How much is a specific graphic design project worth? How much is it worth to you and how much to your client? Lets take an example of a random logo design project and examine it.
The thing is when it comes to pricing, it will always end up with you and how much do you think something is worth. Period.
There is no magic universal price book for designers. This being said the reality is that many designers have No strategy while forming their prices, and they value themselves too low! One very common scenario in our industry is when the client says the price of design cannot justify itself for whatever reason. At this point the client tries to negotiate the price down. I’m guessing its because design is intellectual work, you are not trading with any physical goods, but with your knowledge, talent and experience. Quite often you will meet certain clients who don’t respect those qualities.
Lets take a quick look on how much graphic design seems to be worth in the eyes of a specific client and how much is it really worth.
Lets say you’re doing a logo design project for a small chain of hot dog stands. You may think, it’s a really small business with 5 stands scattered around town, so as a low-end client and because the owner is a nice guy you are willing to cut your price to a minimum. Lets say you value your work for this project at $800. It won’t be complicated, a couple of proposals with a few revisions or so and done.
The owner than approaches you and say that he sells his hot dogs for $2, so he would need to sell 400 hot dogs not including taxes and other expenses and that $800 is a lot for a simple logo. Thats a lot of hot dogs. Just sit on a computer press some buttons and you’ll do it in no time, the client might say(I bet he doesn’t look so nice now).
At this point two things can happen. You can either leave and never start the project, or you can lower the price further. Lets say you continue working and you agree on $500 budget for the logo design.
Considering there are designers selling logos for $30 on freelancing websites, $500 is a nice paycheck, right?
Lets analyze this a bit in-depth.
Your client named ‘Happy Hot Dog’ has 5 stands around town. You design him a simple and recognizable logo for $500 and throw in a couple of proposals for hot dog stand branding for an extra $300 for the total of $800. Nothing fancy, just his existing stand structure branded with defined brand color, a few banners and some interesting details. Now ‘Happy Hot Dog’ is transformed from boring and bland hot dog stand into a recognizable small fast food chain with the potential to grow. Since his every stand looks the same, people can recognize him, which builds trust. People like to shop and interact with someone they know. It’s just human nature.
On the other hand most of ‘Happy Hot Dog’ competitors have no real visual identity, just a random mix of colors on their stands that’s in the long run costing them recognizability and potential customer trust thus losing them a lot of money. Your client has recognizable identity, he builds brand trust and stands out from the crowd. The business is going well so he expands and opens 5 more stands. He now has 10 stands and each one is selling an average of let’s say 80 hot dogs per day. That’s 800 hotdogs in total for all 10 stands daily. 800X$2=$1600 daily, that’s $48.000,00 a month minus expenses. He’s non branded competition with the same number of stands can only dream of making half of that in the same conditions. McDonald’s figured out the power of branding long time ago.
So $48.000 a month equals to $576.000,00 a year. Even if he never opened new stands, he would still earn $288.000,00! Not bad for a small hot dog stand chain right? By the way these are all very realistic and average figures. Please note that the price of a hot dog can be 10X higher in certain cities in the US and other countries.
Now, do you still think $500 is a good deal, and that $800 proposal for a logo was unrealistic and too expensive? I’m not saying you can predict someone’s success rate or net worth and charge him accordingly. Thats not realistic. But you must have your integrity and stand behind your assessment about the price. How much did your design contributed to his success? The answer is a lot. A huge power lies in branding when done right. How something feels, what kind of impression it makes and what character has it got is all defined by branding. Visual identity is a huge part of all this.
Negotiations are ok, because it is very difficult to stay rigid about the price and always get the job, before you’re established as an expert. But never under price yourself. You may say ”thats ok, but if i don’t agree on price reduction i will not get the job”. Well you see, if you plan on working as a professional graphic designer and make a serious career of it, you have to set a certain rules in place. Try to educate the client and explain why does something costs as much, and how will lowering of the price affect his business. If he still insist on a major price reduction, than it’s for the best if you skip that project. If you’re having that much difficulties in the beginning just imagine how can things turn out during the project. Rejecting projects is also a part off the designers career.
Your design surly wont be the only driving force to a successful business, because there is much more in business in general, but it will definitely play a huge roll! The main point is, you must never underestimate your work because you’re only underestimating yourself. Be realistic, do your best and get what you’re worth! Don’t settle for anything less!