Hourly Rate vs Project Rate
Nobody ever really wants to talk money when it comes to creative projects. I don’t know if that’s because they’re supposed to be creative expression or if it’s because nobody wants to be seen as over/under charging. But the problem is that leads to nobody really knowing what’s going on. I’m planning to write a few posts about this but I thought I’d start with hourly vs project based billing because it just came up for me with a client.
I hate hourly billing. That’s all there is to it.
I’ve been doing this a long time and I know that there’s often internal reasons a client asks for hourly vs project based costs. But I hate hourly. There’s two main reasons. The first is more altruistic. I think that clients end up viewing people who bill on a project basis as partners in the project vs a cost. I know I feel that way. When I’m billing a client on a project basis, I’m able to just do what needs to be done. Rarely am I charging them (in a meaningful way) for render times or extra tweaks or whatever. I’m focused on the project being the best it can be because I don’t need to worry about hours. Where billing hourly, you’re going to pay for render times, you’re going to pay for uploading and any time that can’t be used for another project, you’ve gotta pay for. Not to mention that there’s usually hour limits on an hourly project. So maybe I see something after a 30 minute render that I’d like to tweak, but I’m close to hitting my max hours… then it goes out as is. When my time is viewed as a commodity, it gets treated that way.
The other reason hourly sucks is because it doesn’t take my skills, expertise, and experience into account. I’ve been doing this a long time and I know I’m a very fast editor. This is because of the technical skills I’ve developed, and my experience in the agency world knowing exactly what the client wants. Before I started AV I worked with other editors, who are great, but it might take them 25-50% longer to do the same edit, the same way I did it. They’re not bad, I’ve just developed different skills to work faster. So if I’m billing hourly, I’m being punished for being good at what I do. That slower person will make more per project (at an even hourly rate, which we’ll get to below) because they’re just not as fast.
And hourly doesn’t take into account what I’ve put together hardware and software wise to work quickly and efficiently. I love gear, that’s for sure. But I also buy gear and software and plugins that make my life easier and let me deliver quicker for a client. If a client has a rush project, I know I can edit it, export it, and upload it faster than the average editor. That’s because I’ve invested in Mac Pros to keep render times down, NVME working drives and 10Gbe servers to access data quickly, and Fiber internet to upload 50x faster than the average editor. At the surface that will just look like something clients shouldn’t pay for. But when you add all those things together I’m able to deliver edits faster, which is critical on a lot of jobs, because of hardware and software. And I shouldn’t be penalized for that.
“Stop giving your input, just do what I tell you to do.”
This is a line I got in an email for a project I was working on with a client. I don’t give too much input, but I have been doing this nearly two decades and I know a few things. I always deliver what the client asks, but when I think there might be a better way to do something I bring it up. When you bill hourly, you’re a line item, you’re not a partner. If I throw out a rate of $100/hr, the client will compare that to someone at $50/hr and say “half as much, let’s go with them.” Hourly rates assume that everyone is at the same level skill wise. They’re not. You’ll find some amazing editors are $50/hr, that’s for sure. But the majority will have minimal experience and won’t know how to handle complex situations. They’ll also be slow. You might spend less per hour, but when it takes them 50% longer, there’s not really a savings there. Expertise and experience are what matter most, and bargain basement shopping for the lowest hourly rate won’t get you the best people for your project.
We’re creatives, not commodities.
So that turned into a bit more of a rant than I’d hoped, but hopefully you all get it. It shouldn’t be about trying to find the cheapest option to get something done. Creativity is a skill and talent. Some projects just need to get things done, I understand that. But for real projects that need real creative input, don’t go back and forth over a few dollars. Look at the people helping you as extensions of your team and everyone will have a better experience, and you’ll get better results.