2 min read
20 Apr


What’s your day rate?  

Jeez, how about you provide some info about what, when, where, who and why. Then we can talk more. Perhaps I may not want to do it - even for a million quid! 

It might sound strange if you’re salaried, but the answers to those questions will probably all determine how much I’d like to or need to charge you. 

Day rates aren’t the only option either, although they are by far the most popular. I think because it’s then easier to “convert” to a salary. Not that you should… 

Day rate   

My day rate is not a salary equivalent. If you do the maths, you’ll discover that it equates to a huge salary. But that’s not a valid equation to make. Because if you need me, full time, long term you would hire a permanent employee instead. 

Think of it from my perspective. The rate you pay me per day needs to cover a decent wage and the perks of a permanent role that freelancers don’t receive: 

  • Sick pay
  • Holiday pay
  • Pension
  • Reserves for taxes

I also have business running costs: 

  • Accountant
  • Insurance
  • Website domain and email
  • IT software/hardware and security
  • Travel and subsistence
  • Professional memberships / training

I accept that this is they way that I will always be paid for a vast majority of my engagements. It’s easier for hirers to figure out how long a job their end might take and then look for someone with that level of capacity that fits their budget. 

Sometimes hirers miscalculate though, or don’t bother at all preferring to just ‘get someone in.’ I may not have enough work to do and get bored and demotivated. Or sometimes I’m totally overloaded doing the job of 2 people for weeks. 

What tends to happen with either one of those extremes is that it’s probably going to be my first and last gig with that client. The truth is, that if I’m on a day rate, my incentive is to do my hours for the day and sign off, no more, no less. 

That is why working with a small set of repeat clients or referred new ones is the way I tend to operate now. The trust is there on both sides that we can continue to use this simple model and neither party will knowingly screw the other. 

Project fee 

This is how I cost work with SMEs. I figure it out by working out what there is to do, how long that will take and applying rates to that. It’s also how most agency clients I work with cost their proposals, so I’m surprised it’s not used more. 

I reckon it’s the eggs in one basket thing. Hire on a day rate and you can get shot and replace if it doesn’t work out for any reason. But not so easy if you hire in one freelancer to deliver a set scope of work for a fixed fee in a specific timeframe. 

Hirers must be sure that the work gets signed off by their clients and all internal approvals are met. And the data is delivered on time. In my experience, there’s at least one too many ducks to line up there! 

It is a shame though, because my incentive working on a fixed fee is to work as efficiently as possible because that is what maximises my profitability. I care a tiny bit less about that on a day rate.  

Fee per unit 

This has really happened although I didn’t work on it in the end because the fee I was asking for each unit (in this case an econometric model) was about twice what the client wanted to pay. 

I should day that the agency in question had not meant for this to happen which I am glad about because it is by far the worst way to pay or be paid, for consultancy anyway. 

But they found themselves without perm staff in a hiring freeze, a freelancer down due to illness. They approached a group of freelancers individually to see if between them the necessary work could be carved up. 

An absolute nightmare to coordinate their side and reassemble the efforts of 5 people back into a coherent piece of work. 

If you are being paid by the item, your incentive might be to get through as many as possible without the usual level of attention to each one? 

Even if that’s not the case, it’s almost impossible to work well on a fraction of a whole and nail it without collaboration. You simply don’t have the context. 

That’s why my rate was too high for them. I’d factored that in, they had not.  

Wrapping it up 

It starts from £375 + VAT in case you were wondering. Not cheap by any means but exceptional value given my experience and dedication to what I do.

Here's an earlier piece I wrote that touches on price and value in case you're interested. It was only from 2019 but it seems a lifetime ago!

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