How Much Should I Charge for Projects?
By Barnaby Kalan
This is a very popular question among copywriters who are starting out as freelancers. When you ask around, you’ll get answers such as “as much as you can” or “depends on what you’re writing” or people will refer you to pricing charts.
But the truth is, it’s really a very simple formula that can be easily adjusted as you get more experience and build a track record. Here’s the formula:
First, decide how much you want to earn this year. Pick an income that’s realistic, maybe a little bit of a stretch, but achievable. For the purpose of this exercise, let’s pick $75,000.
Now, as a freelance copywriter, you will work a certain number of hours per day. You may be at your desk for 8 hours or more. But realistically, you will doing “billable” work (work that can be directly billed to a project) for about 4 hours a day. That’s a good target. If you write for a solid 4 hours each day, you’re doing well. The rest of the time you’ll be researching, answering calls, sending emails, eating lunch, etc.
(By the way…the very best copywriters in the world…from Gary Bencivenga to Gene Schwartz to Clayton Makepeace and others feel burned out after four hours of solid writing. So they use a target like this as well.)
So now, let’s do some math. 4 hours a day times 5 days a week = 20 billable hours per week. That’s a realistic target. Some weeks you might work more. Some weeks you might work less. But aim to average 20 hours a week.
You’re not going to work every day of the year, either. You’re going to want to take some vacation time. So let’s say you take 6 weeks of vacation a year. That leaves 46 work weeks.
20 billable hours a week times 46 weeks = 920 billable hours a year, as a target.
$75,000 (your target income) divided by 920 = roughly $82 per hour.
That is your new hourly rate.
BUT…you NEVER bill clients by the hour! Here’s what you do instead…
Now you have a way to figure out how much to charge a client for ANY type of project—whether it’s a series of emails, a print ad, a long-form sales letter, a VSL, doesn’t matter.
You estimate how many hours it will take you to complete that project and pad the estimate by a few hours.
For example, suppose you had to quote on an autoresponder series of 7 emails. You’d estimate an hour for getting the briefing and talking to the client, 2-3 hours (at least) for background research, maybe one hour to write each email and a half hour to edit each email, then you’d tack on one more hour in case there’s any unexpected work or edits.
That’s 1 + 3 + 7 + 3.5 + 1 = 15.5 hours
15.5 hours times your hourly rate of $82 = $1,271.
Bingo. There’s your estimate for the project for your client, based on the value of your time and how much you want to earn this year.
The specificity of that number will also show your client that you’re not bullshitting and picking a number out of the air. And that you value your time and have calculated the cost very carefully.
Sure, sometimes projects will take longer than you estimated. Sometimes they will take less time. But as time goes on, you will get better and better as estimating how much time it takes to do various projects.
If you are really smart, you will keep track of how many hours you spend on each project, so you can fine-tune your estimating (and give your clients an instant tally of the hours worked, in case the project is cancelled. That way you may be able to get paid for what you’ve done so far, and not lose any money.)
You can use a paper journal, an online or phone app, or an excel spreadsheet for this. I use a computer timesheet program called ORO Timesheets because I started my career in advertising agencies, and we were trained to use timesheets. But you can use whatever works for you.
Finally, as you get more experienced and get more “wins” that you can document, you can start charging more. And here’s the beauty of this system:
You can give yourself a “raise” anytime. You can simply say to yourself, “I want to earn $100,000 next year.” Do the same calculations. Figure out your new hourly rate. The rest of the process (estimating your time) is the same. And presto—you’re on track to earn your new target annual income.
As you get more established you will also be able to negotiate things like retainers, for a certain number of your hours every month (good for income stability).
You may even be able to negotiate royalties for the work you do. So you’re not only “trading time for money” through your project fees but also earning a percentage of sales or the number of pieces mailed. This can range from 2% to 5% or more and can add many thousands of dollars to your income when you work for big clients.
© 2019 Barnaby Kalan and Reliance Direct Marketing.