We’ve all made rookie mistakes in quoting our rates to a client who asked for an estimate–and kicked ourselves later as we toiled through a project where the pay just didn’t cut it. Fortunately, there’s a lot of good advice on this front circulating around the freelance community to help all of us get better at this. Here are a few smart tips I’ve come across recently on other freelance blogs.
1. Know your client’s budget. A big-company client may be willing to pay you far more than smaller customers. The blog wakeup later suggests a way to “discover” how much a prospect is willing and able to pay that may be more palatable than asking directly: Request that clients fill out a worksheet outlining their needs. If you’re looking at taking on a big project, this could be a smart way to go. For smaller jobs, it might be too much paperwork for a client.
2. Figure out how much you need to charge to cover your fixed costs and still turn a profit. There’s an excellent discussion of this on Positive Space Blog. One good tip from the blog: “Set your price based on your level of services and your costs and then stick to your price no matter what.”
3. Consider your overhead and geographic location. The Insatiable Solopreneur offers a smart discussion of how to factor these often overlooked variables into your price quotes.
Now that I’ve been freelancing for almost five years, I have a good sense of how much time it takes me to do various types of projects, so I’ve gotten better at estimating what a job is worth. But when in doubt, I may check around with trusted freelance buddies to make sure I’m coming up with an accurate estimate.
And, if a job balloons into a much bigger project, which sometimes happens, I’ve forced myself to speak up, even though I don’t relish the task. When I was hesitant to renegotiate a bid recently, after doing five times the work I expected initially, my husband nudged me, “Those were all hours you couldn’t spend with your kids–and you’re not going to ask for compensation?” It was a good reality check. Time is our most precious commodity as freelancers, so it’s important to protect it.
And, I might add, it’s good for our employers too. If we can’t make a living and close up shop, they’ll lose out on the help we provide. There are lots of freelancers, but not all of them do a good job.