Design Bureau: Economic Model
Out of context: Reply #16
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- popovich0
The part of the problem is that normally services have standard rates, which are easily accessible for a client (and, of course, for this business owners). Say, if a client comes to a solicitor, there is a standard rate which will apply to the required job. Architects also have some easy formulas to calculate the job (normally, percentage of the construction costs — though, this may not always be the rule). And then, such a service will grow the standard rates out by making a good name, by winning at courts, by getting awarded by the industry, whatever. The problem with the design industry is that there exists no standard rate for the jobs and such rates will be also handled as a top secret. "Charge as much as you *think* you are worth of". What kind of a challenge should this be for a beginner? How this thinking should be clarified for a client? "I *think* this job costs this much"? In this view, businesses like logoworks.com or dreamtemplate.com have quite clear statement and job rate which a client can easily grasp. Certainly, this kind of business might not be as rewarding as running your-majesty.com and winning Fave Website Award, but it is at least "quantifiable".
Certainly, running a small agency and a big network are differrent businesses. However, as we are talking here about starting small, this is what interests me most. One thing is clear — there should be one or a couple of strictly defined products to offer. A group of 3 people cannot seriuosly offer the full range of design services without sacrificing the credibility of such offer. This is what should be defined and calculated, I guess.
On a side note, I have noticed, that offering a tangible product — like posters, t-shirts, books, stickers (wall stickers anyone? www.wallstickers.ie) — makes the whole business more credible and might help survive in the first "delicate" phase of the start-up.
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