Forum Anecdotal Nuggets—How to Estimate Time Well Spent

I very recently came across a thread from someone who was inquiring how much she should charge for logo design/stationery package. Upon reading some suggestions in calculating an accurate method for as she put it, "a one-word mark" she decided that coming up with a price is "up to interpretation" and deadpanned, "guess I'll have to figure it out..."

Arriving at an estimate is not quite as difficult nor "open" to interpretation as one would think.

I told her to think of it in this way. If two people were both working on the same project, it's doubtful that both would complete it simultaneously, or even close. One might be faster, or vice versa.

Another thing to consider is region. Cost of living in one person's region may not be the same as the cost of living in another's. So if in response to her query I were to suggest, "Charge him roughly $10,000.USD for the logo" some folks may find that difficult to comprehend why so steep. Meanwhile here in my home town it just might even be considered a low figure.

So in that respect, that's where the "relative" comes in.

Easiest way to arrive at an estimate is to base your calculations on your hourly rate. How long will it take you design a one word mark? That includes how many concepts you plan to ultimately present to the client, how many revisions allowed thereafter, perhaps even including a "redo" if he/she doesn't like what you've presented...see? These things start to add up in valuable time and effort. No matter what anyone will tell you, the intangible creative process is often more valuable than the final digital execution—anyone with a computer, some "acquired" software and a couple of manuals can learn to use the programs to create, but to develop a mark that meets your clients promotional criteria and is effective in representing and stimulating interest in his business? Priceless.

So once you've factored how many hours you'll relatively spend researching and brainstorming...let's hypothetically say one week (40 hours in a regular work week) to research, brainstorm and sketch out three to five nearly finished good concepts.

Then after the initial concept presentation, let's suppose the client decides that he/she likes two—albeit with a few revisions—plus a third (only he/she didn't like the other ideas, meaning that you will create a completely new one based on the exchange of ideas during the meeting). P.S.- it helps to create an informative brief—basically a client questionnaire that will give you some insight on the client's target demographic, likes, dislikes, details on the business location/market, style, favorite color, etc. that you can use as a guide as you tailor the mark. Lets say all of this will take you another 10 hours or so.

This is when you can turn on the computer and start digitally rendering in black and white (not greyscale) your approved concepts. Figure that you end up spending another 12 hours, give or take (always best to err on the side of caution and not calculate your minimum time, because you will end up going over at some point for whatever the reason). After the second client presentation, he/she accepts one for final development. After a few more tweaks here and there, that is. Applying color palette variations and revising "tweaks," say 4 hours. Include the itemized expense of proofs and a spec sheet, another fifty bucks. Then finally when the client is happy, signs off on the proofs (one copy for your records, another for the client's) you burn a high resolution pdf disk of the spec sheet (that's "specifications" not "speculative," which is "s-p-e-c" bad, btw). Include that price as well (Whatever it costs for you to buy and burn a cd for him as an itemized expense) and voila.

So what have we got in this particular little hypothetical process for logo design from start to finish? 66 hours total plus a couple of itemized bills? Now let's suppose that your hourly rate is $50.USD per hour (depending on your region, cost of living, etc. this could be seen as a pretty low rate, but it's just an example). That would come out to $3,300.USD plus $45.USD bucks for itemized bills, $3,345.00USD, plus a 10% mark up (again, I'm erring on the exceedingly modest side) $3679.50USD plus about 2X that for the sale of rights to the client (because the design is yours until you transfer rights in a transaction...or give them away which isn't exactly a common "business" practice, but I digress). Suppose that this fictional client is a "mom and pop." That comes out to $7,359.USD total. If the client is in a somewhat better, good earning business with 5+ years, mark it up to 3X your total cost instead for a total of about 11,038.50USD.

As you can see, there is a lot to factor in (there are probably steps which I have missed as well). And when the client gasps in alarm at the ticket price (because they almost always seem to), the non-business designer's first inclination is to lowball themselves. I know, I've been there. But as you can see, even using very modest figures, the time is not ill calculated or drawn form thin air. And as I said, chances are your time will end up exceeding your estimate depending on your client relationship and how many revisions they will end up making during the course of it's development. These reasons and more are why logo design is the most lucrative niche in the creative industry.

And this of course, didn't even include the business card and stationery system design, which is far easier to calculate and normally far more inexpensive by comparison. If you're working out a package, I'd probably try to work in any "deals" here rather than the logo design.

PS- Remember to work with a contract that includes "kill fees" as well as details on how many revisions, comps, etc. to allow. Work without one at your own peril, even if it's for a friend or relative.

Hope this little scenario helped organize what's in store and how to somewhat price accordingly a bit. Another forum frolicker offered some wonderful resources from folks who have been there and back, which I'll post next time.

"Dollar Sign Question" image source: Vinfolio
"Calculating" image source: Piper Report