Day rate: definition
The average daily rate: the price of a day of work from a freelancer or contractor, a common billing basis in freelance work.
By Mathéo Ballasse · June 28, 2026
Definition
The TJM (average daily rate) is the price of a day's work from a freelancer or agency. It serves as the basis for quoting a project and for comparing the cost of an outside contractor to that of a hire. Reading it correctly means multiplying it by a realistic number of billable days, always lower than the number of working days.
Why it matters
For a SaaS founder, the daily rate is useful when outsourcing part of acquisition: it lets you compare the real cost of a freelancer to that of a hire. Reasoning in daily rate without accounting for non-billable days or your own management time skews the comparison.
When to use it
You use it to budget an outside engagement and decide between doing it yourself, hiring, or delegating. In practice, you multiply the daily rate by the estimated number of days, add the time the collaboration will take on your end, and compare that total to the in-house alternative.
Example
A consultant charging 600 euros a day on a 10-day engagement comes to 6,000 euros, not counting your own coordination time.
Common mistakes
- Reading it without counting non-billable days.
- Comparing two daily rates without looking at the full cost of the engagement.
- Forgetting your own management time.
Don't confuse it with
- cac: The daily rate is the cost of one day of service; CAC is what it costs to acquire a customer, of which an outside engagement is only one component.
Related terms
Articles that use this term
Frequently asked questions
- Is a high daily rate necessarily expensive?
- Not necessarily: a contractor with a high but efficient daily rate can end up costing less overall than a lower rate that takes twice as many days. It's the full cost of the engagement that matters.