How to price a job you have never done

Somebody asks what you would charge for something you have not done before. You have about a day to answer, no comparable job to look at, and a strong suspicion that whatever number you say will be the number you live with.

There is a method for this, and it is not “charge what you are worth.” It is arithmetic, done in a particular order, and it takes about twenty minutes.

Start from the hours, even when you will not bill by the hour

Write down the job as a list of tasks, in the order they happen. Not “photography” — the drive, the setup, the shoot, the culling, the edit, the upload, the two rounds of changes. Put a number of hours beside each one.

Now add the parts people forget, because they are the parts that turn a profitable job into a break-even one:

• The brief and the back-and-forth before you start. Two hours is normal and it is unpaid unless you price it.
• Travel, both directions, and the dead time between.
• Revisions. Assume two rounds. If you assume none, you have priced a job that does not exist.
• Delivery and admin — export, upload, the invoice, the chase.

Total the hours. Multiply by the rate you actually need, not the rate you feel comfortable saying out loud. That gives you a floor. You are not going to send this number, but you now know what a bad outcome looks like, which is the only thing that lets you negotiate.

Work out the rate you need, once

Most freelancers set an hourly rate by asking what other people charge. Do it from the other end instead, once a year, and keep the answer somewhere.

Take what you need to earn in a year. Add what you spend on the business — gear, software, insurance, accountant, the phone. Add tax, which is the line people leave out and then feel blindsided by. That is your target.

Then divide by billable hours, not working hours. Nobody bills forty hours a week. Between selling, admin, quoting jobs you do not win, and the weeks nobody calls, 20 to 25 billable hours a week is a realistic year for most solo operators. If you divide by forty you have just set a rate that cannot cover your own life, and no amount of volume fixes it.

Then decide what the job is worth to them

The floor is about you. The price is about the client. The same day of work is worth different amounts to a national brand launching a product line and to a neighbour opening a cafe, and pretending otherwise mostly means undercharging the first one.

Two questions get you most of the way. What happens to them if this goes well? And what were they expecting to pay? The second one is not cheating to ask — “Do you have a budget in mind?” is a normal question, and the answer saves both of you a week.

Where the number lands between your floor and their ceiling is judgement. But you should know both numbers before you say anything.

Price the job, not the day

Once you have a figure, present it as the job. A day rate invites a conversation about how many days it should take, which is a conversation you cannot win — the client has never done it either and will guess low.

A fixed price for a defined scope moves the conversation to what is included, which is a conversation worth having and one you can write down. Then write it down: what is in, what is not, how many revision rounds, what happens if the scope moves.

Say which kind of number it is

If you can define the scope, send a quote — a fixed price you will stand behind. If there is real unknown left, send an estimate and say what is uncertain on its own line. What loses jobs is not uncertainty; it is a number that arrives with no working shown.

Do not send an estimate and then behave as though it was a quote, or the reverse. The word at the top of the page is what a client will hold you to, whatever was said on the phone.

Two things to put on it before you send

An expiry date.Your costs move and your calendar fills. A price with no expiry is one someone can accept next spring at last year’s rate.

A deposit. For anything over a few days, ask for money before you start. It is the single strongest filter for a client who was never going to pay, and it is far easier to agree before the work than after. Deposits and payment terms covers what to ask for and how to phrase it.

Afterwards, write down what it actually took

The reason this job is hard to price is that you have not done it before. That stops being true the moment it is finished — but only if you record the real hours, including the ones that annoyed you, while you still remember them.

Six jobs later you are not estimating any more. You are looking things up, which is a different and much better position to negotiate from.