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Pricing PSD to HTML Services

First published on Feb 13, 2010 by Simon Foust

I’ve been in this business for several years now, and everything I’m about to say is based on experience, failure, success and research.

What will the market bare?

It’s tempting to start with this question, so why don’t we do that? What you have to keep in mind is that you are a part of the market. “The Market” is not simply some abstract thing that’s “out there”. It’s here. You’re in it, and you’re a part of it. You have a responsibility. And the last thing you should want to do is take unfair advantage of it.

There are two ways people typically take advantage. The first is by charging significantly lower than the average price for PSD to HTML services.

Depending on your standing in the market, this could create a price war. Price wars are bad for businesses and for customers. They’re bad for businesses because when you’re involved in a price war, most likely you can’t even break even, much less turn a profit. You’ll go out of business quickly, or if you find a way to stick around for a while you will treat your employees poorly and just generally fail to have a positive impact on your community or local economy. And that should bother you.

Price wars are equally bad for customers because customer service and product quality suffers deeply. The reason is because employees of these companies are not qualified to do the job. If you give away your product or service, you don’t have the money to pay for good craftsmanship and delivery.

The second way people take advantage of the market is by charging significantly more than the average price for PSD to HTML services.

If you’re among the best at what you do and you deliver the service in a unique way that benefits your clients more than they would benefit otherwise, then there’s absolutely nothing wrong with charging a bit more than the average price. This practice is actually a good thing in many cases. When your client feels like he’s getting what he’s paying for, this is a good thing.

Some people even set their price points a bit higher to weed out clients who care more about price than value, in part because those kinds of clients are typically more demanding and difficult to deal with.

However, there are some companies out there who have set their prices much higher than the average price, and that could be a bad thing for those interested in buying these services even if they don’t buy from those particular companies. Why? The obvious reason is that other companies will be tempted to raise their prices without warrant or reason (other than that they see the ridiculous prices on the high end). If your prices are too high then no one is going to buy from you unless you’re Apple.

I keep track of the pricing for PSD to HTML services of 50 or so companies by recording their respective prices every few months. What I find is that the bottom and top 5% or so tend to shift more towards the middle, and the middle 90% or so tend to stay relatively the same.

From this information, you can come up with an average price and then divide it by your hourly rate as a front-end developer. Then you know the number of hours you should be spending on a project if your prices are set around the average of these companies.

Of course, figuring out your hourly rate obviously means more than just how long it takes you to do the actual technical work of a PSD to HTML project. You have to factor in the very important time you will spend doing customer service, sales, marketing, etc.

How much time goes into one project?

Several years ago when I first started offering PSD to HTML services, I figured out that the average job went for about $150. At that time, it was taking me about 10 hours to do the actual technical work alone. With 5 hours built in for sales, customer service, etc, I figured my rate was $10 per hour. That’s similar to what you could make working at Starbucks, except without health benefits or a guaranteed number of hours per week. Grim.

But I pressed on, because I knew I would get better at the technical work, and because in my mind working “for yourself” is always better than working for “the man”. I started keeping track of how much time I spent on a number of things, such as sales, marketing, time spent researching and honing my skills, customer service, and of course the actual technical work of writing the html and css for a project.

After a few months, I could count the number of jobs I’d completed and then compare that to the amount of time spent on the aforementioned tasks, and then I’d know two very important things. For one thing, I’d know approximately how long it takes to complete one project. And secondly, I’d know how much money it takes to gain a customer. That second point is important to know so that you understand how much money and time you’ll need to spend in order to reach your sales goals for the month.

So keeping strict track of your time spent on various things can be very profitable. What you’ll find is that as your skills grow, the time it takes you to do something decreases. That goes for the technical work as well as things like customer service and sales. Therefore, your hourly rate goes up because your time is more valuable and you’re more skilled.

And while you should never stop improving your skills, you can make time tracking a less important part of your daily tasks as you go forward. That’s not to say you shouldn’t have goals – that’s crucial. It’s just that at a certain point you have to stop thinking about what you do as an hourly service. You’re not selling hours; you’re providing solutions.

Conclusion

To sum things up nice and tidy, when you’re trying to figure out the right price for your PSD to HTML services you should take into consideration what the market will bare, while at the same time realizing that as a part of that market you have a responsibility to be fair to your customers, yourself, your competitors, and your local economy. You should also take into consideration how much time and money it takes you to complete the process of making the sale and delivering the service. In the end, the goal is to find a way for everyone to “win”.

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