“How I set my prices, in the beginning, was simple, I guessed.”
“I worry if my fee’s too high, people won’t hire me, if it’s too low, they won’t think I know what I’m doing.”
𝗞𝗡𝗢𝗪 𝗪𝗛𝗔𝗧 𝗬𝗢𝗨’𝗟𝗟 𝗖𝗛𝗔𝗥𝗚𝗘 (𝗠𝗢𝗥𝗘 𝗢𝗥 𝗟𝗘𝗦𝗦)
Sounds familiar? Your goal isn’t just to pay your bills but to be paid what you’re worth. Fee structures and norms vary widely, so it’s important to decide on what suits you and your skills best. Will it be a project fee, hourly, quality-based, package-based, day rate, percentage of profits… this should be all decided on what you think would benefit your business the most!
𝗙𝗜𝗚𝗨𝗥𝗜𝗡𝗚 𝗢𝗨𝗧 𝗙𝗘𝗘𝗦
Whatever rate structure you choose, it should take into account the following factors:
𝗕𝗶𝗹𝗹𝗮𝗯𝗹𝗲 𝘁𝗶𝗺𝗲: Knowing how long specific tasks take, is extremely important for you, whether or not you actually quote an hourly rate.
𝗣𝘂𝗿𝗰𝗵𝗮𝘀𝗲𝘀 𝗰𝗼𝗻𝗻𝗲𝗰𝘁𝗲𝗱 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗽𝗿𝗼𝗷𝗲𝗰𝘁: Unless the client agrees to buy them, these could include supplies, ad space, domain names, photo research or any other expenditure you have to layout to complete the project. If you bring especially strong knowledge or skill to the task, such as photo research, your price might reflect that.
𝗢𝘃𝗲𝗿𝗵𝗲𝗮𝗱: This is a percentage of the proverbial “what it costs to keep the lights on.” It includes everything that enables you to live and be in business, from your mortgage or rent to your internet bulls to your accounting costs, equipment, marketing, and more.
𝗬𝗼𝘂𝗿 𝗽𝗿𝗼𝗳𝗶𝘁: This added percentage reflects your value: your experience, your specialty, or that certain something that distinguishes you. It may grow as you grow. How much you charge for profit also depends on industry norms, your region, your level of excellence and expertise, what you want your annual income to be, and what percentage of your annual earning time this project is likely to take.
𝗧𝗛𝗜𝗦 𝗠𝗔𝗞𝗘𝗦 𝗨𝗦 𝗖𝗢𝗠𝗘 𝗧𝗢 𝗧𝗛𝗘 𝟱 𝗙𝗘𝗘-𝗦𝗘𝗧𝗧𝗜𝗡𝗚 𝗦𝗧𝗥𝗔𝗧𝗘𝗚𝗜𝗘𝗦
- 𝗧𝗿𝗮𝗰𝗸 𝘆𝗼𝘂𝗿 𝘁𝗶𝗺𝗲. Task by task. You can track it pencil-to-paper or use an online tool. Such as Harvest or Clockify.
- 𝗔𝘃𝗼𝗶𝗱 𝗳𝗲𝗮𝘀𝘁 𝗼𝗿 𝗳𝗮𝗺𝗶𝗻𝗲 𝗽𝗿𝗶𝗰𝗶𝗻𝗴 𝗮𝗻𝗱 𝗸𝗻𝗼𝘄 𝘆𝗼𝘂𝗿 𝗿𝗼𝗰𝗸 𝗯𝗼𝘁𝘁𝗼𝗺. Find a zone that reflects your value, but leaves room to negotiate. This means doing market research and getting a sense of job scope and, if possible, budget from the client before you crunch numbers. Going too low or too high causes stress and costs time. Also know your lowest number – the one you won’t go below, no matter how great the gig is.
- 𝗗𝗼 𝘆𝗼𝘂𝗿 𝗵𝗼𝗺𝗲𝘄𝗼𝗿𝗸. Learn the benchmarks for rates in your industry. Check industry discussion boards and professional networking sites where people swap stories and strategies, and magazines, and books. You can even talk to like-minded peers on Wishu who offer services like yours.
- 𝗘𝗱𝘂𝗰𝗮𝘁𝗲 𝘁𝗵𝗲 𝗰𝗹𝗶𝗲𝗻𝘁 𝗮𝗯𝗼𝘂𝘁 𝘄𝗵𝗮𝘁 𝘆𝗼𝘂’𝗿𝗲 𝘄𝗼𝗿𝘁𝗵. Calculating and communicating your value to your clients is your job. Let the client know what your services are worth and why! A really good freelancer makes it look effortless. So making sure your clients know something of the skill and thought that goes into your work.
- 𝗗𝗼𝗻’𝘁 𝗳𝗲𝗮𝗿 𝗳𝗹𝘂𝗰𝘁𝘂𝗮𝘁𝗶𝗼𝗻. In some industries, it’s pretty much “one price fits all” for a given task. But if there’s a price spectrum, quote ‘em and you see ’em. Do you see hours of meetings and revisions in your future? Think of the cost to you of serving that client – the time you won’t have for other projects, plus the aggro factor. And if it’s your busy season or you’re cramming this wish onto a full plate, that can be another reason to raise prices.
