10 factors that you must bear in mind before putting a price on your work.
How much would you have to charge for this job?
It is a very common question at the beginning of our activity as freelancers. The experience helps us to give a more and more adequate response but, even with the passage of time, the doubt still does not fade completely.
So, what is the best way to put a price on our work? We must take into account to get the rate and budget that we present to the client.
1. How much experience do you have?
Have you been working for 20 years or have you just come to the business? The most normal thing is that the broader your experience, the better your work will be. All professionals improve over time: they expand their knowledge, acquire new resources and, above all, they know how to react to the different challenges that arise in their daily work.
2. How good is your work?
It is a complicated question, but essential. There are good professionals, and others who are even better. The measure is in the quality of the work we do. Therefore, to put a price on what you do, it is important that you try to evaluate yourself in the most honest way possible: at what point do you find yourself in comparison with the rest of the professionals?
You can always try to find out what other professionals charge that, in your opinion, offer products and services equivalent to yours.
3. How much time does the project require?
Should it be documented before? Should you train in a specific tool or discipline? How many meetings will there be to keep with the client? All these factors must be taken into account when estimating the duration of the project and, therefore, influence the final price.
4. When does the client need it?
Sometimes, the client needs the project to be ready in a very tight time frame. It’s typical: “I need it for yesterday.” You must take it into account to calculate what the effort will be, and to transfer that requirement to your rate or the final budget.
5. What is the level of exposure of the project?
The size of the company for which you are going to carry out the project usually determines, to a large extent, the visibility of the final work: how many people will see, try or use what you have done.
Creating a logo for a small business is not the same as redesigning the big brand logo. The impact of both works is different: one will be visible to few people, and the other will be used massively. This can also influence the price.
Read Also : The Importance of The First Impression : 6 Typical Ways To Cause A Bad Impression
6. Deliverables and formats: how will your work be used?
Following the example of the logo: will it be used exclusively for a website or will it also appear in written documents? That implies that you will have to work with different demands, and that you will have to prepare several formats.
The same applies in other fields: if you are going to program an application, will it be used exclusively within the company or online? In the case of translations: will they appear in a magazine, in a book or on a website? You must take everything into account when estimating the effort and, therefore, also the price.
7. What is the demand for your professional services?
It is about the implacable law of supply and demand: the more customers demand your services, the higher your price may be. And vice versa, of course … Do not feel bad about it: practically all businesses work like this.
8. Do you manage to differentiate yourself from your competitors?
Do you offer a special product or service that makes a difference compared to other professionals? A 24-hour support and attention service? A training course that others do not have? If you manage to make a difference, and you are able to make it visible to the client, you can write it down in your final bill / rate.
9. How much attention will the client need?
There are clients who will hire your services and, simply, they will let you do your job. Others, on the other hand, will want to be on top of it, and it is quite possible that they will establish regular control meetings. This may translate into constant changes.
It is also possible for you to adapt to the processes, methodologies and monitoring tools of the organization that hires you. You must take into account all that, because the way of working will be different, and the time of dedication as well.
10. How much do you need / want to do the job?
In an ideal situation, maybe it should not be like that. But if you currently have hardly any work, that can condition your economic pretensions.
There are other important factors that can motivate you to modify your budget. The visibility and impact that we can achieve when performing a job for a well-known client is one of them. There are many professionals who will prefer to adjust the price to ensure that star project, which can then help us to achieve many others.
Learn It is also true that some customers will take advantage of this “game”, and will look for discounts offering “promises of the future” in return. So try to get all the information available, analyze the situation well, reflect and trust your good judgment.
About the discounts. We have already commented on several occasions that lowering rates can be a bad idea . You can try to apply some discounts . If, despite everything, the customer thinks that your price is too high, try these alternatives .
And if the client says that your price is too high for your budget …
It is no secret: we are in crisis, people are just running out of money, and the same thing happens to companies. For that reason, it is increasingly easier for you to listen to the already known one: “I’m sorry, but what you ask for is beyond my budget”. When that happens, you may think that there is nothing more to talk about, that your services do not interest the client, period. But maybe there are still possibilities of redirecting the situation. That’s what today’s article is about.
Available options are:
1. Let the client go
This option is fine when you have a lot of projects. So, saying “no” is a little less complicated. But it is also true that the moment you are “busy” is the best to expand your client portfolio: you have no pressure, because your professional and economic present is not at risk, and you are able to negotiate with a cool head. In the end, you could always delay delivery times a little to make room for the new project …
2. Think about lowering your price a bit
If you decide to take this path, be sure to clearly explain to the client that it is an EXCEPTION. If you lower your rate simply because a client asks for it, you will be reducing the value of your service and your work.
This option is recommended especially if the project seems really interesting, or if you are very just about money …
Use a formula similar to the following to explain the “discount” to your client:
“The project interests me to include it in my portfolio, and that’s why I decided to do it with a discount of xxx”.
As we have said before, emphasize that it is an exception. It is a good way to avoid the client talking about the discount to their friends and collaborators.
3. Start a conversation
When the client tells you that the price is too high, you do not have to give the negotiation by ditch. You can start a conversation that will possibly lead you to an agreement that is more convenient for both parties:
Explain why it is more profitable to work with you. You can ask the customer how much he plans to pay for that professional service he needs. You may throw an approximate number. And that is a good opportunity to explain why your services will save money: your work is of quality, so you will not have to return over and over again to correct it. Try to work in that direction, to offer reasons why hiring you really “comes to mind”.
Adjust your offer to the budget. A good option to find an agreement favorable to both parties is to adapt your offer to the price that the customer is willing to pay. Some examples: if you usually design 5 logo proposals for 1000 dollars, for the 800 that the client is willing to pay, you will submit 3 proposals. Instead of building a web with 10 sections, you can deliver 8, etc.
Normally, the client will appreciate your ability to adapt to your needs, and the flexibility of your proposals. In addition, it is possible that you can “sell” some additional services.
Read Also : How To Deal With Complicated Customers
Be flexible to redirect the situation
Some people think that you always have to stand firm with the issue of rates and prices, because rebates can lead you to a dead end .
But it is also true that there are times when circumstances force, and we need to be a little more flexible. This strategy has its positive points: the fact that you show interest in carrying out a certain project usually creates a strong relationship with the client, and it is very easy to continue trusting you for the future (in addition, there will not always be a crisis).
If the client accepts that you adjust your services to your budget, you can be sure that it is not the typical customer that comes “on sale”, just to see if he can get a real bargain.
Think that if you manage to manage these situations well, instead of discarding a project, you may get a loyal, long-term client.
Can you think of another important factor to put a price on our work?
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