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How Much to Charge? Use this Easy Formula

June 14, 2016 by diannejacob 9 Comments

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SeanTimberlakeA guest post by Sean Timberlake

Go to any blog conference, or drop in on any online forum for bloggers and freelancers, and one question crops up again and again: How much should I charge?

There’s a lot tied up in that request. As a freelance creative, determining your rate may feel a lot like determining your personal worth. It’s important to separate valuing your work with valuing yourself.

The reality is that there is no easy answer. There are no standard rates, and companies are often coy. Their goal is to extract as much value from contributors while parting with as little money as possible.

Contract work is, and will always be, an open negotiation. It is entirely up to you to establish your worth, and push to get it as much as possible. Few creatives will disclose what they make, in part because most likely they do not make a consistent rate themselves. For these reasons, it’s important for you to establish a rate to which you aspire.

The best advice I heard on this was at BlogHer Food a few years ago. Blogger (and personal friend) Stephanie O’Dea laid out her equation for how much to charge:

  • How much do you want to make in a year?
  • How many hours do you want to work in a week?
  • No, really, how many hours do you want to work in a week?
  • Divide your yearly rate by 52, then by the number of weekly hours worked.

Let’s talk about the second and third bullets. It’s facile to say you will work 40 hours a week, but realistically you will not be dedicating that time exclusively to paid work. What you’re after here is actual billable hours. As a freelancer, you’ll probably spend nearly as much time getting work as doing it. The time you spend building your media kit, updating your portfolio, drafting your pitch, maintaining your own blog, and managing your social media do not qualify. That’s all on you. You only bill for work that is directly germane to the job.

Say you want to make $100,000 in a year, and let’s hypothetically aim for a 20-hour week of billable hours. That’s $1,923 per week, which works out to an hourly rate of $96.15. Let’s round it up to $100 per hour.

Once you’ve established an hourly rate, use it as your lever for project-based pitches. If you want to do a sponsored post involving recipe development, for example, consider how many hours you will put into that project, and multiply it by your hourly rate to calculate a price. If it’s going to take 20 hours, then that’s a $2,000 project fee.

Sounds like a lot? Perhaps so, out of the gate. Remember, this is your target. As you land more gigs and build a body of work, you will have more leverage to demand higher rates. You may not land your optimal hourly rate the first time you ask for it, or even the tenth. But if you don’t ask for it, you will never get it at all.

* * *

Sean Timberlake has written professionally for 20 years. He has been a copywriter and content marketing consultant for Williams-Sonoma, California Wine Institute, Din, and other clients. He started his personal blog, Hedonia, in 2006, and launched Punk Domestics, a community for DIY and food preservation enthusiasts, in 2010. He lives in San Francisco with his husband, realtor dpaul brown.

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Filed Under: Career Tagged With: Food blogging, food writing, how much to charge, Sean Timberlake, Stephanie O'Dea

Reader Interactions

Comments

  1. Andrew @ Blog Tutor says

    June 14, 2016 at 6:07 pm

    I think this is a great starting point, Sean… but I also think rates need to factor in the value you’re providing to the client. Of course, that’s considerably harder to calculate!

    Reply
    • Sean Timberlake says

      June 15, 2016 at 7:46 am

      Certainly this equation is directional. I just posted on my site today about other factors that go into assessing opportunities. http://www.seantimberlake.com/2016/06/15/on-purpose-and-satisfaction/

      Reply
  2. Stephanie O'Dea says

    June 14, 2016 at 7:46 pm

    Thanks Sean! I tell you— I’ve been writing professionally for 15 yrs but I still get chills when I’m tagged in a post.

    One thing I’d like to add to your post is that when I got started, 40 hrs a week was peanuts. Even now that I’ve got some nice passive streams set up, I still “work” 60+ hrs a week.

    I don’t consider social media, answering emails, or playing with dead links work, though. That’s just the hours needed when you run your own business.

    Reply
  3. Nicole says

    June 14, 2016 at 8:01 pm

    Maybe this is already implied but just in case it’s not obvious to everyone, your tax rate and healthcare expenses will be much higher as a freelancer than they are as an employee. That’s important to keep in mind when determining what you want to make per year. $100k is a much lower actual annual income for a freelancer than it is for an employee of a company.

    Reply
    • Sean Timberlake says

      June 15, 2016 at 7:47 am

      Exactly. Your hourly rate should be at least 25% higher than you’d expect on W2, if not significantly higher than that.

      Reply
  4. Jane, The Heritage Cook says

    June 14, 2016 at 11:41 pm

    I was in that same session Sean and remember thinking that her strategy was great. Thanks for reminding us!

    Reply
  5. Vicki Bensinger says

    June 15, 2016 at 6:20 am

    Great information. However, the client also takes into consideration the reach each blogger has. I’m curious if you have any insight on how to adjust your rate based on the information above and total reach of blogger?

    Reply
    • Stepfanie Romine says

      June 15, 2016 at 7:20 am

      That’s a good question, and I hope my experience can help you answer it.
      I have used this formula for the last few years, and I have a very small reach with my own blog (because I choose to focus on paid work and have a full-time job, too). If you do good work and are worth it, good clients will see that and have no problem paying.

      Reply
  6. Rosemary Mark says

    June 15, 2016 at 9:09 pm

    Excellent post Sean, thanks! Really like your addendum too on assessing opportunities in http://www.seantimberlake.com/2016/06/15/on-purpose-and-satisfaction/
    Agree with Andrew about the value to the client which is important to keep in mind when justifying fees. Can read about value-based pricing but it’s still hard to assess.
    And always remember you are probably making around 50 cents on the dollar with taxes and unreimbursed expenses which is why Nicole mentions freelance $100k is much less than an employee $100k.

    Reply

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