How Much Should You Charge to Build a Website?

There’s a big difference between asking “How much does a website cost?” and “How much should I charge for a website?”. 

When you talk about the cost of a website, the focus is on the technology used to make a website and the time spent building it. While website costs go into calculating your pricing, there’s much more to think about when coming up with the best web design rate for you and your clients. 

Web Design Pricing: Should You Charge a Flat Fee or an Hourly Rate?

Before we jump into the calculation, let’s talk about how you should charge for web design work.

If you were to look around a freelancer marketplace like Upwork, you’d notice that most web designers pitch their services at an hourly rate. On the other hand, many freelance designers who work independently of these marketplaces charge a flat fee. Most web design agencies do the same thing. 

So, does it matter which route you go?

It does. When you charge by the hour, many clients will end up watching the clock instead of focusing on the beautiful digital product that’s unfolding before them:

“How many hours have you spent on this so far?”

“Why is it taking so long?” 

“If you build out that feature that I really want, how many more hours will it take?”

“Why did you charge X amount of hours for that specific task?”

“If it’s going to take much longer, can we just skip that [critical step you suggested]?”

How often is it that you go to a store and see a breakdown of the hours spent creating the products they sell or the cost of the individual components within them? You don’t. 

People buy the product, not the effort put into it. If it’s of value to them, they’ll be willing to pay the price as stated.

All this is to say that, when you charge a flat fee, the focus is on the value of the website being built. Not only will it keep you and your client from stressing over the ticking clock, but it will help you attract better clients — ones that understand that you have to pay good money for a high-value product.

Calculating How Much to Charge for Website Design

By taking it one step at a time and examining the context in which you build websites, you’ll be able to figure out the best rate for your web design services. The best rate being one that:

• Attracts the right types of value-driven clients.
• Fully covers your costs.
• Leaves some wiggle room for scope creep.
• Makes each job you work on profitable.
• Keeps you from working crazy hours and burning out just to make a decent wage.

Use the following questions to calculate what that rate is today. Then repeat this exercise every year or so to figure out how much to increase your rates by as well as to determine pricing for new services. 

1. What Is Your Niche?

There are so many reasons why you should niche down in web design. Setting your rates is one of them.

Different types of businesses have different website needs. If you try to serve a variety of business types (or every business type), your pricing is going to be all over the place. And if that’s the way you’re going to run your business, it’ll be easier to charge an hourly rate (which can have major drawbacks, as noted earlier). 

When starting out in web design, it’s better to choose one clear-cut niche. 

The more narrow your focus, the more comfortable and confident you’ll get with building websites. Over time, you’ll be able to create these websites more quickly, which will increase your profit margins.

To-Do:

Narrow down your niche by:

• Industry (e.g. retail, education, enterprise)
• Business type (e.g. B2B, B2C, C2C)
• Website type (e.g. small business website, ecommerce, blog)
• CMS (e.g. WordPress, Squarespace, Shopify)
• Web design complexity (e.g. turnkey web design, template-based design, UX design)

Make sure your website clearly explains what your niche is. This will enable your site to weed out prospective clients that aren’t a good fit in terms of your area of experience and expertise. Even if you don’t publicly publish your prices, many prospects will be able to guess how much your services cost based on what kind of web design you do. 

2. Who Are You Building Websites For?

Let’s say you want to build websites for restaurants. There will be major differences in the types of websites you build for someone like an independent restaurant owner vs. a large franchise like Taco Bell. 

For starters, size and scope impact how much a website costs. A local restaurant website will be smaller and require basic small business features like a contact form or social media integration. A franchise website will be larger and need more advanced features that allow customers to do things like find the nearest location and place online orders.

Secondly, the goal of a website will affect how complex the design and functionality are. For example, the local restaurant owner might want the website to attract people searching for “restaurants near me” on Google, so this site might be more informational in nature. On the other hand, the franchise owner probably wants the site to handle online ordering, sell merchandise, and recruit new franchisees, so it would be more transactional.

Lastly, you have to consider what sort of budget your intended client is working with. If you can’t design websites that fit into their budget — or you can’t make a living from what you earn from them — then you’ll need to adjust your niche.

By understanding your target client and their needs well, you’ll get a better idea of how much you should charge as well as how much they expect to pay for it. 

To-Do: 

Take a survey of business owners in your target niche. You’ll likely find them in groups on Facebook or LinkedIn. Give them a range of website budgets to choose from and see if their expectations align with your own. Adjust your niche or pricing strategy accordingly.

3. What Is the Market Rate for Your Niche?

This part can be challenging. 

There are tons of resources out there that will tell you how much web designers charge, on average, for a website. Even then, they’ll give you a range of rates without much detail concerning the complexity of the design or the niche. For instance, numerous websites suggest that freelancers should charge between $500 and $5,000+ to design websites while agencies should charge at least $3,000. 

If you want to find out how much clients in your specific niche are currently paying for websites, you’re going to have to go digging around for that information. 

To-Do: 

Start on Google Maps. Do a local search for “[niche] web designers”.

Unfortunately, many web designers don’t publish their rates on their websites. However, it’s still worth taking a peek at the top-rated local designers’ sites to see if they do. This will give you a general idea of what everyone is charging. 

You can also use freelancer marketplace websites like Upwork to see what niche designers are charging over there.

I would just be careful with the information you get on these platforms. There are a lot of designers that greatly undervalue their services. I’m talking like $5 to $15 an hour. There are also ones that are way overpriced. 

Still, it’s not a bad idea to see what sort of range there is for your niche so you’re not pricing your own services too high or too low.

4. How Much Does It Cost to Build One of These Websites? 

Now that you know what type of website you’re building and for whom, it’s time to dig into the cost of the website. Specifically, you want to nail down how much all the software and hardware will cost.

What you have to pay will differ based on which CMS you use as well as the complexity of the site you’re building. For example, here’s how those costs might look for a basic small business website:

Other costs you might need to factor in include premium security and performance add-ons, third-party integrations, as well as contract services for writing, animation, development, etc. 

To-Do: 

Put together a list of everything your average client’s website will need. Then dig around your preferred CMS to find out how much money you will have to spend on average to get it done.

5. How Much Does It Cost You to Run Your Design Business?

When businesses calculate how much to charge for their products, they’re not just looking at the cost of raw materials or the time their workers spent putting them together. They’re also factoring in overhead — the general cost of keeping their operations in working order.

It should be no different for web designers. 

After all, if your web design rate barely covers the cost of software and hardware, you’ll end up losing money on each job. Plus, if you make no or very little profit, you won’t have money to invest into your business. And that means your skill set and business’s capabilities will likely stagnate, which is no good for you and it’s no good for the clients who reap the benefits from your growing knowledge and expertise.

To-Do: 

In terms of how to factor overhead into your pricing, first take an inventory of everything you pay for that keeps you in business. For example: 

• Hardware (e.g. computers, smartphones, printers)
• Software (e.g. design, project management, communication)
• Office space and utilities
• Your website and marketing
• Health insurance

Unlike direct website costs, you’re not going to pass the full cost of overhead expenses onto your clients. However, you want to make sure that your annual earnings from web design greatly surpass your expenses. 

If you don’t currently have a monthly budget or way to track it, set one up now. Mint will make easy work of this. 

Set up your business-related spending and let the app track your expenses. When you’re ready to scale your business, use this tool to monitor and manage your growing expenses. This level of visibility and control will make it easier to adjust your rates in the future as needed.

6. How Many Websites Can You Build in a Year?

You have a limited amount of time to give away to clients. That is, unless you plan on starting an agency and hiring a bunch of web designers to share the load with. As such, it’s important to figure out how much work you can reasonably fit in for web design projects.

For instance, let’s say you want to make $50,000 your first year as a web designer. It takes about 75 hours to build a website right now. (See below if you’re not sure how long it takes.) 

You plan to work 50 weeks, 5 days a week, 8 hours each day. This comes to 2,000 working hours each year. That doesn’t mean you can complete 26 websites though. 

Web designers can spend anywhere from a quarter to half of their day doing administrative work — prospecting, issuing invoices, managing their marketing, etc. So you won’t really have a full 8 hours each day to work. 

Let’s say you have 5 hours. That brings your total working hours down to 1,250, which means you can realistically build 16 websites in a year’s time. In order to hit your revenue goal, you’d have to charge $3,125 per site.

Take this number and compare it to the other calculations you’ve made so far. Make sure it doesn’t seem wildly off compared to the market rate or when compared with your out-of-pocket costs. If it looks good, this will be the baseline rate to work with.

To-Do: 

If you don’t know exactly how long it takes you to complete each task in your web design process — from client onboarding to offboarding — set yourself up with a time tracker. 

I think RescueTime is a good option for this. 

You program your schedule into the app. It will then automatically track what you do, where you spend your time (in terms of in what apps or websites), and for how long. 

Use the tracker to log all of your time — as you build websites as well as when performing administrative tasks. It’s critical that you understand what percentage of your time goes to actual design work vs. everything else.

Then analyze the data. In the end, you should be able to assign a specific time limit to each task. For instance, 1 hour for client onboarding calls, 3 hours for wireframing, and 2.5 hours for proofreading copy. This will be useful for creating project timelines as well as figuring out how much to charge for websites. 

7. What Is the Monetary Value of the Websites You Build?

The last thing to think about as you finalize your web design rates is the value of what you’re building. 

One way to look at this is how much money you’ll help clients make from their websites. Let’s use the restaurant examples from earlier as an example. 

A well-built, search-optimized local restaurant website will get more traffic from Google and other search engines. This website traffic can lead to more reservations and in-house diners. It can also help them grow their social media following. 

A well-built website for a franchise restaurant will likely have more automations built in so it can scale its operation. This means that the site will exponentially increase how much money the location makes by processing online orders, selling swag, recruiting new employees, etc. 

Because there is a significant difference in the earning potential between these sites, what you charge for the two would have to reflect that disparity. 

Another thing to factor into your pricing is your value. 

Your clients have chosen not to build their own websites because they don’t have the time, energy, or interest in doing so. They also recognize they’ll get far better results if they let an expert do it for them. 

To-Do:

Make a list of the goals of the website. For example:

• Book appointments or reservations
• Sell physical products
• Sell digital goods
• Schedule product demos
• Book consultations
• Subscribe readers
• Get new members
• Get social media followers
• Make money from ads or affiliate partnerships

While you might not be able to guarantee a certain number of conversions in the first months after launch, you should have a good idea of their earning potential once things get rolling. This will help you figure out how truly valuable the site is to the client and what they’d be willing to spend for that sort of return. 

Don’t forget to factor in your value, too. While it might not be the easiest thing to monetize, it’s important to factor it in so that your pricing accurately depicts the full value they’re getting.

What Are Your Web Design Services Worth?

If all web design was the same, the matter of what to charge would end up being like The Price Is Right. You’d end up pitching your clients a rate based on what you think the competition has pitched them. You’d try not to make your prices too low, while at the same not aiming not to make them too high either.

But that’s no way to go about setting your design rates. Web design services wildly vary depending on what you design and who you design for, among other factors. What you charge should be a direct reflection of that. 

Your web design prices should reflect your level of experience and expertise as well as the value you offer. They should attract clients that understand and appreciate the value of what you do. They should also provide you with sufficient profitability so you can comfortably and confidently run your business, improve your skills and offering, and keep yourself from burning out.