What to charge per hour = (Hours you're willing to work / Your Salary Per Month)
Once you have that down:
Travel (aka, showing up to their offices / minimum fee) = ((Cost per KM * KM traveled) * 1 hour from above calculation)
So as an example:
I want a salary of R35000/ month
I'm willing to work 12 hours a day 5 days a week for it
My charge per hour will be R145.85 per hour (which is ****ing cheap btw)
Assuming I travel 12km to them and 12km back, my charge is 24km * (rate from the AA, I'll use R0.26 for the example) + R145.85 = R183.80 for the first hour and then R145.85 hourly after (if travel takes you longer, charge the time it took you to arrive at client). Also charge for if it's just a meeting. You don't want to waste hours in meetings discussing points and not get paid for it and in the end they **** you anyway (happened to me)
Now you wouldn't leave your day job for nothing so you might want to push up your rate to about R350. This will cover you and allow you to bill less hours, especially if clients dispute the cost and refuses to pay. It'll also make it easy to stay competitive. But don't slack in charging for everything. Usually consultants we work with are in the R650-1250 per hour range.
It's important to let them know an estimate for the analysis you're doing for the system and revert back with a quote on how much time it will take you to do the design/development work. Always quote more time that you need and let them know if you do the job quicker then the charge will be less (for time worked) but it should give them a good idea of how much it'll cost.
Once you have the sign-off (get proper contracts, so find a lawyer to help you, you WILL need this) then start the work (this is after the analysis part).
This way you get paid for the time you spent at their offices going through the system and then if they don't accept your quote for completing the work, you can easily move on to another client etc.
This is what I learned in my 3 year stint on my own. Even though I had proper contracts, people still just wiped their ass with it. So watch out for those types. Concentrate on clients who are loyal and pay and build up a nice reputation with them. Take on new clients with caution and don't be afraid to tell clients to go **** themselves if they give you grief and don't pay for things that were mutually agreed upon (obviously not from the get-go, but if it's dead in the water, politely tell them you won't be working with them in the future anymore and would like to get paid for the work done, dont fall for any promise of payment and then continue working. You know, like them dangling the football for you to kick and pulling it away each time. Refuse to work further unless they have paid their debt to you, otherwise just concentrate on other clients)
Also don't fall for the "clear your schedule next month we have a ton of work for you". If a client does this, send them a contract stating they want your full dedication for the month and need to pay a 50% deposit for that month which they will forfeit if they push back the project or don't use you for the month. That way you're not entirely ****ed if you turn down work when someone blocks off an entire month and you can, at least 2 weeks into the month, decide to take on more work to make up for the 50% you lost out on.
Also, open up a savings account and pop in the max amount of tax payable in there. Even if it looks like a lot, if you have anything left over in the savings account after Mr. Taxman (which is more than likely) it'll be a nice bonus that you can use to treat yourself or even keep on saving for a rainy day with compound interest
