Author Topic: PRO101 Calculating Your Base Price Rate  (Read 1672 times)

Mother Roshiya

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PRO101 Calculating Your Base Price Rate
« on: July 21, 2017, 12:50:33 AM »
You've honed your drawing skills to professional perfection! Your friends want you to draw things for them and they're willing to pay you for your service! But... What do you charge??? Anyone who "goes pro" and starts working Freelance (meaning by and for yourself, not attached to any company) inevitably needs to know how to do this, and while it's not difficult, it IS a daunting mathematical task when you first start out, and it IS NECESSARY.

So let's get started!

Step 1: Decide What Type of Art You Will Offer

Different types of art require different considerations. Oil paintings need supplies, time for the paint to be applied, and a long time for it to dry. Acrylics and watercolors need supplies, time for you to paint it, and not nearly as long a time to dry. Digital art won't be taking you to the art supply store wondering how much burnt umber and cadmium yellow you're going to need to get, but you need to make sure your computer is on, the paint program is paid for, and the time you'll spend on the piece will differ depending on the complexity of the image, the resolution you work at, and whether you're working in a Raster or Vector format. Will you only be doing finished for personal use single images? Company logos? Web comics? If you're doing raster images, will you offer different resolution sizes? Decide on what you're offering and MAKE A LIST.

For example, as a digital illustrator, I offer raster image commissions for personal use in resolution sizes 150/200/300/600 ppi in the following scaled complexities:
LineArt Only (No BG, Simple BG, Complex BG), B&W Screentone (No BG, Simple BG, Complex BG), Cell Shading (No BG, Simple BG, Complex BG), Painted w/ LineArt (Simple BG, Complex BG), and Fully Painted (Simple BG, Complex BG). I also offer vector image commissions for personal use (simple, detailed, complex), Logos, business cards, Web elements/images at only 72 ppi, and a per page pricing for webcomics/graphic novels at only 300 ppi that includes all of the above raster image complexity options as well as Stick Figures and Sketch options, and corresponding character sheets.

Make sure you write your list down on paper or in a spreadsheet program.

Step 2: Time Yourself

If you're not sure currently how long it takes you to do an image of a certain size and complexity, get yourself a stopwatch and TIME YOURSELF making the art on your list that you're offering. Don't worry about supplies yet. Just pretend you're getting paid for it and work as diligently as you would for your customer. Write down how long it took. For example, here's a good way to test my Raster Commissions list above:

Open an 8 x 10" raster image with 200 ppi and draw a stand alone character of the usual complexity you're expecting to draw for your customers with no BG while timing yourself with a stopwatch. Write down the time when you're done with the sketch. DO NOT restart the clock. Write down the time when you finish the LineArt. RESTART the clock. Make a layer for screentone and finish the image that way. Write down the time on the clock, then add it to the time from the LineArt to get your total time. RESTART the clock. Make a layer for cell shading and finish, write down the time, add for the total time, restart your clock. Open a new 8 x 10" @ 200 ppi image and create an image with a simple BG. Time it the same way, adding layers for Painted w/ LineArt, and Fully Painted (hiding your LineArt layer and adding your time to the sketch time). Create an image for a complex BG and time it. WRITE EVERYTHING DOWN.

An important note: DO NOT worry about stopping the clock for minor interruptions like quick bathroom breaks and questions from your kids/roommates (though make a note of them and how long they took). We want to know how long you're sitting at the computer for this step of the tutorial. DO stop it for food breaks and extended breaks for i.e. sleep, Facebook and grocery store runs that take you away from the computer or if you switch to a different project.

You could do this for every single thing on your list, or you can choose to scale your results where applicable, and then test to make sure that the scaling is accurate. For example, to scale for raster resolution, times your total time spent on a 200 ppi image by .75 for a 150 ppi image of the same size, 1.5 for 300 ppi, and 3 for 600 ppi to compensate for the difference in canvas size that you have to detail and make sure is smooth at 100% size. You can also divide your time by a measurement related to your piece to get an easy "by the inch" or "by the square inch" time to apply to sizes other than an 8 x 10". If you need some help with math for this, here are some equations:

To convert minutes into a base 10 number you can use in equations: [Your Minutes] / 60 = [Base 10 Number]
          i.e. 30 minutes = 30/60=0.5, 24 minutes = 24/60=0.4, 7 minutes = 7/60=0.1167
Work Time per Inch equation: [Your Total Time] / [width + height] = [Work Time per Inch]
          i.e. 19.44/(8+10=)18 = 1.08
Work Time per Square Inch equation: [Your Total Time] / [width * height] = [Work Time per Square Inch]
          i.e. 19.44/(8*10=)80 = 0.243
To convert a base 10 number into minutes: [Base 10 Number] * 60 = [minutes]
          i.e. 0.08*60 = 4.8 minutes, .243*60 = 14.58 minutes

You could scale by pixel, centimeter, millimeter, points... However and whatever measurement you use to scale it, MAKE SURE YOU USE IT CONSISTENTLY, and do a few practice runs using that scaling measurement to make sure that it is accurate!

Step 3: Figure Out Your Active Work Hour Percentage

Also known as your Labor hours, these are the hours that are distilled away from the minor interruptions and long space out periods where you're trying to decide if fuchsia really was the best color choice right there and maybe you should start thinking about what you're going to have for dinner... If you were good at your time keeping (and you should have done a bunch of that) you can just subtract the interruption times from your total work times. If you're guilty of space out moments often that you didn't catch, or you didn't keep good time keeping, you'll have to utilize software that will help you determine what it is.

I'm apparently a space out Queen, but I wasn't aware of how guilty I was until I started working on another project using Celtx (a cloud based online free script writing program) which keeps track of your writing and thinking times for you as you go. Basically it starts the thinking countdown whenever you stop typing for a few seconds. Some of it was legit thinking time that I could count as active hours, but I found out that between space outs and answering to the calls of my two tiny children, my active time averages only 24 minutes for every hour at the computer. If you're not sure how much of a space out you are, consider using Celtx for a bit to see how you fare. (If anyone knows of better time management/tracking software, feel free to post it below).

Once you know your active time, write it down and convert it into a base 10 percentage using the equation [Active Work Time] / [Full Work Time]
          i.e. 24/60 = 0.4, or 40%

Step 3: Figure Out Supplies and Overhead

Quick vocabulary lesson for you! Supplies: anything used up to create your project, such as paint, markers, ink, canvas, real screen tone, paper, etc. Overhead: all non-labor expenses not directly related to the creation of the piece but required to be paid for you to be in a position to offer your services. Think rent, internet, printer paper/toner/ink for physical copies of an invoice (oh yes... invoices. No worries. They'll be covered in a later tutorial), daycare/babysitting if you decide to go that route for an extra productive day, etc. They're not directly related to the hours spent creating the art, but they're definitely things that need to be considered because you still have to pay for them in order to be able to create the art.

If you know you're going to use 6 different colors in your oil painting, and that you'll need to pay rent and electricity for 2 weeks to keep it in a dry spot long enough for it to be fully cured/dry to deliver to the customer, you'll want to consider adding that to your finished price. This is different from shipping and handling (the price of putting that artwork in a box and mailing it) and is expected to be included into the commission price from the get go if you're going to include it. Considering you're quite likely to need those 6 colors in your next oil painting, it would be reasonable to include it as a supply cost to that customer.

If you're not concerned about supplies or overhead because this is a second source of income in the household and your supply costs are negligible (I'm in a spot where I don't have to get any new software ever if I don't want to, for example, and my invoices/goods are all electronic) you don't have to include them in your price. But you should still consider them just so you're aware of what they are.

Whatever overhead you choose to include, get it down to an hourly rate for easy math later. You can also choose to have different overhead costs assigned to each category of art that you offer (oil, acrylic, marker, digital raster, digital vector, etc.). Write the hourly rates down.

Also if you know that on average, for example, you're going to use one canvas and 20 ounces of paint, you can take the usual cost of those supplies and divide it by your scale measurement for a set supply charge. Write it down.

Step 4: Decide On Your Hourly Wage

There are a lot of things to consider here, such as your state/province/country's minimum wage (never go below minimum wage at the professional level!), your level of schooling that you've taken/had to pay for in the arts, how many hours you've put into practicing and books you've bought (we know you've done a lot of this to get here!), what your yearly income comfort level is, other income in the house, whether or not you want this to be a full time job or a part time one, how in demand you are (more clients than time = higher price), what your active work hour percentage is (lower percentage means longer wait times, so keeping prices down will combat people's desire to search elsewhere) and whether or not you want all of your yearly income to stem from this or not. If you know exactly WHY you charge the amount you do, and it's a reasonable argument, people are more willing to pay what will seem to you at first to be extremely high prices. Not sure if that high price is reasonable? Research your competition and ask for quotes. Look up the average yearly salary for an illustrator/painter/artist in your country. It's scary sometimes.

I know that was all sort of vague, so for example, if I was reaching for a goal of $50k annually, and I had to make it all via my artwork, I would need prices and/or hours high enough to make $961.54 a week. Whereas, keeping that same goal of $50k, if there was already an income of $45k coming in from day jobs in the household, I would only have to make $5k a year to reach that goal and could have lower prices and/or work less time to accomplish it because I would only need to make (5000/52=) $96.16 a week. If I didn't have a financial goal at all and this was all just a side gig for extra spending money, I could choose to have even lower prices and work sporadically as the jobs presented themselves.

Once you have your hourly wage, whether that's $12 USD, $45 USD, £35 or whatever, you can figure out your base rate table.

Step 5: Create Your Base Rate Table

You know that list you wrote down on paper or in a spreadsheet listing all the art you're going to offer? Get that out now. We're going to use it to create the base rate table that you'll use to calculate an educated quote for all of your future customers. Next to each item you're offering create these columns: Minimum Deadline Hours, Charge Hours, Price per ___ (Use your scale measurement from step 2).
          i.e. Painted w/ Lineart (Simple BG, 300 ppi): [Minimum Deadline Hours] [Charge Hours] [Price per inch]

Going down the Minimum Deadline Hours column, write down the result of [Your Total Work Time] / [Your Scale Of Measurement] that we figured out in step 2 for each item.
          i.e. Painted w/ Lineart (Simple BG, 300 ppi): [ (19.44/(8+10=)18 =) 1.08 ] [Charge Hours] [Price per inch]

Going down the Charge Hours column, write down the result of [the Minimum Deadline Hours Number] * [Your Active Work Hour Percentage] for each item.
          i.e. Painted w/ Lineart (Simple BG, 300 ppi): [ 1.08 ] [ (1.08*0.4=) 0.432 ] [Price per inch]

Going down the Price per ___ column, write down the result of ([Your Overhead Hourly Rate] * [the Minimum Deadline Hours Number]) + ([Your Hourly Wage] * [the Charge Hours Number]) + [Supply Charge per __] for each item, remembering to round to the nearest Monetary Numerical Value ($0.00 for USD).
          i.e. Painted w/ Lineart (Simple BG, 300 ppi): [ 1.08 ] [ 0.432 ] [ ((0*1.08)+(12*0.432)+(0)=5.184=) $5.18 ]

Step 6: Use Your Table to Create Quotes and Deadlines

You now have a fully functional Base Rate table that not only will tell you how much to charge your customer, but also the minimum amount of time that you will need to be able to finish the work in! So if someone requests a quote you now just have to plug your numbers in from your table!
          i.e. Someone asks for a quote for a 5 x 6" raster image, Painted w/ Lineart (Simple BG, 300 ppi). The Charge would be ($5.18 * 11=) $56.98, and the minimum amount of hours I would need to finish the piece is (1.08 * 11=) 11.88 or 11 hours and just under 53 minutes. If I work for 4 hours a day on the piece, I now know I can't set a deadline closer than the evening of the 3rd day, but 4 or 5 days out would be preferred.

Congratulations!

Use this new information wisely and make art!

"But what if they want a discount? Do I have to add tax?" I hear you asking... First and foremost, I will emphasize that you are under no obligations to offer ANYBODY a discount, not even close friends and family members. Beyond that, you'll have to read the next tutorial.
« Last Edit: August 23, 2017, 08:06:46 PM by Mother Roshiya »