There’s some business advice doing the rounds that insists we all charge what we’re ‘worth’. And I don’t like it.
It’s usually followed by the idea that if customers refuse to pay your prices they weren’t your customers anyway and you don’t want them dragging you down with their shitty attitude. Screw ‘em.
BUT is this really the right way to go about it?
Are people charging more because it’s what they think they’re entitled to, or are they charging more because they’ve earned the right to?
There’s a huge difference.
Most people have trouble knowing exactly what they’re worth. It’s the kind of advice that feeds the egos of the overconfident (who potentially have little skill or experience) but are willing to charge £400 an hour for work that isn’t that great, while scaring those who don’t have much faith in their abilities and end up charging a ridiculously low amount even though they’re brilliant at what they do.
A lot of people mix worth with what they think they deserve, and it’s a mistake.
Ask yourself; are you expensive because some marketing ‘guru’ told you to put your prices up, or are you expensive because you have years of experience and happy clients to back you up?
I’m not saying that if you’re starting out you should charge next to nothing, what I’m saying is you won’t be charging as much as someone who’s been freelancing for years.
A good rule of thumb is to pick a price that feels good to you (that covers your expenses plus extra for you to save and enjoy life with) but not the kind of price people with 3+ experience are charging.
I’ve struggled with pricing for years (and probably over thought it) but I’d say a rough guide is:
Starting out (0 – 6 months experience) = £25 – £60 an hour
Your first clients will help you decide what you should charge initially too. If you find no one is hiring you at £40 it’s probably a good idea to lower your rate otherwise you won’t get your business off the ground. Eventually when you build a pool of clients you can start to raise your rates.
Gaining experience (7 – 24 months) = £60 – £100 an hour
It can feel awkward asking for more money at first but now you’ve got some experience and case studies under your belt you shouldn’t be settling for the same prices you started out with. For any new clients you can try adding £20 – £50 onto your usual hourly rate and see what happens.
Once you have some new clients paying your higher rates, it’ll give you the confidence to go to your old ones and tell them you’re raising your prices. All you need to do is explain that your prices reflect your growing experience. Some will stick with you and some will go but it’s fine because you’ll have your new clients at the higher rate.
Experienced (3+ years) = price on a project basis
It took me a while to do this but it works well for me because I can look at a project and give a price to complete it based on the work involved. Clients like it as they’re not worrying about how many hours it’ll take, they have a set price and that’s it. Some freelancers can run up quite a bill based on the hours they work and not tell their client, which is really bad practice and doesn’t establish a good relationship.
Another reason I like project pricing is because someone with less experience – and therefore slower and less skilled – could potentially earn more than me because they’d take longer to do the job. It doesn’t make sense.
If you want to give project pricing a go right from the start be my guest, but I found charging an hourly rate for a few years let me get an idea for how long projects take and what’s involved.
Don’t follow the pack and charge a ridiculous amount because you think you’re ‘worth’ it – leave that to the L’Oréal models. Be more savvy and charge what’s realistic for where you are now.
Photo by Luca Onniboni on Unsplash