19 replies to this topic

[drunk]

Hello Everyone -

I've ben following the advice that I get from this website and have had phenomenal results. Anyway, different companies have asked to do work for them and I have for the past few months.

I'm just wondering, have any of you out there started companies working website marketing and had any sucess? Is now a good time to start a company doing web design and search engine optimization.?I have a niche in the river raftin industry.

What is the going rate for doing this type of work? Do you all bill hourly or by the job? Right now I'm charging $25 an hour for friends.

Any advice would be much appreciated.

Thanks!

[msdetta]

Just thought you should be aware that designers cannot discuss design fees as it is considered price fixing.

[anthonyparsons.com]

The going rate is whatever you think your time is worth. Business expenses, overheads, salary, profits etc....

[sweepthelegnate]

Just thought you should be aware that designers cannot discuss design fees as it is considered price fixing.

what??? that doesn't make sense to me...if I wanted to know what you charged per hour of web design I could just visit your site...and if you wanted to know how much I charge, you would visit mine.

and besides all markets pretty much have a bell curve rate...either you charge too little and you go out of business or you charge too much and you get no business...or you settle in.

[torka]

Yet, that's how it is in the USA, at least.

Yes, you can visit a bunch of websites and -- if they post their prices -- you can compile a list of what they charge and base your charges off that. That's called market research, and AFAIK there's nothing wrong with it (other than you might not come up with realistic charges for your specific niche or geographical area, depending on which sites you choose for your sample). :doh:

On the other hand, if the owners of those websites were to get together, either in real life, via e-mail or on a forum such as this, and actually start discussing what prices they charge, not only the website owners but the forum owners could find themselves charged with price-fixing.

I know of several forums and mailing lists where any discussion of prices at all -- even discussion of the prices charged by other people (not members of the list) in other industries (not directly related to the topic of the list itself) is forbidden. Apparently, the consequences of even being accused under the racketeering law in question (much less convicted) can be devastating... so many list/forum owners aren't taking any chances.

There was one list I used to read, the owners of which were so paranoid about this, I unsubbed because the limitations they imposed were making it almost impossible to have substantial business-related discussions.

--Torka "better safe than sorry, they always said"

[drunk]

Thanks for all of the discussion about how we can't talk about much to charge.

I'm actually more curious about what it's like starting a business like this and if it's rewarding. Are there tons of these types of companies already or is now a good time to start one?

Will I be driving my Pinto for 10 more years or can I send my kids to a private school if I do this?

Thanks.....

[OldWelshGuy]

The going rate is whatever you think your time is worth. Business expenses, overheads, salary, profits etc....

For once AP I have to totally disagree with you

The ONLY way to set your rates is to set it to whatever the market will allow. There is a maximum rate, a minimum rate and a gamut between. You should set your rates at whatever your marketplace will allow, and they should reflect your ability.

Set them too low, and you will be labelled for life as a 'cheap guy who can only do low grade work' set them to high, and you may struggle for clients, or worse, get them and not be able to deliver the quality of work that the rate charged suggests.

If as you say you are specialising in a marketplace where you have a mountain of quality knowledge, then clients can expect to pay for that .

In short, research your marketplace.

[Jill]

Will I be driving my Pinto for 10 more years or can I send my kids to a private school if I do this?

It really all depends on whether you can market your business, get clients, how good you are once you have them, how happy they are.

If you're successful at all those things, then eventually yes, you can send your kids to private school. But you're gonna have to work pretty hard for a number of years before you get to that stage!

(And yeah, and cut out the )

Jill

[Grumpus]

Worse than setting them too low and getting labeled the "cheap guy" is setting them too low and discovering that all your clients think you're a sucker and will spend every waking moment trying to get every inch out of that dollar they spent with you.

Psychologically, if you're charging a low rate, it means that your time doesn't have a lot of value, so what's wrong with getting you to spend another hour or two on something without changing the agreed upon price?

The most horrific part of getting myself situated in my own business was to find a good price. I've never regretted losing a client by pricing too high, but I have regretted landing clients for pricing too low. Reputation goes a long way here and since you have an "in" with the river rafting field, the reputation you already have in that field could very well carry over (to a certain extent) into your design and seo efforts. Granted, you'll need to hang onto that reputation by providing good work, but...

For design, and large project, I tend not to charge by the hour because it doesn't tell the client anything. I know what I charge per hour, and I know about how long it'll take me (programming is easier to guess this - with design, the artistic elements are harder to guess at timeframes). So, I give them a flat fee based upon the time it'll take me. With most clients, I also set that as a "maximum fee" so that if I find a shortcut and it takes less time, I can charge them less. That seems to make folks happy and it allows me to put an "a-hole factor" in my price for new clients. If it's someone I don't know and it "feels" like they are going to give me a headache, I can take on 20% or whatever for safety. Then, if they don't give me a headache, I can take that fee off the final bill. If they do give me a headache, I've got a few hundred bucks or whatever in the budget already earmarked for the time spent dealing with it.

Try it out on your first few clients - especially if you know them a little bit. Say, okay, I'm not sure exactly how to charge for this. I'm going to give you a bid on the job and I guarantee we won't go over that - if we do, it's my fault and since you're a friend, I will eat the loss. If I come in way under, I'll only charge you what I should have in the first place. If they are really good friends, make sure they know that it's good to nitpick over the littlest crap, too. It'll also prepare you, after doing it with a few folks, for the different types of things some clients freak out about. People freak over funny stuff - they may not care that under certain rare circumstances their shopping cart throws an error and just won't work in such-and-so a browser, but they will be having a cow over the fact that their logo is three pixels to the left of where they wanted it.

---

When starting out - the best piece of advice I can give is to make sure the clients remember YOU and the EXPERIENCE and not remember the work you did. This goes a long way toward getting future referals. You're far better off with your past clients not saying, "Yeah, I got a great web site from some guy for $500" but rather, "Drunk <or your real name> does my web site - here's his URL".

G.

[torka]

In short, research your marketplace.

Drunk, I think this is probably the answer to your questions.

IMO, there isn't necessarily a general "wrong time" to launch any small business. People launched successful new businesses during the deepest days of the Great Depression, and there are plenty of small businesses launched at the peak of economic good times who quickly fail.

Same thing for whether a market is "saturated". It all depends on how you define the "market" and what you do to differentiate yourself from the other providers. If you're nothing but a "me, too" offering, then one or two competitors may be more than you can handle. If on the other hand you've got a unique spin on your service offerings, or an unusual combination of services, or you've identified an underserved niche market, then you may find that however many competitors you think you've got, you actually don't have ANY direct competition at all.

There are plenty of people who launch small businesses without having done sufficient homework, so they either market to the wrong audience (or they've got the right crowd but use the wrong approach), or they're priced incorrectly for their market, or they're not offering the right combination of services, or something along those lines. And they fail, and they say "it was just a bad time to start a new business."

Do your homework -- identify your target audience. Local? Global? Industry-specific? Find out what services and service combinations they're looking for. (Ask them!) Check the competition -- how many are already in the market, what are they charging and what combinations of services do they offer? Do any of them address the specific niche you do? And if so, what can you do to differentiate yourself from them? Honestly assess your level of experience and skill. Do you already have the experience, or can you learn quickly enough? What are your financial needs -- how much money do you need to make, and what sort of resources do you have to tide you over if for some reason you don't make that much right away?

Once you get the answers to these sorts of questions, you can determine if launching this business is the right thing to do for you right now.

--Torka

[webgrrl]

Hey Grumpus, Torka, and OWG,

I just wanted to say that those were some really great posts. Thanks for your insight...

-w

[drunk]

Wow!

Thanks for all of the great responses....And webbgrl, your avatar is very cool(especially for a river person).

I feel like I've just received hundreds of dollars of advice from all of you. Hopefully I can pay that back to other newbies to the industry. It's a scary step leaving teaching (and full benefits) to start a business, but I'm also very excited about the possibility.

And Jill, I do my best work after a little . I'm into my second glass of merlot and going strong!

Thanks again!

[msdetta]

If you're serious about starting up, then read Jim Smith's "How to Start a Home-Based Web Design Business." He's got a great test in the first chapter for you to determine if you have (1) programming skills, (2) design and layout, (3) sales ability, and (4) bookkeeping. It's also got the basic layout for your original business plan.

Hope this helps!

[oneofthe3lions]

Another good point is that in business as in life, we need our friends around us and if you was charging me 25 dollars an hr as a mate youd be on yer bike

[anthonyparsons.com]

Sorry OWG, it was about 1am when I wrote this one. You tidied it up for me in yours....cheers mate.