A guide to quoting and invoicing

By Jes Egan

Having worked in the management side of the creative industry for almost all of my working career, I’ve never really thought about quoting for work or invoicing once it's done. It has always just been taken care of for me! However, in my current job I lecture ‘business by design’ at Billy Blue College of Design, and earlier this trimester I asked my usual question in the first class: ‘What do you want to learn about business?’. Overwhelmingly the responses were ‘How do I charge for my time?’ and ‘How do I put a quote together?’.

It struck me that knowing what to charge, and how to charge, is something that creative and small business owners often struggle with. So here is my guide for quoting and invoice for your creative work.

Determining your rate

Putting a value on your work or your skills can be a very hard thing to do. My advice? Value yourself and what you do. People pay for you for something they don’t have the skill set to do, so try to give a value to your time. There a couple of ways to do this:

1. Think about how long that job is going to take you to complete, considering every step and every action. For example, if it’s going to take you 10 hours and you’re charging the client $100, you’re making only $10 an hour. That's not event minimum wage! Decide what your hourly rate should be and start from there.

2. Review what other ‘similar’ individuals or businesses charge for their time. Don’t necessarily copy this rate, but use it as a guide. If others are charging between $40-$80 per hour then think about where you sit within the spectrum of skills compared to those people. Are you just starting out and maybe not as experienced as some of those charging the higher end of that range? Then charge a lower rate than those until you become more experienced, or vice versa.

3. Sometimes (and it should  be only sometimes) you might decide quote 'low' just win a job, because it's for a client that you really want to work with, or you’re trying to crack into a new industry or gain experience or skills you don't already have. I say that this is okay, as long as it doesn’t become the norm. Remember value yourself and your time.

Preparing your quote in writing

I can’t tell you how many times I’ve seen a client request something extra during the course of a job (adding to your time or the skills and experience you bring to the work), and then refused to pay for it because the details of the initial quote were ambiguous. When it comes to project quotes, the devil is in the detail. Unless your quote clearly outlines what is and isn't included for the total price you're quoting (before any actual work begins), if the final fee is above what the client expects, it can be a difficult conversation to have.

The key is to be very, very detailed in your quote and if a request for additional tasks or the scope of the job changes after the original quote is approved, then it's good practise to provide them with an additional quote or 'change request’ and have this approved also.

With any quote, ensure you get the client to sign it off and/or supply you with a purchase order before you start the work. I know that sometimes this admin side of business can get in the way of doing the real creative work, but it is important - a few minutes to do this correctly can save you so much time and hassle in the long run.

Here’s an example of what kind of information I might include in a quote.

Preparing an invoice

An invoice is what you send to the client in anticipation of a payment milestone or completion of a job. It details the work that has been completed (or details of a deposit before starting a job) and includes your business details, bank account details, payment terms and other essential tax information.

Here’s an example of what an invoice could look like:

While it might be tempting to simplify your invoice down to a single final 'amount due' total, I personally find that an invoice which contains almost as much detail as the original quote can alleviate many client queries and objections (and possibly the delay of payment). You don't have to list a blow-by-blow account of the work completed, but a client will generally appreciate some detail of what is being invoiced for.

The tax stuff

An ABN (Australian Business Number) is important to have, although it isn’t mandatory if you're a sole trader. However, other businesses may be legally bound to withhold almost half of any payment to you for tax if you don’t quote an ABN on your invoice. Half! You maybe able to claim this back at tax time, but in my opinion it is better to apply for an ABN at the Australian Business Register and have this ready to supply to any potential client.

Registering for GST is another thing to think about if you run a creative business in Australia. If you are expecting to earn less than $75,000 per financial year, then technically you don’t have to register, but if you think you could be nearing that amount then you may need to. Have a look at more info on registering for GST here, and be sure to contact a professional in the area of tax and accounting before you send off your first invoice.

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I know numbers aren’t always the ‘fun’ bit of running a creative business, but they are necessary and it is important to set up good systems from the outset. Of course, professional advice from an accountant, a lawyer, bookkeeper, the ATO or other professional body is always recommended before you jump in head first into quoting or invoicing for your creative work or starting a business - it may save you a whole lot of hassle and pain in the long run. Then you can have some fun with the money that comes in at the end for all of your hard earned work!

Jes is a ‘practical creative’ and a very busy lady, doing the business in a digital agency, being an artist, a university lecturer, and small business owner who can creatively be found cutting up a storm at paperchap.com. Follow Jes on Instagram and Facebook.