It is easy to understand why flat prices exist. They are efficient in a scalable way. They ease a chain of command that would otherwise be impeded by often lengthy haggling. This exists to promote efficient servicing for the highest amount of people.

However, services often do come as a flat price and here’s why you shouldn’t do that. If you’re, let’s say a designer, your clients rarely come in bulk. Rather, you spend your time developing a brand for your client — a logo, set of illustrations, a colour palette and maybe some instructions on strategy. That is an awful lot of work for one client and most designers end up charging a flat fee each time. Now, why is that? The assumption lies that if an hour of work for a designer is worth, say $100, and the workload for each client is identical, then they are pricing their services fairly.

Yet, a designer can look at pricing their service in a more liquid way. They can price discriminate based on how much value their service brings to the client. Charging different customers different prices for the same product/service is called price discrimination. In recent history virtually all sectors of business have tried applying this tactic. Amazon, for example, was busted in late 2000 for selling certain DVD’s for $26.24 to one set of customers and for $22.74 to others.

This obviously doesn’t flow well with most consumers and once it is revealed to be true companies revert to flat pricing. Amazon cannot take the time or effort to explain to each customer how this ‘dynamic pricing’ system benefits their overall experience. It seems greedy and erodes trust in the brand. Yet, when our designer is dealing with one client at a time a lot can be done to explain to their client how the product (a logo or a brand strategy) can be worth a larger price.

What you need to do as a designer is to determine the scale to which your client operates — their revenues and estimated marketing budget. That might seem like sensitive information but it is key to determining what risks your client is hedging by paying up. Let’s say that their printing budget is small. This means that if your logo is not any good there is a smaller batch of print that will be tagged by it. So the costs of a potential failure are smaller with a smaller client. But with a big client — one that plans to put the logo on merchandise, cars, print etc. — the risks are much bigger. This means that by paying more, your client is getting the logo as well as the comfort of relative security.

But charging more does not simply imply that you are better than somebody else. That is where your portfolio steps in to prove quality, but that may not be enough either. There are many good designers with good portfolios out there. You stand out by showing that you value your own service not based on hourly rates, but on the value you bring to your customer.