Should I charge hourly or flat rate?
Should I charge hourly or flat rate? To summarize, a flat rate billing system generally works well for projects that have a well-defined scope and specific deliverables; an hourly billing system is ideal for more broad, ongoing, unstructured work.
Should you charge by the hour?
You already know that charging hourly puts a ceiling on how much you can earn, but there’s something else you probably haven’t considered. Billing hourly actually gives you incentive to work LESS efficiently. Since you’re being paid not for the outcome but for your time, you’ll end up taking more time to do the work.
How do I charge per hour?
Calculate Your Hourly Rate
Business schools teach a standard formula for determining an hourly rate: Add up your labor and overhead costs, add the profit you want to earn, then divide the total by your hours worked. This is the minimum you must charge to pay your expenses, pay yourself a salary, and earn a profit.
How do you charge hourly?
Desired profit amount + desired salary + operating costs / number of income producing hours = your hourly rate. For example: Desired profit of $16,500 + desired personal salary of $83,500 + operating costs of $30,000/1040 income generating hours = $125 per hour.
