Time to read: 2 min
Industrial Design consulting work is a great way to maintain personal flexibility and build a wide variety of skills, but it can be hard to know how to get started. Of the many things to learn along the way, figuring out how much to charge for your work is a good place to start.
Here’s a simple way to help you get a sense of what your consulting rate should be.
Start with your expected annual salary
Before calculating your hourly consulting rate, it’s helpful to first get a sense of what your equivalent employee salary would be.
Important variables here include experience, education, specialization, job market, and location; sites like Payscale can help you estimate your annual salary based on those factors:
Multiply your expected salary by 2.5 – 3x
The rule of thumb for calculating your base hourly consulting rate is to multiply your expected employee salary by 2.5 – 3x. Why so much higher? Here’s a few reasons:
- Availability – As a consultant you provide businesses an on-demand service and as such you should be compensated.
- Health insurance – You’re responsible for paying for your own health insurance and other benefits an employer would normally provide.
- Business expenses – You need to take into account expenses such as travel time, workspace needs, creative tools and supplies, and business management software.
So using this multiplication rule, here’s what average Industrial Design salaries would convert to as consulting rates:
This math is done simply by multiplying expected salaries by 2.5 – 3, then dividing by 52 weeks in a year and 40 hours in a week (i.e. for Entry Level/Low: $36,000 x 2.5 = $91,500 / 52 / 40 = $44)
Note that many consultants prefer to bill a day rate or project rate rather than by the hour. It’s generally a good idea to start off billing hourly and then once you have a good sense of how long a given task or project takes, you can give a more accurate project-based quote.