066: How Much Should I Charge?

Why is Creative Freelance Pricing Such A Game?

Retail stores tell you exactly how much things cost. When I go through the checkout I know they are going to add up all prices that were listed under the product I put in my shopping cart and the total will be what I pay. If I do not want to pay as much, I put something back on the shelf. I have never expected the checkout person to cut me a deal or tell me about the automatic volume discount because I bought and extra jar of salsa. What do you think the grocery clerk would say if I asked them to cut me a deal because I am a loyal shopper and really didn’t have the budget this week to pay for the extra salsa but really want it, and if they let me have it I would send them a lot of new hungry shoppers with big families? My checkout person would say, paper or plastic?

I am new to freelancing full-time, but not new to the creative industry. Pricing is really hard. Especially in creative services because no two tasks are ever the same and it is hard to find any rhyme or reason of what to charge. It doesn’t help when you have a variety of services and skills to offer. Do what the market will bear is often the advice I read when it comes to pricing. Oh, thanks I did not realize it was as easy as that. Now where do I find that market bearing number exactly as I will charge that once I find it? What is your competition charging? Oh right, I have a competition price list spreadsheet that I totally forgot about. I love the concept of value based pricing, but it is easier said than done. Figure out your time, factor in experience and expertise and the value you will deliver to client and their ROI and then charge a lot more than your hourly rate and that is how you do value pricing. Makes sense to me. So when a random person calls I just need to determine how much money my services will make them by tracking their analytics and conversion goals and then convince them of that so they feel good about paying me a ton of money because they will surely triple their investment in me. You do know how to forecast annual analytics and future sales, so you can justify your pricing, right? Uhh.

Ask a prospective client how much they paid for their last freelancer or how much they have to budget or get them to tell you the details of what they need or how many hours they need is a game that I don’t want to play. I just had an inquiry from someone looking to hire me because they were not happy their current freelancer because they were too expensive and not doing a good job. I asked how much they were paying and what it was they were not happy with and they would not tell me. I’d rather not say. So I have to be tested and made to look like a fool. If I bid lower, you get bragging rights and if I bid too high, you check me off the list and go play the same game with the next freelancer. I refuse to play this passive aggressive charade. Be human.

Asking creative freelancers for help and guidance usually gets a response of it depends. Every job is different. I usually just make up a number I think they will pay and see. I do volume discounts if the job is longer. If they can’t afford me, I usually custom bid. What is your rate? It depends on the job. You don’t want to charge too much but you have to get what you deserve and not settle for any less. So what is your starting rate. It depends. Ballpark? Hard to say. Thanks, that was a good talk.

I’m a fixer. Pricing is not an easy fix.

Pricing for creative freelancers is too random for me. Can it be simplified? Can it be easier? Does it make sense to have one flat fee and never waiver from it? What if I could get more? What if I lose jobs because I am too rigid in pricing? What if one job requires more skill than another? Am I de-valuing myself? What if Apple hired me with a huge budget? What if a startup I believed in needed a break but I was certain it would benefit me in the future? What if and circumstances…herein lies the cause and effects of pricing confusion.

How do carpenters and plumbers and electricians bid jobs so consistently and close to all other bidders? This always impresses me. I want that simplicity and understanding of what to charge.

I understand the complexities of pricing, but still find it maddening that it’s so taboo to talk about and so confusing to get a straight answer. Nobody wants to tell how much they paid in case they got overcharged and nobody wants to reveal their actual pricing, because they really don’t have a formula.

My hourly Photoshop rate is $100/hour (sometimes). 2 hours of Photoshop work will cost you $200. Well I surely can’t afford that rate for all of the hours I need and the work is really easy (even I could do it if I had the time), so what will it cost me if I hire you for the 20 hours I need you for and send you a ton of referrals? You get the same discount I get when I place 20 jars of salsa in my grocery cart.

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My name is Mike Murphy, I’m a one man band and podcaster.
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