More than a mechanic, less than a lawyer

~ 22 February 2005 ~

Allow me to deliver one more blow to the well-beaten horse: Pricing in the design industry. My humble opinion enclosed.

This article was one of the few that made the 2004 editorial cut, but I never found the time to author it before year’s end.

And perhaps that was a good thing. After all, I’ve enjoyed the luxury of seeing other wise minds pen a few words on the same topic since then. For example, Greg devalued the market (or so they claimed), JSM lamented automation, and Jason refuted the millennia-old theory that clients hire us. And I must say, they’re all excellent reads, both article and comments.

Hence, what more needs to be said?

Probably not much. But if you’re still reading at this point, perhaps you’re seeking closure on the issue. Fact is, there won’t ever be closure. There won’t ever be a standardized hourly rate that everyone charges. And there certainly won’t ever be the ideal client/agency situation we all hope for.

What’s more, there are two sides to every coin. Step back for a minute then, and examine the second side of the coin: Pricing decisions faced by the client. Take a look at this example: University of Hawaii logo critique at HOW Forums. The short and the long of it? The university paid $82,000 for logo redesign, and the islanders despised the work the mainland agency produced (among other things). Frankly, after seeing the logos, I don’t blame them.

Contrast that with CD design from Disc Makers. The exact opposite of the premium pricing charged by the unnamed agency above, one might argue that Disc Makers’ “low-ball pricing” scars the industry. But is it really low-ball? After trolling through their portfolio you might be inclined to instead call it a darn good deal.

Let’s face it, crew — the design industry isn’t perfect. There is no flawless pricing model. And perhaps there shouldn’t be. Examine the car repair industry, for instance. I pay $82/hour when I take my ’95 Land Rover Discovery in for service. Yet when I take my ’88 Jeep Cherokee in for service, I pay $40/hour. A 205% markup in pricing for essentially the “same” service? What gives? Why not pay just one labor rate for both? Perhaps I should take both to the same shop. Why don’t I? Good question.

But wait, $70/hour for graphic design by Jill Y? And only $20/hour for the “same”design by Joe X? What gives? Why not the same rate? And why go for $70/hour when I can get $20/hour?

Seems there’s an interesting dichotomy at hand. But honestly, I welcome the dichotomy. If a client’s top priority is price, I have no qualms about referring them to LogoWorks.com (I’ve done so before) or StockLayouts.com. If that’s all they think their budget can afford, I waste little time convincing them otherwise. However, if price is only one of several priorities on the list, I’m all ears.

So at the end of the day, you charge what you need to charge. I’ll charge what I need to charge. Let others charge what they need to charge. And allow the market to weed out those who fail to differentiate their services and justify their pricing.

Related:

Credits

Special thanks to Threshold State, whose blog entry about rates provided the title for this article. And comments are off as many of you have already spent your 2¢ elsewhere responding to some of the articles referenced here.

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