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How much should you charge to build websites? [Freelancing Tips]

Philip Westfall, January 28, 2020

What’s the best way to charge customers when building websites?

Should you use an hourly rate or charge by project?

When should you use a retainer model?

In this article, we discuss pricing strategies used by successful freelancers and explain why some creative professionals struggle to make $20 per hour while others are making over $15,000 every month.

Charging by the hour is a mistake

Although hourly billing is the de facto standard used by most freelancers (and can be good in certain cases), it’s not the best way to increase your revenue and get paid top dollar for your expertise.

Here are just a few reasons why hourly billing isn’t ideal:

Regardless of if you’re a designer, developer, or marketer who builds websites for a living, there are better ways to price out your web projects.

Project based pricing

The more sophisticated you get as a freelancer and the more predictable your work, the more you want to focus on project-based pricing. Here’s a quick example of how this works, and why it's the best approach:

A local dentist is looking to create a website to help drive new patients to their clinic.

Their existing website is outdated, does not rank well for relevant keywords, and only drives a few emails per month, rarely converting into new patients.

Because of your experience in SEO and conversion rate optimization, you know that their direct competitors are acquiring around 100 leads per month that convert into roughly 10 new patients.

After discussing with the dentist, you are made aware that each patient’s lifetime value (LTV) is around $1,000.

Quick napkin math confirms that a well designed, high-converting website in this industry is worth roughly $120,000 per year (10 patients per month X 12 months X $1,000 LTV).

How should you price this project?

Obviously, you can’t charge $120,000 for a website - you won’t be providing enough value to the customer and that price would not be competitive with other available options.

A website quote should come down to how much perceived value you can provide to your customer (i.e. “How much are they willing to pay?”). Furthermore, the quote needs to align with the required time investment so the project is profitable for you.

To illustrate different ways to price this project, let’s look at 3 fictional invoices where the total price is $12,000.

Quote #1 (Entry-level freelancer)

Web design (60 hours)

  • Website branding (logo, colors, fonts)
  • 10 pages (home, about, services (5X), team, contact, landing page for ads)
  • Includes discover meeting and 2 revisions

Development (45 hours)

  • Content Management System allowing for copy and image changes
  • Custom form with tracking connected to CRM

Copywriting and SEO (45 hours)

  • Visible copy for all pages
  • Includes markup for titles, meta descriptions, heading tags, images tags, etc.

Website setup (30 hours)

  • Hosting, domain, and security set up
  • Website analytics and reporting

Hour total = 240
Hourly rate = $50
Total price = $12,000

What a customer might think of this quote:

“That’s a lot of hours, this project will take forever.”

“There is a lot of time spent on development and website setup, I wonder why it will take so long.”

“I hope this person knows what they are doing, most people are charging a higher hourly rate.”

Quote #2 (Experienced freelancer)

Web design (25 hours)

  • Website branding (logo, colors, fonts)
  • 10 pages (home, about, services (5X), team, contact, landing page for ads)
  • Includes discover meeting and 2 revisions

Development (5 hours)

  • Content Management System allowing for copy and image changes
  • Custom form with tracking connected to CRM

Copywriting and SEO (25 hours)

  • Visible copy for all pages
  • Includes markup for titles, meta descriptions, heading tags, images tags, etc.

Website setup (5 hours)

  • Hosting, domain, and security set up
  • Website analytics and reporting

Hour total = 60
Hourly rate = $200
Total price = $12,000

What a customer might think of this quote:

“The website looks like it will get done quickly, but $200/hour seems overpriced compared to the competition.”

“I shouldn’t be paying $200/hour for basic things like setting up a website or adding analytics, I know someone who can do that for way less.”

“I will need to see a breakdown of how many hours they worked to make sure they don’t go over budget.”

Quote #3 (Expert freelancer)

Web design (45%)

  • Website branding (logo, colors, fonts)
  • 10 pages (home, about, services (5X), team, contact, landing page for ads)
  • Includes discover meeting and 2 revisions

Development (5%)

  • Content Management System allowing for copy and image changes
  • Custom form with tracking connected to CRM

Copywriting and SEO (45%)

  • Visible copy for all pages
  • Includes markup for titles, meta descriptions, heading tags, images tags, etc.

Website setup (5%)

  • Hosting, domain, and security set up
  • Website analytics and reporting

Total price = $12,000

What a customer might think of this quote:

“I’m happy to see that 90% of the effort is placed on things that matter: design, copywriting, and SEO.”

“I like their all-in pricing, it’s easy to budget for.”

“Before I spend $12,000 on my website, I’d like to talk to other clients to see how satisfied they are with their websites.”

Although these quotes are made-up, they teach us several important lessons about customer behavior:

Challenges with Project Based Pricing

The two most common challenges to Project Based Pricing are project complexity and customer indecision.

The larger and more complex a project, the harder it is to evaluate. The same goes for dealing with indecisive customers that can make it challenging to estimate how many revisions they will request.

The best way to address these problems is by creating a detailed contract that covers the scope of the project and how reviews will be done. Your contract needs to outline what happens in unpredictable situations, such as new or unknown requests and dealing with never-ending review cycles.

Often, this will require you to add an hourly rate to deal with unknowns.

How to choose your hourly rate

Generally speaking, your hourly rate should match your level of expertise, your technical skills, and the industry or region in which you compete. It should not be based on how much you make divided by the number of hours you worked.

Here’s a quick example to illustrate:

Let’s assume you have an extremely efficient design process where you are able to build a high-converting landing page in 2 hours. Because landing pages provide your customers with a lot of value, you typically charge them around $1,000 per page.

Although all your customers are happy to pay you for the pages, they would be very hesitant to pay you $500/hour for your time.

This is why adding a line to your contract mentioning: “changes outside the scope of the project will be billed @ $500/hour”, is almost guaranteed to create customer pushback and make it harder to close new deals.

If designers similar to you charge $75 - $100 per hour, that’s what you should consider charging. If you go above that, clients will overly scrutinize your work and might look for alternatives.

The bad news is this hourly pricing strategy will leave money on the table. This is why, to maximize your revenue, you need to avoid charging by the hour.

How to avoid charging by the hour

How much should you charge to build websites?

The short answer is that it’s up to you. You need to come up with your price!

There are no formulas or rules that determine how much you should charge for websites or web-related projects.

Some people charge $500 for a logo and others charge $50,000.

When it comes to successful pricing as a freelancer, here are a few additional things to avoid and to consider when coming up with your prices:

Avoid

Consider

Bonus tip #1 How to increase your efficiency as a freelancer

One of the best ways to improve your efficiency is through software.

While tools like Honeybook and Grammarly can help you get paid on time and avoid spelling mistakes, real efficiencies come from how you decide to create your websites.

Website building platforms like PageCloud were made to empower creative professionals to build websites faster than ever and without code.

By allowing you to design and publish from the same tool, you can move projects from concept to completion in no-time.

The best part? By building with software like PageCloud, you are providing your customer with a high-performance website while giving them the ability to make changes themselves.

Bonus tip #2 How to get more clients

There are several freelancing websites that enable you to showcase your work and attract potential customers. Upwork, Fiverr, and 99designs are just a few examples.

Unfortunately, many of these websites put a lot of emphasis on hourly rates and “starting at” prices for projects.

However, if you’ve built an efficient process for creating websites, you can attract customers on these sites even as a high-end creative professional.

While some freelancers purchase WordPress templates and make small changes to fit clients needs, others build with visual designers like PageCloud that leverage reusable sections to create custom sites in just a few clicks.

Pro tip: Most website builders have communities of freelancers or agencies building on their platform. Joining programs like PageCloud Pros is another way to get free client referrals.

Written by

Philip Westfall

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