This is an edited and updated version of a post that first appeared in March 2013.
When you’re starting out as a freelancer, it’s hard to know what you can reasonably charge, especially if you are entering a whole new area of work. This is even more true of Upwork and other freelance content writing sites where some freelancers charge around $3 per hour.
It pays to put a reasonable cost on your experience, skills and knowledge, but how do you weight that up against much cheaper competition or those who are more experienced? Your first philosophy should always be…
Negotiate On An Individual Basis
With over three years of experience, my approach is now “this is my rate, take it or leave it” and I have enough work that I am not in a position to reduce my rate to secure work. I feel very luck that this has been the case for about a year now. However, I am not beyond the art of negotiation, especially at the start with an new client if I am not sure how long something will take. Nor am I beyond offering sweeteners in the form of offering to do a first test article at a slightly reduced rate (but don’t make a habit of it). Play each contract by ear because each client is different. Their needs and requirements, and their budget, will be different.
Put a Value on Your Work
I’m not prepared to sell my skills and experiences for the sort of costs that some potential clients demand. You will hear excuses such as “we don’t have the budget for that! Would you accept 20% of your normal rate instead?” and even that classic “our old freelancer is much cheaper!” You have a skill and you are offering those skills for financial compensation. It is no different from training 7 years to become a medical Doctor. You expect just reward and reasonable pay for your services. Therefore, and this is easy to say with the benefit of hindsight as I am no longer a new freelancer struggling for work, is never sell yourself short. The majority of clients will accept your rate without query. A large proportion will always attempt to knock you down – a little. That comes with the territory. Few will attempt to insult your intelligence by offering pay rates that could be considered derisory, but some will. If you don’t live in Bangladesh, then don’t work for Bangladesh rates.
Devise a Structured Pay System
If you’re confidence about what you might charge, you might consider giving your charges some structure. Charge small jobs your regular rate, but offer reduced rates for ongoing jobs. I would advise not offering this until the client has stated that they are looking for a freelancer with whom to work long-term. One of the tricks they try on Upwork is to ask for “a best price for this first job. We’ll pay your regular rate when we are satisfied we want to work with you.” Don’t significantly discount your price to secure work. I know that 0 ratings and 0 contracts looks depressing, but as I said above, don’t undersell yourself.
Have a Minimum Acceptable Rate
Ideally, this should fluctuate depending on how much work you have. When I am busy, my pay rate is my pay rate and nothing will knock me down below it. When things are quiet, and I would rather have a little bit more work at a lower rate than nothing at all, then I have a minimum offer beneath which I will not work. Knowing your work, your workload and what is acceptable and reasonable to you is a good way to enter into negotiation.
“What Budget Did You Have in Mind?”
Learn this phrase. You will need it for clients who quibble that your prices are slightly higher than they would expect. If you are too high for them, they will simply walk away, but for others who are to a tight budget, they may be willing to meet in the middle between what they expected to pay and what your actual rate is. These clients could be potential sources of long-term work, so don’t dismiss them. Instead, ask the simple question “well, what did you think it would cost and can we negotiate?”
Haggle / Don’t Haggle
Your philosophy for work will largely be between two concepts:
ONE: Start high and haggle down to a rate that is agreeable to both of you. This could take a lot of time and requires assertiveness and confidence in your abilities, as well as a certain amount of determination to stick to your guns. I tend to find these clients come from those societies with a strong tradition of haggling. The Middle East, the Indian subcontinent and Africa, for example. It is less common amongst European clients.
TWO: My rate is my rate and that is that. Or you can forego the cut and thrust of the deal and state that you won’t negotiate (deep down, you know you will if pushed by a quibbler client – see previous point on “how much did you think it will cost?”) This will take assertiveness and a little stubborness, but in a different way. You will get clients who want to knock down your price but your persistence will pay off. If you choose this route, you need the confidence and straight-forward approach of telling them that you don’t mess around with prices and it’s a one-size-fits-all that applies to everybody.