Everyone who is self employed or plans on becoming self employed has to ask themselves how much the own work is worth and how they can make a living with that - that's for sure. This hourly wage may very well be lower for career starters than for seniors, but this also should have its limitations and it can be really hard to find a fitting value for the own work.
These days I often experience that colleagues, even those who have worked as professionals for years now, offer their services for dumping wages - and that is why I wanted to write this post and try to wake you up.
The hourly wage of a self employed person is not comparable to the hourly basis of a casual employee, as the casual worker has few to no costs he/she has to spend to be able to work. But the hourly wage of a self employee has to take these costs into account and that also means your wages have to rise "proportionate" to the quality of your work which rises with your experience and the quality of your equipment. But what other costs have to be considered?
These days I often experience that colleagues, even those who have worked as professionals for years now, offer their services for dumping wages - and that is why I wanted to write this post and try to wake you up.
The hourly wage of a self employed person is not comparable to the hourly basis of a casual employee, as the casual worker has few to no costs he/she has to spend to be able to work. But the hourly wage of a self employee has to take these costs into account and that also means your wages have to rise "proportionate" to the quality of your work which rises with your experience and the quality of your equipment. But what other costs have to be considered?
A good (but only in german - sorry!) overview can be found here: http://lambertschuster.de/existenzgruender/stundensatz-kalkulation-fuer-freiberufler-und-selbstaendige/
(for the lazy ones of you, who want it faster, there is a shorter version here: http://www.mv-startups.de/Ichwillgründen/Gründungplanen/Schritt5DieFinanzierung/RealistischeStundensätzekalkulieren.aspx)
So far, so good - now we have a scope. The next step is to have a detailed look on all the costs you have. Fee-calculators, were you can simply enter your expenses can be really helpful, e.g.: http://www.guru-20.info/tools/fhour/
There is one thing that always has to be clear: If you set your own prices too low, you will not only harm your own business, but also damage the industry and make yourself responsible for a lot of strenuous discussions about money your colleagues have to get through. The more cheap offerings the customers find, the less they are willing to pay properly for a high quality service.
If there is no big budget, it is always better to limit the services instead of dropping the prices. It is astounding how often a supposed small budget suddenly grows if you have the personality to stand for your services and their pricing.
And for those people, that always want other people to work for free, here is a great meme I found for you:
