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#1
burwelbo

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I haven't seen this on the list yet so I thought I would throw it out there.

I was just wondering what people are charging with respect to hourly billing rates? When it comes to flat rate pricing do you factor in more for risk? When I was consulting people said I charged too little but I saw what other companies were charging and I thought it was way too much. Also, are you charging different rates for different tasks (ie programming, project management, data collection) and heave each task itemized in your quote? And now the ethics question. Do you charge more based on a particular client? For example, knowing you may be delayed up to 90 days by a governement agency, might you factor in more for this inconvenience?

Just curious

Bruce

#2
benbakelaar

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I'm in my first year of GIS/mapping consulting, second year of online mapping consulting, and fourth year of PHP/ASP/web database integration. I charge $25/hr, normally working with non-profits. In the next year or two I plan to move up to $35/hr, as I have a lot more project management experience now, which is a big benefit to the client in my opinion. I'm looking to find the sweet spot that makes the client pay attention to the project, while not overcharging. Almost every "free" project I've worked on has gone nowhere, mostly due to the lack of priority placed on it by the client/group/non-profit.

#3
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Good topic.

As Ben... my rate is between 25 and 35$ per hour (that is Canadian dollars :rolleyes: ). In theory considering all other expenses your actual pay is most likely half of what you charge (50-50 rule). So charging 40 dollars per hour is equivalent to making 20 dollars per hour after you pay the taxes, marketing (e.g. web site) communications, equipment depreciation etc... (in other words the cost for doing what you do).

I provide most clients with a flat rate for the job. One price to cover the job. In this case you have to be careful and job estimation experience is important. However clients appreciate this approach as they can budget their cost much better. As a guide line I factor in my time at a fixed rate (e.g. 30$ per hour) and then I double the price. I then look at the final price and make adjustments if I believe the end price is out of reach for my client (enter here intuition along with the 50-50 rule as to what I hope to actually make for the job). Remember if your estimate is off you can not ethically go back to the client for more once the job is started (see following paragraph...).

I don't believe there are difficult clients per say. They become difficult if you have not provide them with a good service offer and have not put in place a contract that refers to your offer. In other words here is what you paid for. The cost for extras have been clearly indicated in your offer. You have to be firm and professional with so called difficult clients.

I don't tend to make any difference between a project that requires that I write some code for an application or for one that I do simple data capturing. I am a one man shop, so to me the bottom line is always taking on work that, for one I CAN do and for two, that I will enjoy doing.

Risk factor. If you know your trade there should not be a risk factor. If it is a never done this before type of work your are bidding for, well the risk factor is higher. However gaining new experience might be worth the risk.

(I keep editing my posts...) As for long 90 days before you get paid.... You can brake down the job depending on the deliverables, and say for example, send a bill out along with initial deliverables. This keeps the money coming in faster. Bottom line however, I stay away from these 'we will pay you 90 days after you bill us'. 30 days is what most my creditors offer and it is what I offer.

I also use my intuition when I decide to place a bid. I try to achieve a 90% success rate. So if I feel someone is pulling my leg I simply don't bid.

This is a wide subject, hoping others will add..

Regards,
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#4
ELeFevre

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If the data is developed in-house, and it isn't found elsewhere in the marketplace, the project-rate is probably much higher than $25-50. Of course you would have to charge a lot more in-order to recover data development costs and to protect your investment.
Then there is companies like Raven maps who should be able to charge whatever they want (no matter what data they show) because they set the cartographic quality bar for customers and cartographers IMO.

Great topic.



#5
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It all depends on what you bring to the table, right? For instance, when I worked for a consulting firm, I would charge $110 an hour and was highly billable, but I had a team of database people, statisticians, and engineers to handle other elements of the project. They also had high rates. So our clients saw the value of a team very worthwhile. Yet another reason for collaborations: higher billing rates!

#6
burwelbo

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I did do some research on the web and found the following article at Directions Magazine.


http://www.direction...a...id=91&trv=1 . This article was written in 2001.

Basically it says most consultants use a multiplier to determine their billing rate. I guess I am looking at it from the whole discipline of Geomatics compared to just Cartography. To me, $25-$35 per hour seems very low. I also found an article with respect to Graphic Design. The average rate it quoted was $60/hr. One company I worked for charged this for what I considered to be labour. We need to look at this closer.

Just my thoughts.

Bruce

#7
BEAVER

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$25-$35 sound way too low for skilled GIS/Carto person. I don't do contract work in mapping but I do mechanical engineering on the side and charge $90 per hour. At that rate most of my projects are 40% cheaper than most other large engineering firms would charge. I could technically charge $120 and still get the work but I have very good relationship with my customers and don't want to loose that. To be honest, I would not even look at projects for $25-$35 per hour unless I was really struggling and had to pay the bills. After all the expenses, insurance you are working for minimum wage.

#8
benbakelaar

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Hmm, well let me clarify for the original poster, I have a day job in IT, I do consulting on the side. And I can tell you, as others have mentioned, it would be very hard to survive on $25-$50 as my sole income, non-salaried. In fact, that's one of the reasons I haven't quit my day job - need them to provide me with my base salary, benefits, health care, etc. But I'm one of those people that considers 8 hours of work to be a warm-up, something to keep me busy (sure and pay the bills too). So I really don't have a problem working an extra 10-20 hours a week doing consulting on the side.

Also, I am a one man shop (like Jacques) and I wouldn't ever take a contract that required developing in-house data. I just facilitate putting maps together, whether online or off, and provide some basic design work. I would more or less consider myself a bottom feeder - I look for (and enjoy working with) the small guys.

#9
Mike H

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$25-35/hr is low for a skilled ANYTHING in today's economy. In cart work the norm is to put more hours into a project than anticipated, so you may be realizing considerably less pay-in-pocket. Don't take a career-level salary position and divide it up to reach this number - a freelance fee does not include benefits of a salary position - where the employer pays health care, rent, provides computers and software, and provides the work - you just show up and do the work. Getting work, and managing the projects, is more labor intensive than many people realise.

Two key factors are geography and client: some areas cost more to live in and the pay scale is higher to accomodate. Clients have a wide range of resources - but just because the client can't afford your services doesn't mean you must drop your price, unless you honestly feel charitabe towards them. If you have grant writing experience you may be able to help them find a grant to subsidize the project, resulting in your ability to charge a reasonable rate.

My local car dealer charges a flat rate of $65.00 to do anything, my local independent mechanic gets $50.00. The landscaper gets $30.00/hr to mow grass and walk around with a leaf blower. A friend who waitresses walks with $50/hr for a 5 hour shift at a mid-level family restauraunt, while a friend who bartends makes over $100/hr on any Friday night, and as a result only works 3 or 4 nights a week, and drives a Porsche.

Look at it critically - how much time is spent in preliminary meetings conceptuallizing the project - is that billable? Usually not. How much does it cost to upgrade hardware and software every two years? Will this job cost more in ink and paper, and phone bills, or is all digital. Do you have to travel to meetings - are you billing travel time and expenses? If it's a print job, are you expected to be on-press? Is it your fault if it goes bad on press?

Another abstract factor I consider is creative input. A job that involves editing and updating an existing project isn't (usually) that creative - just do the needed tasks on deadline. But other jobs are wildly creative - build a new map from scratch - this poses a host of unknowns, and you will be expected to resolve every last one of them, by yourself (or with the help of cartotalk).

Ultimately it's a personal decision how much to charge, and all freelancers start low. The question is at what point have you matured as a cartographer, programmer, GIS services - whatever it is you do - are you doing it on the same level as an established professional cart firm? If so, why charge less than half the expected rate.

Conversely, a typical cart student at the undergrad/grad level works freelance on the cheap, in part because they don't really know what they're doing, and in part because they want the chance to try new things and build a portfolio. They also don't have a professional reputation to endanger by a blown project. But if you can provide top-shelf services, and go beyond client expectations - you should bill an appropriate rate. If your confidence in your work isn't that high, and/or the clients expectations of your work aren't very high, you should bill less.

m.
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#10
Hans van der Maarel

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Depends on your local market too of course, but my rate in euro's (which is pretty much mid-range over here) seems awfully high in $ due to the weak US$

I think it's certainly ethical to take in account the various external factors when quoting a price. If you have a project that requires several on-site visits that each take 3 hours of travel alone, that's certainly something to keep in mind. If you have a client that consistently pays too late, I think it's certainly acceptable to compensate that somehow. Don't know what it's like in the US, but in The Netherlands the system works like this: all the sales tax I collected during Q1 has to be paid to the IRS by April 30th, Q2 has to be settled by July 31st, Q3 on October 31st and Q4 on January 31st of the next year. That's some pretty sizeable payments every time and if I have a client with a big invoice somewhere in the last month of a quarter, there's a potential for financial problems on my end.
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#11
Mike H

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So I really don't have a problem working an extra 10-20 hours a week doing consulting on the side.

Also, I am a one man shop (like Jacques) and I wouldn't ever take a contract that required developing in-house data. I just facilitate putting maps together, whether online or off, and provide some basic design work. I would more or less consider myself a bottom feeder - I look for (and enjoy working with) the small guys.



And this makes sense in that what you really are doing is moonlighting on selective projects you enjoy doing, and it doesn't have to make 'financial sense' in the context of the marketplace. But, if you're going to dabble 10-20 hours a week anyway, an extra $10-$20/hr above and beyond your normal rate will add up substantially. It may simply be there for the asking.

I essentially do the same thing - selectively take on projects in addition to my fulltime cart job. But over the last ten years two fundamental changes developed: 1. My reputation and visibility grew so projects come to me, and 2. I'm less motivated to trade those additional 20 hours a week to do more cart work.

For me, it is first and foremost about my desire to work with the client (I have some really interesting people as clients) and secondly my desire to make the map happen. If I can add an attractive pay rate then those "extra" 10-20 hours a week are worth it economically. If I honestly enjoy the map work involved, and find it creatively rewarding, then it's all good.

m.
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#12
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I think we need to differentiate between moonlighting and full time freelancer with regards to setting fees. For my part I am a full time freelancer and I only have one source of revenue. My business is my lively-hood. I don't have the luxury to say no to work and be as selective as say a moonlighter who has a steady source of income. I agree a 25-35$ hourly rate is bottom feed (up to 50-70 if you add my little 50-50 rule). However I have been able to stay a float for the last 10 years and have never been out of work. So it might be easier for someone looking for additional income to charge more if it does not matter if he gets the job or not.

There is another point. Your personal market value in the context of the actual market for your field of activity. Yo could be worth a lot but if there is little mapping work around....
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#13
ELeFevre

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There is another point. Your personal market value in the context of the actual market for your field of activity. You could be worth a lot but if there is little mapping work around....



The rate is also dependant upon the industry you provide maps for. A good example of this is the energy industry where the hourly rates for custom cartography are more in-line with that of an energy consultant rather than a graphic artist. If you set your price below industry standards, then you run the risk of appearing unprofessional and out-of-touch with the industry. Price is associated with quality regardless of whether or not it is true.

Jacques makes a good point in that price is dependant upon the market in which you live and work. Twenty- five to thirty dollars an hour is suitable if you live in a smaller, more rural community with a low cost of living. If you live in NYC and depend soley on that wage then you might be eating ramen noodles three meals a day!



#14
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The rate is also dependant upon the industry you provide maps for. A good example of this is the energy industry where the hourly rates for custom cartography are more in-line with that of an energy consultant rather than a graphic artist. If you set your price below industry standards, then you run the risk of appearing unprofessional and out-of-touch with the industry. Price is associated with quality regardless of whether or not it is true.


Good point Erin. There are various industry trends to consider.

Also... who is your competition. Go ahead and place a bid at 100 bucks an hour and you might be eating those ramen noodles(? :( ) if some other company got the job at 80 bucks an hour. They might not survive long if they under price all the time (and are not as good as you) but you are left out for that time around.
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#15
burwelbo

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I thought there were already some basic rules of thumb for billing ranges based on job title. For example, $50-60 for data capture and cartographic design, $60-80 for a GIS/RS analyst, $80-100 for software development and database design and $100-150 for project management. Of course this is all based on market, experience competition. I was wondering if most people (even one man shops) broke out the costs based on task or if you just took an average and billed at that rate. Jacques, I misunderstood your 50-50 reference. I thought you were only billing at $25-$35/hr total. I think from a professional standpoint, some guidlines should be established for the spatial sciences.

Another question I had is about Web Sites and marketing. What percentage of work is driven by your web site compared to the old traditional ways? What is your budget for web site marketing? Maybe I should put this in another post.

Bruce




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