Thought’s on pricing by Pablo Picasso | Don’t charge by the hour
“What is your hourly rate?” or “How much do you charge per hour?” are common questions asked by prospective clients when it comes time to quote on a project. Inevitably the second question is “How long will it take you to complete?” as the prospective client tries to elicit a price for your services. But you shouldn’t always quote based on your hourly rate.
Perhaps the question that should be asked by the client is “How much is completing the project worth to them?” or “What is the value of the project to them?” Because let’s face it there will always be somebody willing to do the job at any price.
A favourite story of mine and one we use at Newport Digital to explain our pricing to prospective clients is one told about Pablo Picasso:
Legend has it that Pablo Picasso was sketching in the park when a bold woman approached him.
“It’s you! Picasso, the great artist! Oh, you must sketch my portrait… I insist.”
So Picasso agreed to sketch her. After studying her for a moment, he used a single pencil stroke to create her portrait. He handed the women his work of art.
“It’s perfect!” she gushed. “You managed to capture my essence with one stroke, in one moment. Thank you! How much do I owe you?”
“Five thousand dollars,” the artist replied.
“B-b-but, what?” the woman sputtered. “How could you want so much money for this picture? It only took you a second to draw it!”
To which Picasso responded, “Madame, it took me my entire life.”
The time taken to do the project is really irrelevant except if you are meeting a deadline, then theoretically, the price should go up if it is a short deadline. We know from experience that a project might take ‘X-hours’ for you to complete. But it might take the client ‘y-hours’ and someone else ‘z-hours’. It is all relative to skills and experience. It is not about what it “costs” the client, but more about the value to the client having you complete their project with your skills and your expertise. If you have a client hassling you on price and you don’t feel comfortable. Walk away, because the prospective client who bases your value on the lowest price is not a valuable client to have.
About the Author
Wayne van Elsen
Founder at Newport Digital
Thinker. Creator. Unapologetic internet geek. Coffee enthusiast. Entrepreneur. Falls down a lot. But gets back up.
Wayne van Elsen is an experienced entrepreneur, online business coach and WordPress wizard.