It was my role to research into costing and how our business will charge clients for the work we produce.
Step 1: Determine your costs, Start with your fixed costs such as rent, internet costs, and insurance as these are usually the easiest to total. Next add in any variable costs such as long distance phone calls, and travel expenses by giving a fair estimate of your yearly costs. I like to over estimate with these costs in order to make sure that I set an accurate break even point. Finally add in any one time costs such as computer purchases and software upgrades. Las Vegas, Nevada, After completing these steps, you should have a fairly accurate figure of what your costs are for the year. The next step is where I tend to stray for the typical formulas.I like to throw in another $3000 “insurance” figure to account for any unexpected costs that may occur during the year. This could be more or less depending on your needs
QUICK FORMULA 1:
Fixed Costs + Variable Costs + One Time Costs + What If Costs = Yearly Costs
Step 2: Determine your billable hours
As long as you are honest with yourself, this is actually a fairly simple task. First find the Number of hours you work per week, and then subtract and time you normally spend doing administrative tasks or any other non billable time. Your result is your billable time. Here is where the honesty part comes in. If you know that you spend another 2 hours each day reading blogs and checking email then take off this time as well.
QUICK FORMULA 2:
Hours Worked – Non Billable Tasks – Honesty Time = Billable Hours
Step 3: Figuring your break even point
Now we know both what our expenses are and what our realistic amount of billable hours are. If we divide our yearly costs by our billable hours we receive our break even point.
QUICK FORMULA 3:
Yearly Costs / Billable Hours = Break Even Point
What are designers saying about their rates?
“I usually give an all inclusive estimate based on this rate, but will specify that anything beyond the scope of the estimate will be billed per hour.”—Northeast
“I find clients prefer to get a quote for a job in its entirety. A per-hour fee makes them nervous, as they don’t know how many hours I will rack up. Quoting a project based on a good faith estimate of what it takes me to to the work assures I get paid fairly for my efforts. Working effectively and completing tasks in less time than I estimate is the equivalent of extra profit. This does not require a change to the original agreed upon fee, or the terms of delivery, and still allows me to meet the expectations of the client. Over the course of a year it also helps compensate for the projects which, take me longer than I expect.”—West
“For the most part people freak out when they hear an hourly rate. But are fine when you tell them a project will cost $X. Costs the same either way, but it focuses them on the big picture of pricing rather than the details.”—Midwest
“I don’t charge hourly rates, because it hurts the graphic design business as a whole. I charge based on the task itself, and the value of the task, based on a multitude of factors, such as how and where it will be used, and what type of licensing I am contracting to the client. Hourly charges make clients relate graphic design work to other jobs, and doesn’t include the artistic talent that is not hard-priced.”—South
I found this article discussing how designers go about charging. The majority of opinions suggest it can be hard to charge an hourly rate as it puts of customers off so we are going to charge by the project.
I found this office space to rent that includes all cost for internet desks, phone lines .....
We decided to use this as a starting point for the company with the option to upgrade once we become established. This option will keep costs down.
The digital media director position is a relatively recent one. It has only existed since computer-based media and advertising became a viable market during the mid-1990s. Since the job is still so new to many, the actual responsibilities of a digital media director vary from place to place. Common jobs include overseeing teams of media creators and planners, working with clients on digital media projects, and developing new digital media advertising formats.
A digital media director typically has a college education, but there are a wide range of fields that can lead someone to this position. It is common for a person with this job to have a degree in standard or digital marketing. He or she will likely have the background to organize and create the campaigns as well as the business sense to run a department. Less common positions leading into this profession are graphic design, search engine optimization, and webpage creation and programming.
Most digital media directors head either their own department or their own section within a department. Depending on the size of the organization, this can have many different meanings. They may have a full team in larger firms or a single assistant in smaller ones. Smaller companies often require the director to handle his own accounting while larger firms do not. Company size and configuration also determines whether the director is the main contact with digital clients.