David Airey

Design pricing for non-profits

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David Airey
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Kim Hatton asked, “Do the same design pricing principles apply between non-profits and for-profit businesses?”

When it comes to pricing for non-profits there are a few things I think about:

  1. A percentage off my normal rate
  2. Pro bono, cutting my rate entirely “for the public good”
  3. A service trade, where the client can offer a product or service that’s useful (although this is actually better suited to for-profit clients)
  4. Full rate (we might call them non-profits, but they’re still businesses with design budgets, needing to turn a profit to grow)

Most of my clients are for-profit businesses, but when the third sector gets in touch, sometimes I’ll choose one option, sometimes another. It depends on my workload and how strongly I feel about the cause. When a client needs a reduced rate that I can’t offer, I’ll always be happy to give feedback on ideas for no charge — a kind of free non-profit consultation.

If you work pro bono or offer a discount, send a full-price invoice as normal but show the saving, whether it’s 100%, 10%, or whatever. It’s a little reminder about the value of the project.

It’d be good to know how you work with non-profits.

Thanks for the question, Kim.

Comments

16 responses to “Design pricing for non-profits”

  1. Sara Avatar
    Sara

    I work solely with non profits and always charge my full rate.

    Reply
  2. Lee Newham Avatar
    Lee Newham

    We put in the full cost but offer a discount if our fee is too much for a charity, not-for-profit, etc, so they know what they are getting.

    Reply
  3. David Airey Avatar
    David Airey

    An admirable policy, Sara. it’d be great to know how you find new clients.

    Hi Lee, for one reason or another I was thinking about your “what if” projects when writing this. It’s a brilliant idea that’ll always stick.

    Reply
  4. Jamie Avatar
    Jamie

    Thanks for the tip! I’m actually putting together a contract for a non-profit and was just going to put the discounted rate, but now (after reading this) I will add my normal rate. Makes sense to let them know the value.

    Reply
  5. Wendy Avatar
    Wendy

    For those of us in the US (it may also apply to other countries, but I don’t know), if you are offering a discounted or pro-bono rate, the non-profit should hopefully offer to provide you with a donation letter (for the difference in the rate) that you can use to reduce your taxes, since you are donating services to the organization.

    Reply
  6. Jon Avatar
    Jon

    If the non-profit checks out (we have a lot of them here in the US set up for less than helpful purposes like a veterans assistance non-profit that apparently thinks veterans need chef coats and tons of coconut M&Ms) and I like the cause they work for, I will generally discount the work.

    If it is one that misbehaves or stands for something I disagree with, I would refuse the client.

    Reply
  7. beth Avatar
    beth

    I work for a nonprofit design organization (we are nonprofit and we only work with nonprofits) and we charge a slightly less per hour rate than normal studios in our area. I always warn my clients when they see people offer to do their projects “pro bono”, and I have a 95% track record for being right and have saved many of them from catastrophic results. In one case the “pro bono” designer was going on vacation 2 days before the nonprofits major fundraising invitation package was going to the printer – the project had not been completed, had been done so poorly that required me to create entirely new files for the printer. This designer wasn’t even some newbie freelancer but worked as an in-house designer for a business that had donated the services as a way of sponsorship. I have had clients come back to me after these pro bono offers and tell me – never again will I go elsewhere no matter what they offer.

    Reply
  8. Eric G Avatar
    Eric G

    Definitely a subject worth discussing. Would you take a pay cut to work for a non profit? Many of their CEOs don’t
    http://www.huffingtonpost.com/2013/04/08/10-insanely-overpaid-nonp_n_3038162.html

    So why give them a discount?

    Reply
  9. Yaco Roca Avatar
    Yaco Roca

    My policy is similar and it definitely is important that your client know the value of the work, which can affect the relationship, expectations, as well as negotiations.

    In cases where I know the NPO has an undetermined amount of resources, and a cause I feel I can support , I charge them my full rate and stay open for negotiations, letting them know in advance that we can use that as a starting point.

    Reply
  10. James Curran Avatar
    James Curran

    I have worked for a couple of charities and have always charged my normal rate. They are both very worthwhile causes that I have great admiration for, but I don’t cut my rates because:

    1) When you charge less than normal or nothing at all, it gives the impression the work has less value.

    2) The people working for the charity are not all part-time volunteers. Many of them are able to do such great work because they are salaried employees and can focus their whole attention on their jobs. The majority of charities could not exist without paid employees.

    3) They have budgets for marketing that are already set and if they don’t get spent in one department, they’ll get spent in another and possibly on something less worthwhile.

    4) If it’s something you can feel passionate about you go the extra mile, as you want the work to add as much value as possible to the cause.

    Reply
  11. David Airey Avatar
    David Airey

    Good tip, Wendy. I think that’d apply in the UK, too.

    Some dodgy ones out there, Jon. This post was interesting: We need to distinguish between good and bad charities.

    Beth, the old “good, fast, cheap” saying comes to mind, but in that case it’s just shoddy. Should never have started.

    Eric, this website seems like a good resource for your side of the water: Charity Navigator. I don’t know of something similar in the UK.

    Yaco, James, thanks guys.

    Reply
  12. Greg Avatar
    Greg

    As a freelance designer I would definitely give a reduced rate for non-profits AS LONG AS they are a reputable company. While I was getting my Bachelor’s in Graphic Design I worked for a call center that raised money for the Special Olympics. Different states had different rates, and the worst was definitely Iowa, who only gave 3% to the program, and the rest went to overhead…I didn’t stay in that department for long.

    If they can take that much out of the children’s funding, then I won’t be taking any off my price. They will be charged fully.

    Reply
  13. Brett Wright Avatar
    Brett Wright

    I have not yet made it through all the comments, but I decided to add my “2 cents” in. Once every few months I will find a charity or a cause that I hold close to my heart, and I will do pro bono work for them. The gain in return is knowing that I was able to help, and that my services and opinions were valued and appreciated. I choose not to donate money to most charities as I don’t know exactly how it is being utilized, so this is a comfortable and trusting way for me to give back. On the flip side, your name is being circulated around, and could bring you leads, or referrals in the future. I think that is the best gain out of non profit situations. I also think this is one of the best ways for a new designer to build their portfolio rather then turn to crowdsourcing.

    Reply
  14. Chris Prescott Avatar
    Chris Prescott

    I agree with many of the comments here, the most important thing is that the company is respectable, and for a cause you feel passionate about, then do it. However, a lot of these “non-profits” I feel, tend to be a little inflated about how much they really help their cause. Years back, I ran into an article that showed how much CEOs of these companies were rich beyond reason. How could this be so? I tend to be teeter between wanting to help, and being cautious.

    James Curran (Above) nails it spot on, if you price out lower then your normal pricing, devalues the design work as a whole. I tend to charge my normal rate no matter what. I’d rather be with my young daughter, watch her grow up, instead of working for reduced funds.

    Reply
  15. Mark McCorkell Avatar
    Mark McCorkell

    It’s great to do work for non-profits every so often. Thing is though, just because the Charity is for a great cause, that doesn’t mean the people will be great to work with. People matter – I still keep that in mind when considering any job.

    And it’s important to manage their expectations too. Nothing worse than agreeing to do a job and not having enough time to do it right. I say only do them if you can do them the justice they deserve.

    Reply
  16. Maria Avatar
    Maria

    I work at a nonprofit as a fundraiser and also run an events management and communications company with my husband. We serve both for-profit and nonprofit companies. I just wanted to comment on a couple of things, sitting on both sides of the fence.

    Organization budget size is the guide we use. We have a set fee, but smaller organizations receive a discounted rate. We do break this out. A $10 million organization has a very different marketing/events budget than a $250,000 organization. We ask or obtain it at guidestar.org. (FYI, you can also get the pay of the top execs there and I can guarantee most won’t be outrageous, especially when viewed in context with budget size.)

    That said, similar to the one comment above, I also consider who works at the agency. There are certain organizations I would be unlikely to work with–not because they aren’t effective–but because the people will be unreasonable. Or if I do, I will certainly price accordingly for the extra time spent keeping things on track.

    Finally, I wanted to point out that donations of services are not tax deductible. Donations of tangible items such as pencils, books, etc. are deductible. https://www.nonprofitissues.com/public/features/point/647-Are-pro-bono-services-tax-deductible.php

    Reply

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