Most freelancers consider unique projects or specific determined-time jobs a good way to earn money. Check our new content to learn how to create your rate and negotiate it
Talking about money could be overwhelming for most people and many of them suffer from self-confidence issues during the negotiating process. However, unlike traditional employees, freelancers have to negotiate their rates constantly with their clients since they do not receive a fixed salary. During the negotiating process, freelancers want to stick to their rates while clients try to convince them to a lower salary. Freelancers should present themselves as professionals who can add value to the company to obtain the rates they wish for. Check below to see how to negotiate your freelancer rates with your new client in 5 steps!
• Do your research
To determine your rates as a freelancer, you should do market research to see the average rates within your field. After that, you can come up with a price that is convenient for the market and in line with your skills, abilities, and expertise. You should position yourself in the spectrum of freelancers ranging from junior to senior. By doing that, you can see your place for determining your freelance rates.
Also, searching for the company would be beneficial for you because if you learn its core values, you can present yourself in a better light and show that you are a good fit for the current project. Thus, you can show them that you bring value to their company and the project you wished to be involved in. In addition, to come up with a convenient rate, you should understand the requirements of the current project. Read the job description carefully, and if you have any additional questions, do not hesitate to ask the client. Other than that, you can search their website and social media accounts to get a general idea about their projects, core values, and objectives.
• Provide a specific price
While negotiating your rates with your client, you can either provide them with a range for your rates or come up with a specific price. Providing a specific price would be more beneficial since it will show that you are confident with your skills and do not desperately look for a job. Also, when you present a range for your rates, your potential client would be inclined to consider the lowest rates in that range. To avoid that, you can offer them a specific price with a room for bargain. By doing that, you can represent yourself as a freelancer who is determined by their rates.
• Determine your freelancer rates per project
Generally, there are two types of rates in freelancing; you can either charge your client on an hourly-based price or you can determine your rates per project. Charging your client on an hourly-based price can limit your overall income because probably you would be required to work certain hours, for instance, six hours per day. However, if you determine your rates per project, you would be able to earn more and won’t be restricted by time limits.
Also, your income will depend on the tasks you are doing, not the time. Since the quality of
your work is more important than the number of hours that you worked, it would be better to charge them per project. Thus, charging your client per project would be a better option, compared to charging them at an hourly-based price.
• Establish convenient rates
Before the negotiating process, you may ask about their budget for the current project. It would help you to structure your rates in line with the client’s budget if you want to be involved in the project. Otherwise, if you do not want to compromise your rates, you won’t be losing time with negotiating since you learned their budget before the process. You can continue to search for projects that are in line with your financial expectations.
Most of the clients aim to make you accept a lower rate than your initial one. For that reason, it would be better to state your rates as approximately 10% higher than your original rates. By doing that, you would be also leaving room for a bargain; which is essential in the
negotiating process. Also, you would be able to show them you are a flexible freelancer when it is necessary.
You can also establish a minimum acceptable rate for the current project to use as a reference point. The minimum acceptable rate (MAR) is a combination of your expenses, taxes, and years of experience and is used to establish the minimum rate you must charge your client. The MAR is calculated as follows;
* ((personal outgoings + business outgoings) / hours worked) + tax
You can use this formula to determine your minimum acceptable rate. However, keep in mind that you should charge your client above the MAR since it only includes your expenses.