Pricing is a dilemma that faces all web designers (and other service professionals) at one time or another. There are a number of decisions that need to be made regarding pricing, and one of the most common involves offering fixed prices for different types of projects or providing quotes for each individual project. If you look around at various web designers you’ll see a bit of both, although you will probably see more that do quotes. In this article I would like to take a look at some of the benefits to each pricing strategy. There is no right or wrong method, but you should consider these factors before deciding on your strategy.
The Pros of Offering Set Prices
1. Less time is spent with potential customers that don’t result in any business. Quotes can take a good bit of time and if a high percentage of your quotes are not generating work, you could be wasting valuable time. It should also be said that any designer offering set prices should allow themselves the flexibility to up the price if it doesn’t fit into a specific box.
2. Potential customers like to see prices. Seeing prices can put customers at ease as they will have a much better idea what a design from you will cost. They may be hesitant to contact a bunch of potential designers for quotes, and finding a designer with set prices that they consider reasonable may encourage them to not even seek quotes from others.
Comparing the price of one designer to another is more feasible with set pricing (although a negative is that some customers tend to decide based on the lowest price rather than factoring quality into the decision). In general, I think most potential customers prefer to see set prices.
3. You may get more interest with set prices. Most people would rather contact a designer knowing at least the range of the price, as opposed to contacting a designer for a quote not having an idea what the price will be. This will not always be the case, but from my experience set prices will often generate more interest. On the down side, designers that offer low set prices will get inquiries from a lot of tire kickers that never wind up taking any action.
4. More consistency in prices. Providing a quote for each individual project can sometimes lead to a great deal of variation in prices. This can be a good thing for designers when they are able to make more money, but generally consistency and stability is more desirable. With set prices you will avoid quoting too low out of fear that the customer will go somewhere else. As a result, you won’t wind up doing work for less than you should.
The Pros of Using Price Quotes
1. More flexibility. Each project is unique and set prices really don’t account for this. Providing price quotes will help you to price jobs according to their individual requirements and demands. It should be noted that even with a strategy of offering quotes you will still find yourself dealing with surprises and you’ll still have the possibility of being in a bad situation price wise.
2. Increasing your prices is not so noticeable. Over time as you gain experience and become a better designer you will most likely want to raise your prices. With a set pricing plan these increase can be pretty obvious to customers and potential customers, but with price quotes it is not nearly so noticeable.
3. Allows you to overprice jobs that are not a good fit. From time-to-time you’ll get some potential projects that really aren’t the best fit for you. With price quotes you can simply quote a job higher than you normally would. In most cases, the customer will wind up going with another designer, but if they do choose you, at least you’ll make more off of the job than you would have otherwise.
4. You can get a foot in the door with a potential customer. When providing price quotes there is a bit more selling involved. If you website displays set prices, either a customer wants that price or they don’t. With price quotes you may get a better chance to talk to potential customers and sell them on your service.
Most designers prefer using price quotes rather than set prices because it allows them to treat each job individually, and since no two jobs are the same, this is important to a lot of designers. Of those who offer set pricing packages, most are lower-priced designers that tend to work on less complicated projects. As you move into bigger and more complex projects, set prices become less feasible.
What are your thoughts on pricing? Which strategy do you use, and why?