Home – New Forums Money matters Consulting rates – what to charge Reply To: Consulting rates – what to charge

#1070736
MarketinginMelbourne
Member
  • Total posts: 16
Up
0
::
bradzo, post: 88216 wrote:
Hi Kathy

I like your idea. I had something the same when I was trying to work out how I could start again as a soloist.

From my income calculations, I would only accept 6 clients. That basically gives each customer 7 hours a week (or close to your 25 hours a month) – yes I would work on Saturdays. 6 clients Mon-Sat.

I was asked by a potential client how that would work, and how many hours I’d provide to them on a weekly basis for that weekly “retainer”. Well, as a case study, I’ve done three hours for them this week (I’ll be charging an hourly rate) and that is purely because I am doing it after hours, so I have to wait till the next day until I get a reply on questions I’ve asked.

As it is, they’ve already gone over the weekly “retainer” cost I calculated simply by charging them an hourly rate. If they had chosen to go with my idea, they would have been charged less overall already.

I must say here though that this is a customer I’ve been working with since 2004 – it was an idea I ran past them to see if it would fly. As you can see, they weren’t keen on it. They preferred to pay the hourly rate, and I think that boils down to them having to pay the retainer upfront and not knowing exactly what they’re paying for.

An hourly rate is a nicer income, but their reluctance to go with the retainer option didn’t fill me with confidence to go out to the marketplace and try to sell it to others. Maybe given your example, I should try it.

Thanks.

Thanks Bradzo. This is where I am at currently:

I offer 15 marketing days a month on a monthly retainer based on a capped day rate of $600/day ($80/hr). This arrangement allows me to be both reactive (i can respond to adhoc marketing requests as they arise) and strategic (i can work through specific projects). It provides both myself and the client some financial certainty. I am happy to reduce my hourly rate from $100/hr to to $80/hr or $600/day for a 6 months commitment. Obviously the client would not have to pay me any perks on top (super, holidays etc..).

My calculation:
Avg PAYG Salary for a Senior Marketing Manager with digital skills – $120k
Equivalent consulting salary – $140k after you add approx $20k for super, holidays etc..
$140k/48 weeks = $2916 per week
$2916/38 hours a week = $80 per hour (approx)
$80/hr x 7.5 days = $600/day
$600/day x 15 days = $9000 per month

That sound pretty good to me!

Another thing that is important is reiterating value. What value am i bringing to the organisation? I will detail that out when i talk to him.

Any other ideas to justify this rate?
Thanks everyone?