Working by the hour might be ok if you're a teenager with a paper run but its not sustainable when youre in the big bad world and there are plenty of reasons why this is the case.
Freelancers, I know you need the work and fair enough however youre chopping off your nose to spite your face and here's a few reasons why you should consider project fees rather than hourly rates.
Granted this is my opinion, hopefully it will allow you to make a firm decision next time someone asks you to charge hourly.
You have two options when youre freelancing
- Hourly rate
- Project-based prices
Heres why you need to consider not charging by the hour:
- Hourly rates penalise you - the more you work, the faster you become however with hourly rates you are basically being penalised for working well. That sounds pretty dumb to me. Whereas if you work on a project base, no matter how long it takes you get the same amount. This arrangement is good when you are starting out and also when you are a very proficient freelancer.
- You know how much you will earn when you sign up for a project-based job - there are absolutely no surprises for you or your employer when you have a milestone in place and you get cracking. Whats more, it can be harder to get employers to cough up more money if their expectations of the time it should take and your expectations differ.
- Projects are easier to bill - from a billing perspective its much easier to know what you have coming up so there are no surprises. Its hard enough to make money as a freelancer, so the last thing you want is disputes.
- Tracking hours spent is a massive pain - if youve had to track and prove hours youve probably already figured out that it is a massive pain and you always seem to forget something.
No matter what, there is always going to be pros for and against and it is a personal preference, however freelancers should be aware that hourly rates are not always the best avenue to go down.
I have been freelancing while I have been setting up and growing my business and while it works, individuals do need to take control of it otherwise you end up working for basically nothing and getting taken advantage of.
Any thoughts from everyone out there about this?