When I was younger and more foolish, I wanted to make $60 per hour. Not for any great reason, more of, when I come to your office and you want to waste my time, it wouldn’t bother me so much. I figured I would say, “Let me buy you a soda,” and in the span of time it took me to walk to the vending machine, drop in a few quarters and bring it back to you, I would make a few bucks in the process and you would think I was a generous guy.
I got a little smarter since then.
Using the same soda analogy, I see you’re in the desert – parched and in dire need of water. I calculate how long it will take you to dig up a well, set up the equipment, and get your own water. That is how much I bill. The only catch is I will be done tomorrow or maybe in a few days. Meanwhile, it will take you months. So how much is getting that thirst quenched worth to you?
Of course in this case I sound like a total….and I work really hard not to withhold water from people in the desert. But I do bill based on the value of the project to you, not on my time. I want you to take a moment and think about that.
The value to you, my client.
So let’s say my client has a project that will take them 3 months to complete and will begin reaping value when the project is done. Labor and all the resources will cost $5000 and will be sporadically worked on over the next 90 days. We’ll say 250 hours at $20 per hour is what they are paying their person.
I’m pretty sharp, so I think I can be done in 10 hours over two days. What are the odds of my client wanting to pay me $500 per hour when they can pay someone else $20 per hour? I’m guessing pretty low.
So I offer package pricing, $5000 for the project and we can be done by next week. I make sure they know I have to rearrange my schedule quite a bit and it will be a stretch, but I’m sure I can have it done early next week, mid-week at the latest.
Now, they really don’t know how many hours they’re paying for, so they don’t know the wage. It all gets a little soft around the edges, but now it’s reasonable.
So I get the job and do some work on it every day over the course of the next week (remotely), clean up a few other things while I’m working on it, put a beautiful bow on the project, and call it done. The client gets an awesome result. I get a happy client and a good rate. Everybody is happy.
Except for that one person reading this, you still think badly of me.
It seems as if I conned my client.
What you and the client don’t and will never see are the tens of thousands of hours that got me to where I am today. Those are my skills. It was what I was reading about last night and what got me so frustrated earlier in the day, I had to walk away and take a break. It’s me waking the little woman up at 2AM just to tell her, ‘I found a solution and I can go to bed now.’ It was that moment I was walking along and said “Got it.” It’s Edison finding 10,000 things that will not work as filaments for a light bulb in order to look for the one that will. In a way, my client paid for ‘failure’.
They paid for all the failures they didn’t have to go through to get to the solution.
On the other hand, they paid for the success my experience brings. Either way is fine; it’s just different sides of the same coin.
Something to consider.