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The world's largest collection of prices and pricing related support tools for the desktop professional |
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current rates for writing, editing, graphic design, DTP, prepress, multimedia and web design and development |
| HOW DO I KNOW MY PRICE IS RIGHT? |
 Set your rates using
How to Price Graphic Design & DTP Services
or Pricing Guide for Web Services ($34.95 each)
These books clearly explain how to set prices that work. (Both books also include tips on estimating, bidding and
negotiating jobs.) |
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What's the Price Up North? by Robert C. Brenner, MSEE, MSSM ©1999 Brenner Information Group
Among the paradigm shifts that have occurred in the last two years, one has
immediate and far-reaching impact on every graphic designer, desktop
publisher, and web service provider in America. There is a growing base of
desktop computer entrepreneurs who are actively selling services to buyers
geographically distant from their own shops. A tsunami of growth in the use
of the Internet for communications and data transfer has enabled workers to
be located anywhere on the planet. It has also enabled direct competition
from afar. Thus we have Web designers in San Francisco working for companies
in Japan and Germany. And web site developers in Australia doing work for
advertising agencies and commercial companies in New York City. The world has
become one huge marketplace, and many of those who are familiar with buying
and selling internationally are thriving in our global economy.
Competitors can come from anywhere, so it helps to know what service
providers are charging elsewhere in the world. Take the Canadians, for
example.
We recently completed a comprehensive analysis of pricing in the far
north (Canada). Over the past three months, we've collected thousands of
price points covering writing, editing, graphic design, desktop publishing,
prepress, multimedia and web site development. These prices became the basis
for our sixth update to our Pricing Tables reference book on Canada. During
our research, we noted hundreds of Canadian shops who are actively
advertising their design and maintenance services down in the "lower 48". In
reality, they're advertising to the whole world by using their web sites to
reach out everywhere as they mine for business. Many of these shops have an
office or contact point here in the United States. Like most service
providers here, their shops are small (one or two people). But their market
reach is enormous.
Since competition is now coming from all directions, I felt it would be
appropriate to share some insights into what Canadians are actually charging
for desktop computer services. As I do so, I'll be describing prices that
will appear in the upcoming Pricing Tables Canada reference book.
Canada is a country partitioned into 10 provinces and two major
territories. The provinces are: Alberta, British Columbia, Manitoba, New
Brunswick, Newfoundland, Nova Scotia, Ontario, Prince Edward Island, Quebec,
and Saskatchewan. The territories are: Northwest Territories, and the Yukon
Territory. Canada has a population of about 30 million. Most of its citizens
are located in Ontario (11 million), Quebec (7 million) and British Columbia
(4 million). As expected, Ontario has the largest number of desktop service
providers (48%). However, Quebec with the second largest population (23%) has
only 5% of the total service providers in Canada. British Columbia with 13%
of the population has 26% of the creative shops. So most of the competition
here is coming from Ontario and British Columbia.
To compare Canadian prices with those in the United States, we looked at
a broad selection of common services noted in the price lists, advertisements
and web pages of shop owners in both countries. Our Canadian sample size was
3,850.
Consulting in the U.S. typically bills out at $65 an hour. Likewise in
Canada, but the $65 is in Canadian funds. Since the exchange rate as of this
writing is 1.4 to 1, this means that $65 Canadian is $46.43 in U.S. dollars
(USD). Web consulting is even less expensive up north — $60 Canadian (USD
$42.86) versus about $80 an hour here.
Graphic design services in Canada typically bill out at $60 an hour (USD
$42.86), whereas the typical rate in the states is between $55 and $60 an
hour. We also discovered that illustrators in Canada are billing out at $75
an hour (USD $53.51) whereas here we typically charge between $55 and $60 an
hour.
Logo design in Canada is quite inexpensive. They typically charge $50 an
hour (USD $35.71). Our typical rate for this service is $55 an hour. Here,
simple logos sell for between $50 and $250 each. Up there, our Canadian
neighbors are charging between $15 and $65 each (between $11 and $46 in U.S.
funds).
Desktop publishing here and up north both typically go for $55 an hour.
The Canadian range of prices is from $10 an hour to $175 an hour (average CDN
$62.91 an hour). In U.S. rates this Canadian average is about $45 an hour.
Our average rate is close to $60 an hour.
Single color flyers in Canada are going for between $20 and $75 a page.
Here we're charging between $45 and $85 a page. An 8-page newsletter in
British Columbia can cost $750. Here we're charging between $20 and $250 a
page (typically $75). In Ontario, we can buy DTP production of a newsletter
for just $20 a page (Canadian).
Multimedia services follow a similar pricing pattern up north. We can buy
a multimedia specialist with the same skills as a U.S. counterpart for $1,000
a day in Ontario (USD $714.29) This service costs around $750 a day here. And
digital video is much less expensive in Canada. Digital video bills out at
$75 an hour in Canada (USD $53.57 an hour) while it runs about $125 an hour
here.
Web site design in Canada sells for $10 to $150 an hour, typically $50 an
hour (USD $35.71). Here we're charging between $12 and $240 an hour
(typically around $65 an hour). A single page site in Canada typically sells
for around $100, same as here. But $100 Canadian is only $71.43 in our
currency.
HTML authoring is selling for between $10 and $125 an hour in Canada (USD
$35.71 an hour typical). It goes for typically $55 an hour here. Java
programming sells for $60 an hour up there (USD $42.86) and about $65 an hour
here. Perl programming is going for $65 an hour Canadian (USD $46.43). Our
typical price is over $70 an hour. And the price differentials go on and on
in like fashion.
The bottom line is that service prices are about 30 percent less
expensive in Canada than they are here. But they're so far north, you say.
Well they're across the street electronically! We've been sending image and
data files all over the country including up into Canada for over a year now,
and we've not had a problem at either end. Canadians are just as capable with
Pagemaker, Illustrator, Photoshop and Adobe Acrobat as we are. Canadians are
just as capable with Publisher, FrontPage, Netscape and Internet Explorer as
we are. So if you think you're just competing with the shop down the street,
think again!
You may feel that the currency difference is a barrier to international
trade. Not any more! While conducting research in Canada, I usually charged
expenses on my credit card. The credit card companies are VERY comfortable
moving funds back and forth between currencies. I never experienced a problem
buying or selling to Canada (or other countries such as Japan). In fact, my
company often receives book orders from Canadian bookstores and individual
companies. They all purchase with a credit card. Except for American Express
and Discover Card, we get the funds the same day (three days for the former)
and the customer gets the product shipped out within 24 hours of paid order.
Canadian entrepreneurs are beginning to conduct similar marketing and
selling activities focused in our direction. Your competitors may be
geographically distant, but they're electronically right next door. The
pricing strategy that you adopt needs to incorporate the global market. It's
imperative for you to consider global competition. And your pricing strategy
need to be competitive around the globe. If a buyer in your own town can get
creative services for one fourth less cost with little or no production time
delay, only you can motivate them to spend their dollars locally and not
thousands of miles away.
Face it. The value that you add to your goods and services must be
sufficient (if not overpowering) to keep buyers from looking for support
beyond your city, town or village limits. You no longer have a monopoly on
your market. There's hundreds, if not thousands of capable and reasonably
priced competitors living and working at the far ends of the earth. And
they're looking your way as they seek out new business. To the swift go the
spoils. If you drag your feet, if you sit back and just complain, you'll be
losing customers to those who are electronically savvy.
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©Copyright 2001, Brenner Information Group, All rights reserved.
revised on July 10, 2001
