Echoing yesterday’s theme, just where should you set your rate? How high is too high? How low is too low? Oddly, it’s not all that tough to figure out.
Let me start with an example from personal experience. I had this client who needed a website revision. I gave him a price – a low one – and he balked. Instead of losing the client, I countered. Fine so far, right? Not really. See, my rate was already so doggone low that it would cost me more to get up in the morning and work on his project than it would to just stay in bed. But, knowing that his business could very well take off and I could be handed more work, I did it.
In the end, his budget was so tight that I only wrote one page of his site – for $100. I’m not ashamed of telling you this because you’re going to make a similar mistake. Okay, I am ashamed, but I figure I’m in good company. 😉 So I bid the client adieu and we parted on good terms.
Then came his referral. Great! At least I was getting some work out of it. He’d sent a relative to me, so he was certainly happy with what I’d done for him. I was giddy at the thought of getting more referrals from this one, low-paying job. What a way to recoup!
My personal celebration quickly came to a screeching halt. Oh, his relative wanted a full-out website written, but because I’d worked so cheaply for the original client, there was no way this relative was taking any rate higher than, you guessed it, that original $100. I had to turn the job down. Two weeks worth of work for $100? McDonald’s pays more! I was polite and professional – and discouraged.
Upon examining the situation, I realized that the problem was with my accepting the first counter offer. While this client was fabulous and while he loved my work, he also referred me and tacked on somewhere in the conversation “she’s cheap and good.” (Just the image my mother would want me toting around, I’m sure.)
My rate is now $100 an hour. I no longer get clients like that neat guy who paid me the $100 to write that page. But you know what? The moment I started advertising a higher rate, I began getting more clients. Better-paying clients, for sure. But now instead of working for peanuts, I’m working for corporations.
So here’s your lesson for today – if you want to make more money, set your rates higher. Here’s an easy test of your rates – too low is when clients regularly argue with you about the price. Too high is when even the corporate entities can’t afford you. Ask other writers on forums such as About Freelance Writing to share what they charge (and they will). Look at market guides to see what the high, low and average rates are. Keep in mind where you live – if you’re in Casper, Wyoming, you probably couldn’t charge clients in that area the same price as say a writer working in Manhattan. While most jobs I have taken are not in my immediate area, I do structure my fees lower for areas of the country that do not have the same cost-of-living as where I am. But be smart about it. You’re still living in that area. If the price you settle on is lower than it would take to work at McDonald’s, either go higher or put on that apron and get grilling.
Cheap begets cheap. Don’t underestimate your worth. Otherwise, you’ll be stuck in the vortex of low-paying clients who have friends who need a cheap writer. Is that the image you really want to hang on to?
go girl… when I raised my rates I had the same thing happen… more and better clients.
Anne
http://www.thegoldenpencil
My father once advertised to give away his dog. No takers. He put another ad in the paper offering to sell the dog. Plenty of interest. By setting your price, you tell people how much they should value you. Great post! (And it’s amazing how often potential clients will accept top quality rates without even blinking an eye)