Things we’re thinking about this week.
How do we figure out how much a project is worth? Typically it’s based on the number of hours we think a project is going to take - a project that takes 3 months to complete is going to cost a lot more than a project that takes 3 days to complete. But is that right?
As a freelancer, it makes sense to segment by time - there are only so many hours within the day, and you need to make sure that you actually have enough time to complete your work. But at the end of the day, are you selling your time? Or are you creating something of value?
If something is valuable, does it matter how much time it takes to create it?
If you can create something quickly, does it lower the value? If it takes longer than anticipated, should you be charging more money?
The other reason we think putting time against cost is because many clients ask for it - they want a break down and potentially see if there are things that can be cut. But again, that’s a little silly. If I can create something in 3 days, that means you’re not spending 3 weeks going back and forth (a couple hours a week) with someone who’s taking longer to get to the same conclusion.
Value is a funny thing. We all want to save money, but often saving money is the wrong way to go. On the business side, being a boss means making the hard decisions - balancing cost/risk/value. If you’re only even going for the cheapest option, you’re not making a hard decision, you’re just playing a numbers game. CFOs and CEOs make decisions very differently, and there’s a reason we place value more on one than the other.