Is Charging More the Right Thing to Do?

Note: This post is our personal opinion and will most likely set our blog on fire with heated debate and criticism for its controversial content. We ask that all comments remain polite and respectful at all times, no matter what your views may be.

“That’s all you charge?” The startled words came back at me. “You’re kidding me.”

A peer and I were playing ‘I’ll show you mine if you show me yours’ with our rates. She’d been sure we charged far more for our services. She was shocked to learn the truth.

This surprised me.

Rates for web services like design, writing and more are often an area of great debate. Many people (including ourselves) encourage low-paid web workers to set better rates.

But what is the ideal rate? What should we all be charging?

Some people suggest a minimal rate, stating you should accept nothing less. Some suggest doubling rates out of the blue. Just like that. Just because. Some propose flexible rates and some propose rates based on who your client is and the person’s ability to pay.

Now, I’m all for people charging what they feel their skills are worth. I’m all for earning a good living and having equitable compensation for the work we perform.

But the shocked reaction of my peer and her concern that we were selling ourselves short found me defensively muddling over the rates we charge.

Putting Yourself Out of Reach

I am not – I repeat, not – for high rates. I never have been. Since day one, Harry and I have had a vision for our business based on our personal values and beliefs.

We want fair compensation for our work based on our skill levels, abilities and experience. We also want to offer people quality services at affordable rates.

“But you’re the Men with Pens! You could charge way more than that – easily,” my peer stated, and I found myself blinking in reaction. We could charge more, yes.

But why would we? Is that right? Is that fair?

Harry and I aren’t new at this business. We aren’t rookies. We just fell into high demand because we became somewhat of a celebrity duo – nothing else about us has changed.

Does our popularity allow us to jack our rates and set ourselves out of people’s reach? We’re the Pen Men, after all – we can almost start our own trademark. I can just see it now: “A Men with Pens Design”.

Hold on. Promoting an “Original Men with Pens Design” does sound nice, but does that mean we should raise our rates accordingly?

No. I don’t think doing so is right or fair. Part of what sets us apart is that we understand budgets. Not everyone can afford expensive work. I don’t like to pay extra just for a name brand myself.

We take pride in finding the middle ground and solutions that let us earn a good income but that also put our services within reach. People shouldn’t have to spend a small fortune to have a site that looks good or content that reads well.

What’s wrong with that?

Nothing. But I suddenly find myself defending lower rates instead of higher ones. Am I in the minority? If you had the chance to triple your rates because of sudden fame or popularity, would you do it?

I’m not sure popularity justifies high wages. Sure, we’re Men with Pens. We do rockin’ work. We’re good at our jobs. We’re conscientious, caring and friendly. And we have fair wages.

Those who just jack their rates because they can get away with it seem to be dabbling in an unethical business practice.

The Alternatives: McDonalds

When Harry and I began working on the Web, we needed to set our rates. The wide range of fees for similar products and services out there left us scratching our heads. Are 500 words worth $5 or $150? Is a banner worth $20 or $200?

We looked to authorities such as www.writers.ca and used online salary tools. We examined the rates those sites suggested and what other workers received for the same services.

We took a look at the alternatives, too. The web may be international, but our local economies drive our financial needs. So where would we work and what would we earn if all this dried up and disappeared tomorrow?

That raised interesting questions. What do other people earn? What’s a good salary? What isn’t? What income do I need to live well? What does Harry need? What are our local, regional and national economies? What’s a good salary in Ontario? In B.C.? In Las Vegas? In Florida?

The Canadian minimum wage is around $8.50 and in the United States, it fluctuates from between $5 and $8. A middle-income family in Canada earns about $25,000. In Nevada, $20 an hour is pretty good.

And yet on the web, you have prices that range from $2 to $2,000 for the same work we do. Puzzling? You betcha.

We decided to choose rates that met our financial needs and that stayed within suggested industry guidelines. We also tried to price our services to meet market value. We set our ‘don’t go below’ rate, and we remembered to price ourselves within reach of most people.

Sleeping Well at Night

During our number crunching, we looked at how long it took us to complete a project based on our personal speed, skill levels, experience and talents. We know that pricing by the hour is bad for our business, but we still had to figure out our hourly income to know where we stood at the end of the day.

Both of us felt quite strongly about taking an ethical stand. We needed to feel comfortable with the rates we charged. We needed to know that we’d done the right thing, not the lucrative thing.

But we can, indeed, do the lucrative thing if we so choose. We find ourselves in the position of being able to raise our rates if we’d like – easily. We’ve looked around, too, to see what others are charging for the same services we provide.

We’ve noticed that some services worth about two hours of time are going for $250 – and we charge one fifth of that amount. What is justifying the huge difference in rates? Not skills, not experience… what?

Personally, both Harry and I feel sick at the thought of charging so much for so little. We both felt that demanding that kind of money for our services was unfair to clients and compromised our integrity, values and beliefs.

Does that mean the person charging $250 is unethical? Not at all. But it does make me wonder where the person’s values lie.

Who Do We Think We Are?

When the subject of rates comes up, I often think of my sister. She’s a crown prosecutor and spent years studying law. She has decades of experience putting war criminals behind bars – and she earns less than many writers and designers.

There’s something very wrong with that.

Who the hell am I to demand higher wages than a lawyer? Are my services worth more than an accountant? A doctor? A teacher? A firefighter? All these people are paid less than many web workers out there.

I’m a writer, for god’s sake. Yes, I’m a very good one, but let’s be realistic. I won’t die on the job or save lives or put war criminals behind bars. Who am I to be paid so much for my work?

Harry feels the same way. He flatly told me that he has a ‘don’t go below’ rate and that he also has a ‘don’t go above’ rate as well. He wouldn’t accept a job that pays more than he feels is right.

Neither would I.

Value for the Customer

“You have to look at the value for the client,” my peer argued. “It’s worth a lot to them. Your work lets them make more money. Charge accordingly.”

It’s a valid argument, but I disagree. It is not about what my work is worth to someone else. It is about what it is worth to me and what I feel is fair compensation.

She suggested that I charge more, because corporate clients have more money to spare and needed to reach more people. She mentioned that I could offer discounts to those I felt deserved a break.

I disagree with that as well. Should a corporate client building a website pay more for my words than the hobbyist blogger who wants a nice welcome page?

Having different rates based on your client’s ability to pay is price discrimination. It’s not an ethical business practice. When you walk into a grocery store, you aren’t scanned for your background and income history to see whether you should pay more for your apple.

But do you scan clients like that? Be honest. We all have “annoyance tax”, don’t we?

We try to maintain a policy of “all people are equal in our eyes”. We don’t take bribes from a client so he can move to the head of the line. We don’t charge corporate clients more than hobbyists. If Microsoft came knocking at our door and asked us to work for them, they would pay the same rate as John Doe who lives next door.

This is right. This is business integrity.

Paying for Premium

We aren’t saying that those who do command double and triple our rates aren’t ethical. Let’s get that clear, before someone torches our blog. Some providers set justifiable rates based on their skill levels, experience, abilities, talents and beliefs.

That’s good. I am not challenging these people and their rates. I wish them very well and congratulate them on their monetary achievement.

Many people charge premium rates for special work. There’s nothing wrong with that, either. I get that you pay more for something exclusive, something special. I know why my Nike running shoes cost me a lot and I know why I pay that amount, too.

I’m also fully aware of the law of supply and demand and the issues of pricing around that. I understand that perception and pricing go hand in hand.

I know full well that we could charge premium rates – and for some things, the special things, the things only we can do, our rates are higher to reflect that uniqueness. There are reasons and strategies for everyone’s pricing, our own included.

But there are many services we perform that are banal. They are truly nothing. Many people offer the same service. Why should we inflate the price just because the Pen Men are doing the job?

There is no reason. There is nothing special about these tasks. Sure, the skills are special, but they’re not that damned special.

There is nothing shocking about not jacking our prices. We’re something of a small superstar and could get away with it, but we choose not to.We don’t have rock bottom rates, but there’s something right about refusing to increase our prices for certain tasks just because we’ve become the hot thing of the moment.

I think it’s completely arrogant to say, “If you want a piece of me, you gotta pay the price.” I’m cocky, but I’m not that much of an arrogant ass.

Abusing the Situation

We see people setting high rates arbitrarily – they see their buddies doing it. They see other providers doing it. Unfortunately, buyers don’t always know the difference and they agree to pay high rates.

We don’t feel that just because you can get away with high rates doesn’t mean you should.

What also bothers me are the many providers that are just plain greedy. They’re taking advantage of a situation. They screw people. They’re about the money – that’s all.

You wouldn’t believe the amount of remedial work we receive from clients who’ve been burned. Over half of our clients –50% of people who contact us – were taken for a ride by someone who overcharged and who did shoddy work.

And we have the joy of cleaning up their tangled mess.

Even worse? These clients come to us needing help, and they’ve had their wallets drained. They have no money left to correct the situation.

This isn’t right, people.

Another problem? These clients who’ve been overcharged are mistrustful and they’re gun shy. Deep down inside, they’ve lost faith in people. They just want to learn to trust again. We retain more clients because of our honesty than anything else.

I feel very strongly about providers who set high rates for a service that takes a couple of hours, especially when that service isn’t anything artistic or special. Nothing justifies those kinds of high rates.

It’s like Sears selling an MDF sofa for 3 million dollars – something’s wrong with that.

I think clients – no matter who they are – deserve the respect of fair treatment. They shouldn’t be gouged by high prices. They should be told up front that a job is a small one or an easy one or that it’s not a big deal.

There’s something to be said for honesty and transparency.

I also think that Harry and I deserve the respect of making the decision to be an affordable service provider. The fact that we specifically refuse to jack our rates should reflect on us positively, not negatively.

We want to make money, yes. But we want to be an accessible business within reach of those who want or need our services. We believe in honest and integrity. We believe in balanced values, strong morals, and practicing good business ethics.

There’s not a damned thing wrong with that.

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