Pricing Models for Creatives (Hourly, Flat, Value-Based)

Pricing Models for Creatives (Hourly, Flat, Value-Based)

How you price your work affects your income, your workflow, and your client relationships.

This guide breaks down the three main pricing models for creatives: hourly, flat, and value-based. Learn when to use each, and how to implement them.

📖 Part of our pricing guide series: Pricing models are Step 3 in the invoicing process. For the complete guide, see How to Invoice as a Designer or Creator or How to Price Design Work.

Quick reference: This is a numbered listicle format. For a different take, see 7 Pricing Models for Designers.

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The 3 Pricing Models

Quick overview:

1. Hourly Pricing — Best for uncertain scope, consulting, revisions
2. Flat Project Pricing — Best for defined projects, clear deliverables
3. Value-Based Pricing — Best for high-impact work, strategic projects

1. Hourly Pricing

How it works:

• Set an hourly rate
• Track hours worked
• Invoice: hours × rate

Example:

• Rate: $100/hour
• Hours: 8
• Total: $800

Best for:

• Consulting work
• Revisions
• Uncertain scope
• Ongoing work
• Projects with unclear deliverables

Pros:

• Fair for uncertain projects
• Easy to calculate
• Client understands value
• Rewards efficiency (sometimes)

Cons:

• Can penalize efficiency
• Hard to scale
• Client might question hours
• Income is variable

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2. Flat Project Pricing

How it works:

• Agree on project scope
• Set fixed price
• Invoice for total amount

Example:

• Brand Identity: $2,400
• Includes: Logo, guidelines, color palette, typography

Best for:

• Defined projects
• Clear deliverables
• Brand identity
• Website design
• Projects with known scope

Pros:

• Predictable income
• Rewards efficiency
• Client knows total cost upfront
• Easier to sell

Cons:

• Risk of scope creep
• Hard to adjust if project changes
• Can undervalue if scope expands
• Need to estimate accurately

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3. Value-Based Pricing

How it works:

• Price based on value delivered
• Not hours or deliverables
• Focus on impact/results

Example:

• Complete brand system: $10,000
• Value: Increases market recognition, positions brand for growth

Best for:

• High-impact work
• Strategic projects
• Brand partnerships
• When you have strong portfolio
• Projects with clear ROI

Pros:

• Rewards high-impact work
• Can charge premium
• Focuses on results
• Scales well

Cons:

• Harder to justify
• Requires client education
• Can be harder to sell
• Need strong portfolio/credibility

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When to Use Each Model

Use Hourly Pricing When:

✅ Scope is uncertain — Don't know how long it will take
✅ Consulting work — Advice, strategy, guidance
✅ Revisions — Changes, adjustments, iterations
✅ Ongoing work — Retainers, monthly work
✅ Variable time — Some projects take longer than others

Hourly works when scope is unclear.

Use Flat Pricing When:

✅ Scope is clear — Know exactly what's included
✅ Defined deliverables — Logo, website, brand guidelines
✅ Client wants certainty — They want to know total cost
✅ You can estimate accurately — Know how long it takes
✅ Standard projects — Similar work you've done before

Flat pricing works for defined projects.

Use Value-Based Pricing When:

✅ High impact — Work that significantly impacts client's business
✅ Strategic projects — Brand positioning, market entry
✅ Clear ROI — Client can measure results
✅ Strong portfolio — You have credibility and results
✅ Premium positioning — You're positioning as expert

Value-based works for high-impact, strategic work.

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How to Set Your Rates

Hourly Rate Calculation

Formula:

(Annual expenses + desired profit) ÷ Billable hours = Hourly rate

Example:

• Annual expenses: $30,000
• Desired profit: $50,000
• Billable hours: 1,200 (50% of 2,400 working hours)
• Rate: ($30,000 + $50,000) ÷ 1,200 = $66.67/hour
• Round up to: $75-100/hour

Adjust based on:

• Your experience
• Market rates
• Client budget
• Project complexity

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Flat Rate Calculation

Formula:

Estimated hours × Hourly rate = Flat rate

Example:

• Estimated hours: 20
• Hourly rate: $100
• Flat rate: $2,000

Add buffer for:

• Scope creep (20-30%)
• Revisions (10-20%)
• Unexpected issues (10%)

Adjusted rate: $2,000 × 1.4 = $2,800

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Value-Based Rate Calculation

Formula:

Value to client ÷ Your share = Price

Example:

• Value to client: $50,000 (increased revenue)
• Your share: 20%
• Price: $10,000

Consider:

• Client's budget
• Your positioning
• Market rates
• Your credibility

Value-based is more art than science.

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Hybrid Approaches

Hourly + Cap

How it works:

• Charge hourly rate
• Set maximum cap
• Client pays less if you finish early

Example:

• Rate: $100/hour
• Estimated: 20 hours
• Cap: $2,000
• If finished in 15 hours: $1,500

Good for: Uncertain scope, but client wants cost certainty.

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Flat + Hourly for Extras

How it works:

• Flat rate for defined scope
• Hourly rate for additional work
• Clear boundaries

Example:

• Brand Identity: $2,400 (flat)
• Additional revisions: $100/hour
• New concepts: $100/hour

Good for: Defined projects with potential for extras.

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Value-Based + Milestones

How it works:

• Value-based total price
• Split into milestones
• Payment at each milestone

Example:

• Total: $10,000
• Milestone 1 (Discovery): $2,000
• Milestone 2 (Design): $5,000
• Milestone 3 (Delivery): $3,000

Good for: Large projects, value-based pricing.

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Pricing Best Practices

1. Start with Market Research

Research:

• What others charge
• Industry standards
• Client budgets
• Your experience level

Price based on market, not just your costs.

2. Consider Your Value

Factor in:

• Your experience
• Your portfolio
• Your results
• Your positioning

Don't just price on hours. Price on value.

3. Be Consistent

Apply pricing:

• Consistently across similar projects
• Based on clear criteria
• Fairly to all clients

Consistency builds trust.

4. Adjust Over Time

Raise rates:

• Annually (at minimum)
• When you gain experience
• When demand increases
• When you add skills

Don't stay at the same rate forever.

5. Communicate Clearly

Explain:

• How you price
• What's included
• What's not included
• Why your price is fair

Clear communication prevents disputes.

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Common Pricing Mistakes

1. Pricing Too Low

Problem: Undervaluing yourself, attracting bad clients, not sustainable.

Solution: Price at market rate (or slightly below if starting out).

2. Pricing Too High

Problem: Losing clients, not getting work, unrealistic.

Solution: Research market, price competitively, adjust if needed.

3. Not Accounting for Revisions

Problem: Scope creeps, you work for free, project becomes unprofitable.

Solution: Include revision policy, charge for extras, set clear boundaries.

4. Inconsistent Pricing

Problem: Charging different rates for similar work, looks unprofessional.

Solution: Use consistent pricing criteria, document your rates.

5. Not Raising Rates

Problem: Same rate for years, not keeping up with experience, undervaluing.

Solution: Raise rates regularly, at least annually.

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FAQs

Which pricing model is best?

Depends on your situation:

• Hourly: Uncertain scope, consulting
• Flat: Defined projects, clear deliverables
• Value-based: High-impact, strategic work

Most creatives use flat pricing for projects, hourly for consulting/revisions.

Should I charge the same for all clients?

Not necessarily. Consider:

• Client size (startup vs enterprise)
• Project complexity
• Long-term value
• Your relationship

But be consistent — don't charge wildly different rates for similar work.

How do I justify my price?

Explain:

• What's included
• Your experience
• Value delivered
• Market rates

Clear communication helps justify price.

Should I show my rates publicly?

Pros: Saves time, shows confidence, filters clients.
Cons: Less flexibility, competitors see rates.

For beginners: Maybe keep private. For experienced: Public rates can work.

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