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How much do industrial design services cost?

Industrial design is an important activity in the early stages of the physical product development process that has a huge impact over the success of your product. The cost of industrial (product) design services varies depending on the size, experience and location of a firm as well as the complexity of your product. Hourly rates typically range from $40 to $400 per hour, but with outliers falling both below and above this range. There are also various pricing models like flat fee, hourly or equity-based models. Contact us to get a quote for product design services for your specific project.

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Industrial Design Pricing Models

Listed below are three common pricing models used by industrial design firms to charge for physical product design work.

1. Flat Fee Pricing

The flat fee pricing model works best when the project outcome, scope and specifications are well-defined. This model is typically popular for re-design of existing products or making a product similar to an existing one in terms of features and functionality but different in the overall design and experience.

While a flat fee pricing model offers predictability in planning and allocating budgets, it doesn’t work for projects where the scope is not well-defined. This is often the case with startups that work on innovative new product ideas which keep evolving over time and require a lot of testing, validation and iterations.

2. Hourly Pricing

As the name suggest, the hourly pricing model is directly based on the time a design firm works on your project multiplied by their hourly rate. Hourly rates range from anywhere between $40 to $400 per hour depending on the location, size and reputation of the product design company. Freelance product designers charge anywhere from $25 to $200 per hour again depending on the location and experience level.

Hourly pricing works best when the project scope is not very well-defined and the design might need prototyping, testing and validation to refine the key features. Sometimes a combination of hourly and flat rate pricing is used to first create a well-defined brief and then charge a flat rate to execute that design brief. Though the hourly pricing model provides flexibility, it is still prudent to define your project scope as much as possible in order to avoid scope creep later.

3. Fee & Equity Pricing

The fee + equity or royalty model works by sharing the risk/reward of your product with your design partner. This is an appealing pricing model to entrepreneurs and startups that believe they have a great idea but are low on cash to develop it. Typically, in this model, the design firm works at a reduced rate upfront along with equity in your company.

The problem with this model is that in order to create a successful product startup, there has to be much more than great product design. Therefore, the financial return of the design firm is not only tied to creating a great product but also at your ability to create a successful company around that product. And given that majority of new product startups fail, it is not often that a reputable design firm is convinced of working for equity in a startup.


Outdesign Co is a product design & development company helping clients across 15+ countries turn their ideas into “World-Firsts” and award-winning products.

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