No one has mentioned the skill level factor so far, and its a major factor if this is something you've never done for money in the past. Equipment is another, as it influences the time it takes you to get the job done.
Lets say you're charging $70/hr as an average of the high and low rates you've found in your area. To do that, you'll need to have several years applicable experience and a shop that's very well equipped for the type work you're doing. Without both, you'll be grossly overcharging, and probably spend as much time arguing about charges as you spend working.
The best way to get around this is to work on fixed estimates as much as possible. The customer knows up front what its going to cost, and you don't have to worry about keeping up with every minute you did (or didn't) work on his project. When you quote prices up front its pretty easy to tell where you are realtive to the competition. If you get every job you quote, you're too cheap. And if you don't get any of them, good chance you're a little high. You do want to keep an accurate account of the time you spend on each job, not for the customer's benefit but for your own. Over time you'll likely find you make a lot better hourly rate on some types of jobs than on others. This is common in all types of similar businesses. Keeping up with the time allows you to adjust those lesser paying jobs upward when you quote similar ones in the future.
Obviously some jobs are going to have hidden problems that can't be estimated until they're uncovered. That's why any work agreement needs to spell out exactly what's being quoted, and what's excluded from the quote. If a problem is found, the customer needs to be notified asap so he can decide whether he wants you to fix it as well, or if he wants you to just complete the originally agreed to work and let him worry about the hidden stuff later.
And then there's the ones where its near impossible to work any way but on an hourly basis. Someone drags in a frame that's been rusting since the 50's and wants you to turn it into a rolling chassis. If you were starting with a new pair of rails, and fabricating all the crossmembers, etc from new material, then you could quote a firm price. But starting with something 60 or 70 years old means any up front price will involve lots of guessing. Is it twisted? Is it cracked? Is there massive rust between the inner and outer rails? Will the riveted joints be loose as a tambourine once the frame is blasted? Will blasting show up spots where you can see daylight thru the metal? The list goes on and on, and the likelihood of the repair bill being substantially more than the cost of going with new (assuming its something where new is available) is high. That's the place where you have to be up front with the customer about possible costs, and let him bear the risk if he wants to proceed.
All that said, you'll find you can get a lot more work by quoting fixed prices rather than hourly rates in any case where the work to be done is well defined. I've been in various phases of the metalworking business for 30 years, and if I have some work I'm looking to sub out to someone, and a drawing or other good description of the work involved, then they're wasting my time and theirs if they think they'll get me to bite on an hourly rate and give them the job. If a man isn't familiar enough with the work to know what it's worth, the he surely isn't familiar enough with it for me to open the wallet and trust he'll do me right.