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Most freelancers out there work as a freelancer either because they are in need of a job or they want to increase their skills and improve their portfolio. But have you ever thought about the fact that all of us do it for money too? Now some of you might disagree with me and I fully encourage you to do it. Then I also encourage you to go out there and work for free, while marketing yourself as a volunteer designer. After three months come back to me and I am sure you will agree that you freelance for money. If we wouldn’t need money to survive, we would probably not work at all.
Now I am not saying all freelancers are focused on the money. Some of them are not even full-time freelancers, but do this as a hobby after their normal 9-5 job; but even they charge money.
Image by caltiva.
So you might ask yourself now and then, how much should I charge the client? Should I charge him by the hour or maybe a flat rate per project and should I ask for milestone payments or not? At some point you will find answer to all these questions and then the supreme one will come: how can I charge my clients more than I do now?
This is a difficult question to answer because the internet is a relative new domain thus unknown to many. Sometimes it is difficult to even convince the client that the sum you ask for is actually quite decent – how will you manage to convince them to pay even more?
Now I know many freelancers prefer to work for a lower fee to get the project, than ask for an outrageous sum and not get anything. I totally get it. I’ve found myself in this situation many times. Sometimes I still do. I probably always will, but if you are able to land your dream project, money shouldn’t stop you. However, we’re not talking about dream projects, but about the normal, weekly design or development assignments you can get.
The question you will always have to answer is how much is the client willing to pay. Think of the importance of your job, which is also the criteria used in any other business to determine the salary of an employee. You also need to think about how much demand there is for the kind of work you do, and how many other people can do it. While you can be a genius at comic book design, there might not be anyone interested in them anymore, as they are not profitable. Moreover, there are so many designers out there who can do the same job and there is always someone out there who can outclass you, that landing a huge project is highly unlikely for the average freelancer.
Image by immrchris.
The first step is knowing how much you are worth. You need to determine how much you can charge and the way you do it (per hour or by project). Think of costs versus profits, your experience and skill level and the demand we talked about earlier. Then try to research the market for and see how much a designer in the same situation as you would charge. There is no shame in asking other fellow freelancers how much they charge and set your price accordingly.
If, for example, the demand is very high, which means more people are in need of your service than you can provide, you can ask a higher price and you will get it. But consider that unless you do something really special, this is not the case, as the market is saturated with professional designers and developers with years of experience. And talking about experience… consider it when setting your prices as well, because it matters, regardless of what many nut jobs in the field think. Would you like to be operated on by a surgeon on their first day, or a surgeon with more than 30 years experience?
It is also rather smart to know the client you work with. This is not easy to do all the time, as many clients you land are new to you, but just think of it for a while. If you ask $1,000 for an integrated blog, to an individual it might seem too much for him, but you might get away with $3,000 from FedEx or Coca Cola for the exact same product.
Most freelancers start low, with small companies and individuals, build their portfolio and then thanks to this, and their experience, are able to land higher clients who will pay more. This is the normal path. Hoping to charge hundreds of thousands dollars per year in the beginning is unlikely to happen – there are designers with more than 20 years experience out there who don’t earn that much.
Selling you and your products is crucial. The way you do this will affect your final price. But knowing how to sell yourself and your skills will definitely help you get away with a bigger paycheck. You are in charge of developing products and also in charge of marketing yourself and landing clients. This is not easy to do because you need skills in two areas of the web, but knowing how to properly use these skills will give you an advantage over the others.
Many freelancers out there undersell themselves because they want to get hired. As said earlier, they would rather work for a small fee than not work at all – which is a normal way of thinking. But for how long are you willing to work for lower wages than the others?
Image by Cognition Coach.
It is very easy to spot in a supermarket two products from different companies (with the same ingredients and same weight) that are priced differently, only because individuals place more value on one than the other. To give you a more familiar example, consider an Apple computer and a PC. Or to go even more in-depth, consider a Sony Vaio laptop and an Asus. They do the same thing, both of them have the same warranty, the Asus might even have better specifications – but the Vaio will always be more expensive.
Underselling yourself is strongly linked with this principle of undervaluing yourself to the client. If you don’t undersell yourself, the client will not think less of you., always be confident about what you can deliver.
There is no shame in negotiating your prices down – everybody does it. But try to stand by your standards as much as possible and always have a clear minimum that you don’t go under. You might lose some clients now and then if you negotiate strongly, but don’t be afraid of doing it. The clients who will accept your demands will respect you more and we all know this can lead to further collaborations.
This is much easier than you think. It has something to do with knowing how to sell your products and knowing something about selling in general. Just ask salespeople how often they use the “and there’s even more” technique. The main idea is to make the client think he gets a good deal. Little does he know you would have charged the same amount regardless, but at least you look like a good guy. Let me explain:
Let’s say your price for developing a customized CMS plus customized graphic design is $750. Now you go to the client and tell him you will develop a customized CMS for him for $750. And there’s even more; you tell him that for an additional $250, you will also throw in the design for his web page. The bottom line is that now you get $250 more for the same products, and all you did was pull a simple sales trick. Tell him that if he is interested, you will do both for only $750, as you are really excited about working with him.
Image by jnobles100.
What did just happen there? You still get $750, your original asking price, and you still have to develop exactly the same products, but now you seem like a good guy and the client thinks he got a deal out of you. Not only did you get the client, but he will also recommend you to others and we all know how much viral and word of mouth marketing means.
Laying out every detail to the client is important, especially when working with clients who don’t know too much about the web. They might search Google to see what a development process entails and realize it would be much easier to hire an expert than try to do it themselves. They just don’t get it and don’t care about it, it is not their business.
Therefore you might want to explain to your clients what your products mean. Explain to them why you charge so much, put everything on paper, from domain and hosting costs to each hour you spend on developing the website. If you show them in detail why you charge as much as you do, it is an increased possibility that you will land the project.
Image by Winter Bicycles.
Keep in mind you don’t do this because you are desperate to land the job, you do it to help the client. You will earn more gratitude by treating them with respect and they will appreciate you even more after this, because not everybody takes the time to explain the process and what the client is actually paying for.
If you expected me to tell you precisely how much to charge during the course of this article, you were obviously wrong. I can’t tell you how much to charge because it depends on many internal and external factors and there is no way for me to discuss this with each of you individually.
The conclusion is that very few clients will pay less than the market dictates. You can try whatever you want, you will not fool many. Don’t ask for outrageous prices and always remain within the market price range. Selling yourself properly is what will help you charge closer to the higher end. Always make the customer feel like he gets a great deal and that you do something for him by developing these products, not him for you by paying. Don’t forget to treat every single client with respect, this is what will bring you more referrals from him in the future, and keep you in their minds when they have any projects in the future.
How do you try to set your prices and when do you think is the right time to start charging more? Are you pleased with what you get or you would like to charge more, but the market does not allow you?
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Christian Vasile is an enthuziastic Romanian web designer currently living in Denmark. He is passionate for the industry and writes about design, usability, coding and freelancing and is a regular publisher here at 1WD. You can follow him on Twitter at @christianvasile or visit his web portfolio by clicking on the link above.