How much does your company bill an hour?

motorguy

novelty-socks wrote: »

I agree it's all relative but when I was freelance I aimed to charge £500/day and most often landed in the £300-£350 range. The work I did for clients would typically deliver value far in excess of that, and I would certainly have charged more if possible.

Two other thoughts:

1. In my opinion, if you're working with a contractor or freelancer, you need to think about their rate as an investment, and work out the return you'll get on it. For instance, my old website cost about £5,000, but I could certainly attribute £50,000+ of revenue to leads that it generated. Definitely a worthwhile investment.

2. Good web developers are hard to find. If you've found one who's good at £40/hour, you've done well. Get them to sign that contract!

+1

If you're adding value greater than or equal to the amount charged then the customer is happy.

I tend to work on large data migration projects. The customer would generally rather buy in experience for a relatively short period of time rather than take on a FTE that they later wont need.

A typical professional in a PAYE role at say £50,000 is probably costing the employer £80K+ once you factor in the taxes they pay, pension contributions, annual leave, sick leave, overheads, etc, which brings you back to £300 a day anyway even for an FTE so its not a big overhead to bring in a contractor for a shortish time.

DKLS

If you want cheaper web development look overseas, I use talent in Romania, India and Vietnam for various projects and its a much cheaper hourly rate.

My own pricing varies, I tend to price higher for big corporates so I can afford to take on other projects that pay less but are either worthy or interesting to me. E.g. I did a small consultancy job for a charity and only charged expenses as I wanted to do it and my "wage" was being covered by one of the Big four.

Pennywise

ClarkeKent wrote: »

Surprised to get a quote from a web development firm for £40 an hour. Got a £50 quote from a London firm.

I was amazed, having worked in low paid jobs all my life and living in the North perhaps I am blinkered.

How much does your company bill per hour?

The key point is that these are firms, not individuals. Firms have overheads - premises, support staff, equipment, support services, marketing, etc.

In a lot of firms I've been involved with, a person's hourly charge out rate is somewhere near double their gross annual salary. If their gross pay is £20k per year, then their charge out rate is £40 per hour. So your worker doing your web development is probably earning a wage of £20k per year.

A completely different scenario to a freelancer/contractor who has no "organisation" behind them, gets their work through agencies (no marketing costs), tends to work blocks of 40 hour weeks for several weeks/months per contract, etc. Their "hourly rate" is indeed like a salary to them because their overheads are minimal.

I run a small accountancy practice. I charge out at £90 per hour. Some uninformed people express surprise. But my actual "earnings" is around the level of a teacher (i.e. mid £40-£50k p.a. but without the holidays and pension). All people see is £90 times 40 hours per week times 48 weeks of the year and think I earn £150-£200k p.a. What they don't see is that it costs nearly £25k per year to run the business, i.e. office rent, power, insurance, repairs, admin support, advertising, stationery, postage, computers, software, subscriptions, training, etc. Nor do they see that instead of charging all hours worked, in reality, I'm lucky to hit 50% chargeable work - my timesheets usually show an average 3-4 hours per day of actual work that's chargeable - the rest of the time is engaged on admin & management (keeping on top of nearly 100 clients), pro-bono work, non-chargeable meetings with new clients and suppliers, attending courses and personal reading/research, dealing with 10-20 emails per day, dealing with HMRC mistakes, dealing with regulatory bodies. Despite charging at £90 per hour, the business total turnover is below the VAT threshold, in fact it's around £70k per year, less £25k overheads gives £45k profit!! Wow what a rich accountant I am - or so some clients think!!!!

In my last employed job (20 years ago), my wage was £25k per year and my charge out rate was £50 per hour.

Don't underestimate the costs and time of running a business as opposed to being a "hired hand" freelancer or contractor.

gingerdad

i would have thought 40-60 per hour for design is pretty normal.

we charge our staff out at £30.00 per hour and they're paid not that much above minimum wage.

scaredofdebt

I am a webdeveloper (freelancer) and charge £20 an hour, which I know is cheap but I have only recently started out on my own so I need to attract some clients.

I was asked for a "piece rate" for a load of pages for a new site and quoted £2.50 per page for that, I can now do a page in about 90 seconds as I have perfected a technique for doing it quickly so that works out quite nicely. Client is also happy as he knows how much it will cost for the whole job.

I used to work in IT for a large bank and specialised UNI*X contracters were on approaching £1k per day, although they were first out of the door when the recession hit. But they can probably afford to take some time off!

I have clients who have paid around £6k for an ecommerce website with all the bells and whistles. These are small businesses, not large companies, who probably pay a lot more than that.

I applied for a job as web designer a couple of years ago and was surprised to be told the salary was £13k! They advertised it as "competitive"