How to Charge More as a Freelancer From a Developing Country [An Interview With Janet Brent]

How can freelancers from developing nations charge more for their services that can be on par with their counterparts from developed nations?

In the world of entrepreneurship, it’s becoming more and more trendy to outsource to developing countries, since this way you can hire skilled people for a fraction of the cost. I always had mixed feelings about this: is it really okay to pay someone a slave-wage only because they are living in the Philippines or India? It seems that most entrepreneurs think that it’s justifiable, therefore I was pleasantly surprised to stumble on an article by Janet, a Filpina web designer from USA, who called BS on this whole thing.

I know that many of you guys are from developing countries, therefore I decided to interview Janet, and ask her to explain her take on this outsourcing trend and share how she went from working for low paying clients to working for high paying ones.

In this interview:

  • What was the difference between working as a web designer in the USA and working as a web designer in the Philippines.
  • Why Janet presents herself as a location-independent web designer instead of a Filipina web designer.
  • Why Janet thinks that web designers from developing countries should increase rates for their services.

How much web designers around the world are getting paid

When you hire web designers from developed countries, a good web design can cost thousands of dollars, especially if they are already established in the industry.

  • Stephanie Hobbs charges $1,200 for a 4-page website. She charges more depending on the size and complexity of the project.
  • Noel Green charges between $2,500 and $5,000 for a complete website.
  • Artisan Pros offer different packages with prices ranging from $1,495 to $3,595.

Wondering what web designers from developed countries charge per hour? Many people start out with a low rate, for example $15/hour. However, over time they gradually increase their rates from to $60-70/hour.

Web designers who are really established and well-known often charge $100/hour or more. Now, when it comes to web designers from developing countries, that’s a completely different story. Sure, there are some who managed to establish themselves and therefore can charge the same rates as web designers from the US or UK. However, the majority of them earn significantly less money for the same amount of work.

I don’t want to point out anyone in particular who is charging low rates since that might make them feel uncomfortable, therefore I suggest you to take a look at popular freelance boards like Freelancer and oDesk to get an idea about the differences in rates. Pay attention to average bids. Sure, there are some projects where average bids go over $1,000, but on many others they are in $50 -$250 range. There are also many jobs that offer $4-$7/hour rate. Why clients offer low rates like that? They know that there are people in developing countries who are willing to do the job for a that amount of money.

Here’s a real screenshot from a real ad on one of the freelance boards:

bad-job-boards-posting

Yes, you read it right, they want a high quality homepage and logo, with three different versions for a website and six different versions for a homepage, and, of course, unlimited revisions in their selected version, all for $70.

Sure, there will always be a big difference between the rates of those who just started freelancing and those who are more established, which is perfectly fine. However, we all know that there’s something else going on. People who pay extremely low wages don’t target inexperienced people who are just out of college. They look for decent web designers from developing countries that are willing to work for a very small payment.

Now, here’s the question: is it okay to pay someone from India $70 when you would pay $2,500 to someone from USA for that same job? Is it about bringing more opportunities to developed countries or is it about exploiting people who are vulnerable due to their financial situation? Let’s see what Janet has to say about this.


Janet Brent is an intuitive graphic/web designer for holistic, creative and heart-based small businesses. She blogs at Purple Panda and tweets @janetbrent.

janet-brent

Please introduce yourself to our readers.

I’m Janet, an intuitive graphic/web designer for conscious creatives and heart-based small businesses. I’m interested in passionate people making positive change. I guess that’s my “elevator pitch” but like attracts like and I’m finding there’s no shortage of amazing people I make connections with.

Why did you get into design in the first place?

I knew I wanted to be a graphic designer since sophomore year in highschool when I job shadowed one who worked for a sewerage agency. Not a glamorous design job at all, but he talked with so much passion that really attracted me and made a big enough impact that I chose to make that my career path! Before then, I had no idea that “graphic design” existed but I was always interested in art since the moment I could hold a crayon at age 2.

What is your professional design-related experience?

I taught myself html when I was 13. So I became a “professional” web designer when I got on the WordPress bandwagon and slowly got into paid gigs. I now spend most my time designing e-books, opt-ins, logos and websites for solopreneurs. My first professional design job straight out of art school was a graphic designer for a souvenir company.

What is the difference between working as a designer in USA and working as a designer in Philippines? What about the difference between presenting yourself an American designer or as a Filipina designer? Do clients treat you differently depending on where they think you live or what nationality they think you are?

I have experienced day jobs both in the US and Philippines and I have to say that people in the US have it easy. In general, there is a lack of organization in Philippine companies and less worker protection. Working overtime is a norm, so it’s not just 40 hours a week, it’s also 50+ for less than you’d earn in the states. I definitely think there’s some influence as to presenting yourself as a US based or Philippine designer. It takes some branding skills to avoid getting taken advantage of. Since its often assumed that you outsource to Filipinos, I struggled with this early on.

You’ve mentioned on your blog that this month you will be breaking your personal record for income while self-employed. However, in the past you’ve had a full-time job that pays only $400/month, as well as your share of low-paying clients. How did you get out of this and started earning decent money?

It’s a mindset shift. As simple AND hard as that. I think I had collective cultural baggage of being a Filipina. I had never felt like a minority in the states because it never affected me until now. The poverty consciousness was something I had to work through emotionally. I trained myself to be in an abundant mindset. I’m big on personal and self-development so I’m grateful for this path because it’s been a big learning curve.

It’s also important to brand yourself in an empowering way. Rather than promote myself as someone who lives in the Philippines, I say I’m location independent and a digital nomad, and I work with clients from around the world. I reject the outsourcing business model. That’s not what I do. Slowly but surely, I’m learning how to stand in my power.

There are a lot of designers from the developing countries that feel that they are being massively underpaid. However, they feel stuck because they don’t know how to raise their rates, get better clients, and earn more. What would be your advice to people who are in this situation?

overworked-and-underpaid

It’s tough because I’m fortunate to have the Western background of being raised in the US, which does help. There’s a sort of colonial attitude that we’re somehow ‘under’ Westerners and with outsourcing, it’s viewed as helping developing countries because it provides jobs. I don’t think its that black and white.

More designers should stand up to low rates and not accept them. The more you accept low rates, the more that you will continue to receive low rates so why not help the industry out and raise the standards rather than be part of the problem? Thinking outside the box is also good.

The time = money model isn’t very scalable so thinking more entrepreneurial in regards to solving problems and offering a product could be more rewarding in the long run.

Technology is empowering and it’s also the greatest equalizer. Most people in developing countries don’t see that because they’ve also been taught that they’re not equal, so you have to empower yourself and despite external circumstances, it starts from within.

Keeping in mind that there are low-paying clients who are tight with their budget and high-paying clients who are after quality. But high-paying clients are suspicious when hiring people, especially from developing countries. How can designers from developing countries present themselves in a way that would dispel doubts of high-paying clients?

That’s a great question because it addresses the fact that low-paying clients tend to hang out in this cesspool. People in developing countries tend to get this low hanging fruit. My advice would be to reject the outsourcing business model. It’s tricky, and I’m not even sure what that would entail. But “outsourcing” just has that connotation that attracts low-paying clients so it’s not the right brand to pursue if you want higher paying clients.

Many designers from developing countries feel uncomfortable with charging the same rates as their counterparts from developed nations because it seems “unfair” to them since the cost of living is higher for developed nations. How can designers from developing countries overcome this mental barrier that keeps them from charging more?

Yes, there’s some truth towards having a lower cost of living, so charging a US price seems counter-intuitive. But there are still ways to earn more and increase your livelihood because you DO deserve to live more than paycheck to paycheck. I’m not saying you should be making $100/hr. but you shouldn’t be making $2/hr either.

Ask yourself what’s a fair price to work towards. There’s this cultural emotional baggage that’s a collective experience, and you’ve got to break through the scarcity mindset. I’ve really benefited from personal development techniques like EFT.

If you are hiring someone for a minimum wage job, aren’t you justified in paying a person living in the USA $1,160/month and a person living in Lithuania $360/month for the exact same job. Many employers justify this by saying that they’re paying them the equivalent amount of what they’d make on their own country. What’s your take on this?

As I said, it’s not so black and white and I believe there needs to be more education on both ends; entrepreneurs and workers in developing countries. On one end, you shouldn’t be a “slave master” and I’ve talked to Western entrepreneurs who have outsourced and secretly feel guilty about that issue. And on the other end, you shouldn’t happily accept $300/mo. especially if you’ve got a full family to take care of. I don’t know how locals do it! I also love the phrase my VA friend said: “If you pay peanuts, you get monkeys!”

Outsourcing to developing countries is becoming more and more popular among entrepreneurs. However, the ethical side of it is quite a complex topic, since on one hand, it provides a lot of opportunities to people from developing countries, while on the other hand, paying someone from Philippines way less than you would pay someone from USA seems like outright racism+nationalism when you think about it. What is your take on the whole thing?

I see it as a kind of colonialized attitude. It’s a slippery slope and I think there’s a lot of room for improvement and education on both sides. And it’s not just Caucasians who are outsourcing. I know Filipino-Americans who are taking on this model and starting businesses to provide for Filipinos. The upside is they want to help raise the livelihood of Filipinos and create a stronger middle class. I don’t have all the answers and outsourcing is neither good or bad. But we are a globalized world and outsourcing is here to stay. There are still many opportunities for better solutions.

You’ve said on your blog that if you pay peanuts you end up hiring monkeys. Honestly, I never understood the obsession with hiring people who are willing to work for ridiculously low amounts of money, because it seems to be counterproductive in the long run. Would you agree that it’s penny wise and pound foolish?

If you pay "peanuts" you might end up hiring a soda-loving monkey.

Bob, why aren’t you working?

I agree that it’s counterproductive in the long run. It might end up costing you more money in the end, because it’s the difference of hiring a professional from the start, vs. outsourcing and then having to backtrack and hire people to fix it. The quality of work IS usually less because outsourcing businesses tend to hire people straight from college and train on the job just so they can pay their employees even less. You’re not hiring professionals. You’re hiring people who are still learning and who knows how organized their internal systems are!

What would be your advice to young people from developing countries who want to become professional designers (and get paid as such!), but are at the very beginning of this path?

On the job training can work if you’ve got good mentors, so look at the team before you decide to take on a job. Job interviews should be as much interviewing the company as they are interviewing you. Look for internships or apprenticeships. Don’t underestimate the internet beyond Facebook. As I said, it’s the greatest equalizer. You can find the latest Western-based design trends and learn from example. Read and learn as much as you can through design blogs. Find a niche that interests you so you can stand out. If you love outdoor sports for example, you could design specifically for outdoor sport companies and start to brand yourself within that niche. Don’t just be a designer. Be a designer for a particular passion. You’ll stand out & be less generic.

Last, but not least (and slightly off-topic), you have this crazy experiment going on right now, your “Live on $2/day” challenge. That sounds quite extreme! Can you tell us more about it?

I’ve been quite lenient about it. I’m living on $2/day but relying also on “gift economy” which also just means my boyfriend gets to pay for me. The idea behind it isn’t to limit myself with a poverty consciousness but see exactly how abundant we are if money weren’t a consequence. There’s a lot of options when you choose to simplify. It doesn’t become limiting, but very freeing! I’m also selling stationery for $2 and donating 30% to my favorite non-profit, Her Star Scholars.

Thank you, Janet!

In a nutshell:

  • As a web designer from a developing country, you have to understand your worth and drop the limiting beliefs regarding your nationality, because only when you do that you will be able to successfully charge reasonable rates.
  • You don’t want to be dealing with low-paying clients for the rest of your career. It’s okay to take on questionable jobs when you are only starting out, but it shouldn’t become a habit, and you should move on from that as soon as you can. Keep in mind that clients who pay the lowest fees are also the ones that are the hardest do deal with.
  • There’s nothing wrong in charging your clients western rates even when you live in developing country. Think about it: if a web designer from USA would move to your country, would they start working for $2/hour, or would they keep charging the same rates as they did when they were living in the states (assuming they work with international, not local clients)? You are under no obligation to adjust your rates based on the country you are living in.
  • Take time to figure out how you can present in a way that would allow you to attract high-paying clients. Good branding will help you to avoid being taken advantage of. What can you do in order to distance yourself from the “cheap labor from the third world” image?
  • As an entrepreneur, it’s important to understand that when you pay someone low rates, you will not get the same quality as if you would pay someone a decent amount of money. People from developing countries are not living under a rock, they know what the international industry rates are, and therefore understand that you are being a stingy douche when you try to hire someone for $2/hour. People who know that they are being exploited simply won’t give you their best.

Recommended reading

Here three articles that are really valuable to web designers who want to increase their rates:

Pay attention how important your positioning is. Charging lower rates doesn’t necessarily lead to more clients. Would you rather position yourself as someone who is willing to work for peanuts or as someone who knows their work and has their price that is non-negotiable? Think about which person you would like to work with if you would be a client with a decent budget.

Guys, what are your thoughts on this whole issue?

Have you ever struggled with being underpaid because you are from a developing country? Have you ever hired someone from a developing country for an extremely low rate?

Is outsourcing an ethical thing to do?

Let me know in the comments!

Agota Bialobzeskyte

Agota is a digital nomad who makes a living writing. She has a hard time staying in one place and loves slow travel. As a result, over the last five years, she has lived in United Kingdom, Spain, and Greece, where she's currently staying for the summer. Agota believes that travel is a great way to learn more about yourself and about the world, and that pretty much anyone can afford it if they set their mind to it.

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Comments

  1. Lu says

    The problem is most of the online outsourcing company right now are allowing very low bid price for web/graphic design. for me, the price should not matter where he/she lives because it is a freelance job… it means you are lucky if you have many contracts along the line but these are all short terms…Basically, the portfolio and experienced must be the basis. the crowdsourcing company should implement price standards.

  2. says

    Well, I hired Janet, and I can say she is multi-talented and high-quality. That means a lot when time is money, and you need to get a product out. She helped me with my book, Transforming Economy, and showed some impressive past work and posted a reasonable rate, given her quality of work and experience.

    Because Janet was a professional she could go beyond her more narrow job description to get designs up on the site, connected to e-mail subscriber services, etc. (I use AWeber.) You won’t find this with someone starting off.

    I do the same. I charge a fairly robust per-hour rate as well to do learning consulting. Why? I actually accelerate success 8X or more. Wouldn’t anyone rather pay 5x as much to get 8x the time and confirmed benefit? Less time, more progress, better value. Less overall money spent to achieve the desired end.

    That’s what I look for. My time is valuable. My mental health is valuable. My business is valuable. I need someone who can deliver confirmed results without hassle. That is worth more than just peace of mind. It’s worth real money, easily the “extra” money I paid on the front end to save money on the back end.

    My suggestion to everyone out there is figure in your total budget– time, mental clarity, organizational skill, critical thinking and problem-solving ability, good working relationship, total money (not just dollars per hour), and you will find good value out there.

    Usually it’s not the very expensive professionals, who are riding their name and celebrity and have gotten a little bored with the day-to-day work, or those who are a little too fresh and a little too inexperienced to have the depth and breadth to get the job done without a lot of mistakes, stops, and learning.

    Find someone who offers high quality past work, offers a middling, reasonable wage, loves their job, and with whom you can form a solid, productive working relationship. Trust yourself, verify their ability, and invest in that relationship as you would your own business, because that relationship is your business.

    Regards, Zeus

    • Agota Bialobzeskyte says

      Great points, Zeus!

      I think many entrepreneurs are so blinded by the idea of hiring people for peanuts that they don’t see the impact this has on their business in the long run.

      It is much wiser to hire a professional with who you want to build a long-term business relationship with.

      Plus, at least from my experience, people who are not paid well will never put their heart into their work. They know that they are being taken advantage of and probably only took the job because they are desperate for money. That is probably not the person you want to have involved in your business.

      P.S. Guys, pay attention to Zeus’ comment, that’s an example of how a high quality client thinks when hiring a designer, useful stuff ;)

  3. says

    Hi!

    Awesome interview! A lot of points to think about, since I’m also from a developing country (Brazil), and I’m managing to apply a fair rate since I’ve became a full time freelancer.

    I’d like to add that it’s not entirely true that the living cost is lower in developing countries than in countries like US. For example, here the same Apple products cost 4 times what it cost there, Internet connection is more expensive and really bad (around $35 for a non-reliable 2MB connection) and to find the same service quality you need to pay a lot of money (good houses, cars, services…).

    The difference tough is that maybe there are more chaper options (families that live with $300 or so per month is quite common).

    -roch

    • says

      Really great point, Roch! Because of import tax, most products cost an arm and a leg. Internet connection is about the same in the Philippines.. and I’m told they have one of the most expensive electricity in Asia. Condo prices are not cheap for an average local wage.. It really boggles my mind sometimes how people can live in such varied economies in the same country.. $300/month for a family is really low when you think about how many heads you need to support.

  4. Florante says

    The rate you charge is a decision that you need to make and stick to. Employers can negotiate a lower rate, if you accept it, then there’s no one to blame but yourself.

    I have been working as a freelancer for over four years now and I share the same experience. Some would compare my price with other freelancers and use it as their basis for me to lower my rate so I can get the project. When I see these signs, there are three things I think of:

    1. They either don’t see the value of what I can bring to their business or
    2. They see the value but they are on a tight budget
    3. They are just out there for profit, but not to build relationship with their employees

    Florante

  5. says

    I completely agree with Janet, I was always underpaid and overworked! It is not only about outsourcing but people in your own country pay peanuts! (just because I’m a freelancer) They would pay thousands together to a company but not to a freelancer! (Actually I believe freelancer should be paid more because they expertise in a particular area). To all the freelancers from developing nation follow janet’s rule, if you pay PEANUTS you get MONKEYS!

  6. Diego says

    I just think that today is the right time for freelancing, and from my personal point of view (as freelancer and employer) many people that usually bid on cheap projects are a headache for his employers, here comes to life the real “you get what you pay for…”

    I am freelancing for 10 years… today i have a hourly avrg of $35

    I used to be an employer (and also freelancer) for 4 to 10 usd hourly, then i discovered that i only get really bad results in my projects with that low budget, in the end i just wasted time & money…

    I also discovered that this (low budget on projects) works as a nice filter for profesional freelancers, because good employers will not create projects of 4 to 7 bucks hourly, i am not a good epmployer and that’s because i created this kind of projects… LOL….., so if you want to freelance in the right way.. AVOID THIS PROJECTS! and take 2 months to create your own amazing stuff for your portfolio, and then start in the right way, i was not so lucky than you when i started, nobody told us about this, freelancing was new, and i did take a lot of low budget projects, and i noticed that:

    1.- Usually employer is a starter
    2.- 70% of the time your work will be NOT LIVE, because project is discarded
    3.- Employer is really is picky
    4.- You will not have a bonus from employer, just FORGET IT!
    5.- You will not have a nice longterm relationship
    6.- You will get a BAD rating because employer is waiting for something incredible for a really tiny budget, so be ready to work overtime and make one trillion of revisions to keep a nice rating in future
    7.- You will work OVERTIME to have a nice rating record
    8.- You will end into a DISPUTES because u have worked more than expected, you are tired, and employer is waiting for more that what he have paid…

    In the end, just leave employers get their headache for low budget on projects, and if you feel that you are good enough, just take your time to create a nice portfolio with your own stuff in a couple of weeks and try to reach higher hourly payments.

    GL to all!

    • says

      I agree. When clients shop based on price and try to bargain down it’s always a recipe for headache! That’s why I try to get away from this cesspool and carve out a niche who will value what I do, rather than play on an ‘outsourcing’ business model. Just because I live in Asia doesn’t mean I have an outsourcing business and it doesn’t mean you can ‘outsource’ me. I travel a lot and I’m in the US right now so I don’t really rely on just the local economy.

      • Agota Bialobzeskyte says

        I think in general there are two types of clients:

        Type A: cares more about the quality rather than the price.

        Type B: cares more about the price rather than the quality.

        It’s not a good idea to go after clients whose most important criteria for hiring someone is their price – not only they pay you the least amount of money but they also give you the biggest amount of headache.

  7. Peter says

    Interestingly one of the links to the designer that charges $60 hour has their own portfolio page designed with HTML tables..

    I’ve seen on sites like ‘freelancer.com’ many developing nation designers with portfolio sites also designed with HTML tables. It’s not a general rule but design standards do differ greatly across countries/continents.

    • says

      If you ask me table design is bad and old! It doesn’t depend on countries from where the designers are, it is just that they are still using bad practices! Stop using tables and improve the quality of your website and internet on the whole!

  8. Peter says

    “How can freelancers from developing nations charge more for their services that can be on par with their counterparts from developed nations” ?

    Put simply they can’t. The main reason to look to a developing nation to outsource your work is because it’s more affordable. If someone in a developing nation is charging the same as someone in the UK or US, then that’s where I would look to get the work done because you remove potential language & cultural barriers and even time-zones.

    If you are paying someone $2 an hour you can’t expect quality work, but someone in a country that has a much lower cost of living shouldn’t expect to earn the same as someone in the a country with a higher cost of living, unless they offer a niche service that can only found in a developing nation.

    It basically come down to supply and demand. Designers in developing nations can work cheaper because their costs are lower so there is more demand. If they try to match developed nation wages the demand will go down.

    • says

      I also agree with this. It doesn’t make sense to inflate wages from a developing nation to, say, $150/hr. But they shouldn’t be making $2/hr either. A happy medium… I also think that if the whole world earns and spends like they do in the west, it wouldn’t be sustainable. Still, I advocate being able to value your work so you can avoid working with crap clients.

      • Agota Bialobzeskyte says

        “..but someone in a country that has a much lower cost of living shouldn’t expect to earn the same as someone in the a country with a higher cost of living, unless they offer a niche service that can only found in a developing nation.”

        I actually disagree with this. As an employer, you should pay to people according to the value they provide, not according to what their living expenses are. Why should an employer care about someone’s living expenses?

        I mean, by the same logic, you should also pay less to a person who’s from a developed nation but who is living with their parents. I mean, that person doesn’t have the same expenses, so why should they get pay the same amount of money? You see, this logic doesn’t work, if you transfer it to different situations where someone has low living expenses.

        I understand that there’s supply of cheap workers and there’s demand for cheap workers.

        “Put simply they can’t.” – I think they can if they position themselves as industry professionals and not 2$/hour labor.

        I think that the idea of paying someone a lower wage simply because they live in a different country than you is wrong.

        I understand that it’s not black and white, though, since outsourcing provides opportunities to people in developing nations.

  9. says

    Inspiring interview, glad to see another fellow designer that has the same view as me. Thanks for the article, it made my day :)

    • Ryan Zapanta says

      this is what I’m talking about in the past. some western companies abuse and take advantage of professionals from third-world countries. Janet Brent is right. if one gives in to the nickel and dime-ing by these multinationals, one is not elevating the webdesign profession. divide and rule is an old tactic. to boost the profession and the industry as a whole, dont succumb to this tactic. you are worth more than the $2 per hour fee, even if you live in a substandard milieu as against the western setting. cost of living is not the point. it is your worth as a person and as a professional.

      • says

        Great points. It also comes down to thinking more about the value you give rather than the time it takes to do it.. Get away from time=money thinking… and focus on how you can be of value.

        • Agota Bialobzeskyte says

          That’s a great point about the value and time.

          I think one of the mental blocks that prevents freelancers from earning more is that they feel guilty about charging a lot for things that don’t take much time to complete.

          It doesn’t matter how much time you have spent on something, what matters is what results you can get for your employers, so think about how you can improve their business, and charge accordingly.