Re: Freelance programming
Re: Freelance programming
- Subject: Re: Freelance programming
- From: Jeff LaMarche <email@hidden>
- Date: Fri, 31 Oct 2003 11:33:56 -0500
On Oct 31, 2003, at 2:30 AM, Jacob Chapa wrote:
Im looking to do some freelance programming work, in cocoa and
actionScript for a company. I am new to the whole freelance thing, and
want to know some 'aboutish' fees that you guys charge. not super
professional, just the regular freelance joe. if you know what i mean.
I agree with Chris' comments whole heartedly. If you self-assess and
decide to still go ahead, there are a few other things he didn't
mention: location and costs.
If you are a programmer in Manhattan or in Silicon Valley you will have
to charge more than one living in, say, Lake George, NY or [insert
favorite small town here]. Some of this is due to greater demand, some
is due to higher cost of living. For any of us to tell you a "ballpark"
would only be useful if you are in the same geographic area and have
about the same ability and capabilities. Generally, you don't want to
be "too cheap" or "too expensive"; the former is a sin (if you aren't
worth the going rate, don't go independent), the latter is okay if your
reputation justifies and people are willing to pay it.
Most people underprice when they first go out as an independent. They
fail to take into account the fact that almost nobody is 100% utilized
(most people figure 2000 billable years hours in a year is 100%), while
rates as an employee are usually either salary, or full-time hourly and
the employer absorbs the risk associated with being on the bench, as
well as the fact that you typically get benefits such as partial
healthcare coverage, 401(k), vacation, etc. Employer's also typically
buy your equipment - remember that you will have to buy and maintain
your own equipment, even though some clients will provide you with a
workstation, you can't assume it. It is not uncommon for your hourly
rate as an independent to be more than double your rate as an employee,
often it's even more than that, and many people are often uncomfortable
asking for that much money for their efforts.
Here are some factors to consider:
What % utilization can you maintain. If you're going to do only Mac
programming, you'll probably have to figure a lower utilization, at
least at first simply because the potential client base is smaller.
Equipment costs - plan to buy professional-grade equipment, and keep it
current. This is going to cost you several thousand a year likely,
although that is take deductible.
Training and conferences - you have to stay current and network. If
you're going to focus on the Mac market exclusively, plan to go to
MacHack (or whatever it's called now), possibly your coast's MacWorld
Expo, and probably some training to keep your skills current is not a
bad idea. The time to attend these has to be factored into your
utilization above.
Advertising, clerical, postage, etc. Don't forget the "costs of doing
business". They are hard to estimate at first, but it's better to
overestimate costs and underestimate income when figuring your rate.
Vacation, Pension, savings
RISK: There is uncertainty in business. As an employee, you are largely
insulated from that. You get a steady paycheck regardless of whether
your employer is having problems getting paid, has a lull in business,
etc.
So
(%utilization / 100) * (2000 - hours for training and conferences)
gives you the number of billable hours you can expect to bill.
Now, calculate
Salary you expect + expenses
You may be surprised at how much it turns out to be. Let's say that you
want to earn $50k and believe you can stay 70% utilized, and will take
2 weeks to attend conferences and training, your calculation might look
something like this:
.7 * 1920 = 1344 hours
50,000 + 8,000 for equipment, training, conference, and misc. business
costs
58000 / 1344 = 43.15 hourly rate
Is that reasonable? Depends - I personally haven't heard of many good
programmers working for that rate except H1Bs, and you don't see much
of that in the Mac world, but a lot of that depends on you. Can you
live on $50k? Can you really sell yourself well enough to bill that
many hours? Are your costs estimated accurately? Don't use the numbers
above as gospel - they are pulled from thin air just to show the
process. Try to include any possible costs in your calculation. And
remember that $50k as a freelancer is not the same as $50k as an
employee. You have to pay for your own health care, handle your own
retirement savings, and YOU, not your employer is taking the risk of
non-work and non-payment, as well as incurring the cost of obtaining
new work. The true cost of an employee who is making $50k is probably
$75k when you figure benefits, vacation, etc.
Bottom line, remember that you can negotiate down on price, but not up.
If you are not comfortable asking the rate you calculate out, then you
probably need some more experience as an employee.
Jeff
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