A huge part of freelancing is deciding how much to charge for your work. Whether you’re a writer, a designer or a web developer, you need to find a balance between getting paid fairly for your skills and offering a price that will attract clients.
There isn’t one set formula for setting freelance rates. But there are some things you can take into account to make the whole process easier and a bit more fair. Below are tips to help you set your freelance rates.
Setting Freelance Rates
Choose a Pricing Format
There are three main choices when it comes to freelance pricing. You can charge per word, which mainly just applies to writing projects. You can charge per hour. Or you can charge a flat rate for the entire project.
Belinda Weaver of Copywrite Matters has plenty of experience pricing freelance copywriting projects. She says she prefers per project pricing because of the certainty it offers to both her and her clients. But every freelancer has to choose the model that makes them and their clients most comfortable.
Consider Your Competition
Part of making your clients comfortable with your quote is giving them something that they can compare against other rates. If the rest of the proposals they get include an hourly rate, but you charge per word, that could be confusing for them. Weaver says that’s another part of her decision to stick with a fixed project pricing model, since that’s what most other Australian copywriters use. “My goal with my copywriting proposal is to help my clients make their decision (hopefully in my favor!). Part of that is giving them information and figures they can compare.”
Include a Time Estimate for Hourly Work
If you do decide to charge hourly when setting freelance rates, it’s important to include a time estimate for the project so that your clients at least have some idea of what the finished project could cost them.
Look at the Length of Each Project
To be able to offer clients a reasonable time estimate, or just to estimate the time for yourself, you have to find out how long the project needs to be. If it’s a writing project, you need to find out about how many words they expect. For web design, how many pages and how complicated is each one?
Gather as Much Other Information as Possible
There are also some other factors that could impact the amount of time you spend on a project. How many revisions are they likely to request? How many different people will be emailing you different requests? Is there anything else involved? Make sure you very clearly understand exactly what is expected of you before quoting a price.
Keep It Consistent
When you’ve chosen a pricing model, try to stick to the same one as much as possible unless a client specifically asks for you to quote a price to them in another format. That way, you can get a better handle on how fair your rates are to both you and you clients. It also gives some consistency to your returning clients.
Use Your Experience to Estimate the Length
Once you’ve gathered all the information you can about a given project, you have to try and estimate how long the whole thing is likely to take you. The only way of really knowing this is by looking at your past experience and considering how long similar projects have taken you to complete.
Use a Time Tracking Tool
To get a more accurate picture of how much time you spend on each project, you need to track your time. Tools like Harvest and Timely can help you understand the most time consuming parts of each project so you’ll have a clearer picture of what to charge.
Include All Facets of a Project In Your Time Tracking
When tracking your time for each project, it’s important that you include everything that goes into it. Don’t just write out how long it takes you to complete your first draft. Include things like admin work, brainstorming and communicating with clients. Weaver says, “The time spent communicating with a client during a project is something that’s often not factored into a quote as it’s quite hard to estimate. And it’s very much swings and roundabouts; some clients need more time and some need less. You just have to build it into your hourly rate.”
Factor in Revisions
In almost every project you’re also likely to have at least some revisions or suggestions that you’ll need to factor into your finished project. Consider how many revisions you’ve been asked to complete on your past projects and use that as a guide when deciding what to charge for the project as a whole.
Track Other Tasks, Too
In addition to tracking how long each project takes, you should also keep tabs on how long the other parts of running your business take. Things like marketing are essential, but they don’t get included in your billable time. So you need to make sure that you account for that time somehow and don’t spend too much time doing things that aren’t making you any money. Weaver says, “I need to now how much time I’m spending on a project versus how much time I quoted but I also find it useful to keep an eye on administration and marketing to ensure I don’t spend too much time on tasks I can’t bill anyone for.”
Develop an Efficient Communication Process
Since each client you work with is different, the way you communicate with them will vary greatly. But if you have a good idea of what information you need from them to get started, along with how to handle things like revisions, the process is likely to go a lot smoother. And the less time you spend going back and forth with clients who might be confused or overwhelmed, the more you’re likely to make for your work overall.
Be Prepared for Some Lengthy Projects
Regardless of how great you are at communicating, there will be some clients who just require extra communication, revisions and work. In those cases, if you’ve charged a fixed price for the project as a whole, you might end up getting paid less for the time you put into it. But you still have to do your best work and just hope that it evens out for you down the road.
Adjust Your Price for Major Changes
However, if you have a client who has completely changed the scope of your project after you’ve already given them a price, it may be necessary to update your original estimate. For instance, if you agreed to design a logo and some basic branding elements and then the client adds in an entire web design project, you don’t need to stick to the original price.
Consider the Time Frame
Another factor that can impact setting freelance rates is the time in which the client expects you to complete a project. If it’s a really tight deadline, you might consider charging more since you’ll likely have to delay some other work.
Set Clear Terms at the Beginning
To ensure that your pricing reflects the scope and time frame of the project when setting freelance rates, you should have a clear contract or terms and conditions set up front. That way, if anything changes that you didn’t originally agree to, you can adjust your pricing accordingly.
Take a Percentage Up Front
Each freelancer will need to decide for themselves how much they require up front to get started on a project. But you should have a percentage that you regularly charge clients to ensure that you’re covered for any costs incurred if they walk away mid-project.
Leave Yourself Some Buffer Space
Weaver also recommends that you leave yourself some wiggle room in each estimate. Unexpected things that take up precious time are quite common for freelancers. So you don’t want to find yourself undercharging every single client for the work you’ve put in.
Make Sure the Rate is Fair to You
Overall, you need to make sure that your rate is something that will support you and your growing business. If a price for a project just seems to small for it to be worth your time, then it probably is.
Make it as Favorable as Possible for Clients
The other side of that is that your rates also need to be fair to clients. If you set them too high, people are likely to choose a cheaper option and then you won’t make any money at all. It’s important to have balance.
Adjust Your Quoting Process Periodically
As you grow and learn as a freelancer, you’ll probably need to update your rates and your process. You don’t have to charge the same hourly rate as you did when you first started. And you’re also likely to learn things about how you work as you track your time and deal with a bigger array of clients.
Offer a Great Customer Experience
The finished product is definitely the biggest part of what clients are paying for. But some are likely to be okay paying a bit more for a great experience. If you can make it easy and stress-free for them, that’s a great way to increase the overall value of your offering.
Have Confidence In Your Skills
Weaver says, “A huge part of pricing is confidence. I recommend charging a little more than you initially think as we usually under-charge anyway!”
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