00:00Music
00:13Ladies and gentlemen, we have discussed in great detail how to value yourself as a freelancer.
00:19Now, the zillion dollar question gets down to how to calculate your hours and how to calculate the price per hour.
00:27Before I tell you all this, I would like to share a story with you.
00:32It is a very interesting story.
00:35There are two graphic designers.
00:38Both of them are freelancers.
00:40Both of them work in a freelance marketplace.
00:43Both of them earn $1,000 per month.
00:47Both of them are happy.
00:48Both of them have a lot of work.
00:50Both of them have a lot of projects in the pipeline because they are in demand.
00:55That is why they are earning so much money.
00:57But there is a small difference here.
01:01The difference is that one freelancer earns $1,000 per month by working for 9 hours.
01:10Whereas, the other freelancer earns $1,000 per month by working for 4 hours.
01:19Friends, I am a freelancer myself.
01:24One is my past and the other is my today.
01:28I did not know how to value myself until I had my past.
01:32And I have believed in working hours after hours to get to $1,000 per month.
01:40And today, scientifically, by working smart over hard work,
01:48I earn the same amount of money by working for 4 hours.
01:54The question arises, how did I do that?
01:57What magic trick is up my sleeves that I adopted
02:02and all of a sudden my work hours reduced
02:07without compromising on the amount of money I was earning on a monthly basis?
02:14If I was earning money, I would not have compromised on quality,
02:19communication skills, and business development skills.
02:26So, how did it happen that my work hours reduced by half
02:31and the amount of money earned was the same?
02:35Let me tell you a magic formula to calculate hours or price per hour.
02:43Both are the same thing.
02:45If you look at the screen, for example, the price of a project is $100.
02:53As I told you, a person's typical cost is $100.
02:57And it takes 10 hours to complete it after going through the overall phases.
03:03So, when you divide 100 by 10, this would give you your per hour price.
03:11Now, let's do the opposite.
03:15Imagine, you know your per hour price,
03:19but you do not know the amount of hours it will take for you to complete that assignment.
03:25So, all you need to do is just take the overall price, which is 100,
03:29divide by 10, which is your per hour price,
03:32and you will be able to get a figure of 10,
03:34which is the number of hours it will take to complete an assignment.
03:40It's a simple math.
03:42These kids ask me endless questions.
03:44Sir, we can't figure out the price.
03:47Believe me, the price is a formula that you have to define yourself.
03:52Yes, the mathematical way, as I told you, does apply,
03:58but you need to figure out, you need to understand, you need to know yourself
04:04what kind of value you can provide to your employer,
04:08what kind of expertise you have in that particular skill set.
04:13All these things play a big role in determining a per hour price.
04:20Your per hour price is directly associated with your self-promotion, ladies and gentlemen.
04:27As I told you, if you work for someone for 9 to 5 years,
04:32then every year you get an annual increment,
04:36or according to the organization's rules,
04:39you get an increment after any time period or time frame.
04:44In the case of freelancing, you are boss of your own,
04:47so you need to self-assess yourself and you need to promote yourself
04:52based on your experience, based on the expertise,
04:58and of course, above all, the most important thing,
05:02based on your quality of work, with which the timeline is also associated,
05:08because the way you are an expert in a skill set,
05:12so as a beginner, the time it takes you to complete a project,
05:17as an expert, as a pro, your time of completion is substantially reduced.
05:24Therefore, you can self-promote yourself,
05:27you can increase your per hour price, and this is a very easy way.
05:32There is another debate of per hour price versus the fixed project price
05:37that I would like to present to you with my personal example.
05:41Look, in the beginning, no one told me that fixed price is better than per hour price,
05:49and I still believe this.
05:51Over a decade, what I have figured out is that the overall project price gives you more money.
05:57How? Let me give you an example.
05:59I got a client five years ago.
06:02My per hour price was $30.
06:06Now, I had to utilize that $30 in four hours,
06:11and I had to pay the overall price of a project, $120.
06:15It was a beautiful website.
06:17It was a WordPress theme, which only needed a user interface and a design,
06:21and I finished it and gave it to them, and I earned $120.
06:24I was very happy at that time.
06:26Then I realized, over a period of time, through experience,
06:30that if I had given a fixed price for this work,
06:33then I would not have talked less than $300.
06:36So, therefore, that healthy debate of charging per hour as well as giving a fixed price,
06:44actually wins the weightage and wins the competition,
06:48just because if you get the per hour price capped,
06:52you'll have to stay on the clock.
06:55There are a lot of tools, which are called project management tools,
06:59on which you record your screen, and you stay on the clock.
07:03But what is the loss of that?
07:05The loss is that the more hours you work, the more price you will pay.
07:09Whereas, you'll not be able to account for all those expenses
07:13and all those extra price and the profit you need to get.
07:18So, my request is always to try to charge a fixed price.
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