“How much do you charge?”
This question is enough to send new freelancers into a tailspin. Does this inner dialogue sound familiar?
“I have no idea how long this project is going to take … how am I supposed to quote a price? What if it takes me way longer than I think it will?”
Or how about this?
“That quote sounds like a lot. What if I give that price and then they don’t want to work with me?”
“They’ve accepted my quote, but what if they think the work sucks?”
We psych ourselves out in a major way when we’re first starting out. Unfortunately for all of you newbies out there, it’s experience that will help you get over these fears, though it doesn’t hurt to listen to those who have gone before you.
Please learn from my mistakes:
1. Don’t ask your clients to solve your financial problems.
I fell into this trap trying to rebound after a couple bad business deals. Instead of looking for more clients to solve my financial problems, I tried to squeeze more money out of my current clients.
I learned two valuable lessons from this process:
Your clients have to value your work. There were times I deserved more money, but my clients simply didn’t value the service I was offering. If you have to convince your client that you provide a valuable service, you won’t be paid accordingly.
Sometimes you have to walk away. If you are underpaid for your services, you aren’t only hurt your bottom line, you are tying up time you could be pursuing and working with other clients who will pay you what you’re worth.
The point is not to limit yourself. Instead of trying to get more money from the clients you’ve already captured, work to attain new clients.
2. Know that you may have to sacrifice early.
I would beat myself up over not being able to charge a lot, but that happens before you have a proven track record. Understand and embrace the process and try to keep those early jobs short-term so you aren’t stuck at a low rate for a long period of time.
As you take on new clients, adjust accordingly. With each win, you will be more justified to charge. Just make sure you are producing quality work.
3. Confidence is key.
You know that line from Jerry Maguire, “Do you know bees and dogs can smell fear?” Well, so can potential clients.
Those early days of charging for a service can be terrifying because you are declaring your worth with nothing but your word to back it up. Don’t do as I did and waiver on your worth because you lack quantitative ROI. Stand up for your quality of work and walk away from negotiations if you have to.
Why is this so important? Imagine you’re looking for someone to fix your roof. If the contractor you’re interviewing seems unsure of the price they’re quoting, won’t it scare you that they aren’t very good at fixing a roof? Confident people put you at ease.
4. Work toward getting rid of hourly rates.
Hourly rates are good when you’re first starting out because they provide a safety net in case you underestimate how long a job will take. As you get more confident in your workflow, though, you want to do away with hourly rates.
One of my first freelance gigs was hourly. I was tasked with writing eight blogs per week. I was thrilled to get the job, because I needed the money. I did well at first, but as I got more efficient at writing the blogs, my paychecks began to dwindle.
Instead of earning more money for working efficiently, I was punished because I wasn’t spending as much time on the project. I ultimately had to walk away because the client didn’t want to pay me a stipend.
Why are stipends so great? Let’s say I’m writing an article for $200. If the article takes me four hours to write, I’ve made $50 per hour. If I can complete the article in two hours, I’ve made $100 per hour.
Stipends are also good from the client side. If the client offers $50 per hour for what is assumed to be a four-hour job, the client believes that the project will cost $200. But if the job runs two hours over, the client is on the hook for $300.
As you get familiar with what you’re worth and the length of time it will take you to complete a project, you will be able to quote stipends with confidence and both you and the client will benefit.
5. Don’t cave to pressure.
Pricing your services is a process that takes time to figure out. Don’t beat yourself up because you have no clue what to charge a client. Also make sure you don’t cave to pressure to offer a turnkey system or publish your rates.
You have the right to look at each client individually and determine what to charge. Each project has its own nuances that will impact your rate. Publishing a cheat sheet of prices may open you up to be taken advantage of by clients with a big budget and may scare away potential clients with a small budget.
You do you and don’t worry about what is easiest for the masses.
I hope this list was helpful to new freelancers! Stay the course and know that this process gets easier the longer you’re in it. Good luck and happy quoting!