Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

How I learned to charge my customers

idiallo.com

Post reply on HN
Print view View original

51–60 of 85 posts

Re: How I learned to charge my customers

#51

Post by jen20 »

justaguyhere wrote: post #47
kova12 wrote: post #19

That explains why all the recruiters on LinkedIn are trying to low-ball me so much. The actual rate they charge is double!

This makes me soooooooo mad. Instead of LAMP, I spelled out Linux/Apache... etc in my resume. One recruiter spent 10 minutes arguing with me that LAMP is not the same as Linux... Why do they deserve 50% of the billing rate (they can't even bother spending 30 seconds to google and note down what these terms mean)? Is their service that valuable? Heck, compared to them even the freelance websites that take 20% (Fiverr…

Every time I encounter a shady recruitment agency (or their practices) I'm reminded of this blog post [1], although this is an archived version rather than the original.

In the UK, everyone even close to tech-adjacent has similar stories.

[1]: https://gist.github.com/CumpsD/696599d1bd4cd472a056586967293...

Re: How I learned to charge my customers

#52

Post by thaumasiotes »

JamesSwift wrote: post #16
chadash wrote: post #4

I do some consulting on the side and I won't charge by the hour if I can avoid it because: 1) I hate keeping track of time. 2) hourly rates aren't how my customers think of the issue. They think: "this product will make (or save) me $20,000/year" (making up numbers here). If I tell them that I can do the job for $5,000, that sounds like a great deal to them. But if I tell them I can do it for $200/hour, and I estimat…

I explicitly do hourly when working on the side because of the lower overhead on my end to manage the process. As long as the trust is there on both sides, its a much more pleasant relationship to manage. The client is never going to be surprised by my hours (because I've given a gut estimate and am communicating as we go), and we never have to worry about horse trading for scope. If requirements change we just do th…

> "we are growing and need a hired gun to handle a broad spectrum of miscellaneous requests"

I have difficulty seeing how you could charge for this other than by units of time.

Re: How I learned to charge my customers

#53

Post by mratsim »

afarrell wrote: post #12
Swizec wrote: post #5

Earlier quoted context omitted.

I hire freelancers sometimes and this is exactly right. We agree on scope, price, and timeline. Helps me budget, helps you know when the project is done. Hourly fills me with dread as a client. I have no idea how much this is gonna cost or when you’ll be done and I can use it. Retainers work well for ongoing work. Like when you need someone to do X, Y, and Z misc tasks every week. Fundamentally I pay for results, tim…

If you are hiring someone who does not know how to tell how long it will take them.

Unfortunately, without having done the same job, it's hard to evaluate the time, even if you pad. And for lots of complex jobs you have skeleton in the closet, meetings upon meetings, extra management to contact for approval.

I'd rather charge by day/week to discourage those unproductive things and have the company get its act together in terms of scope/approvals so that there is no blocker (or they get expensive).

Re: How I learned to charge my customers

#54

Post by stronglikedan »

superhuzza wrote: post #7
chadash wrote: post #4

I do some consulting on the side and I won't charge by the hour if I can avoid it because: 1) I hate keeping track of time. 2) hourly rates aren't how my customers think of the issue. They think: "this product will make (or save) me $20,000/year" (making up numbers here). If I tell them that I can do the job for $5,000, that sounds like a great deal to them. But if I tell them I can do it for $200/hour, and I estimat…

Genuinely curious, how do you mitigate scope creep when you charge by product? What stops the client from pushing back when there's a bug in the future or feature request they think should have been included?

A very precise, unambiguous Design Document, the drafting of which is included in the price.

Re: How I learned to charge my customers

#55

Post by mechEpleb »

JamesSwift wrote: post #16
chadash wrote: post #4

I do some consulting on the side and I won't charge by the hour if I can avoid it because: 1) I hate keeping track of time. 2) hourly rates aren't how my customers think of the issue. They think: "this product will make (or save) me $20,000/year" (making up numbers here). If I tell them that I can do the job for $5,000, that sounds like a great deal to them. But if I tell them I can do it for $200/hour, and I estimat…

I explicitly do hourly when working on the side because of the lower overhead on my end to manage the process. As long as the trust is there on both sides, its a much more pleasant relationship to manage. The client is never going to be surprised by my hours (because I've given a gut estimate and am communicating as we go), and we never have to worry about horse trading for scope. If requirements change we just do th…

Isn't the incentive structure for hourly completely ass-backwards? If you're a consultant there is an implied information assymetry - the client doesn't know what you are doing and has a hard time judging the amount of work required/being done. How do you handle the inherent and justified suspicion of padding billable hours?

I just can't charge hourly because I just can't imagine trusting someone who charges hourly.

Re: How I learned to charge my customers

#56

Post by mechEpleb »

superhuzza wrote: post #7
chadash wrote: post #4

I do some consulting on the side and I won't charge by the hour if I can avoid it because: 1) I hate keeping track of time. 2) hourly rates aren't how my customers think of the issue. They think: "this product will make (or save) me $20,000/year" (making up numbers here). If I tell them that I can do the job for $5,000, that sounds like a great deal to them. But if I tell them I can do it for $200/hour, and I estimat…

Genuinely curious, how do you mitigate scope creep when you charge by product? What stops the client from pushing back when there's a bug in the future or feature request they think should have been included?

You agree on a very explicit set of deliverables upfront. Whenever the client attempts feature creep simply tell them that it's gonna cost extra time for you and extra money for them. If they persist give them a quote for it.

Re: How I learned to charge my customers

#58

Post by mechEpleb »

afarrell wrote: post #12
Swizec wrote: post #5

Earlier quoted context omitted.

I hire freelancers sometimes and this is exactly right. We agree on scope, price, and timeline. Helps me budget, helps you know when the project is done. Hourly fills me with dread as a client. I have no idea how much this is gonna cost or when you’ll be done and I can use it. Retainers work well for ongoing work. Like when you need someone to do X, Y, and Z misc tasks every week. Fundamentally I pay for results, tim…

If you are hiring someone who does not know how to tell how long it will take them.

You might (think) you know how long it will take you; we don't. We don't even know if you're being honest, or deliberately underestimating/overcharging for work. Because an hourly rate means you have every incentive to do so.

Re: How I learned to charge my customers

#59

Post by mechEpleb »

afarrell wrote: post #39
Swizec wrote: post #28

Earlier quoted context omitted.

Since I pay for results that’s their problem. At least financially. Dealing with delays is easier if they don’t come with crazy extra costs. Imagine paying someone an extra $10,000 because they missed the deadline. That’s how hourly works.

If you've hired someone who doesn't know how to predict how long the project will take and they suddenly stop development midway through, it is probably also your problem. > Imagine paying someone an extra $10,000 because they missed the deadline. That’s how hourly works. Yes it is. You should probably ensure you only hire people who have experience predicting the costs of the projects you hire them for.

There is no way to know ahead of time what kind of contractor you are. And if you're not making an active effort to bill as much as humanly possible for the minimum amount of actual work, you are bad at business.

Re: How I learned to charge my customers

#60

Post by rileytg »

mechEpleb wrote: post #55
JamesSwift wrote: post #16

Earlier quoted context omitted.

I explicitly do hourly when working on the side because of the lower overhead on my end to manage the process. As long as the trust is there on both sides, its a much more pleasant relationship to manage. The client is never going to be surprised by my hours (because I've given a gut estimate and am communicating as we go), and we never have to worry about horse trading for scope. If requirements change we just do th…

Isn't the incentive structure for hourly completely ass-backwards? If you're a consultant there is an implied information assymetry - the client doesn't know what you are doing and has a hard time judging the amount of work required/being done. How do you handle the inherent and justified suspicion of padding billable hours? I just can't charge hourly because I just can't imagine trusting someone who charges hourly.

you nailed it, it’s about trust. i’ve had a couple clients for 9 years, all hourly, and never had an issue. i’ve had 20 or so clients that this didn’t work and one of us fired the other, most of the time amicably.
Post reply on HN