projected billable hours.

Next Page > Calculate Your Flat Fee or Project Estimate

Freelance Design > Start a Business > Pricing Your Desktop Publishing Services

  • This article is part of our free Start a Desktop Publishing Business Email Course. Learn more about the course and sign up now.

Doing Desktop Publishing & Graphic Design
Training, Education, Jobs:Careers in Desktop Publishing
In the Classroom:Back to School With Desktop Publishing
Jobs:How to Find an Entry-Level Design Job or Internship
Business:How to Start a Freelance Desktop Publishing or Graphic Design Business
Pick Your Path to Desktop Publishing
Get Started:Basic Guidelines and Requirements for Desktop Publishing
Choose Software:Desktop Publishing and Design Software
Tips & Tutorials:How to Do Desktop Publishing
Make Something:Things to Make for the Holidays
Use Templates:Templates for Print and Web Publishing

While some designers will charge an hourly rate, most desktop publishing services are charged by the project. Clients generally prefer this method because they can more easily see how much a job will cost and what each part of a project costs.

Calculate Your Flat Fee or Project Estimate
The basic formula for figuring out how much a specific project will cost is Hourly Rate x Labor = Flat Fee and then taken a step further (Hourly Rate x Labor) + Other Expenses = Project Estimate.

  1. Hourly Rate. This is the rate you have determined that your time is worth. See "Calculate Your Hourly Rate" for how to come up with this figure.
  2. Labor. In order to set a flat fee or quote a project price you'll need to know how long it will take to complete the job. This is time spent doing research, conceptualization, choosing fonts, creating layouts, printing out proofs, making client-directed changes, meeting with the client, talking to the printer - in other words, all the time required to take the project from beginning to end. If you have no past experience on which to base this you may have to sit down and time yourself doing different kinds of tasks (scanning, image editing, printing out proofs) and entire projects (laying out a brochure, a newsletter, an ad). You can also consult with other designers to find out how long it should take to do certain tasks. Estimating time is a process that may become easier as you gain experience with working on various projects.

    Multiple your Hourly Rate x Labor to reach a basic flat fee for brochure design or creating an ad or whatever the project you are pricing. At this point you may need to do additional research to find out if this comes out to a reasonable fee for your client and if it is in keeping with market conditions. If not, you may either have to find clients who can afford you or figure out if your hourly rate is too high or your time estimates are way off.

  1. Expenses. If you will handle the printing for the job (whether that is desktop printing or working with a commercial printer) it is typical to add an extra 10-20% onto what the printing will actually cost. This is your fee for any additional time involved in dealing with the printer.

    There may be some one-time expenses associated with a particular job. For instance, the client may require a specific typeface that you'll have to purchase. You may choose to pass that cost along to the client. The cost of paper, envelopes, or other supplies specific to that project would be included.

    • Although it may not be included in the quote you give for a project, responsibility for additional charges not included in the project estimate should be specified in the contract. These might be unexpected rush delivery fees, excessive revisions, or additional client meetings not previously budgeted for.

  1. Project Estimate. (1 x 2) + 3 = 4 This is your estimate of what a specific job will cost the client. It includes your labor costs, the cost of printing and supplies, and other incidental expenses. This project estimate would become a part of your contract for that job.

Your Assignment: Use this lesson and the resources in the sidebar calculate a flat fee for some of the typical projects you expect to be doing in your desktop publishing business. Use the sidebar resources for additional, detailed advice on setting rates and determining if your hourly rates and project pricing is in keeping with what other freelance designers are charging.

Previous Page > Calculate Your Hourly Rate

  • This article is part of our free Start a Desktop Publishing Business Email Course. Learn more about the course and sign up now.

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Your Citation
Bear, Jacci Howard. "Setting an Hourly Rate for Desktop Publishing." ThoughtCo, Feb. 16, 2016, Bear, Jacci Howard. (2016, February 16). Setting an Hourly Rate for Desktop Publishing. Retrieved from Bear, Jacci Howard. "Setting an Hourly Rate for Desktop Publishing." ThoughtCo. (accessed December 11, 2017).