Continuing on my review of The Graphic Design Business Book on information on proposals, clients, and pricing. I will start with proposals, Ted writes, “The most important factor in the success of a design project is the bid process.” Most clients will request for a proposal (RFP), a good proposal is made up of four parts. 1. Capabilities statement - Why your company is best suited, history and past experience. 2. Project overview - What you perceive to be the scope of the work (show some thinking on your part.) 3. Technical. 4. Cost - It’s a good idea of specify exactly how many concepts the client will get to cover your butt. On writing proposals, I thought this was an insightful and very true quote, “Write in a way that comes naturally. Omit needless words. Do not overstate. Do not explain too much. Do not inject opinion. Be clear.”

Talk in ways that the clients can understand, talk the talk. Read the business press, you should be comfortable discussing return on investments. Read the Wall Street Journal at least weekly, it is written very well and you’re be learning the lingo quicker than you think. Clients sometimes need hand-holding, pamper your clients, make them think they’re always number one. Keeping clients is important for returning business, three ways to lose a client are: printing messes up, typo (hire a proofreader for large projects), the client is not satisfied with the work.

Down to the costs. Every designer knows there will always be changes! If changes were not included in the original quote and the client requests changes, do them and yourself a favor, send the client a memo before they get the bill - explain that the work is additional and was not anticipated in the contract. You can also make it clear that the changes were not included in the original quote, but as a courtesy, they won’t be charged for the costs. However, any additional changes thereafter will need to be billed.

How do you configure your hourly rate can feel like a guessing game. Here is an easy comprehendable formula: First figure out your billable hours - 52 weeks x 40 hours = 2,080. You’ll need a vacation eventually, subtract 80. Allow for five days of sick time, subtract 40. Don’t forget our seven legal holidays, subtract 60, you’re now at 1,900 billable hours. Now no designer is in anyway billable for an actual forty hours a week. Time-consuming tasks such as running errands, backing up your system, cleaning up for a client visit can quickly add up to about an hour a day, subtract a painful 230 for downtime. Now we’re at 1670 of possible billable hours. An average salary for a graphic designer runs around $45,000 a year, divide by 1670, and get an hourly rate of $27. But remember, this rate does not cover expenses, most design firms have expenses averaging at 31% of the total. Multiply it to cover the overhead, and you’ll get $8 more an hour, equaling it to $35 an hour. We haven’t made allowances here for slow periods, a common percentage of profit is 15-25 percent. Let’s pick 20 percent, adding $7, making it $42 an hour. You must also incorporate experience into the equation, so starting at $42 an hour might be beneneath some designers’ expertise.

Hope you learned something from The Graphic Design Business Book. I would encourage you to purchase this book and read it cover to cover to learn more. There are also full contracts and forms on copyrights, taxes and lawsuits in the book.

Tags: book review

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