Ok, I am starting to get a lot more clients and starting to get some deadbeats.

Here is how it plays out...

We communicate, I decide what is needed for their website for them to be succesful.

I start with a mockup design, once approved I develop the website and then I get paid.

I then provide a mockup website and they state they dont like and it is not as good as...

the website they are comparing it too has cost over $1k to develop I am sure as well. They want me to provide the same service when I am charging $300-$500 and sometimes less.

I am offering very cost effective services and a lot of my clients are not only surprised and satisfied with the service they pay.

So, I spend at least 1 hour designing websites and communication and then never get paid.

What can I do? I just lost valuable time that could be used for an existing client.

Do, I need to start requiring payment upfront?

yes I guess you need at least to get half of the money. and also talk about these things before starting doing anything. and if they didn't want to pay you half of the money in advance I suggest you don't make it for them

First question - do you have ANYTHING in writing ?? Do you create a proposal ? Do you have a CONTRACT that the clients have to sign BEFORE you start any work ?? If not, then you need to do all of the above. It doesn't matter whether you are building $300 sites or $1500 sites, you NEED IT IN WRITING first. A signed contract gives you the right to sue them if they don't pay as agreed. It also shows that you are a serious business person and it lays out exactly what's expected. The proposal and contract should include a time line and terms to deal with delays and lack of payment on their part.

Getting some money up front is not a bad idea, it's not at all unusual to ask for a deposit - as long as you have both agreed on the work to be done and a time frame.

A couple of things:

First, as LadynRed mentioned, you always need a contract. If you don't use one, you're just asking for trouble and have only yourself to blame. Spend the money on the lawyer up front and you'll save yourself a lot of grief later on. Money up front is a good idea, as is developing the site on your servers and transferring it only after the final payment is received.

Second, you should be designing mockups in Photoshop or an equivalent first before writing any code. It wasn't clear from your post if that was the case. You should also have the client sign-off on that design and you should consider several rounds of design. Also, if you're sometimes only spending 1 hour between communication and the design, I'm not surprised at all that the client didn't like it. There are very few people that could design a great website mockup that works perfectly for a client in an hour. I am not one of them and I've never met someone who could.

Third, I don't know what your sites are like, but assuming that you can make great sites, you're charging far too little. Clients in that price range are more likely to be problem clients because they're cheap and think they can command the world without paying a lot of money. You are not bound to take just any client, you have just as much right to choose them as they do to choose you. If you charge more, you will generally get better clients and if you don't get better clients, at least you'll be making more and so it will still be worth it.

I'm a full time freelancer, and I never write up contracts. I have a permanent contract in the form of a user agreement, that goes along with the billing service I use. I've never not been paid on time, and do everything by the hour. If you want to avoid deadbeats, you can do what I do, and use Odesk to do all of your billing for you. It is like an insurance policy, because it guarantees your rate if your customer ditches you. It also has handy dandy tools for tracking your hours accurately.

I wrote a blog about this (How I became a full time freelancer), because I know people have a hard time with billing and other issues, especially when it comes to networking with people in a global marketplace.

There are other services you could use for billing, some of them better than others, but I just prefer Odesk because of the hourly guarantee. The cost is 10% of the billed amount, which I think is totally worth it, since it allows me to instantly network with anyone in the world. Also, I never have to track anyone down to get paid: my bills go out automatically weekly, and I am paid automatically each week through direct deposit.

If you don't operate like I do, writing contracts and taking deposits is definitely a good idea, as pointed out above.

Thanks All,

the design is mocked up in photoshop and then shown, once approved I get to developing.

I am just tired of people thinking they can get a $1k design for $300.

Lady In Red,

I typed up a overview of what is expected and given to clients, ill look into a proposal kit.

I think you might be approaching pricing from the wrong angle, if you're looking to do web design full-time. Here is my suggestion:

Decide how much you want to make each year (as in salary). Don't forget to factor in taxes, which will probably be around 1/3 of your salary, depending on where you live and how much you make. Add expenses, which should include lawyer fees for contracts (one-time), accounting (ongoing, unless you take care of it yourself), marketing, client meetings, hardware, software, travel expenses, etc. Now take that number, divide it by the number of days you want to work each year and divide that by the number of hours you want to work each day. Then add 10-20% because you won't be able to anticipate all of your expenses. That should be your hourly rate.

You don't have to charge the client per hour, but if you charge by the project, calculate how many hours you think the project will take, and multiple it by 1.5. Then take that number and use it as a project cost.