I produce a variety of resources which I make available for free, such as my freelance questions + answers, blog posts and open source software. This is for a number of reasons, some personal and others commercial.
This also applies to some of my web applications, such as Pick a Date and Viking Mind. However, I do intend to charge for some future applications that are in development.
Pricing is hard
Deciding how much to charge for resources is difficult, given that:
- Incomes vary between countries – £50 might be nothing to a senior developer in the UK, but a month’s wages elsewhere.
- Incomes vary within countries – £50 is a lot to someone who is struggling on benefits or early in their career, or working in a poorly paid sector such as a charity.
- The value each person gets from resources can differ enormously, from a minor bit of useful information to helping solve a problem that was costing them hundreds or even thousands of pounds.
I could get around some of these problems by charging a different rate per country, or a ‘pay what you feel’ system, but that gets complicated and I wouldn’t expect to sell enough resources to make this worthwhile.
Tax
Tax is complicated – even VAT within the UK is a nightmare (which is why I’ve not voluntarily registered for VAT), before I even think about other countries. I don’t want to take a trip abroad only to be arrested or turned back on arrival for not having charged the right amount of tax on some sales. It doesn’t help that digital services are sometimes taxed based on the location of the buyer, rather than the seller. In order to work out the correct rates, I’d have to collect personal data (e.g. your address), and I don’t feel comfortable doing that.
I could pay someone to make this problem go away (they’re called a merchant of record), but they’d take a 15-30% cut for doing so, and the data collection would still have to take place.
Margins
Everyone wants their cut when selling online – marketplace, tax management, payment processing etc. I’d be lucky to get 50-60% of the cover price after deductions, and I would then have to deduct a further 50% of that for pension contributions and UK income taxes. On a resource sold for £50, I might end up with £12.50.
Refunds, chargebacks and fraud
As soon as I start taking payment for resources, I have to think about having to return some of those payments. For refunds, it’s worth bearing in mind that, in the UK at least, consumers have a lot of protection that allows them to return products simply because they’ve changed their mind.
If someone has paid by card, they often have the ability to start a chargeback process. This is where the card provider refunds the money and then asks the merchant to prove that the transaction was valid. The starting point is usually that the customer is right, i.e. the chargeback will proceed unless the merchant can demonstrate that the purchase was genuine and that the product or service was delivered as promised.
Finally, there’s outright fraud, where someone uses stolen card details to purchase resources. The liability for fraud is not always clear – sometimes it lies with the merchant and other times with the bank – but it’s not something I want to get involved with.
Of course, all of these are potentially problematic even when I sell my time, but in those cases I pre-screen clients and only allow for payment by bank transfer, which reduces the risk. Effectively I have a small number of high value transactions, rather than a large number of low value transactions.
Marketing
The resources I produce are a marketing tool for my PHP skills and ability to explain technical content clearly in writing. They help people find me through search engines and sharing on social media, and they also persuade people that I’ve got the skills needed to solve their problems. If a small percentage of readers go on to ask me to do paid work, or refer me to people who hire me, the resources effectively pay for themselves that way.
One way to look at this is how many resources I’d have to sell vs how much I would get from a referral. My minimum project fee is £250, so a referral would earn me at least that much. If I was selling a resource for £50, I’d need 5 sales to make the same amount as one referral – and that’s in the worst case where the referral only generates my minimum fee.
Thanks
If you enjoy and benefit from the resources I produce and would like to say thank you, please consider:
- Recommending me as a PHP developer (e.g. on LinkedIn or via email).
- Recommending the resources to other people who you think would benefit.
- Sharing a link to the resources on social media.
- Donating to a charity in your country supporting asthma, diabetes or mental health.
I rely on being paid for PHP development for the majority of my income, so every recommendation or share helps.