Streamlining Freelance Charging

Disclaimer: I am not a freelancer and have no experience in freelancing. These are just some of my thoughts.

Freelancers: Do your charge hourly or per project? Why not both? This way you are incentivized to be more efficient with your time while still being comfortable if you aren’t fast enough. This, together with deadlines defined in advance by you and the customer serve as a great framework. The Customer is guaranteed the completion time, and you are guaranteed at least x$ in your pocket, even if your finish too early.

This solution has caveats: To remain in tune with the market, you will need to lower your hourly rate to compensate for the added per-project charge. This is something you don’t want to do. Also, you are suddenly affected by perceived double charging phenomenon. Larger percentage of customers will neglect to notice the reduced hourly rate but will be sure to note that you are now charging them twice! Once for the work, and once more for…the work?

To combat this, I propose the following solution. Instead of lowering your hourly rate, always charge the customer for X hours, agreed upon by you and the customer These hours represent your per-project cost. Define the deadline as the time that usually takes you to log that much hours times Y, again, agreed upon by both parties. So now, with correctly picked X and Y, you are incentivized to complete the project early, and cash in on that sweet X - $(hours_worked) hours. In the case of your work taking longer than anticipated, you effectively fall back to the original charging scheme.

Here is a drawing I made to visualize this.