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Evaluating and expanding your skills are key elements of running a freelance business. Some of those skills may be related to the products and services you provide, and others may be regarding how you communicate with clients or price your offerings.
Since you’re essentially running your own business as a freelancer, it’s important to determine your own pay rates, the terms you’ll be working on together, and how you’ll approach your clients with that information.
In this post, you’ll discover how to negotiate your freelance rates with new and existing clients, alongside negotiating higher rates when the time is right.
Freelance Rates: What’s the Lowest You’ll Work For?
Before discussing any rates with your prospects or existing clients, it’s essential to establish your minimum rate. Entering negotiations with a client over freelancer pay rates without working out minimums could put you at a loss on that particular project.
To work out the minimum that you should accept, calculate your personal expenses, like rent or grocery shopping, and then add that to business expenses, like office space, computer software, and subcontractors. Divide that figure by the total number of hours you’ll need for the project, and then add tax for your country on top.
The final figure you’re left with represents the absolute minimum you should work for, based on your expenses and project hours.
After establishing your minimum rate, it’s time to think about negotiation strategies.
When entering a negotiation where you’re trying to ask for higher freelance rates, it’s important to inform your clients why you deserve more pay. Whether you’ve learned more skills or have gained greater experience, emphasizing why you’re asking for a rate increase helps your clients to understand why upping the rate might be beneficial for them.
For example, start negotiations by briefly explaining your background, your certifications, and your skills. Then it’s important to build trust; you can do this by telling your client about the perks of working with you. One of those perks may include offering quick turnaround times and consistently delivering on time. Another perk of working with you could be that you are incredibly meticulous with edits.
Every benefit you offer the client is a great way to generate more trust in your working relationship. Furthermore, the more benefits you provide your client, the more willing they are to agree to higher pay rates.
It’s a Trap!
One common pitfall freelancers often fall into is a client asking, “How much do you charge for that?” Unless you have a standard hourly rate, that question can be a little tricky. You don’t want to lowball yourself, hoping that the client will say yes or give too high a rate and scare the client away.
One great strategy to avoid naming your rates upfront is to ask your client to disclose their budget. Establishing the client’s project budget helps you gauge your own rates based on what the client is willing to spend. With the client’s budget in mind, you can also ensure that you don’t charge too low and potentially put yourself at a loss.
Ask Questions and Listen
Asking questions helps ease the tension, negotiate the terms of higher pay rates, and allow both parties to participate in the conversation. A question you may want to consider when starting negotiations is, “Are you happy with the services I currently provide?” This question creates opportunities to discuss your performance and the work you’ve already completed.
Negotiating Higher Freelance Rates in 2022
When negotiating with clients for higher pay rates, it’s vital to build a bond of trust by communicating why you’re skilled and the qualifications you have. Furthermore, illustrate the perks of working with you over your competition; perhaps you offer faster turnaround times or align with their brand tone of voice — it’s important to discuss that during negotiations.
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