Hourly rate vs fixed price vs everything else. How I quote for copywriting, after 16 yearsAugust 21st, 2018 8 Comments
We copywriters torture ourselves over a lot of stuff. It’s part of what makes us who we are. But few questions lead to more indecision than how to quote.
Usually it’s, “should I go hourly rate or fixed price?”, and you’ll find many fans of each out there.
Me? I’m like…
I’m happy with either. In fact, I don’t care what the engagement model is. Hourly rate, fixed price, retainer, day rate, barter, royalties, equity, contract, even salary… So long as I get paid, I’m good.
But that doesn’t mean I’m happy with any model on any job. The “so long as I get paid” bit is kinda important. Here’s a rundown of the factors that influence my decision, day-to-day…
I almost always quote fixed prices for new clients. When they don’t know me from a bar of soap, it makes them feel safe. The way I see it, I wouldn’t pay a landscaper an hourly rate if I hadn’t worked with him before; I figure copywriting clients feel the same. Assuming there’s a fixed scope, there are very few jobs you can’t quote a fixed price on.
Occasionally I quote hourly rates for new clients, but usually it’s because they can’t give me a fixed scope. I also do a lot of hourly rate work for repeat clients. They eliminate the risk for me, and I don’t have to spend a lot of time painstakingly scoping the job to ensure I don’t shoot myself in the foot by under- or over-quoting. But obviously that means the client has to wear the risk, which can make it harder to win the job. And if you haven’t established a good foundation of trust yet, it can be difficult to tell the client if it turns out you underestimated the time involved. Plus some clients are daunted by a three-figure hourly rate, even if their overall investment would be exactly the same on a fixed price.
I rarely work on day rates. I’m not sure why. I have a feeling they’re better suited to short-term contracts – anywhere from, say, a couple of days to a couple of months. Particularly when it’s on-site work. (I was asked to quote day rates for an 8-week contract the other day.) Let me know in the comments if you have more experience with day rates than me.
Retainers are actually my favourite arrangement. I get some guaranteed, ongoing income, and the client gets a guaranteed chunk of my time each month. It’s a win-win. But more than that, because it’s long-term, and there’s less talk of dollars, hours and T&Cs, and more talk about getting stuff done, I feel like I’m a real part of the team. This is great for my motivation and work satisfaction, and excellent for my relationship with the client (and for generating repeat work).
I once wrote a manual in exchange for an espresso machine and coffee grinder. And I wrote some web copy in exchange for some genetic testing and consultation on supplements. I also do fairly regular contra work for my designer and developer. But, generally speaking, barter’s a hard way to do things. It’s just not easy finding the perfect fit. I’m not keen to swap my time for crystal healing services, and my mechanic is already booked out most days, so the last thing he wants is more marketing stuff. And then, of course, there’s the question of value; how much copy do I have to write for a year’s supply of eggs?
You have to be pretty confident in a lot of things to write copy for royalties. Your writing, obviously. But also is it a good product or service, or will it bomb no matter how good the copy? How will you know the real sales figures? How do you know the client will honour their side of the deal and continue paying royalties, long term? What happens if they discontinue the product or service? What happens if they sell or close their business? In 16 years, I’ve only ever written for royalties once. (It’s a long-term client, though, and I’m on a retainer + rev-share arrangement. I completely trust the client and I have full access to all the sales data.)
As exciting as it sounds, equity is the riskiest of all the models for a copywriter. Most businesses that offer it are doing so simply because they don’t have the cash to pay you real money. Usually they’re a completely unproven startup, and sometimes they have nothing more than a concept. Although the potential reward is great, my advice is to be very wary when someone offers you equity. What they’re really asking for is investment – they want you to bankroll them. And bankrolling startups is notoriously risky.
I don’t have a lot of experience with contracts, and most of it has been in the technical writing field (in the software industry). The contracts I’ve been involved in were based on an hourly or day rate. I see them as kinda a short-term retainer. My experience with contracts tells me they’re a little bit more… ‘transactional’ than other engagements. The message is almost, “We need a body in here for 3 months, can you do it?” But again, I don’t have much experience in this area, so please feel free to correct me in the comments.
If the client wants a lot of me – and I mean a LOT – I may suggest a salary. This may sound like a strange one for an established business owner, but if you see your employer as just an ongoing client, then it’s really not a lot different from a retainer. A couple of years ago, I did a year as a salaried UX and copywriting manager for a major appliances retailer. I was full-time but working from home 4 days a week. Most days, I worked approx 9am-5pm for them, and another 4 or so hours for other clients. So outside of the long hours, holiday pay, sick pay and super, it was pretty much business as usual. Be aware, though, that the security of ongoing work comes at a cost: opportunity. You don’t have as much time to spend chasing other work and marketing your business, so when the engagement comes to a close, you may have to play a little catch-up.
Over to you
Enough about me; tell me about you. How do you quote? And lemme know if you have any questions.
Please comment below with your thoughts. I'm not so old a dog that I can't learn a few new tricks!
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