NYCPHP Meetup

[Jim Hendricks]

A great story about the cost/value question.  I started my business almost 2
years ago.  I have 19 years in the business so knew that my experience
should allow for high rates, but my lack of name recognition as an
independent would work against me.  Rather than start my rates at the $90 I
felt I should be able to get, I started at $70.  I also factored my cost of
living, extra cost for running the business, and an expectation of 20
billable hours per week and came up with $60 would be the minimum I would
need to live on if I obtained the 20 billable per week.  I had no bites.  I
finally had a great lead which would lead to the potential for much future
work, but they didn't want to pay over $50, this was with me stating the $70
hr. rate.  Since the potential was great, we settled on $55 hr for the first
project, each project thereafter would be a new negotiation with the
understanding that I would over time attempt to get the rate up to my $70.

Well experience pays off, my next couple projects were at $60, then $65, now
at $70.  On top of all that, they have lots of other projects ongoing with
other consultants.  They even have one project billing out at $10 an hour.
Wouldn't you know that many of their lowball projects have encountered many
problems at delivery time with no end in sight as to when the problems would
be corrected.  They have pulled me in to correct the problems fully
understanding that my corrections would take more time because I would need
to familurize myself with what was done by the other programmer.  They now
rarely contract any real projects for the person willing to lowball because
they finally understand the concept of getting what you pay for and don't
want to have to pay me to correct the problems caused by the low ballers.

Jim
______________________________________________________________
Jim Hendricks, President, Biz Computing, Inc
Phone:  (201) 599-9380     Email: jim at bizcomputinginc.com
Web: www.bizcomputinginc.com
Snail:  Jim Hendricks,  Biz Computing, Inc.,  255 McKinley Ave, New Milford,
NJ 07646
______________________________________________________________

----- Original Message -----
From: "Sterling Hughes" <sterling at bumblebury.com>
To: "NYPHP Talk" <talk at nyphp.org>
Sent: Monday, January 20, 2003 12:46 PM
Subject: Re: [nycphp-talk] NYC Freelance rates


> On Mon, 2003-01-20 at 12:38, Brian wrote:
> > Jumping at a low rate has a tendency to put you in a low pay bracket for
any
> > future work that may come out of it.  People start passing out your name
as
> > 'the cheap guy' and that type of pigeon-holing is a trend that is
difficult
> > to change.
> >
> > That may be easy for me to say, since I am not at a loss for projects at
the
> > moment either.  I will say that it was necessary for me to cut some of
the
> > cheap ties lately and make contacts in bigger companies with bigger
budgets
> > and with a better understanding of quality work.
> >
>
> Of course, and when that time comes you can say, "I'm sorry, but my rate
> is no longer XXX an hour.  Because of the quality of my work, I'm very
> busy and my rate is UUU.  Since you're an old client, I'll only charge
> you ZZZ."
>
> XXX == cheap rate
> ZZZ == exorbinant rate minus a little
> UUU == exorbinant rate
>
> If they don't want to pay you, then you can move onto your other
> clients, and they will probably still have a good taste in their mouth
> because you tried to accomodate them, and hopefully give you more
> expensive work when they find it.  If they are willing to pay you, then
> great, you're only giving them a small discount for one project, and it
> may lead to a continuing relationship at the rate you're currently
> charging.
>
>
> -Sterling
>
> --
> "I can't give you a brain, so I'll give you a diploma"
>     - The Great Oz, The Wizard of Oz
>
>
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